Health Partners Institute, Ruling No. 2026-16 (2026)

REJECTION OF APPEAL

HealthPartners Institute (the Institute) seeks Departmental Appeals Board review of a decision by the National Institutes of Health (NIH) to terminate a grant issued to the Institute.  The Board lacks jurisdiction over this matter because the termination decision does not fall within any of the categories of disputes reviewable by the Board under 45 C.F.R. Part 16, Appendix A, or 42 C.F.R. Part 50, Subpart D.  The appealed decision does not represent a disallowance, a termination for failure to comply with the terms of the award, a denial of a noncompeting continuation award for failure to comply with the terms of a previous award, or a voiding.  For the reasons discussed below, this appeal must be rejected.

Legal Background

The Board’s jurisdiction to hear and decide appeals is limited.  Ca. Dep’t of Finance, DAB No. 1592, at 17 (1996) (“[T]here is no general right to review by the Board . . .”).  Board review is available only as provided by statute, regulation, or valid delegation of authority from the Department of Health and Human Services (HHS) Secretary or the head of an HHS operating component.  Experts Are Us, Inc., DAB No. 2342, at 5 (2010); 45 C.F.R. Part 16, App. A, ¶ A.

Before the Board will accept an appeal, the Board’s regulations at 45 C.F.R. Part 16 require that the following conditions be met:  (1) the appellant must have received a “final written decision” by an HHS component (45 C.F.R. §  16.3(b)); (2) the appellant must have appealed that decision within 30 days after receiving it (id.); (3) the appellant must have “exhausted any preliminary review process required by regulation” (id. § 16.3(c)); and (4) the disputed decision “must arise under a program which uses the Board for dispute resolution” and be the type of decision that the Board is authorized to review, as specified in Part 16, Appendix A (id. § 16.3(a); 45 C.F.R. Part 16, App. A, ¶¶ A-E).  The fourth requirement for Board jurisdiction is at issue here.

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Title 45 C.F.R. Part 16, Appendix A, identifies HHS programs that use the Board for dispute resolution and the types of “final written decisions” reviewable by the Board.  45 C.F.R. Part 16, App. A, ¶ A; see also 46 Fed. Reg. 1644, 1645 (Jan. 6, 1981) (noting that Appendix A is the Board’s “jurisdiction statement” reflecting “disputes which agencies have chosen to submit to the Board”).  The Board is authorized to review certain agency decisions involving grants and cooperative agreements.  See 45 C.F.R. Part 16, App. A, ¶¶ B, C.  Grants and cooperative agreements are types of federal financial assistance that provide support or stimulation to carry out a public purpose as authorized by a law of the United States.  See 2 C.F.R. § 200.1 (defining “federal award,” “federal financial assistance,” “grant agreement or grant,” and “cooperative agreement”); 31 U.S.C. §§ 6304 (grant agreements), 6305 (cooperative agreements).  (To simplify, this ruling uses the term “grant” to refer to both grants and cooperative agreements.)  Research grants made by NIH are subject to general terms and conditions depending on the type of grant, as well as any special terms and conditions in the notice of award.  See Targazyme, Inc., DAB No. 2939, at 1-2 (2019).  NIH issues a Grants Policy Statement (NIH GPS) to “make available to NIH recipients, in a single document, the policy requirements that serve as the terms and conditions of NIH grant awards.”  NIH GPS at ii.1 

As relevant here, Appendix A provides that the Board reviews “the following types of final written decisions in disputes arising in any HHS program authorizing the award of direct, discretionary project grants or cooperative agreements:” 

(1) A disallowance or other determination denying payment of an amount claimed under an award, or requiring return or set-off of funds already received.  . . .

(2) A termination for failure to comply with the terms of an award.

(3) A denial of a noncompeting continuation award under the project period system of funding where the denial is for failure to comply with the terms of a previous award.

(4) A voiding (a decision that an award is invalid because it was not authorized by statute or regulation or because it was fraudulently obtained).

