Public Health Institute Urges Changes to OMB Proposed Rule that Threatens the Health of Communities

A proposed federal rule would significantly change how federal grants are awarded, managed and ended, with important implications for public health research and programs that millions of people depend on. The Public Health Institute (PHI) is urging the White House Office of Management and Budget (OMB) to revise the proposed rule, “Regulation for Federal Financial Assistance” (91 FR 32198), before it is finalized.

“Public health programs are designed with evidence-based strategies that span both immediate and long-term health and social outcomes,” said Melissa Stafford Jones, President and Chief Executive Officer of the Public Health Institute. “This rule could disrupt the nation’s capacity to protect the public’s health and dismantle the science that underpins this work.”

PHI operationally and administratively supports more than 40 public health programs that provide the full continuum of public health services—from conducting research and advancing science to delivering programs in communities. Federal funding grounded in community health needs and partnerships as well as scientific merit is critical to this work. PHI administers federal awards for many of its programs. The institute supports the goal of strong stewardship of federal funds but has serious concerns with a paradigm that makes continuation of compliant scientific and public health work dependent on shifting political alignment rather than objective merit. PHI has submitted formal comments to OMB, raising the following concerns and recommended changes:

• Grants that can be terminated at an agency’s discretion harm the health of communities: Agencies could abruptly end a fully compliant, multi-year award if priorities change. This can disrupt the long-term work public health depends on, from applying evidence to shape strategies and building community trust to sustaining services. PHI urges OMB to remove this basis for termination. Termination for noncompliance is already well established and protects the government’s interest.
• More administrative burden for the smallest partners: Eliminating fixed-amount subawards would add significant administrative burden for small, community-based organizations with limited administrative capacity without improving accountability or oversight. PHI recommends that fixed-amount subawards remain available.
• An undefined “reputational harm” standard: The rule would allow agencies to terminate awards under a broadly defined “reputational harm” standard but does not define or set a threshold for it. PHI recommends that the provision either defines reputational harm with specificity or be removed altogether.
• Broad, government-wide reach: A single OMB action could change grant policy across every federal agency at once and could override protections Congress wrote for specific programs. PHI urges OMB to clarify in the final rule that Section 200.101(d)(2) does not displace the program-specific statutes Congress enacted, such as the Public Health Service Act.
• Higher compliance costs: New documentation requirements would raise costs for federal award recipients, even as the rule directs agencies to favor institutions with lower indirect cost rates. PHI recommends that OMB reduce or eliminate the compliance burden created in this rule so that it does not work against the preference it establishes for lower indirect cost rates.

“We all want federal dollars spent responsibly,” Stafford Jones added. “But as written, this rule could make it harder to deliver and sustain evidence-based public health approaches that create opportunities for all individuals and communities to be healthy and thrive.”

The Public Health Institute is a national independent nonprofit that advances the health and wellbeing of all people and communities, particularly those facing the greatest barriers. Rooted in 60 years of public health experience, PHI moves ideas into actions through practice, policy, research and community engagement, while serving as the operational backbone for more than 40 programs delivering evidence-based solutions to complex health challenges.

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