APS comment on Office of Management and Budget proposed rule for federal financial assistance

Submitted via Regulations.gov

Andrew Reisig and Joel Savary
Office of Federal Financial Management
Office of Management and Budget
725 17th Street NW
Washington, DC 20503

Dear Mr. Reisig and Mr. Savary,

The American Physical Society (APS) appreciates the opportunity to provide the following public comments regarding the Office of Management and Budget’s (OMB’s) proposed guidance titled "Regulation for Federal Financial Assistance." APS members — more than 50,000 physicists across academic institutions, national laboratories, and the private sector — stand to be heavily impacted by the major, wide-ranging proposed changes to federal financial assistance policies. On behalf of the physics community, APS expresses its unequivocal opposition to this sweeping proposed rule change. While these measures directly threaten the physical sciences, their destabilizing effects will also reverberate across the entire American scientific enterprise and the wider economy that depends on it.

APS supports the ethical stewardship of federal research funding and the reduction of administrative burden for federally sponsored researchers. The proposed regulation, however, will not achieve OMB’s stated goals of improving transparency, accountability, and oversight of taxpayer dollars while reducing grant recipient burden. Instead, the proposed rule would place federal science funding decisions in the hands of unelected political appointees, isolate American scientists from the international research community, add bureaucratic red-tape to numerous regular research activities, and erode our ability to strengthen the domestic STEM workforce. Individually, each of these changes, if implemented, will negatively impact our nation’s scientific ecosystem. Taken together, they will jeopardize our global leadership, economic competitiveness, and national security.

Many of the policies laid out in this document, often described in broad, imprecise language, will catastrophically disrupt the structural mechanics of American discovery science — the bedrock of American innovation. Since 2014, the current Guidance for Federal Financial Assistance (2 CFR Part 200) has functioned as non-binding guidance, allowing each agency flexibility to administer grants in service of the distinct statutory mission Congress assigned it. The proposed rule would convert that guidance into rigid, legally binding, enforceable regulation for every agency. The rule’s impact analysis fails to address the fact that altering nearly every aspect of the federal research ecosystem simultaneously comes with uncertain, potentially significant consequences for the nation’s research and development (R&D) enterprise and wider economy.

In this comment, we will focus on four key areas most relevant to our membership: the grant review process, international collaboration, professional activities, and broadening participation in STEM. We urge OMB to withdraw the proposed rule in its entirety and engage in deeper consultation with the U.S. scientific and industrial sectors.

Grant Review and Contract Termination

[§ 200.205 and § 200.340]

Decades of economic data1 demonstrate that public funding of fundamental research is an unmatched economic multiplier, generating estimated macroeconomic returns of 150 to 300 percent since World War II by feeding a critical pipeline for private-sector commercialization. This historic engine of discovery, which fuels Nobel Prize-winning research and technology-enabling breakthroughs, relies on a rigorous, competitive expert review system — either managed peer review or community-informed program manager models. The current peer-review process is carefully managed by technical experts at science agencies like the National Science Foundation (NSF), the Department of Energy (DOE) Office of Science, and NASA’s Science Mission Directorate. This specialized workflow ensures that individuals with highly qualified domain expertise evaluate the complex technical merits, methodological rigor, and feasibility of each research proposal.

While it is appropriate for elected politicians to set national priorities, leaving individual award selection to the discretion of political appointees inherently ties the U.S. scientific enterprise to short-term political expediency, replacing decades of strategic research roadmaps with shifting administrative agendas. The proposed "pre-issuance review" process in § 200.205 and the expanded contract termination provisions in § 200.340 threaten to upend the stability and predictability of the funding system, completely failing to achieve OMB's stated goals of reducing administrative burden, improving transparency, and protecting taxpayer value. Requiring that political appointees not “routinely defer” to peer review and allowing vetoes based on changing political priorities introduces a non-technical, subjective filter that is structurally incapable of identifying transformative potential. A non-expert reviewer lacking a deep contextual framework in advanced physics cannot evaluate the technical merit of early-stage, high-risk physics ideas.

