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Latest Cases & Developments
Date:
H.R. 7148, “Consolidated Appropriations Act, 2026” Signed into Law (Feb. 3, 2026)
Congress passed, and the President signed into law, a five-bill FY26 spending package that includes language preventing the administration from imposing a 15 percent cap on indirect cost rates for grants. For the next fiscal year, federal agencies like the National Institutes of Health, the National Sciences Foundation, and the Department of Defense are required to use the negotiated indirect cost rates, applying the process as outlined in 2 CFR § 200.414 and to the same extent and manner applied in FY24. For more information on the language within the appropriations bills, the Association of Public & Land-Grant Universities (APLU) published a tracker compiling facilities and administrative (F&A) language across all FY26 appropriations bills.
Topics:
Contracts | Grants, Contracts, & Sponsored Research | ResearchDate:
Department of Education NPRM on Graduate Student Loan Eligibility (Jan. 30, 2026)
The Department of Education issued a Notice of Proposed Rulemaking (NPRM) which would establish new loan limits for graduate students, professional students, and parents, and phase out the Graduate PLUS Program. The proposal would also phase out existing Income-Contingent Repayment (ICR) plans, create a new tiered standard repayment plan option, and implement a new income-driven repayment plan known as the Repayment Assistant Plan. This action follows the Department’s announcement in November that the negotiators of the Reimagining and Improving Student Education (RISE) committee reached consensus on a definition of a professional degree. Comments are due by March 2, 2026 and, if finalized, the policy is set to take effect July 1, 2026.
Topics:
Financial Aid, Scholarships, & Student Loans | StudentsDate:
Gross v. Univ. of Toledo (N.D. Ohio Jan. 29, 2026)
Opinion Denying Defendant’s Motion to Dismiss. Plaintiff, a former faculty member and DEI Officer for the University of Toledo, brought Title VII discrimination and retaliation claims against the university, alleging the university failed to address his complaints of discriminatory conduct from his coworkers, and that he resigned in “utter frustration” after receiving a letter terminating his contract. In denying the university’s motion to dismiss, the court held that plaintiff was timely in exhausting his administrative remedies, finding that the university’s January 2024 termination letter did not constitute a final adverse employment action for purposes of triggering the 300-day EEOC filing period because (1) the letter stated that plaintiff’s Department Chair could reverse the decision, and (2) the termination was contingent on whether plaintiff “modified his behavior.” Instead, the court found that the operative adverse action occurred at the time of plaintiff’s resignation, which the court determined to be a constructive discharge based on the allegations in his complaint, including that (1) his complaints of discrimination were ignored; (2) he was discouraged from complaining further; and (3) the discriminatory conduct kept him from performing his assigned duties.
Topics:
Discrimination, Accommodation, & Diversity | Gender Identity & Sexual Orientation Discrimination | Race and National Origin Discrimination | RetaliationDate:
CRS Report on Universities and Indirect Costs for Federally Funded Research (Jan. 29, 2026)
The Congressional Research Service (CRS) issued a report on universities and indirect costs for federally funded research. The report includes discussion on fixed and negotiated rates, Office of Management and Budget (OMB) guidance, and considerations for policymakers, including additional or alternative approaches such as the Financial Accountability in Research (FAIR) model from the Joint Associations Group on Indirect Costs.
Topics:
Contracts | Grants, Contracts, & Sponsored Research | ResearchDate:
Department of Education’s OCR Resolution Agreement with San Jose State University for Title IX Violations (Jan. 28, 2026)
The Department of Education’s Office for Civil Rights (OCR) announced that it has found San Jose State University in violation of Title IX for allowing “males to compete in women’s sports and access female-only facilities.” The investigation, which began in February 2025, arose from allegations involving a student competing on the women’s indoor volleyball team and alleged retaliation against female athletes and an assistant coach who criticized the university’s gender identity policies. OCR also concluded that the university failed to promptly and equitably investigate Title IX complaints and took actions that discouraged women from participating in the Title IX process. The resolution agreement requires the university to: (1) “adopt biology-based definitions of male and female”; (2) separate athletics and intimate facilities based on biological sex; (3) refrain from delegating Title IX compliance to external entities and refuse to contract with any entity that discriminates on the basis of sex; (4) restore misappropriated athletic records and titles to female athletes; and (5) issue personalized apologies to affected female athletes, including athletes from other universities who forfeited their right to compete against the university.
Topics:
Athletics & Sports | Gender Equity in Athletics | Students | Title IX & Student Sexual MisconductDate:
Polk v. Montgomery Cnty. Pub. Schs. (4th Cir. Jan. 28, 2026)
Opinion Affirming Denial of Plaintiff’s Request for a Preliminary Injunction. Plaintiff, a former substitute teacher for Montgomery County Public Schools, sued the Montgomery County Board of Education alleging violations of Title VII and First Amendment free speech and free exercise rights, after her request for a religious accommodation from the board’s preferred pronoun policy was denied. While the district court allowed plaintiff’s Title VII claim to proceed, it dismissed her First Amendment claims and denied her motion for a preliminary injunction. In a 2-1 decision, the Fourth Circuit affirmed the lower court’s ruling, finding that plaintiff’s free speech claim failed because the challenged speech fell within a teacher’s official duties under Garcetti v. Ceballos and was not constitutionally protected. The court further found that plaintiff’s free exercise claim failed because the board’s policy was a neutral, generally applicable rule that survived rational basis review under the framework articulated by the Supreme Court in Employment Division v. Smith.
Topics:
Constitutional Issues | Discrimination, Accommodation, & Diversity | First Amendment & Free Speech | Gender Identity & Sexual Orientation DiscriminationDate:
Department of Energy Announcement Rescinding Prior Agency Guidance on Indirect Cost Rates (Jan. 27, 2026)
The Department of Energy announced that as a result of the signing of the annual appropriations bill to fund the Department, several “Policy Flashes,” capping the indirect cost rate at 15% are no longer in effect. Under section 313 of the appropriations bill, DOE is required to “apply the indirect cost rates, as described in 2 CFR § 200.414, including with respect to the approval of deviations from negotiated indirect cost rates to the same extent and the same manners that was applied in fiscal year 2024” and that the agency is prohibited from spending any appropriated funding to “develop, modify or implement” any changes to the negotiated indirect cost rate.
Topics:
Contracts | Grants, Contracts, & Sponsored Research | ResearchDate:
IRS FAQ on New Deduction for Qualified Overtime Compensation under OBBB (Jan. 23, 2026)
The Department of the Treasury and the Internal Revenue Service (IRS) issued a Frequently Asked Questions (FAQ) related to the new deduction for qualified overtime compensation under the One, Big, Beautiful Bill Act. The FAQ provides clarification on eligibility requirements for deductions as well as supplemental information on eligibility and other rules.
Topics:
Compensation & Benefits | Taxes & Finances
NACUA Annual Conference
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