A proposed Education Department rule would let the secretary end grants “for convenience.” More than 5,500 public comments show how much of American education now depends on money that could be withdrawn at will.
Most of the national argument about higher education has been about what colleges teach, whom they admit and what they say. A quieter fight, now in the rulemaking stage, is about something more basic: whether federal money, once awarded, can be counted on to arrive.
The U.S. Department of Education has proposed rule changes that would give the education secretary authority to cancel grants “for convenience,” favor applicants that charge lower indirect cost rates and exercise broader discretion over grantmaking generally. The rule would also require states that receive grants, and the organizations they pass money to, to comply with President Trump‘s executive orders. The one-month comment period closed just before midnight last Wednesday, and the department received more than 5,500 comments, according to Inside Higher Ed. It must respond to them before finalizing the rule.
What the rule would change
A federal grant has traditionally worked like an agreement. Congress creates a program and sets its purpose, the department runs a competition and the winner receives a multiyear award it can plan around, whether that means hiring staff, enrolling students or launching a study. Ending an award midstream has typically required a reason tied to the grant itself, such as poor performance or misuse of funds.
“Termination for convenience” removes that requirement. It allows the government to end an award because it no longer wants to fund it. Combined with the proposal’s other provisions, including giving the secretary more power to review multiyear grants annually, the rule would turn awards that were once commitments into allocations that can be revisited each year.
Critics say the reach is broad. It would cover TRIO college-access programs, Institute of Education Sciences research grants and Perkins state formula grants for career and technical education. Higher education groups also argue that the department is trying to adopt major pieces of a government-wide grant-control rule from the White House Office of Management and Budget, which Congress blocked at least until December after heavy criticism.
Who pushed back, and why
The American Council on Education, writing on behalf of 40 organizations including the Association of American Universities and the American Association of University Professors, said the rule would codify the abrupt grant priority changes and terminations that have caused confusion over the past 18 months. ACE president Ted Mitchellchallenged the executive-order requirement directly: “EOs are not law.” He said many recent orders conflict with state and local laws, and that requiring compliance as a funding condition would force grantees to adopt legal interpretations that courts have rejected.
The American Educational Research Association warned that ending research grants midway through would disrupt partnerships with schools, cut off support for graduate students and waste the federal money already spent. It also cautioned that studies comparing outcomes across student groups could be labeled “disparate impact” research under anti-DEI orders and lose funding, even when the goal is to improve learning for all students.
The Council for Opportunity in Education, which supports TRIO programs, focused on the rule’s preference for lower indirect cost rates. It argued that applicants unable to cover their own administrative costs would be at a structural disadvantage regardless of the quality of their work, which would hurt the community-based organizations that have made TRIO effective.
Commenters also noted that the rule requires grantees to base hiring, admissions and pay on “merit and high standards” without defining those terms. At many public institutions, those policies are set by state governments or university systems, not by the grant recipient.
The department sees it differently. A spokesperson told Inside Higher Ed it doesn’t understand the objection to prioritizing merit, better outcomes for students and families, and protecting taxpayer dollars.
Discretion runs in both directions
The clearest preview of how expanded discretion works came the same week comments closed. The department announced it was sending more than $174 million to historically Black colleges and universities and $61 million to tribal colleges as “one-time” investments, drawn from programs that generally funded Hispanic-serving and other minority-serving institutions. A year earlier, it abruptly canceled most MSI grants, calling them unconstitutionally discriminatory, and redirected $495 million to HBCUs and tribal colleges.
This year’s HBCU money came from a Hispanic-serving institution grant program focused on STEM and transfer pathways. Education Secretary Linda McMahon called HBCUs “engines of opportunity in communities.” UNCFwelcomed the funding but said one-time money doesn’t meet campuses’ ongoing needs. Meanwhile, the administration’s proposed budget would eliminate all $1.6 billion for TRIO and GEAR UP, the college-prep and retention programs that many of the same institutions rely on.
That’s the structural point. When money can be moved at the secretary’s discretion, some institutions come out ahead in a given year. But gaining a one-time award is not the same as having stable funding. A college can’t hire tenure-track faculty, build a multiyear STEM pipeline or promise students a program will still exist with money that has to be won again every year. The same discretion that directs funds to an institution this year can pull them away next year. Even the institutions that benefit end up more dependent on the priorities of whoever holds the office.
Why the comment count matters
Amanda Fuchs Miller, a former Biden administration deputy assistant secretary for higher education programs, noted that the same set of regulations drew only 29 comments in 2024. The jump to more than 5,500 shows that the people who depend on these programs understand what’s at stake.
For colleges, the practical question is about planning. Institutions build programs, sign contracts and hire staff around grants they expect to last several years. A rule that lets those grants end “for convenience” moves the risk from the government to the grantee, and the institutions with the fewest reserves, including many community-based organizations, regional publics and minority-serving institutions, will feel it most.
The department isn’t required to change course because of the comments, but it does have to answer them. What it does next will show whether federal education funding stays a commitment or becomes something colleges have to win again every year, from whoever holds the secretary’s office.
Sources: Inside Higher Ed, Inside Higher Ed (MSI funds), Inside Higher Ed (2025 reallocation), EURweb, Insight Into Academia, Regulations.gov