Furthermore, forcing a centralized group of political designees to sign off on technical awards will create vast administrative bottlenecks that stall scientific frontiers. For instance, the NSF has only one senior political appointee — the Senate-confirmed director — but evaluates more than 40,000 proposals and funds approximately 8,000 to 10,000 annually2. A significant number of new political appointees would be required to evaluate this immense volume, and this additional evaluation would create operational drag on agency output. Over time, these structural inefficiencies will compound into an artificial restriction on economic output in basic research-dependent critical technology sectors like advanced materials and quantum computing. 

While there is always room for improvement, expert review is the primary protection against waste in federal science funding. An expert program manager or panel of reviewers is best positioned to understand whether the work is infeasible, duplicative, or otherwise unlikely to produce a valuable return on investment. Adding an additional layer of political review does not improve the stewardship of federal funds; it weakens the most rigorous quality control mechanism federal science has. Rather than improving transparency and minimizing waste, this politicized intervention layers on further administrative red tape and reduces clarity for researchers, who must determine what shifting priorities their proposals will be judged against both at submission and while carrying out the work.

The expanded termination and suspension provisions in § 200.340 compound these problems. Allowing agencies broad authority to cancel active grants mid-cycle for convenience or shifting priorities fundamentally undermines the contractual reliability necessary to sustain long-duration physics experiments. Sustained physics research simply cannot be paused and restarted at will. When active projects face sudden termination, specialized instruments lose calibration, expensive experimental setups must be dismantled, space launch windows are missed, and the continuity of multi-year data collection is permanently fractured. Students and postdoctoral researchers face interruptions that can derail lives and careers. Federal funds already invested are wasted when abruptly ended programs produce no results.

Ultimately, the American people will lose out most under this destabilized framework. When foundational research programs are interrupted by arbitrary mid-cycle defunding or suppressed by non-expert vetoes, the public is deprived of the domestic job creation, advanced medical breakthroughs, and next-generation consumer devices that inevitably spin off from robust, long-term scientific investments. This programmatic instability creates an untenable environment for researchers and their students alike. Under the perpetual threat of arbitrary grant dissolution, academic teams can no longer reliably plan scientific milestones, enable students to complete a Ph.D. thesis, or maintain rigorous experimental safety. The constant risk of mid-cycle defunding shifts the focus of the laboratory away from deep, rigorous scientific inquiry and toward short-term administrative survival, rupturing the very foundation of the American research enterprise and leaving American taxpayers with a diminished return on their scientific investments.

Barriers to Essential International Scientific Collaboration

[§ 200.202(e) & § 200.220]

Physics is increasingly global, relying on international collaborations and shared infrastructure. In recent years, some of the most significant breakthroughs involved teams of hundreds or even thousands of researchers from dozens of countries, using jointly funded, multi-billion dollar infrastructure spread across the globe. As just one example, consider the discovery of the Higgs Boson — the physical evidence answering fundamental questions about the nature of matter and energy. This elementary particle was discovered at CERN, the international particle collider experiment to which the U.S. contributed over $2 billion. The discovery was first reported in two journal articles published in *Physics Letters B, each with nearly 3,000 authors representing 38 countries, including the United States, several European nations, Japan, Russia, China, and India3.

This type of international scientific collaboration is powering the future, and not only with large projects. Quantum computing, for example, has progressed through international exchange of ideas among many small teams across the globe. Under the proposed rules, scientists in the U.S. could be deprived of the opportunity to learn what colleagues abroad are doing and benefit from that experience. This would mean that the average American loses out on both fundamental discoveries about the nature of our universe and the broader economic benefits of cutting-edge global technological collaboration.

While we recognize that there are legitimate national security concerns in the R&D enterprise, APS is concerned with the government-wide extension of rigid restrictions modeled after the Wolf Amendment under proposed § 200.220. In the physical sciences, a broad, baseline prohibition on funding bilateral or multilateral collaborations — extending to data-sharing, travel, and indirect allocable costs — will severely disrupt unclassified, fundamental research. The proposed terms will disqualify federally funded grants from the export control fundamental research exclusion, stripping away their standard exemption and hindering the free exchange and publication of scientific results. Fundamental research of this type, intended to be published in the open literature, can lead to discoveries that serve Americans and America’s interests.

