CED Newsletters & Policy Alerts

Federal K-12 Funding Freezes

July 24, 2025

Action: Nearly three weeks after freezing $6.8 billion in Federal K-12 school formula funding, the US Department of Education has released a portion of funds to support the 21^st Century Community Learning Centers (21^st CCLC), an after-school and summer learning program with strong bipartisan support. On June 30—just one day before the traditional disbursement date to states—the Department informed states that funding decisions were pending programmatic review. The move prompted an immediate lawsuit from a coalition of 23 state attorneys general and two governors, as well as a letter from 10 Republican Senators to the Office of Management and Budget (OMB), urging the release of funds.

This marks the second time this year that Federal K-12 education funding had been withheld, following a similar freeze in January that cited a review of funding activities potentially at odds with the President’s Executive Orders targeting “financial assistance for foreign aid, nongovernmental organizations, DEI [diversity, equity, and inclusion], woke gender ideology, and the Green New Deal” in Federal funding. The January pause was later rescinded after a lawsuit.

• The frozen funding covers seven Federal grant programs that were targeted for elimination in the President's FY 2026 budget proposal, including funding for migrant education, English-learner services, professional development, adult education, academic enrichment, and before- and after-school programs (the 21^st CCLC funding).
• The lawsuit alleges that the Federal funding freeze is illegal and seeks to restore funding that had already been budgeted to states for the 2025-2026 school year, which begins next month in approximately 80% of public school districts across the country.
• Senator Shelley Moore Capito (R-WV), chair of the Senate Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies, led the Republican letter, which urges the Administration to “release this Congressionally-approved funding to states.” It suggests that withholding funds contradicts the President’s goal of returning K-12 education authority to the states, since the local communities decide how the funding is used.
• While 21^st CCLC funds have now been released, the freeze stands for the remaining programs. The withheld funds will likely disproportionately impact students in rural areas, with disabilities, and from low-income families.