National Security and Unallowable Costs
The U.S. Government and/or USDA may periodically identify unallowable elements of cost, whether tangible or intangible, funded or otherwise made available through cash, non-cash, or in-kind contributions through a financial assistance award, due to national security concerns. Such determination of unallowability due to national security may be prescribed by statute, regulation, Executive Order, or administration policy, or may be in furtherance of Secretary’s Memorandum (SM) 1078-014, and prevents American taxpayer dollars from supporting countries of concern or other foreign adversaries who want to undermine our national security.
Below is a table that identifies unallowable elements of cost, organized by the effective date of the determination of unallowability.
| # | Description of Cost | Authority | Effective Date |
|---|---|---|---|
| 1 | Any low-cost 3D printers manufactured by the following Chinese companies:
| SM 1078-014 | 7/28/25 |
| 2 | To procure a covered unmanned aircraft system that is manufactured or assembled by a covered foreign entity, or in connection with the operation of such a drone or unmanned aircraft system. “Covered foreign entity” is defined at P.L. 118-31, Sect. 1822. | P.L. 118-31, Sect. 1825 | 12/22/25 |
