What the Proposed Federal Grant Rules Could Mean for Children
*Note: As of August 10, 2026, the Senate passed a short-term funding bill that would prevent the Office of Management and Budget (OMB) from finalizing a proposed rule governing federal grantmaking. The bill now moves to the House for consideration.
Recently, the Office of Management and Budget (OMB) proposed a rewrite of rules for federal grants (OMB-2026-0034) – money that funds universities, schools, and nonprofits like PACT nationwide.
More than 55,000 comments were submitted on the proposal, including one from PACT. That level of response shows how much public concern these changes have made.
If finalized, here’s what would change:
Decisions about who receives federal grants would shift from independent expert peer-reviewers to the President’s appointees
Federal funds could no longer go toward what the rule calls “illegal DEI” activities
Federal agencies would be able to terminate or pause funding at any point based on undefined changes in agency priorities or what they determine to be the “national interest”
The Administration has identified human trafficking prevention as a national priority, but these proposed changes raise an important question. If this rule takes effect, how will PACT continue serving the communities most affected by the sexual exploitation and trafficking of children?
The data is clear: Black and Brown children and LGBTQ+ youth are disproportionately affected. Changes like this would limit PACT’s ability to reach and support the children who need it most.
The proposed rule could take effect as early as this fall.