Our Comments in the OMB Rulemaking

Last month, the Office of Management and Budget (OMB) issued a notice seeking comment on a proposed new rule.  The rule would make highly consequential changes to the Uniform Guidance for Federal Financial Assistance. At last count, OMB had received nearly than 350,000 comments, and more than 50,000 were available to read. Today we filed ours.

The Uniform Guidance has occupied Title 2 of the Code of Federal Regulations since 2013. It replaced a series of OMB circulars, each governing a different class of federal grants. For example, Circular A-110 governed grants in higher education; Circular A-122 governed non-profits, etc. (A complete list is archived, here). The Uniform Guidance was an attempt to bring consistency and clarity to a necessarily confusing process. It largely succeeded.

We have recently written about the Uniform Guidance in connection with one specific section, found at 2 C.F.R. § 200.315(b)—the so-called Federal Purpose License (sometimes called the Government Use License), which is the provision that grants the government a license to use certain copyrighted works that it funds through grants. The white papers in our Legal Pathways to Open Access project, for example, go into detail on the mechanics of, and the basis for, the Federal Purpose License.

The OMB’s notice of inquiry comes in at 108 pages, and proposes many, many changes to the Uniform Guidance. Much of the text of the notice is highly political, and the tone of the notice reflects the present Administration’s political priorities. For the factual basis underlying their critical perspectives on previous executive branch work, they heavily on opinion pieces, internal documents, and executive orders from the current president. 

Our comments focus on two points raised in the notice. 

Our first point is on an internal contradiction in the notice itself. Presently, federal grant funds can be used to fund subscriptions to journals and memberships in professional societies. The OMB wants to change the rule to make those costs unallowable. The OMB also asserts they aren’t addressing indirect costs—ongoing lawsuits and injunctions mean their ability to change indirects is very limited. 

But in academic environments at least, indirect costs often go to journal subscriptions by institutional libraries. We are taking OMB at its word that it is not modifying indirect costs, and so we read their comment on indirect costs to mean that the new rule would not apply to library expenditures of indirect funds. We think that is the only way to read the the notice to be within their granted authority. But as we noted in our comment, the contradiction has created confusion within our community, so we want OMB to clarify that is what they mean.

On the second point, OMB would like to change the rules of grant termination, to allow the Administration discretion to terminate any grant—including grants already in progress—if the grants no longer meet the administration’s priorities. Furthermore, that discretion would extend even to the government’s obligation to reimburse costs already expended under the grant. This is a very worrisome move. Grant research doesn’t correspond to the presidential election cycle, but under the new rule no grant would be safe after Inauguration Day. We don’t think this is permitted by the law, but it also is a terrible idea. We are asking OMB to leave the present rule—and its much narrower termination rules—in place.

There were many things we could have chosen to take issue with. We chose to focus on two. We could have chosen many more—there are other proposed changes we think are likely to be struck down if enacted, and still others that betray a terrible understanding of the conditions that allow a research community to thrive. 

It is worth noticing, though, that for all the worrying proposals they make, the OMB’s proposed restructuring of the Uniform Guidance does not touch the Federal Purpose License, nor does it touch the public access policies that resulted from the “Nelson Memo.” At least so far, all indications are that this administration is still on board with the basic principles of public access to publicly funded works. In the end, that is at least good news.

As I mentioned above, the proposed new rules are sweeping, both in their changes and in their consolidation of power in OMB. We are not convinced OMB has the authority to issue many of these rules, and we anticipate litigation along those lines will follow their implementation. We’ll post more about our underlying legal concerns in the near future.

In the meantime, we will be following the Administration’s daunting task of reading every single comment and giving reasoned responses to the concerns raised. The timeline of the notice suggests they are unlikely to change anything, but the record established in the commenting period may help to control some of the excesses of the new rules in the future.