Legal Defense Fund Latino Justice PRLDF
July 13, 2026 Andrew Reisig and Joel Savary
Office of Federal Financial Management
Office of Management and Budget
725 17th St NW
Washington, D.C. 20503
Submitted via regulations.gov
RE: Regulations for Federal Financial Assistance, OMB-2026-0034, et al.
Dear Mr. Reisig and Mr. Savary;
The Legal Defense Fund, LatinoJustice PRLDEF, and the undersigned civil rights, racial justice, and allied organizations write to oppose the “Regulations for Federal Financial Assistance” proposed by the White House Office of Management and Budget (OMB) and other federal agencies.1 Federal financial assistance funds essential health care, food and nutrition, housing, education, job training, scientific research, civil rights counseling and other programs as directed by Congress. Since taking office, however, the Trump administration has sought to turn federal grantmaking into a political tool to chill lawful programs advancing diversity, equity, inclusion, and accessibility and ensuring equal opportunity; force compliance with its divisive agenda; and punish organizations which disagree with its viewpoint. The Trump administration’s weaponization of grantmaking has disproportionately harmed Black, Latino, and other communities of color. The proposed rule would accelerate these harms by giving political appointees additional powers to decide who receives federal funding and imposing burdensome new restrictions on how federal funding can be used. These regulations exceed OMB’s authority and conflict with existing statutory and constitutional law. OMB and the other federal agencies fail to offer a reasoned explanation for the proposed rule. While our comment addresses the authority of OMB specifically to issue this proposed regulation and highlights the harms of specific provisions, we oppose efforts to finalize any of the proposed provisions by any agency. We urge OMB and the other federal agencies to withdraw the proposal in its entirety.
I. The Trump Administration Has Weaponized Grantmaking, Disproportionately Harming Black, Latino, and Other Communities of Color.
Federal financial assistance is meant to fund “national priorities,”2 directing taxpayer dollars toward essential health care, food and nutrition, housing, education, job training, scientific research, civil rights counseling, and other congressionally authorized programs. Since it resumed office in January 2025, however, the Trump administration has utilized federal grantmaking as a political weapon to discriminate against organizations that disagree with its viewpoint, severely harming communities who depend on federal grant programs for access to economic opportunity, housing, life-saving health care, and education.3 The President’s grant cancellations and terminations have already disproportionately harmed Black, Latino, and other communities of color by targeting funding that has been used to prevent or remedy discrimination and barriers to opportunity. The proposed rule would further empower the Trump administration’s use of funding cuts to enforce its discriminatory ideology. In a series of unilateral actions, including executive orders,4 guidance memoranda,5 and other tactics,6 the Trump administration has targeted organizations advancing values the administration views as contrary to its political agenda. Many of these values—related to racial, ethnic, and gender inclusivity—are targeted by the proposed rule. Some of the executive orders issued in the administration’s first few days in office closely track the language and purpose of the proposed rule and are explicitly referenced therein.7 While the Trump administration claims its goal is to end “illegal” and discriminatory conduct, in practice it is targeting expression and values it disagrees with and communities it disfavors. It has frequently circumvented civil rights enforcement procedures to achieve those ends. In addition, in pursuit of its goal, the administration has frequently skirted civil rights laws, withholding funding without due process,8 adding unlawful new conditions to grants and other federal funding opportunities,9 and threatening False Claims Act investigations10 in order to pressure organizations to comply. These actions have frequently been blocked by the courts.11
1 Regulation for Federal Financial Assistance, 91 Fed. Reg. 32198 (May 29, 2026),
https://www.govinfo.gov/content/pkg/FR-2026-05-29/pdf/2026-10817.pdf (hereinafter “Proposed Rule”).
2 Grants Management: Observations on Challenges with Access, Use, and Oversight: Hearing Before the S. Comm. on Homeland Sec. and Governmental Affs., 118th Cong. 1 (2023) (statement of Jeff Arkin, Director, Strategic Issues, U.S. Gov’t Accountability Off.) (hereinafter “Statement of Jeff Arkin”); see also NAT’L COUNCIL OF NONPROFITS, 2026 ADVOCATING FOR FEDERAL SPENDING: A PRACTICAL GUIDE FOR NONPROFITS 3 (2026) (“Federal funding often reflects national priorities. When Congress funds a program, it signals that the issue matters.” (emphasis added)).
3 WHITE HOUSE, CUTS TO WOKE PROGRAMS (FY 2026), https://www.whitehouse.gov/wp-
content/uploads/2025/05/Cuts-to-Woke-Programs-Fact-Sheet.pdf; WHITE HOUSE, CUTS TO WOKE PROGRAMS (FY 2027), https://www.whitehouse.gov/wp-content/uploads/2026/04/cuts-to-woke-programs-fact-sheet.pdf.
