Joanna Snearly
August 7, 2026
Next Steps for Foreign Assistance Reform
The 2nd Trump Administration has made unprecedented progress in the reform of Foreign Assistance in the U.S. Department of State (Department). The elimination of many wasteful programs, the consolidation of USAID into the Department, and a reorganization has established a strong foundation for a foreign assistance system in alignment with U.S. foreign policy goals. This more disciplined use of public funds has increased accountability to the American people. As a next step, a more streamlined administrative structure for federal assistance programs (grants/cooperative agreements) would provide support for this new foundation.
In July of 2025, Senate Foreign Relations Committee Chairman James Risch described the Department’s reorganization as a “good start” and “first step” toward a more effective foreign-policy organization.
The Department’s FY 2026 Congressional Budget Justification (CBJ) further establishes the basis for continued reform. The CBJ states its intention to streamline programs and operations, improve efficiency, align resources with national interests, and complete the integration of selected USAID programs and management resources. The request identifies targeted staffing increases as necessary to ensure that Department bureaus possess the capacity and expertise required to implement and oversee transferred programs.
It also states that the Department will review and integrate foreign-assistance design, monitoring, evaluation, training, and related support mechanisms as it assumes additional programming responsibilities. It separately commits to improving foreign-assistance data quality, transparency, and accuracy throughout the data lifecycle. The CBJ also states that integrating assistance functions into State is intended to improve “efficiencies” and enhance “efficiency, accountability, uniformity, and strategic impact.” It criticizes overlapping mandates, blurred reporting lines, duplication, excessive processing time, and involvement by too many individuals.
In addition, the need for continued improvement was identified in the Department's OIG May 2025 report, Evaluation of the Department of State’s Approach to Realigning U.S. Agency for International Development Functions, AUD-GEER-25-20.
The OIG recommended permanent senior level accountability, evaluation of the Department’s workforce capacity and completion of an implementation plan to name a few.
In the July 2026 OIG follow up report, Evaluation of Department of State Administration of Foreign Assistance Programs Transferred from the U.S. Agency for International Development, AUD-FA-26-17, recognizes resolutions pending further action. It also documents the scale and complexity of the Department’s new responsibilities. Seventeen bureaus and offices were responsible for 1,504 transferred programs and associated awards with $51.5 billion obligated and an expected cost exceeding $86 billion across approximately 100 countries. OIG identified continuing problems involving staffing, personnel training, access to information-technology systems, award guidance, and the completeness and accessibility of award data. OIG concluded that these conditions negatively affected the Department’s ability to administer the transferred programs effectively and efficiently.
OIG further found that Department organizations were developing different operating arrangements. Seven of the sixteen responding entities planned to manage transferred awards differently from their existing Department awards, while other entities planned varying combinations of Washington-based personnel, regional assistance hubs, overseas posts, Bureau of Global Acquisition (GA) Grants Officers, and locally employed staff. These differing approaches create a risk of inconsistent procedures, uneven workloads, duplicative functions, and unclear administrative accountability.
Recent GAO reporting illustrates the need for reliable Department wide data and portfolio visibility. In a June 2026 review of approximately 470 State and USAID projects, GAO found that officials lacked readily available and reliable information about the projects’ types and status. Information had to be requested from separate bureaus and overseas posts and compiled from multiple sources, resulting in incomplete data and errors. GAO recommended complete and periodically updated information identifying award numbers, responsible bureaus or posts, geographic locations, timeframes, funding, and strategic purpose.
In March of 2026 GAO identified weaknesses involving fraud-awareness training, screening and vetting, and oversight of subawardees.
A practical approach for a solution to more effective grants management would be to further centralize management controls and specialized support required to execute Foreign Assistance programs. Consolidating repeatable functions in a central office reduces duplicative efforts at the bureau level. Housing grants management expertise in one office would allow the Department to deploy staff where they are most needed, give leadership a clearer view of the overall portfolio, and apply consistent data standards, risk control, and administrative practices across bureaus. Regional and functional bureaus would retain responsibility for program design, conception, technical expertise and foreign policy objectives and share the monitoring function with the centralized administrative experts.
The current Foreign Affairs Manual assigns the Bureau of Global Acquisitions (GA) responsibility for centralized federal-assistance policy, training, and oversight and assigns the Bureau of Global Acquisitions, Federal Assistance Management (GA/FAM) responsibility for executing a shared-services federal-assistance and grantmaking operations.
Hence, the Department should designate the Bureau of Global Acquisitions (GA) Federal Assistance Management (FAM) organization as the centralized provider of all administrative grants-management services for Department federal assistance programs (grants, cooperative agreements and other federal assistance instruments). Building upon GA’s existing responsibilities rather than establishing a duplicative organization allows the Department to utilize an existing management structure.
Centralization would permit GA/FAM to establish and strengthen its operational capacity and functional support (See diagram below):
The Department needs one accountable operating structure for the administrative work presently distributed across multiple bureaus, offices and posts.
GA is the appropriate location because the Department has already assigned it the relevant Department-wide responsibilities. Formal designation of GA as the administrative service provider for all foreign assistance awards (grants, cooperative agreements and other federal assistance instruments) would complete this existing structure rather than create a new or competing organization.
The proposed organizational structure combines centralized accountability with portfolio-based services. Portfolio teams would provide regional and functional bureaus with dedicated grants-management support throughout the award lifecycle. Common functional capabilities would establish uniform data, workforce, IT systems, risk analysis, training, and field-support practices across those portfolios. Grant personnel could remain embedded with bureaus, regional hubs, and/or overseas posts where operationally necessary, while their professional supervision, standards, systems, and workload management would reside in GA.
Centralization in GA would also give Department leadership a single accountable source for all Department grant portfolios. Leadership would be able to identify who is responsible for each award, which recipients and awards present elevated risk, whether required monitoring has occurred, whether award data are complete, and whether findings and closeouts remain unresolved. A centralized administrative structure provides leadership with consistent access to awards and greater visibility and awareness into Department programs.