45 C.F.R. Part 16, App. A, ¶ C(a)(1)-(4).2 

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When an HHS component, such as NIH, uses a preliminary appeal process, “the ‘final written decision’ for purposes of Board review is the decision issued as a result of that process.”  Id., App. A, ¶ C(b).  One such preliminary appeal process is found at 42 C.F.R. Part 50, Subpart D, which establishes a procedure for resolving certain “grant and cooperative agreement disputes” in programs administered by NIH.  42 C.F.R. §§ 50.401, 50.402.  The preliminary appeal process under Subpart D applies only to certain “adverse determinations under discretionary grants and cooperative agreements,” as specified in section 50.404(a).  Section 50.404(a) mirrors the list of reviewable final written decisions under Part 16, Appendix A, ¶ C(a).3   If a grantee contests an “adverse determination” to which the preliminary appeal process applies, the grantee must exhaust that process before the Board will accept the appeal under Part 16.  42 C.F.R. § 50.403.

The Board Chair determines whether the conditions for Board jurisdiction are satisfied.  See 45 C.F.R. § 16.7(b) (providing that the Board will notify the parties if the Board Chair determines that the appeal does not meet the conditions in section 16.3). 

Procedural and Case Background

A. Notice of Award Termination

NIH awarded a cooperative agreement (award no. UH3DE030063-03)4 to the Institute for the purpose of developing, implementing, and testing “a clinical decision support

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intervention in dental clinics designed to combat oropharyngeal and oral cancer.”  Notice of Appeal (NA) at 1, 4; see also Ex. 2.5 

By letter dated March 10, 2025, NIH terminated the award pursuant to the 2024 NIH GPS and 2 C.F.R. § 200.340.  Ex. 1, at 1. The letter states that the NIH GPS, incorporated into all NIH awards, permits NIH to terminate awards as outlined in 2 C.F.R. § 200.340.  Id. (citing NIH GPS at IIA-155).  The letter notes that section 200.340 authorizes federal agencies to terminate awards “‘to the greatest extent authorized by law, if an award no longer effectuates the program goals or agency priorities.’”  Id. (quoting 2 C.F.R. § 200.340(a)(2) (eff. Aug. 13, 2020)).  The letter states that “[t]his award no longer effectuates agency priorities,” and that the premise of the Institute’s project “is incompatible with agency priorities, and no modification of the project could align the project with agency priorities.”  Id. 

The letter further notes that the Institute “may object and provide information and documentation challenging this termination,” which it described as “a first-level grant appeal procedure that must be exhausted before you may file an appeal with the Departmental Appeals Board.”  Id. at 2 (citing 42 C.F.R. Part 50, Subpart D).  NIH instructed the Institute to submit any request for review to NIH.  Id.  The Institute then filed a first-level appeal with NIH. 

By letter dated August 19, 2025, NIH denied the Institute’s appeal (described as a request for reconsideration), stating that it terminated the award because “the research activities do not align with the agency’s priorities.”  Ex. 2.  The letter states that NIH was upholding the termination because, among other things, the project was “focused on gaining scientific knowledge on why individuals are hesitant to be vaccinated” and, therefore, “this project does not support the agency’s priorities.”  Id.  NIH did not assert, either in the initial termination notice or reconsidered decision, that the Institute failed to comply with the terms of the award.  No appeal rights were offered in the reconsidered decision. 

B. Notice of Appeal

On September 17, 2025, the Institute filed a notice of appeal with the Board, challenging the award termination as “unlawful” and “entirely unrelated to the scope, progress, and administration” of the project.  NA at 1.  The Institute states that it brought this appeal “pursuant to 45 C.F.R. Part 16 and Section 8.7 of the NIH Grants Policy Statement, incorporated by reference into the terms of the Grant Project’s grant agreement.”  Id.

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On September 30, 2025, the Board acknowledged receipt of the notice of appeal but advised the parties that the Chair was “currently evaluating whether the Board has jurisdiction to review the agency decision described in the notice of appeal.”  Dkt. 4.