4 Exec. Order No. 14,151, 90 Fed. Reg. 8339 (Jan. 20, 2025) (directing OMB and other agencies to “coordinate the termination of all discriminatory programs, including illegal DEI and ‘diversity, equity, inclusion, and accessibility’
(DEIA) mandates, policies, programs, preferences, and activities”); Exec. Order No. 14,173, 90 Fed. Reg. 8663 (Jan. 21, 2025) (among other instructions, directing agencies to “excise references to DEI and DEIA principles” from federal contracts and grants and to “[t]erminate all ‘diversity,’ ‘equity,’ ‘equitable decision-making,’ ‘equitable deployment of financial and technical assistance,’ ‘advancing equity,’ and like mandates, requirements, programs, or activities”); Exec. Order No. 14,168 90 Fed. Reg. 8615 (Jan. 20, 2025) (rejecting the concept of gender identity and directing, “[f]ederal funds shall not be used to promote gender ideology”); Exec. Order No. 14,187, 90 Fed. Reg. 8,771 (Jan. 28, 2025) (directing agencies to pull funding from institutions providing gender-affirming care to individuals under the age of nineteen); Exec. Order No. 14,281, 90 Fed. Reg. 14,281 (April 23, 2025) (declaring “[i]t is the policy of the United States to eliminate the use of disparate-impact liability in all contexts”).
5 Memorandum from U.S. Attorney General Pamela J. Bondi for All Federal Agencies: Guidance for Recipients of Federal Funding Regarding Unlawful Discrimination (July 29, 2025) (on file with U.S. Dep’t of Just.),
https://www.justice.gov/ag/media/1409486/dl (hereinafter “July 29, 2025 Memo”).
6 See, e.g., Katherine Knott, What to Know About Trump’s Compact for Higher Ed, INSIDE HIGHER ED (Oct. 20, 2025), https://www.insidehighered.com/news/government/politics-elections/2025/10/20/5-things-know-about-trumps-higher-ed-compact (discussing the Trump administration’s Compact for Academic Excellence in Higher Education, which proposed to give certain universities “preferential treatment for funding if they enact[ed] a number of policy changes”).
7 Proposed Rule at 32215 (discussing proposed revisions to 2 C.F.R. § 200.300).
8 Emily Badger & Alicia Parlapiano, Trump Keeps Finding New Ways to Withhold Money Even After 198 Lawsuits, N.Y. TIMES (Mar. 3, 2026), https://www.nytimes.com/interactive/2026/03/03/upshot/trump-funding-lawsuits.html.
9 See, e.g., Complaint at 28, Freedom Network v. Trump, No. 1:25-cv-12419, 2026 WL 1899186 (N.D. Ill. Mar. 23, 2026); Cory Turner, Head Start Centers Told to Avoid ‘Disability,’ ‘Women,’ and More in Funding Requests, NPR
(Dec. 11, 2025), https://www.npr.org/2025/12/11/nx-s1-5640757/head-start-hhs-funding-dei.
10 Press Release, U.S. Dep’t of Just., Justice Department Establishes Civil Rights Fraud Initiative (May 19, 2025) (on file with authors).
11 See, e.g., Chicago Women in Trades v. Trump, 778 F. Supp. 3d 959 (N.D. Ill. 2025) (granting in part plaintiff’s motion for preliminary injunction on First Amendment and separation of powers grounds, regarding termination and certification provisions in challenged executive orders); NAACP v. U.S. Dep’t of Educ., 779 F. Supp. 3d 53 (D. Md. 2025) (granting plaintiff’s motion for preliminary injunction in challenge against Department of Education (ED) February 14, 2025 letter and accompanying documents “directing federally funded educational institutions to
cease all . . . unlawful DEI programs”); San Francisco Unified School District v. AmeriCorps, 789 F. Supp. 3d 716 (N.D. Cal. 2025) (granting plaintiff’s motion for preliminary injunction challenging AmeriCorps directive imposing anti-diversity, equity, and inclusion conditions); San Francisco A.I.D.S. Found. v. Trump, 786 F. Supp. 3d 1184 (N.D. Cal. 2025) (granting in part plaintiff’s motion for preliminary injunction in challenge to executive orders rolling back diversity, equity, and inclusion initiatives and targeting programs “promoting ‘gender ideology’”); Am. Fed. of Teachers v. U.S. Dep’t of Educ., No. 1:25-cv-00628, 2025 WL 2374697 (D. Md. Aug. 14, 2025) (granting in part plaintiff’s motion for summary judgment in challenge to ED February 2025 letter and accompanying documents); Nat’l Educ. Assoc. v. U.S. Dep’t of Educ., 779 F. Supp. 3d 149 (D.N.H. 2025) (granting plaintiff’s motion for preliminary injunction as to the same); Rhode Island Coalition Against Domestic Violence et al. v. Kennedy, Jr. et al., 812 F. Supp. 3d 180 (D.R.I. 2025) (granting plaintiff’s motion for preliminary injunction in challenge to new funding conditions imposed by the Department of Housing and Urban Development pursuant to executive orders).
