The Latest on Labor

The B.L.U.F. (Bottom Line Up Front):

On September 9, the House Appropriations Committee passed the Health, Human Services, Education, and Labor funding bill. This bill includes important changes in the Department of Labor’s grant procedures and increases funding for rural communities. Today, CMS opened applications for the Rural Health Transformation Program, with the deadline for states to apply for the formula funds set for November 5, 2025. The National Institute for Health revised its guidance for grant applicants, heavily restricting the use of AI in grant applications.  

Labor, Health, Human Services, and Education Bill Updates 

The House Appropriations Committee oversees funding for the Department of Labor, the Department of Education, and the Department Health and Human Services. For FY2026, the Committee recommended a total of $184 billion in current year discretionary funding and $600 billion in overall programmatic fundings. This budget aligns with the President’s desire to reform and reorganize the federal government.   

GRANT OVERSIGHT:

Also included in the legislative text was additional oversight of grant programs. Within 30 days of bill passage and every 30 days until November 30, 2026, the Committee will require DOL to brief the Committee on the status of all formula and competitive grants. Each briefing must include a summary of awards made and Notices of Funding Opportunities.  

FUNDING CHANGES:

• • • The House subcommittee is now mandating the Department of Labor (DOL) to provide the subcommittee with the reviewer’s grant scores for each applicant for every DOL grant program (pg. 10). This includes all scoring requirements from the funding opportunity announcement and the awarded funds.

    • DOL is now required to prioritize grant applications in industries and occupations that exceed the average earnings of a high school graduate ($45,408) when making competitive awards (pg. 10).

    • An additional $5 million in funding is allocated this year for the Workforce Opportunity for Rural Communities program. This program focuses on enhanced worker training in Appalachian, Delta, and Northern Border regions. This funding is specifically meant for multigenerational workforce training in collaboration with institutes of higher education and workforce development (pg. 12). 

    • The House subcommittee allocated $10 million in grants for employment, training opportunities, and early workforce readiness demonstrates an increase from previous funding years (pg. 13).  

    • The FY 2026 bill provides $100 million for state apprenticeship programs. This is a significant increase in funding for apprenticeships (pg. 13). 

    • The committee allocated $78 million for rural hospital flexibility grants(pg. 57). 

CFS TAKEAWAY:

Many CFS clients have been eagerly awaiting guidance on which DOL programs will be released in FY26 after a slow FY25. For those looking to access competitive funding, DOL will likely only consider applications that align with the subcommittee policies and administration priorities. Make sure your project aligns with these considerations and that these new priorities are highlighted within applications. Continue to stay informed of changing grant requirements and shifting policy priorities.   

Agency Rule Updates

NIH Artificial Intelligence Policy Goes Into Effect Next Week

The Supporting Fairness and Originality in NIH Research Applications rule takes effect September 25, 2025. This rule states that NIH will not consider applications for research that are substantially developed by AI. NIH is also limiting the number of applications it will consider from Principal Investigators to only six in a calendar year.   

Keep an eye out for CFS commentary on this specific policy, the overlooked aspects of using AI to access federal funding, and what other agencies may be looking at similar policies.  

Funding Opportunities

Rural Health Transformation Program (RHTP) Now Accepting Applications from States 

Today, the Centers for Medicare & Medicaid Services (CMS) released the NOFO for the Rural Health Transformation Program. The federal government is providing $50 billion ($10 billion annually) through 2030 to empower states to strengthen rural communities across America by improving healthcare access, quality, and outcomes by transforming the healthcare delivery ecosystem. State governments must apply to CMS to be considered for funding.  

Of the $10 billion per year, 50% is to be divided equally amongst all states with an approved application. The formula funding program must be used to improve health outcomes in one or more of the five key strategic focus areas: make rural America healthy again, improve sustainable access, better workforce development, spark innovative care, and foster the use of tech innovation.  

Applications are due on November 5, 2025. You can view the full notice on grants.gov here.

Looking Ahead

There are 19 days left for Congress to pass legislation to fund the government past September 30, but the House, Senate and White House seem to be at odds on how to do that. The White House is seeking a stopgap bill that will extend funding until January 31st. This would allow more time for the budget to align with administration priorities and limit Democrats’ ability to negotiate. Congressional Democrats are pushing for a short continuing resolution that will require a full budget resolution by the end of November.

We anticipate this picture will become clearer in the coming weeks. CFS will continue to monitor budget resolutions and the potential implications of a government shutdown. 

Curious how a government shutdown impacts funding programs? Read our insight article from last spring when Congress was last facing a looming shutdown.