Analysis

I. The appeal does not concern a final written decision reviewable by the Board under 45 C.F.R. Part 16, Appendix A.

The Board lacks jurisdiction over this matter because the award termination does not fall within any of the categories of disputes reviewable by the Board under 45 C.F.R. Part 16, Appendix A.  Although this dispute arises under an “HHS program authorizing the award of direct, discretionary project grants or cooperative agreements,” the appealed decision is not a disallowance, a termination for failure to comply with the terms of the award, a denial of a noncompeting continuation award for failure to comply with the terms of a previous award, or a voiding.  See 45 C.F.R. Part 16, App. A ¶ C(a)(1)-(4).  The record reflects that NIH terminated the award under 2 C.F.R. § 200.340(a)(2) having determined that the award no longer effectuates or aligns with agency priorities.  See Ex. 1 (initial notice), Ex. 2 (reconsidered decision).  As the Board previously concluded in several similar cases, we have no authority to review the award termination at issue.  See, e.g., William Marsh Rice University, Ruling No. 2025-4 (Sept. 30, 2025).6 

In 2020, the Office of Management and Budget (OMB) issued revised guidance regarding federal award terminations under 2 C.F.R. § 200.340.7   The revised guidance replaced the “for cause” basis for termination with a provision authorizing federal awarding agencies to terminate an award “to the greatest extent authorized by law, if an award no longer effectuates the program goals or agency priorities.”  Compare 2 C.F.R. § 200.339(a)(2) (eff. to Aug. 12, 2020) with 2 C.F.R. § 200.340(a)(2) (eff. Aug. 13, 2020).  OMB stated that it revised section 200.340 “to strengthen the ability of the Federal awarding agency to terminate Federal awards, to the greatest extent authorized by law, when the Federal award no longer effectuates the program goals or Federal awarding agency priorities.”  See 85 Fed. Reg. 49,506, 49,507 (Aug. 13, 2020).  OMB further stated that it was “eliminating the termination for cause provision because this term is not substantially different than the provision allowing Federal awarding agencies to terminate Federal awards when the recipient fails to comply with the terms and conditions.”  Id. at 49,508.

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OMB retained, as a separate basis for termination, the awarding agency’s authority to terminate an award if a grantee “fails to comply with the terms and conditions” of the award.  Compare 2 C.F.R. § 200.339(a)(1) (eff. to Aug. 12, 2020) with 2 C.F.R. § 200.340(a)(1) (eff. Aug. 13, 2020).  As further explained below, NIH made section 200.340 applicable to NIH awards through the NIH GPS.8   HHS, however, has not amended Part 16, Appendix A, or issued other regulations authorizing the Board to review an award termination based on an awarding agency’s determination that an award no longer effectuates program goals or agency priorities. 

The Institute argues that the Board has jurisdiction over this matter pursuant to 45 C.F.R. Part 16, App. A, ¶ C “because the Grant Project was necessarily terminated for failure to comply with the terms of the award (although, as a factual matter, HealthPartners complied will all terms and conditions of its award).”  NA at 5-6.  The Institute notes that section 200.340(a)(4)9 falls under a subsection entitled “remedies for noncompliance” and asserts that NIH GPS § 8.5.2 only permits NIH to terminate an award for noncompliance.  Id. at 6.  These arguments are both unfounded and unpersuasive. 

First, the assertion that NIH “necessarily” terminated the award for noncompliance contradicts the plain language of the initial termination notice and reconsidered decision, neither of which alleged that the Institute failed to comply with the terms of the award.  Indeed, NIH stated in the initial termination notice that the award was terminated pursuant to the NIH GPS and 2 C.F.R. § 200.340(a)(2) because the “award no longer effectuates agency priorities.”  Ex. 1, at 1.  Similarly, the reconsidered decision upheld the award termination on grounds that “the research activities do not align with the agency’s priorities.”  Ex. 2.  While 2 C.F.R. § 200.340(a)(1) authorizes agencies to terminate an award if the non-federal entity “fails to comply with the terms and conditions” of the award, NIH did not rely on that provision here. 

Second, the Institute’s assertion that NIH could only have terminated the award for noncompliance is contradicted by the plain language of the NIH GPS, which (as the

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Institute noted) is part of the terms and conditions of the award.  See NIH GPS at IIA-1 (§ 3) (“Part II includes the terms and conditions of NIH grants and cooperative agreements and is incorporated by reference in all NIH grant and cooperative agreement awards.”); see also Targazyme at 1-2.  NIH GPS § 8.5.2 provides:

If a recipient has failed to comply with the terms and conditions of award, NIH may take one or more enforcement actions which include disallowing costs, withholding of further awards, or wholly or partly suspending the grant, pending corrective action.  NIH may also terminate the grant in whole or in part as outlined in 2 CFR Part 200.340.

