Government & Regulatory Affairs Semi-Annual Update

Bond, Schoeneck & King PLLC is pleased to share its July 2026 government & regulatory affairs semi-annual update in which we highlight key legislative, regulatory and enforcement developments that may affect businesses across a wide range of industries.

FEDERAL UPDATE

The U.S. Office of Management and Budget’s (OMB) proposed overhaul of the Uniform Guidance, in its enacted form, would significantly reshape how federal grant funding is awarded, managed and monitored. The proposed rule converts the Uniform Guidance into a binding government-wide regulation called the Uniform Grant Regulation, with a target effective date of Oct. 1, 2026. While the proposal’s goal is to improve accountability and ensure that funds are used and managed appropriately, it also creates new obligations and risks for organizations that rely on federal funding. Key changes include expanded federal control, elimination of fixed-amount awards and additional subrecipient monitoring requirements.

HIPAA-regulated entities have been granted additional time to prepare for major HIPAA Security Rule changes after the Department of Health and Human Services (HHS) delayed the expected final rule by one year, with the final action due in July 2027. The proposed changes would establish stricter cybersecurity requirements, including multi-factor authentication, encryption and expanded documentation obligations. While the changes are intended to strengthen protections, the proposed update has generated criticism regarding cost, complexity and implementation challenges. Organizations are encouraged to use this additional time to assess and strengthen their cybersecurity practices to ensure compliance ahead of the final rule.

On July 11, 2026, the 21st Century ROAD to Housing Act (H.R.6644) became law. Designed to address the nation’s housing crisis, the Act modernizes HUD programs and outdated banking regulations, reduces regulatory barriers and expands access to financing.

NEW YORK STATE UPDATE

Legislative Activity

The 2027 Enacted Budget is projected at roughly $277 billion (a 7% increase from 2026), with State Operating Funds spending projected to total $161.1 billion (an 8.3% increase from 2026). Approximately 60% of the increase can be attributed to Medicaid and School Aid, New York’s two largest assistance and grant programs.

New York counties and municipalities are increasingly enacting biometric privacy laws in response to growing concerns regarding personal data and lack of consent. New York City and Onondaga County’s laws focus on transparency and require notice prior to the collection of biometric information, whereas Erie County broadly prohibits the collection of biometric data unless an exception applies. Similarly, the City of Syracuse enacted a broad restriction on the use of biometric surveillance technologies in businesses and places of public accommodation. Together, these laws reflect a trend toward increased regulation of biometric technologies and heightened consumer privacy concerns across the state.

Employers may soon face new obligations under S.3460, a bill that would expand employee access to personnel records, require notice when negative information is added to an employee’s record and allow employees to submit responses for inclusion in their records. As of now, the bill has passed both the New York Senate and Assembly, though it has not yet been signed into law. Prior attempts to pass similar legislation, including in 2025, were unsuccessful. If signed into law by Governor Kathy Hochul, these new requirements would become effective 60 days after enactment.

On July 14, 2026, Governor Kathy Hochul signed an Executive Order establishing the nation’s first statewide moratorium on new data center development. Similarly, the Responsible Data Center Development Act (A.11560/S.10642), which would impose a one-year moratorium on new large data center permits and set energy efficiency goals for data centers, has passed both the New York Senate and Assembly but has not been signed by the Governor.

Regulatory Activity

Governor Kathy Hochul’s EXPRESS NY (Expediting Processes and Regulations to Enable Streamlined Services) initiative aims to reduce regulatory burdens and streamline interactions with state agencies by simplifying applications and compliance requirements, modernizing outdated processes and expanding digital access to certain government services. In a letter penned to New Yorkers, the Governor announced 50 specific actions targeting 22 state agencies (later formalized in a July 8, 2026, Executive Order).

New York’s new “Regulatory Reset,” launched through Executive Order No. 61 as part of the broader EXPRESS NY initiative, directs state agencies to conduct a comprehensive review of regulations, fees and administrative requirements to increase efficiency and eliminate “needless red tape.” So far, AI-tools have already identified thousands of opportunities for improvement, subject to human review by agency experts. 

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