Because the proposed rule’s definition of a "covered foreign country" relies on expansive, fluid designations across multiple statutes and Executive Orders, large-scale, international collaborations will be effectively paralyzed by legal ambiguity. Fundamental physics collaborations operate under a model of open data sharing amongst partners. Forcing an institution to halt standard data exchanges or deny international travel to standard scientific working groups without explicit approval from a federal agency head or their designee introduces an unworkable administrative burden that treats open, foundational scientific inquiry as an inherent national security threat.

The practical fallout of this restriction in fields like observational astrophysics and particle physics will be particularly severe. For example, global networks tracking transient astronomical events such as gravitational waves or cosmic rays rely on instantaneous, open data sharing among geographically distributed sensors, some of which are located within or operated by nations that fall under these broad definitions. Under the proposed rule, a physicist at an American institution could be barred from accessing a data pipeline, attending a multinational planning conference, or utilizing institutional indirect funds to help support a piece of experimental infrastructure used by partner nations. By cutting off these vital conduits of open scientific exchange, the United States risks cutting its own researchers out of experiments at the frontiers of discovery, stalling international projects where the U.S. has already invested significant resources, and ceding its position at the vanguard of international physics research.

The proposed rule also makes the U.S. an undesirable partner for scientific collaboration. If the presence of a single Chinese researcher in a multilateral fundamental research consortium could force federally funded U.S. researchers to abandon the collaboration, other countries will likely become unwilling to accommodate U.S. participation. In fields like physics, where projects can involve more than one thousand researchers and dozens of countries, it is unreasonable to assume that foreign researchers or U.S.-allied nations might be willing to collectively back out of collaborations that also involve China or other “foreign countries of concern.” Imposing localized, uncertain political clearance protocols onto international consortium agreements introduces a level of systemic risk that will severely undermine the willingness of foreign states to co-invest.

Compounding the issue, the proposed implementation of a "domestic-first framework" for research and development awards (§ 200.202(e)) threatens to further isolate the U.S. scientific enterprise and severely slow the pace of U.S. technological innovation. By requiring researchers to demonstrate that international components are uniquely justified and strictly in the national interest before securing federal support, these policies create immense bureaucratic friction for standard scientific practices. In the physical sciences, breakthrough advancements in fields like quantum computing, materials science, and semiconductor physics rely heavily on a global talent pool and international supply chains for specialized instrumentation. For example, extreme ultraviolet lithography machines, $400 million dollar devices vital for the manufacturing of cutting-edge semiconductors needed for artificial intelligence, are manufactured by a single company in the Netherlands. Restricting research opportunities and suppliers to domestic entities by default will act as a drag on domestic scientific inquiry by restricting access to cutting-edge overseas technologies and incentivizing top international scholars to collaborate elsewhere, ultimately eroding the global competitiveness of the United States.

Restrictions on Professional Activities

[§ 200.432, § 200.454, § 200.461, § 200.206, and § 200.450]

Publications and Conferences

Foundational science is built on the exchange and debate of ideas. This exchange generally occurs via scientific journals and in the open forums of scientific conferences. Subjecting scientific results to the scrutiny of the rest of the community has resulted in a trustworthy consensus understanding of the world. In detailing experimental methods, presenting data, and cataloging uncertainties, conference exchanges and the scientific literature establish a reliable record that allows today’s scientists to build upon past discoveries, minimize duplication, and accelerate technological innovation.

The proposed rule, however, states that conference attendance and publication costs “are not inherently necessary to carry out the core programmatic objectives of most Federal awards.” Recent requests for information by federal agencies to cap or ban publication costs have already attracted widespread opposition4, with respondents noting that caps could hinder dissemination of scientific results, restrict researcher choice in publication venues, and fail to address issues of high publication costs for certain journals. The rule’s stated aim is more transparency and better stewardship of taxpayer dollars, but by cutting researchers off from the very forums through which they share results, the rule is self-defeating. Science becomes less transparent, more time is wasted on duplicative work, potential breakthroughs languish on lone hard drives or lab benches, and the pace of innovation slows. Federal dollars invested in fundamental, unclassified research for which results are never disseminated brings no value to the public that funded that research.