NIH GPS at IIA-155 (emphasis added).  Section 200.340 authorizes federal awarding agencies to unilaterally terminate a federal award for several reasons:  (1) “if a non-Federal entity fails to comply with the terms and conditions of a Federal award”; (2) “to the greatest extent authorized by law, if an award no longer effectuates the program goals or agency priorities”; or (3) “pursuant to termination provisions included in the Federal award.”  2 C.F.R. § 200.340(a)(1), (2), (5) (Aug. 13, 2020).10   Thus, the notion that NIH could only terminate an award if the grantee fails to comply with the terms and conditions of the award is unsupported by the NIH GPS, 2 C.F.R. § 200.340, and the terms of this award.   

Third, the Institute is conflating the jurisdictional question with a different one:  whether NIH had the legal authority to terminate the award under section 200.340(a)(2) based on a change in agency priorities.  NA at 5-6.  The question of Board jurisdiction, however, does not turn on whether NIH lawfully terminated the award due to a change in agency priorities or whether NIH lawfully incorporated 2 C.F.R. § 200.340 into the NIH GPS before its adoption by HHS.  Those questions go to the merits of the dispute.  The question for purposes of determining jurisdiction, and the only issue decided here, is whether the challenged decision is the type of final written agency decision reviewable by the Board under 45 C.F.R. Part 16, Appendix A.

With respect to discretionary grants or cooperative agreements, the Board may review a final agency decision terminating an award “for failure to comply with the terms of [the] award.”  45 C.F.R. Part 16, App. A, ¶ C(a)(2).  The Board is not authorized under Part 16, Appendix A to review other types of terminations arising under direct, discretionary project grants or cooperative agreements.  Cf. Dignity, LLC, DAB No. 3121, at 22-23 (2023) (holding that the Board has no authority under Appendix A to review an agency decision denying a non-competing continuation award, except to the extent that the denial is based on the grantee’s failure to comply with the terms and conditions of the prior

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award).  Again, to obtain Board review of a final agency decision, all regulatory conditions for review must be satisfied, including the requirement that the appealed decision be reviewable under Part 16, Appendix A.  See 45 C.F.R. § 16.3; see also Dignity at 22-23.  That requirement is not satisfied here.

Finally, Appendix A states that “[d]isputes under programs not specified in this appendix” may be reviewed by the Board if such review is authorized by a “program regulation” or “memorandum of understanding between the Board and the head of the appropriate HHS operating component or other agency responsible for administering the program.”  45 C.F.R. Part 16, App. A, ¶ A.  However, no program regulation or memorandum of understanding authorizes the Board to review disputes concerning NIH award terminations based on the agency’s determination that an award no longer effectuates or aligns with “agency priorities.” 

II. NIH’s preliminary appeal process under 42 C.F.R. Part 50, Subpart D is inapplicable.

The Institute further argues that the Board has jurisdiction because the Institute exhausted the preliminary appeal process offered by NIH.  NA at 5.  While the initial termination notice (Ex. 1) referenced 42 C.F.R. Part 50, Subpart D, the mere reference to Subpart D is insufficient to confer the Board with jurisdiction over this matter.  The appeal process under Subpart D applies to certain “adverse determinations” under discretionary project grants, none of which apply here.  See 42 C.F.R. § 50.404(a)(1)-(4).  The appealed decision is not a termination for failure to comply with the terms of the award, a disallowance of an expenditure charged to the grant or failure to account for grant funds, a determination that a grant is void, or a denial of a noncompeting continuation award for failure to comply with the terms of a previous award.  See id.  Thus, for the same reasons that the award termination is not reviewable by the Board under 45 C.F.R. Part 16, Appendix A, ¶ C, it is not subject to the preliminary appeal process under 42 C.F.R. Part 50, Subpart D.

Conclusion

The Board’s jurisdiction is limited, and no statute, regulation, or delegation of authority confers the Board with jurisdiction to review this matter.  I therefore reject the Institute’s appeal for lack of jurisdiction.