A hugely important story has gotten relatively little traction in the mass media: A rule recently proposed by the Trump administration’s office of Management and Budget threatens literally every dollar the federal government sends to California and other states—money that funds everything from schools to bridge repairs, disaster recovery, food assistance, medical and scientific research, and more.
The regulation, officially called Notice of Proposed Rulemaking (NPRM), OMB-2026-0034, Regulation for Federal Financial Assistance, is breathtakingly broad. It would take key decisions about where our tax money goes out of the hands of the experts who usually evaluate projects and give them to political appointees with an absolute veto.
In other words, it makes every federal dollar that our state and local governments and private institutions receive subject to the partisan and ideological agenda of whatever administration is in the White House. It seems no coincidence that this proposal smells strongly of Project 2025, in which OMB Director Russell Vought was “a key figure.”
How much money are we talking about? In California, federal dollars make up fully one third of the state’s budget, over $175 billion in 2025-26. The biggest chunk of that money goes to Medi-Cal, but a lot of other vital services depend on those federal funds—funds that everyone in California contributes to through federal taxes. This includes over $8 billion for K-12 education and nearly as much for higher education, almost $7 billion for transportation, and money for environmental protection, child welfare and much more.
Like many major university systems, the University of California gets lots of federal money. For 2023-24, that included $5.7 billion supporting research programs, $1.7 billion for student aid and nearly $10 billion that supports patient care at UC hospitals and health facilities.
The impact on medical and scientific research has scientists genuinely terrified. Former National Institutes of Health Program Official Elizabeth Ginexi recently laid out the implications, including the evisceration of the peer-review process that puts decisions about research grants in the hands of experts:
This is arguably the most consequential change in the rule. Senior political appointees, rather than career scientists or program officers, would now be required to conduct a “pre-issuance review” of every discretionary grant before it is awarded. These appointees are explicitly forbidden from deferring to peer reviewers or routinely ratifying their recommendations.
The criteria they must apply include blocking awards that touch on denial of “the sex binary in humans,” illegal immigration, or anything deemed to “promote anti-American values.” The rule also requires that discretionary awards must:
“…demonstrably advance the President’s policy priorities.”
In practice, this gives political appointees a veto over any science that conflicts with the current administration’s ideology.
Want to study climate change? Gender diversity? The disparate impacts of different types of policies on various racial, ethnic or other groups? Forget it. And given the fact that the US government is the largest single source of research funding, most of that critical research simply won’t happen.
But, as Ginexi noted in a subsequent piece, the rule goes far beyond science. It covers vast amounts of federal funding—for Medicaid, schools, food assistance and more. And it could allow funding cut-offs in the middle of a project that’s already underway: a bridge half repaired, a school half built, or half-completed reconstruction after a storm or fire, you name it.
OMB’s proposed rule explicitly bars funding for anything connected to diversity, equity and inclusion. It even seeks to police the actions and behavior of funding recipients on their own time, cutting off money to anyone affiliated with a group the administration considers “anti-American,” defined so vaguely that it could mean anything the party in power doesn’t like. That could be membership in a civil rights organization, an environmental group or a group supporting LGBTQ people.
This is particularly scary for people in blue states like California or my adopted home state of in Hawaii, where residents overwhelmingly don’t align with the Trump administration’s views. Unlike this administration, most of us understand that climate change is real and that we must move away from fossil fuels. We respect diversity and try, however imperfectly, to remedy racial injustice. We respect our transgender neighbors and don’t try to deny their existence.
All of these represent reasons that vital funds, money from federal taxes we all pay, could be suddenly and arbitrarily cut off. This is an emergency.
The good news is that this rule can be blocked, but it won’t be easy. Many organizations, including Stand Up for Science and the group I volunteer with, Defend Public Health, are working to stop it on several fronts at once:
First, we’re taking advantage of the requirement that new rules be open for public comment and are encouraging people to file specific, detailed comments explaining the damage the proposed rule would cause. The comment period runs until July 13, and while we doubt that comments will change Russell Vought’s mind, they will create a public record that will help should this fight end up in court – a likely outcome. Lawyers are already looking at how to proceed with litigation if needed.
If you’ve never filed comments with federal regulators before, the idea may seem a little intimidating, but don’t worry: This page contains lots of useful guidance and resources that will help you. If anything you do is in any way touched by federal funding – and that’s nearly all of us – you have something meaningful to add.
We’re also pushing Congress to weigh in. The U.S. Constitution gives Congress authority over spending, and it’s time for Congress to reassert its lawful power. And if enough members of Congress make it clear they’re not willing to make every federal dollar a partisan football, that could get the administration to back off. If necessary, Congress could step in with legislation.
Bear in mind that legislators from red states have reason to fear this politicization of funding, too: Once federal tax dollars become a political weapon, whatever party is in power can use that weapon. Those who agree with Donald Trump’s priorities might not want to hand such a powerful tool to, say, a President Mamdani.
You’ve probably guessed your next bit of homework: Write Congress and let your representatives know how you feel. Both Democrats and Republicans do need to hear from us how important this is. As my friend and colleague Gregg Gonsalves wrote recently, this new OMB rule “is a massive power play to bring all of us to heel on the road to authoritarianism. It is a punishment doled out by our own Tomás de Torquemada, obsessed with a vision of a God only the Devil knows.”
