On June 30, 2025, troubling news emerged from the U.S. Department of Education that will have widespread consequences for school districts and county offices across the country. The Department has informed states that they will not be receiving $6.9 billion in state grant funding that had already been enacted for this fiscal year (FY 2025). These funds were authorized by Congress and signed into law by President Trump in March. Many schools had already factored these funds into their budgets for the upcoming school year.

For California alone, the potential loss exceeds $800 million in expected funding—money that districts and county offices were relying on to support essential programs.

In two brief letters sent to the California Department of Education and other states, the U.S. Department of Education wrote:

“Given the change in Administrations, the Department is reviewing the FY 2025 funding for the [Title I-C, II-A, III-A, IV-A, IV-B] grant program(s), and decisions have not yet been made concerning submissions and awards for this upcoming academic year. Accordingly, the Department will not be issuing Grant Award Notifications obligating funds for these programs on July 1 prior to completing that review. The Department remains committed to ensuring taxpayer resources are spent in accordance with the President’s priorities and the Department’s statutory responsibilities.”

The immediate effect of this decision is the withholding of nearly $6.9 billion in FY 2025 state grant funds that were designated for adult education and several critical elementary and secondary education programs. The impacted funding includes:

• $376 million for Title I-C Migrant Education State Grants

• $890 million for Title III-A English Language Acquisition Grants

• $1.33 billion for Title IV-B 21st Century Community Learning Centers

• $1.38 billion for Title IV-A Student Support and Academic Achievement Grants

• $2.19 billion for Title II-A Supporting Effective Instruction State Grants

• $715 million for Adult Education State Grants

This development was entirely unexpected. Given the clear authorization by Congress and the President earlier this year, states had anticipated receiving these funds on July 1. While the President’s FY 2026 budget proposal does call for eliminating or consolidating many of these programs in the future, withholding already-enacted funding for the current fiscal year is almost certainly illegal and will likely be challenged immediately.

A recent Supreme Court ruling limiting nationwide injunctions may complicate the legal strategy, potentially requiring California to pursue its own litigation to resolve this issue.

Discussions with the Governor’s office are already underway, and efforts to develop a legislative and advocacy response are in progress.