Restricting publication expenses also creates a fundamental contradiction with the federal government’s current public access mandate, which requires that federally funded research results be made publicly available immediately upon publication. OMB cannot simultaneously require public access publication and prohibit the costs of the primary way it is achieved. These essential costs account for only about 1% of the overall research investment, yet they fund the extensive digital infrastructure, editorial scrutiny, and ethical oversight required to maintain a validated, trustworthy research record. Conditioning the eligibility of these expenses on case-by-case agency approval adds severe administrative burden and introduces the risk of politicization, effectively slowing down American innovation at a moment of intense global technological competition.

Separately, the proposed revision to § 200.454 would disallow the cost of subscriptions to professional, academic, and technical periodicals across the board. This restriction undermines American innovation: researchers cannot efficiently build on prior federally funded work — or avoid duplicating research the government has already paid for — without access to the existing literature. Access to the published record is not a discretionary convenience but a precondition for performing the funded work, which makes these subscriptions “necessary to fulfill the award requirements.”

Furthermore, these financial restrictions inflict disproportionate harm on not-for-profit scientific and medical societies like APS, which serve as community-led, mission-driven publishers. Unlike commercial operations, society publishers directly reinvest their publishing revenue into vital public goods, including workforce development, education, scientific standards setting, and the training of the next generation of innovators. By cutting off the ability to recoup these reasonable costs, the regulation threatens to starve societies of the resources needed to sustain scientific exchange. This policy will inevitably weaken research integrity, reduce the diversity of the marketplace of ideas, and diminish public trust in the independent system of communication that has historically anchored American competitiveness and global leadership.

Risk Assessment

The modernized risk-assessment framework under § 200.206 introduces vetting mechanisms that depart significantly from existing, objective research security frameworks like National Security Presidential Memorandum-33 (NSPM-33), Section 117 of the Higher Education Act, and Title VI, Subtitle D of the CHIPS and Science Act. While established research security measures focus primarily on tangible metrics — such as disclosing foreign financial conflicts, tracking physical talent recruitment programs, and safeguarding intellectual property from industrial espionage — the new OMB regulations explicitly mandate that federal agencies evaluate an applicant's "history of questionable practices" using subjective and fluid parameters.

Under § 200.206(b)(2)(vii), a researcher faces evaluation on whether they or their students and collaborators have a history of publishing "discredited or non-replicable studies" or engaging in activities deemed "inconsistent" with broad civil rights or religious liberty interpretations. Institutional and extracurricular affiliations are also considered for the first time, with scrutiny for whether institutions adhere to the tenets of the 2025 EO 14303 “Gold Standard Science” and whether an individual is involved in outside activities deemed to “undermine public safety” or “advocate for the overthrow of the U.S. Government,” both of which are subject to interpretation by an administration. So, rather than simply enforcing standard compliance with statutory foreign disclosure laws or intellectual property protection, the regulation embeds ideological alignment and arbitrary academic scrutiny into the pre-award vetting process. Instead of reducing recipient burden, the proposed extra level of vetting will add onerous new disclosure procedures and necessitate additional administrative staffing support.

Public and Civic Engagement

The proposed uniform grant guidance places a broad, chilling restriction on researchers' public and civic engagement through its updated "issue advocacy" provisions under 2 CFR § 200.450. Specifically, the regulation bans the use of federal award funds to engage in public messaging that promotes or opposes a particular social, political, or public policy position that is unrelated to the narrow, statutory performance metrics of the grant. This includes any communication designed to influence public attitudes on broader societal matters. The preamble frames these restrictions around a mandate to scrub "divisive ideologies" from federally funded operations. By treating broader civic education and discourse as a compliance risk, this provision severely restricts a scientist’s ability to communicate the real-world implications of their research. Experts working on public-facing scientific issues are effectively barred from translating complex technical data into meaningful public education, starving American public policy debates of vital, scientifically grounded insights, and diminishing the recruitment of young talent into the nation’s innovation ecosystem.

Stifling Workforce Development and Broadening Participation in STEM

[§ 200.300 and § 200.218]

Looking to the future, the United States faces an urgent and growing need for a highly skilled STEM workforce to maintain its global leadership in technology and innovation. Historically underrepresented groups represent our single largest untapped opportunity to expand that talent pool domestically. To access this talent, we need targeted, evidence-based recruitment and retention programs. The sweeping restrictions on diversity, equity, and inclusion (DEI), however, will create immense bureaucratic confusion and a chilling effect across research and education institutions. Lawful, long-standing programs designed to broaden STEM participation — such as K-12 STEM engagement activities, physics mentoring networks, and targeted student recruitment tracks — will be forced to survive a complex gauntlet of pre-award political vetting and risk assessments.

