Federal Policy Watch

Welcome to Federal Policy Watch, a regular blog series from OAESA designed to keep our members informed about federal decisions that directly impact PreK-8 education. These updates are provided by OAESA’s Federal Relations Representative, Dr. Nick Neiderhouse, and will highlight key policy developments, funding decisions, and national conversations shaping the work of school leaders. Our goal is to ensure you have timely, relevant information to navigate the shifting federal landscape with confidence and clarity.

Funding

Withholding of FY25 Funds

The Trump administration’s Office of Management and Budget withheld FY25 funding that was supposed to be sent to states on July 1 for several K-12 programs: Title II, Title III, Title IV-A, Title IV-B, Title I migrant grants, and adult education. 

The freeze disrupted local activities and posed challenges to state and local budget decisions in the months leading up to July 1 as the Department did not provide the state allocations for each of these programs that would have helped with budget planning.

The money was eventually released after pressure from congressional leaders though some offices were only willing to intervene with OMB and the Department of Education privately, behind the scenes.

FY26

The Trump administration’s FY26 budget request proposed major cuts to K-12 formula grant programs, including most of those whose FY25 funding was withheld in July. More broadly, the White House plan would have eliminated nearly three dozen programs and consolidated the funding into a $2 billion block grant to states (resulting in a net loss of funding of more than $4 billion).

The Senate Appropriations Committee approved a funding bill that is very encouraging which maintains funding at the current levels for most K-12 programs and also slightly increases funding for Title I, Title IV-A, IDEA Part B, and Head Start.

The House Appropriations Subcommittee marked up their budget for FY26 which included eliminating Title II and Title III and cutting Title I by $4.7 billion. (Note: since the FRC meeting the House Appropriations Committee approved the bill without changing the funding levels.) 

The big differences between the competing funding bills will require significant negotiations among congressional leaders and the Trump administration.

The One Big Beautiful Bill

Medicaid will be cut by more than $900 billion in 2027. Coverage will be reduced and more costs will be shifted to states and their Medicaid budgets which will likely put pressure on state K-12 budgets. In addition, funding for school-based health services reimbursements will likely be reduced as well. 

Supplemental Nutrition Assistance Program (SNAP) will be cut by nearly $400 billion and similarly shift costs to states that will pressure other state budget items like K-12 education. In addition, the number of students enrolled in or eligible for free and reduced-price lunches is expected to decrease. 

A voucher tax plan was enacted that creates a dollar-for-dollar federal tax credit for individual taxpayers who donate up to $1,700 to “Scholarship Granting Organizations.” These organizations can use these contributions to pay for students’ private school tuition (i.e., “scholarship”). States must approve the creation of these SGOs. Importantly, eligible expenses do include public school expenses like technology or tutoring much like Coverdale Education Savings Accounts. Individuals can contribute to scholarship organizations in other states if they choose.

U.S. Department of Education

Penny Schwinn, the nominee to be Deputy Secretary of Education – the 2nd ranked official in the Department, withdrew from consideration. Instead, the former Tennessee Commissioner of Education will serve as a senior advisor to Secretary McMahon. The role does not require Senate confirmation. No new nominee has been named.

The appointment of Kirsten Baesler, the current state superintendent in North Dakota, to be the Assistant Secretary for Elementary and Secondary Education was approved by the Senate HELP Committee in May and is pending a full Senate vote.

Mahmoud v. Taylor Supreme Court Decision

The Supreme Court ruled that parents need to be provided with the option to opt-out of lessons because of their religious views. The specific case involves LGBTQ related reading material in the elementary grades. It is possible that advocates will invoke this decision in schools and districts across the country this school year.  

FCC

FCC Chairman Carr is proposing to eliminate the use of E-rate funds for loaning out Wi-Fi hotspots to students for home use or Wi-Fi on school buses. The decision is expected to be approved at the FCC’s next meeting at the end of September. 

Questions can be directed to OAESA Federal Relations Coordinator: Dr. Nick Neiderhouse at nneiderhouse@rossfordschools.org