What happened: Congress is advancing the Stopping Fraudulent Payments Act, which would authorize the Treasury Secretary to direct federal agencies to delay, condition, or segment disbursements — including grant payments — if the Secretary determines a payment presents an “elevated risk of fraud or an improper payment.” The bill passed the House Oversight Committee on a party-line vote and could move to the House floor soon. The National Council of Nonprofits has formally opposed the bill and is scheduled to meet with House Oversight staff on May 26 to share concerns.
Why it matters: On paper, this is an anti-fraud measure. In practice, it would give the Treasury Secretary new authority to order federal agencies to pause grant payments to organizations — even when the agency itself disagrees — based on vague and undefined criteria about what constitutes “elevated risk.” NCN’s core concern is that this bill codifies and expands authority that has already been used against nonprofit grantees over the past 18 months, with minimal safeguards against politically motivated application. Very few key terms in the bill are defined, making it susceptible to abuse.
What nonprofits can do: Contact your U.S. House member and urge them to oppose or amend the bill. Organizations that receive federal grants should track this bill closely — if it passes, it creates a new mechanism through which disbursements can be delayed or conditioned in ways that are difficult to challenge.
Where things stand: The bill awaits a House floor vote. NCN meets with House Oversight staff on May 26. PANO will share updates following that meeting and when a floor vote is scheduled.
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