USDA Announces Department-Wide Standardization Of Grant And Cooperative Agreement Terms

WHAT: On December 31, 2025, Secretary of Agriculture Brooke Rollins issued a memorandum establishing a single, standardized set of General Terms and Conditions (GT&Cs) for all U.S. Department of Agriculture (USDA) grants, cooperative agreements, and similar awards. The memorandum states that the standardization is intended to ensure that USDA advances "policies that put America First."

According to the memorandum, the policies implemented by the new GT&Cs include "ensuring no recipient of USDA awards" engages with entities on prohibited lists, preventing foreign adversaries from "exploiting American taxpayer funds," "[s]tandardizing termination language" to assist USDA in taking measures with awards not meeting "performance benchmarks," and "[s]trengthening USDA control and oversight" of awards.

The memorandum, which took effect immediately upon its execution, directs all USDA agencies and staff offices to adopt and implement the new GT&Cs for all future awards no later than 45 days after the issuance of the memorandum. The memorandum applies prospectively and does not modify the terms and conditions of existing awards, which will continue to be governed by the terms in effect at the time of award unless otherwise amended. The GT&Cs are to be applied to all modifications of existing awards to the maximum extent consistent with law.

The memorandum was issued as part of USDA's implementation of Executive Order 14332, "Improving Oversight of Federal Grantmaking," previously covered in a Wiley alert here. According to the memorandum, USDA's 21 awarding agencies and staff offices currently rely on office- and program-specific terms and conditions spread across "106 documents numbering 2,218 pages." The memorandum states that the standardization is intended to improve efficiency and reduce administrative burdens by consolidating those requirements into a single 48-page document.

Agencies are required to remove any conflicting terms for their agency-specific terms and conditions. However, the memorandum directs the USDA Office of the Chief Financial Officer (OCFO) to establish a centralized deviation approval process. Under the deviation process, agencies and staff offices may seek written OCFO approval to use "policies, procedures, terms, or conditions that are inconsistent with the GT&Cs." Requests must be justified on a statutory or regulatory basis, or with a policy rationale approved by a "senior policymaking official."

WHAT IT MEANS FOR USDA STAKEHOLDERS: Prospective applicants and recipients can expect the new standardized terms to be incorporated into forthcoming USDA notices of funding opportunities and award documents. For companies, universities, and nonprofits that pursue USDA financial assistance across multiple mission areas of USDA, the consolidation may bring more predictability and repeatability. In theory, recipients should be able to build one internal compliance framework that can be reused across USDA components. However, for those stakeholders that primarily get grants from one mission area, the memorandum could result in various changes such that stakeholders must pay careful attention to avoid any issues with grant compliance. Finally, because the memorandum says that the new terms and conditions can apply to "significant modifications" to existing awards, grant recipients should remain attentive to the possibility of changed terms for ongoing awards subject to modification.

Also, of note in the GT&Cs is a new requirement for award recipients to certify they "are not currently, and will not in the future" enter into any subawards, contracts, or other agreements with any person or entity subject to foreign ownership, control, or influence (FOCI) by a "foreign country of concern or another foreign adversary." Importantly, the new requirement also prohibits awardees from "otherwise provid[ing] any form of benefit (material or non-material) through either funded or unfunded work" to any person or entity subject to FOCI by a foreign country of concern or another foreign adversary,[1] a requirement that seems to stretch this clause to cover contractual and other agreements outside of the scope of the grant itself. Although FOCI restrictions are familiar in national security and defense spheres, this new outright prohibition on FOCI for USDA financial assistance is a notable expansion in scope that will likely affect how recipients structure their subaward, subcontract, and collaboration practices. Stakeholders, including universities and businesses that work with and subaward with foreign countries, institutions, and businesses should be aware of these and other provisions that may materially impact their research arrangements or other business practices.

USDA is also framing the new GT&Cs as an oversight and enforcement tool. The memorandum emphasizes that the standardized framework is intended to strengthen USDA's ability to "take swift action when recipients and cooperators—and even recipients of subawards and subcontracts—are not compliant with Federal law and applicable Executive Orders." The memorandum states that USDA employees must take "reasonable and appropriate" actions to address noncompliance with any term or condition of an award, and that employees who fail to act or report noncompliance may be subject to disciplinary action. Additionally, the memorandum's emphasis on standardizing termination language for awards not meeting "performance benchmarks" means financial aid recipients should carefully monitor their grant performance.

Going forward, organizations seeking USDA funding should review the new GT&Cs now and assess whether their existing compliance programs will align with the new, department-wide framework. Existing awardees should look out for these GT&Cs in any award modifications.

Footnote

1. Going forward, organizations seeking USDA funding should review the new GT&Cs now and assess whether their existing compliance programs will align with the new, department-wide framework. Existing awardees should look out for these GT&Cs in any award modifications.

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