By Mark J. Piszko, CPA, CGMA, Partner
Key Takeaways
1. The House approved a rescission of $9.4 billion in federal grants, including U.S. Agency for International Development and public broadcasting funding.
The U.S. House of Representatives voted to revoke billions in previously allocated grants, including $8.3 billion from the U.S. Agency for International Development and additional funding for the Corporation for Public Broadcasting, which supports National Public Radio and the Public Broadcasting Service.
2. Senate action and potential revisions are expected before bill becomes law.
The bill requires approval by the U.S. Senate, where changes may be introduced before moving to President Donald Trump. A vote is expected in July and may impact the timeline and scope of the proposed funding clawbacks.
3. Nonprofit organizations should assess exposure to federal grant reductions.
Organizations with programs supported by federal grants are encouraged to review current funding sources, staffing plans and budget strategies in anticipation of possible shortfalls or shifts in available funding.
Last week, the U.S. House of Representatives voted to rescind billions in federal funding for the U.S. Agency for International Development (USAID) and grants previously approved for the Corporation for Public Broadcasting (CPB). The CPB provides sub-recipient funding to National Public Radio (NPR) and the Public Broadcasting Service (PBS). Funding clawbacks totaled $9.4 billion, including $8.3 billion allocated to USAID.
The House vote on the grants rescission package is the first step in codifying spending cuts in areas identified as wasteful by the Department of Government Efficiency (DOGE). It is still not certain that the House-passed bill will be approved by the U.S. Senate, to then find its way to President Trump for his approval. A Senate vote is expected to take place in July and may include some revisions to the version approved by the House.
The USAID rescissions package is only part of the administration’s efforts to reduce the country’s current $36 trillion deficit. There are also calls for cuts or eliminations of funding for the United Nations Children’s Fund, the UN Development Program, the UN Population Fund, the World Health Organization and others.
Earlier this year, the administration attempted to freeze all federal USAID funding and disassemble USAID entirely. The U.S. Supreme Court issued a temporary restraining order mandating the provision of federal grants for all USAID-related projects completed through February 13, 2025. Litigation is ongoing, while hundreds of federal contracts are being reviewed.
The PKF O’Connor Davies Not-for-Profit services team will continue to keep you apprised of new developments concerning federal funding for USAID and other government agencies supporting the work performed by thousands of nonprofit organizations. In the meantime, we recommend you stay vigilant, review the funding sources for your programs, consider your staffing needs, establish a plan to take appropriate budgetary measures in the event significant funding streams are reduced or eliminated and be ready to pivot to private and other sources to try to make up shortfalls in projected revenue.
Contact Us
For more information on the House rescissions package and how it may affect your organization or if you have any other questions, contact your PKF O’Connor Davies client service team or:
Mark J. Piszko, CPA, CGMA
Partner-in-Charge
Not-for-Profit Services
mpiszko@pkfod.com | 646.449.6316