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Oak Harbor council signs on to mayor’s letter opposing proposed OMB changes to federal grant rules
Summary
Grants Administrator Wendy Horne warned that proposed changes to 2 CFR Part 200 (federal financial assistance) — including mandatory E‑Verify enrollment, expanded Buy America requirements, and increased reporting — would raise administrative burdens for small cities. The council voted unanimously to sign onto the mayor’s comment letter urging OMB not to finalize the rule.
Grants Administrator Wendy Horne told the council the Office of Management and Budget has proposed revisions to 2 CFR Part 200 that would change how federal financial assistance is awarded and administered. Horne summarized proposed objectives (improving transparency, clarifying regulatory structure, reducing recipient burden) but said many elements would instead increase burdens on small municipalities.
Horne listed several proposed changes that concern the city: mandatory written justification for each payment request; required E‑Verify enrollment and a requirement to run new hires and contractors through E‑Verify within three business days; expanded Buy America coverage (iron, steel, manufactured products and construction materials); enhanced prepayment checks; and broader authority for federal agency leadership to modify or terminate awards during the award period. She warned those changes could delay payments and reduce flexibility for grantees and subrecipients. "If this does pass, it will take effect 10/01/2026," Horne said, and noted that roughly 14 city grants — total program funds the city administers — could be affected immediately (she estimated about $5,500,000 under management currently).
Council members and a representative active with the National League of Cities said the proposed rule has attracted tens of thousands of public comments and that cities nationwide are coordinating responses. Several council members asked whether the mayor’s letter could be sent on behalf of the mayor and the full council to amplify the city’s voice; staff advised a formal motion would be appropriate. Councilmember Peterson moved that city council members sign on to the mayor’s proposed comment letter; the motion was seconded by Councilmember Romero and passed unanimously.
What the council did: the mayor will submit his comment letter opposing finalization of the proposed rule and the council voted unanimously to have council members sign on. Staff provided a link for councilmembers and members of the public to file their own comments; Horne noted a corrected deadline (July 13 in the meeting remarks) for the federal docket.
