By changing standards for procurement under federal grants, the Trump administration’s proposed changes to the rules guiding federal grantees could impact ongoing reforms of the ABA Model Procurement Code (MPC).
Since it was launched in the late 1970s, the MPC has served as a safe procurement “rulebook” for federal grantees. The MPC was drafted with federal grants standards in mind, so that federal grantees (such as cities and states) can adopt the MPC and be confident that their procurement processes will meet federal requirements.
Those federal standards for grants were revised in 2014 by the U.S. Office of Management and Budget (OMB) (part of the White House) to create “Uniform Guidance,” which is implemented by grants-making federal agencies. In Subpart D, the Uniform Guidance includes procurement standards on issues such as competition, conflicts of interest and contract types.
On May 29, 2026, the Trump administration proposed major changes to the Uniform Guidance (which would be renamed the “Uniform Grants Regulation,” and made a uniform governmentwide rule). Those proposed changes have been controversial in part because they would give political appointees authority to review and approve (or deny) grants based on the incumbent administration’s priorities. Over 160,000 comments on the proposed rule were received in the regulatory docket by the closing date of July 13, 2026, and the new rule is scheduled to be implemented on October 1, 2026 (the start of the federal fiscal year).
As the linked comparison shows, the proposed rule would make significant changes to the existing procurement standards, such as:
- Cost-reimbursement contracts discouraged: The proposed rule would more aggressively discourage the use of cost-reimbursement contracts.
- Small business use encouraged: The proposed rule would amplify the encouragement for grantees to “ensure that small businesses, including subcategories of small businesses enumerated in Federal statute, are considered when issuing contracts.”
- Buy U.S. preference: The proposed rule would strengthen domestic preferences for procurement under federal grants. To the “greatest extent practicable and consistent with law,” agencies are to “include terms and conditions in Federal awards to maximize the use of goods, products, and materials produced in the United States.” These requirements would need to be flowed down to “all subawards, contracts, and purchase orders under Federal awards.”
The proposed rule includes other relevant changes, such as a loosening of the internal controls requirements for grantees. Some of OMB’s proposed changes (for example, an exclusion of Chinese drones) are unlikely to be adopted directly into the MPC, which is a more general set of guiding rules. Other changes to the grants requirements, however, are likely to be included in the MPC.
Those working on proposed updates to the Model Procurement Code may want to track the regulatory docket to stay apprised of these ongoing changes (including the forthcoming final rule from OMB). The hope is that, by incorporating the revised grants requirements, the Code will continue to serve as a reliable rules standard for federal grantees.
