National Opposition to Proposed Federal Grant Changes Grows, with 1,300+ Organizations Signing Letter and Thousands of Public Comments Submitted

Read a PDF of our statement here.

On Tuesday, March 31, 2026, the Legal Defense Fund (LDF) joined more than 1,300 nonprofit organizations nationwide in signing a national letter opposing the Trump Administration's proposed changes to the federal System for Award Management (SAM) portal, the online system used to apply for and manage federal financial assistance. The proposal has generated significant public opposition, with many comments submitted against it ahead of the March 30 deadline.

If implemented, the proposed certification requirements would affect organizations that receive grants, cooperative agreements, loans, insurance, and direct appropriations, creating new legal and financial risks that could disrupt essential services in communities across the country.

"Nonprofits frequently partner with the federal government to help deliver essential services to their communities. The changes to federal grant certifications proposed by the Trump Administration undermine this effective partnership and ultimately will harm the people and communities that rely on nonprofits and the services they provide," said President and CEO of the National Council of Nonprofits, Diane Yentel. "Nonprofits with a strong track record of delivering federal programs may decide it is not worth the significant financial and legal risk, leaving communities without the organizations needed to deliver childcare, support for seniors and veterans, job training, food and shelter."

"Nonprofits rely on federal funding to provide critical services to and safeguard the civil and human rights of communities across the country, including millions of Black people," said Demetria McCain, Director of Policy at the Legal Defense Fund. "The Trump Administration's proposed changes would dramatically and needlessly threaten those protections by adding vague requirements that reference misleading federal guidance related to lawful diversity, equity, and inclusion programs. The proposal also tries to discourage services to immigrant communities and lawful activism and protest. The civil rights community must continue to speak up, submit public comments, and stop this effort to deter nonprofits from advancing their missions and serving our communities."

The proposed changes would require all applicants and recipients of federal financial assistance to sign new certifications under penalty of criminal and civil law. These certifications align with executive orders and U.S. Department of Justice guidance that mischaracterize lawful diversity, equity, and inclusion efforts. The proposal also introduces new certification requirements related to immigration and terrorism.

Nonprofits warn that the proposed changes are vague and complex, making it difficult for organizations to determine whether they are in compliance. The uncertainty exposes nonprofits to potential legal harassment and costly investigations, even when no wrongdoing has occurred. Organizations could be forced to divert staff time and resources away from community services in order to manage compliance risks.

Ultimately, many nonprofits may determine that the legal and financial risks are too great, particularly when requirements lack clarity. If organizations withdraw from federal partnerships, communities could lose access to essential services, including civil rights counseling, delivered by trusted local nonprofits.

The national sign-on letter, which was led by the National Council of Nonprofits and the Legal Defense Fund, reflects broad concern across the nonprofit sector that the proposed changes could undermine longstanding partnerships between nonprofits and government that help deliver critical services efficiently and effectively.

For more information, read the proposed changes and supporting materials.

###

Founded in 1940, the Legal Defense Fund (LDF) is the nation's first civil rights legal organization. LDF has been completely separate from the National Association for the Advancement of Colored People (NAACP) since 1957, though it was founded under the leadership of Thurgood Marshall while he was at the NAACP. LDF's Thurgood Marshall Institute (TMI) is a division of LDF that undertakes innovative research and houses LDF's archive. In all media attributions, please refer to us as the Legal Defense Fund or LDF (do not include NAACP) and refer to the Institute as LDF's Thurgood Marshall Institute or TMI.