One such example is the undergrad-to-Ph.D. bridge program, a widely deployed strategy which helps students from all different backgrounds who may not have had sufficient research or coursework opportunities at their undergraduate institution to successfully transition into doctoral physics tracks. These efforts enable a student from a rural school without complex laboratory equipment to gain research experience, or a non-traditional student with caregiving responsibilities who could not take the extra coursework needed to be competitive, catch up with their peers at better-resourced institutions. Conflating evidence-based recruitment strategies with illegal discrimination threatens to eliminate the exact pipeline programs required to sustain the workforce in both discovery sciences and critical technology fields like quantum computing, advanced materials science, and nuclear or fusion energy.

Education accessible to all types of learners is also vital to building a better pipeline. The explicit prohibition on federal funding for disparate-impact studies, research, or policy modifications under § 200.218 threatens to dismantle much of the field of Physics Education Research (PER). PER relies deeply on statistical, sociological, and demographic data to evaluate why certain instructional methodologies — such as rigid, lecture-heavy formats versus interactive, studio-based physics courses — result in varying success rates among distinct student groups. Under the new definitions, a seemingly neutral educational policy that yields differing outcomes cannot be examined through a disparate-impact framework using federal funds, nor can operational policies be adjusted to mitigate these systemic variations.

By banning federal support for these critical inquiries, OMB will effectively halt research into evidence-based pedagogy. For example, university researchers investigating why women or first-generation students leave introductory physics courses at disproportionate rates could see their grant funding revoked simply for tracking and attempting to fix these curriculum-based gaps. This heavy-handed approach starves educational researchers of the resources required to optimize STEM learning environments for the average American student, diminishing the domestic talent pipeline for the U.S. STEM workforce.

Finally, the rigid funding prohibitions regarding "gender ideology" under § 200.300(b)(2) — tied to the enforcement of Executive Order 14168 — will have an immediate chilling effect on physics departments, student safety, and public engagement. The broad baseline rules dictate that federal financial assistance may not be used to fund or facilitate any activities or principles that endorse the notion that sex is a mutable characteristic or depart from a strict binary definition. In practice, because a grantee’s research takes place in a location where infrastructure that has gender-inclusive components and student-led organizations that embrace varying gender interpretations may be present, this rule injects severe ambiguity into whether a researcher’s work is considered to support “gender ideology.”

Universities and science organizations risk compliance violations for simply providing standard supportive environments, inclusive facility use, or targeted evidence-based recruitment and retention opportunities. Forcing an all-encompassing ideological standard onto federally funded research environments compromises the open, inclusive culture necessary for scientific inquiry. This isolates vulnerable domestic students from institutional support networks, interferes with our ability to prepare students for success on the global stage, and makes America less attractive to global talent.

Conclusion

For decades, the unparalleled success of the American scientific enterprise has rested on predictable federal investments, rigorous expert review, and an open, collaborative research environment. The proposed "Regulation for Federal Financial Assistance" threatens to dismantle these foundational pillars. By allowing political vetting to override merit-based review, isolating American researchers from vital international collaborations, suppressing professional communication, and dismantling evidence-based STEM workforce development pipelines, this rule will deeply damage the nation's innovation ecosystem.

Rather than achieving the Office of Management and Budget’s stated goals of reducing administrative burden and increasing transparency, this sweeping regulatory overhaul introduces unprecedented bureaucratic red tape, legal ambiguity, and instability. The U.S. would rapidly lose its international leadership, becoming a secondary user of whatever other nations pioneer. Americans will no longer be first in line for cutting-edge technological, medical, energy, and security innovations. If implemented, these changes will paralyze discovery science, stall technological innovation, and ultimately compromise the health, wealth, and security of our country.

Therefore, the American Physical Society strongly urges OMB to withdraw this proposed rule in its entirety and to instead engage in meaningful, transparent dialogue with the scientific, academic, and industrial sectors to support — rather than disrupt — the progress of American science.

*The previous version of this comment incorrectly stated that the Higgs boson discovery was initially reported in the Physical Review Letters.

Sincerely,