Proposed U.S. OMB Changes May Impact Research Partnerships
The White House Office of Management and Budget (OMB) has proposed a broad update to Uniform Guidance (2 CFR Part 200) – Regulation for Federal Financial Assistance, the government-wide policies and requirements that govern how grants and cooperative agreements are awarded and managed. Although the proposal is now in a public comment phase, it signals a shift toward greater federal oversight, documentation, and accountability across the entire research funding lifecycle—not only for universities that receive government awards directly, but also for the companies, research foundations, consortia, and other organizations that participate in government-funded collaborations.
The proposal is notable less for any single requirement than for the direction it sets for government-funded research partnerships. OMB emphasizes “transparency, accountability, and oversight,” while proposing changes that could affect how projects are selected, managed, monitored, and, in some cases, terminated.
Companies that collaborate with universities on government-sponsored research could see new expectations for reporting, documentation, foreign collaboration reviews, and financial oversight, while universities serving as prime recipients may assume expanded responsibilities for managing industry partners and other subrecipients.
Seven Key Provisions
The following highlights represent only a small portion of the proposed changes included in OMB’s proposal.
Award decisions. OMB proposes greater federal oversight of award decisions, including senior political review before grants and cooperative agreements are issued. The proposal also states that peer review “remains advisory and does not replace agency discretion,” while emphasizing merit-based selection and institutions demonstrating “rigorous and reproducible scholarship.” Companies pursuing collaborative research with universities may see greater emphasis on demonstrated technical capability, prior performance, and measurable project outcomes.
Subawards and partnerships. The proposal would strengthen oversight of subawards and pass-through funding. Universities serving as prime recipients could assume additional monitoring and reporting responsibilities, while companies participating as subrecipients, consortium members, research performers, or affiliated organizations may experience greater documentation requirements, financial transparency, and compliance reviews throughout the life of an award.
Research security. OMB strengthens language related to national and economic security and expands attention to certain foreign collaborations. Universities and companies engaged in international R&D, global supply chains, or multinational research partnerships may want to review existing disclosure, research security, and compliance practices to determine whether additional documentation or approvals could be required.
Payments and oversight. The proposal would require additional justification for payment requests, expand internal control responsibilities, and increase documentation supporting government expenditures. Companies participating in government-funded projects may encounter greater expectations for financial recordkeeping and reimbursement documentation, while prime recipients could face more extensive oversight responsibilities.
Award flexibility. OMB’s proposal would clarify that agencies may suspend or terminate discretionary awards when projects no longer align with program goals, agency priorities, or the national interest. Organizations managing long-term university-industry research partnerships may want to consider how changes in government priorities could affect ongoing collaborative projects.
Allowable costs. The proposed changes would revise several cost principles and change the treatment of certain costs, including conference attendance, publication expenses, open-access fees, and certain foreign collaboration-related expenditures. Universities and industry partners may need to review project budgets, cost-accounting practices, and research dissemination plans if these provisions are finalized.
Indirect costs. The proposal does not establish a government-wide cap on facilities & administrative (F&A) rates or revise the existing negotiated indirect cost process. OMB states that indirect cost negotiations are outside the scope of this rulemaking.
More Details
To download the complete proposed regulations, submit a comment, or view public comments submitted to date, visit the Federal Register page for OMB-2026-0034.
