How Did We Get Here? Federal Grants State of the Union

Happy New Year, readers! We’re kicking off 2026 by facing an uncomfortable truth: the upheavals, challenges, confusion, and stress over the last 12 months in federal grantmaking wasn’t random—it was planned.

I would now like to virtually (because this is a newsletter and I am an introvert with some germaphobe tendencies) hold your hand, look through the ether into your eyes, and ask you to stop saying you’re surprised and shocked by any of this. People heading thinktanks and multiple campaigns have thought this through for decades.

Amanda and I go into much more details in the first episode of Season 9 (unbelievable) of the Fundraising HayDay Podcast where we break down exactly how we got here, tracing the systematic dismantling of federal grantmaking back to its source document.

Here’s a very brief overview.

Project 2025, released by the Heritage Foundation in April 2023, is a 920-page blueprint that’s been executed with precision. From the January grants freeze that cited “Marxist equity” and “transgenderism” as justifications, to the August executive order placing political appointees in charge of funding reviews, these weren’t isolated incidents. They were coordinated steps in a larger plan.

The appointment of Russell Vought as OMB Director crystallized this vision. As the author of Project 2025’s chapter on presidential authority, he explicitly described OMB as “the president’s air traffic control system” and called for it to be “the best, most comprehensive approximation of the president’s mind.” Translation? Centralized control over all federal spending, overriding individual agency expertise and decision-making.

Here are a few of the results. Nearly 12,000 grants were terminated mid-process by the Department of Government Efficiency. Grant application windows that once allowed 30-45 days were suddenly shortened to two weeks, five days, or in at least one rumored case, just 24 hours. Programs serving children, older adults, low-income school districts, and disaster-stricken communities faced sudden funding cuts or impossible new compliance requirements.

What can you do right now?

• Educate yourself and your leadership. Read Project 2025—at least the sections relevant to your work—so you understand the long-term trajectory, not just today’s headlines. This is the uniform guidance for what’s happening to millions of people who depend on federal support.
• Diversify your funding strategy immediately. Federal grants can no longer be your organization’s primary lifeline. Build robust relationships with foundations, corporate partners, and individual donors now, not when the next crisis hits.
• Start local and be the “someone.” Don’t wait for someone else to fix this. Work within your agency, educate your board, and collaborate with your community to create resilience against federal funding volatility.

Knowledge is power, and understanding how we got here is the first step to moving forward. Stay informed to stay strategic.