Terry Gerton The administration has recently closed comments on a rule that would change how the federal government reviews and approves grants awards. It looks like they got almost 500,000 public comments, and the earlier assessment is that about 94% of them were opposed to the rule. So let’s start there. What is this rule, and why is it different, and why has everybody’s hair on fire about it?

Jillian Blanchard Great question, Terry. So what is being proposed in this new rule by the Office of Management and Budget, otherwise known as OMB, is a wholesale change of the guidebook that the federal government uses to administer every single grant dollar. That’s over a trillion dollars that goes out to 42 different federal agencies and the myriad of federal programs that your taxpayer dollars are supposed to provide support for. So what they’re proposing to do is to politicize every single dollar that goes out the door that Congress intended to go for critical public services. Essentially, the Office of Management and Budget is throwing what we call this Trojan horse into what is meant to be really boring, administrative processes of how you get grand dollars out the doors. This OMB is proposing to politicize every one of those. And to tag and add on this administration’s policies onto every dollar. That is causing widespread panic as it should because every school, every university, every nonprofit, every private industry, every single state that relies on this critical federal funding would now have to comply with these political grant conditions that in many cases have nothing to do with their grant award. And the main issue that I think is getting people up in arms is this ability for any political appointee to veto a grant. So no longer are the grants going to be awarded based on merit in scientific research by the experts in the field. Instead, some political appointee could just come in and veto it because they don’t like Harvard University. So they don t want to give Harvard university a million dollars in grant funding. That’s terrifying for all of us. And the other thing that it does that’s really alarming is it implements this portion of Project 2025 to consolidate policy power in the hands of the president. Congress has the power of the purse. They’re the ones who are supposed to say where the money goes and to pass the laws and the policies that we all abide by. The Office of Management and Budget is only supposed to spend those dollars and administer them efficiently. But here they’re trying to take all kinds of policy power.

Terry Gerton Let’s talk a little bit about how this rule would play out in practice, because some folks might argue that elected leaders really should have more say in how federal money is spent, but your organization actually expresses a number of concerns, some starting with constitutional and civil rights. Start there for me and tell me what you’re worried about.

Jillian Blanchard Absolutely. Well, first, I want to also say that to your first point, the elected leader question is right on the money, Terry. The money is supposed to be directed by elected leaders. That’s everyone in Congress. The Constitution gives Congress that power so that a lot of people are deciding together how the money is spent, not one president or his political appointees who have not been elected. So how this would work in practice is the rule attempts to force a bunch of vague restrictions that would essentially police free speech and local communities. It tries to codify, Terry, the executive orders that this administration issued on day one of his administration around DEI and identifying diversity, equity, and inclusion as bad things and gender ideology as a problem and woke policies. So this effort would codify in the grant requirements these executive orders, which have, I will add, been repeatedly found to be unlawful in different courts. In a recent court case, Seattle v. Trump, these conditions were found directly to be contrary to law. You cannot tell people how to think. You cannot people to not implement civil rights or states not to implement civil rights and disparate impact analysis. And yet this OMB rule would do exactly that.

Terry Gerton Jillian Blanchard is senior vice president of climate change and environmental justice at Lawyers for Good Government. Jillian, beyond the civil rights concerns, there are concerns about the impact on particular communities. I mean, federal grants often support projects that take years to complete, and there seems to be some concern that if this rule goes into effect, that there may be political swings on a fairly frequent basis, in which some grantees who had awards may have them revoked, other grantees may get new ones, and there just may not be enough time to actually complete the work that the grants were funded to accomplish. How do you see the concern about stability of grant awards playing out?

Jillian Blanchard Yeah, it’s a fantastic question. And it’s one that many, many people are concerned about. The market and people in business and people in the states, they like certainty. And they have proposed projects like giant infrastructure projects that we all need. Or, think about longstanding clinical trials for cancer research. Those efforts take many, may years, and they require certainty of funding. And this grant proposal or this rule proposal would allow a political appointee to pull a grant at any time. I would also add that last year alone, over 17,000 private businesses relied on federal funding. Imagine if you were in business with the government and you weren’t sure whether one day to the next, they could just pull your funding. We’ve already seen that happen on the ground. My organization, Lawyers for Good Government in partnership with the Environmental Protection Network has already worked with 800 different entities who have had their grants kind of sporadically frozen and then terminated and canceled for reasons none other than it was a shift in agency priorities. That makes it really hard for all of us to rely on the public services that we need because as you said, Terry, a lot of these projects take many, many years to complete.

Terry Gerton So Jillian, where do you draw the line then between legitimate policy direction from elected leaders, we talked about that a little bit up front, and political interference in the grants process that might generate this kind of uncertainty and unpredictability?

Jillian Blanchard It’s a good point. And it’s one that brings me back as a lawyer to the Constitution. There’s a separation of powers. And what the Constitution directs is that it is really Congress who is supposed to be laying out the laws and these policies. The president’s job in this venue is to just implement the laws and implement the funding that Congress has mandated. So when we talk about setting those policies, it shouldn’t be coming from the president. The president’s job is to implement the laws that Congress comes up with. So that’s an important piece because this rule not only is terrifying in that every single American might be impacted by it, but it’s also really troubling because it fundamentally would shift the power over to the executive branch, which is something that was written in Project 2025. There are definitely legitimate concerns and merit-based concerns related to grants, and that’s how they should be judged. But we’ve even seen in a recent ruling in the Thacker case that this administration actually admitted on the record under oath that they terminated grants based solely because the money was supposed to go to a state that had voted for Kamala Harris. That’s extremely troubling. It is not merit-based. It is not based on the purpose and function of the grant award, and definitely not what Congress had intended.

Terry Gerton Jillian, you’ve raised Congress several times in this conversation. As we’re talking about this rule, we’re dealing with the Code of Federal Regulations. Is there a statutory solution to this that Congress could move forward on?

Jillian Blanchard There are a number of statutory solutions. So I’m glad you raised that. In fact, the Senate is so alarmed by this rule, they have added a rider onto their continuing resolution to fund the government that says that the rule cannot be implemented. And one reason that legislators are concerned about this and including this rider in the continuing resolution is because of the impact it will have on their own individual states. I recently learned that 36 cents of every state dollar that goes out the door to nonprofits and to communities comes from federal funding. So that affects every single state in the country and it would have impacts significantly across clean water, flood protection, energy costs, wildfire mitigation, scientific research, all of these things that states need to spend money on would now be conditioned upon a political viewpoint. The continuing resolution would only take us until December, so more advocacy is necessary. The Senate will be voting on that continuing resolution before they go to recess. And the House will have to take a look at it when they get back from recess in September. So it’ll be really important for people to keep reminding their elected leaders that this is something that they care about. And even if it does pass, as you said, it will only go to December. So a longer term legislative fix is absolutely necessary and crucial to avoid having this office of management and budget try and implement these grant conditions either wholesale or through any of the individual federal agencies.