University of North Carolina at Charlotte, Ruling No. 2026-17 (2026)

REJECTION OF APPEAL

University of North Carolina at Charlotte (the University) seeks Departmental Appeals Board review of a decision by the National Institutes of Health (NIH) to terminate a research grant issued to the University.  The Board lacks jurisdiction over this matter because the grant termination does not fall within any of the categories of disputes reviewable by the Board under 45 C.F.R. Part 16, Appendix A.  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 concerning grants.  See 45 C.F.R. Part 16, App. A, ¶¶ B, C.  A grant is a type of federal financial assistance that provides 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,” and “grant agreement or grant”); 31 U.S.C. § 6304 (grant agreements).  Research grant awards made by NIH are subject to general terms and conditions, as well as any special terms and conditions specified 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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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

1. Notice of Grant Termination

NIH terminated the University’s grant (award no. R01AI178992-02) on April 21, 2025.  Dkt. 1, at 1.  According to the University, the termination notice indicated that NIH terminated the award pursuant to 2 C.F.R. § 200.340(a)(2) having determined that the award “no longer effectuates agency priorities.”  Id. at 2.3  On or about May 20, 2025, the University submitted a request for reconsideration to NIH arguing, among other things, that the award should be reinstated because:  (i) the grant does not have any DEI component; (ii) the grant was awarded based on its merits; (iii) when the grant was awarded it was consistent with NIH priorities; and (iv) NIH misapplied section 200.340(a)(2) by terminating the grant “without regard to the specific facts of the project.”  Id. at 1-4.   

By letter dated February 17, 2026, NIH denied the University’s reconsideration request, stating that it “terminated the project on the grounds that the research activities do not align with the agency’s priorities.”  Dkt. 1a (reconsidered decision).  The letter further states that “[t]he program that supported this award was terminated because it no longer aligned with NIH/HHS priorities” and, consequently, grants awarded under this program “can no longer be supported.”  Id.  NIH did not assert that the University failed to comply with the terms of the award.  To the contrary, the reconsidered decision states that “NIH encourages the awardee to submit a new application that aligns with NIH’s priorities under one of NIH’s active [notice of funding opportunities].”  Id.  No appeal rights were offered in the reconsidered decision. 

2. Notice of Appeal

On March 12, 2026, the University filed a notice of appeal (NA) with the Board, requesting review of NIH’s grant termination decision.  Dkt. 1.  The notice of appeal appears to be a copy of the request for reconsideration that the University submitted to NIH in May 2025.  Id.  The notice of appeal does not address the Board’s jurisdictional requirements under 45 C.F.R. Part 16.

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Analysis

1. 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 grant 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,” 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 having determined that it “no longer effectuates agency priorities.”  Dkt. 1, at 2; see also Dkt. 1a (reconsidered decision).  As the Board previously concluded in several similar cases, we have no authority to review the NIH grant termination at issue.  See, e.g., Clark Atlanta Univ., Ruling No. 2026-8 (Dec. 30, 2025).4

In 2020, the Office of Management and Budget (OMB) issued revised guidance regarding federal award terminations under 2 C.F.R. § 200.340.5  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.”  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.  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

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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).6 

NIH made section 200.340 applicable to NIH grants through the NIH GPS, which is part of the standard terms and conditions of all NIH awards.  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 1-2.7  HHS, however, has not amended Part 16, Appendix A, or issued other regulations authorizing the Board to review a grant termination based on an awarding agency’s determination that an award no longer effectuates program goals or agency priorities.

The University acknowledges that “a change in Agency priorities is generally an allowable reason to terminate grants in 2 C.F.R. § 200.340(a)(2),” but argues that NIH misapplied the regulation by terminating its grant “without regard to the specific facts of the project.”  Dkt. 1, at 2-3.  The question of Board jurisdiction, however, does not turn on whether NIH lawfully terminated the grant due to a change in agency priorities.  Whether NIH appropriately terminated the award under section 200.340(a)(2) goes 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, 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.  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 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.

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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 University’s appeal for lack of jurisdiction.