The Delta Issue #60

The federal government is shut down. What does that mean for education?

Author: Catherine Pozniak and Kunjan Narechania

It’s official: The federal government is shut down, and no one knows how long it will last. While the headlines are focused on the political drama, the question for us at the Delta will always be: What does this mean for schools? The good news is that K-12 education funding is designed with some insulation from political gridlock. The bad news is that insulation doesn’t mean immunity — and for some districts, child care providers, and families, the effects of a shutdown could be felt sooner than they might expect.

Together with @Catherine Pozniak, we’re unpacking what a federal shutdown really means for schools, districts, and families. Here’s what you need to know.

How the federal government funds K-12 education

It’s important to start this conversation with two key pieces of background on federal funding:

1. Forward funding: Most K–12 grants (like Title I and IDEA) are “forward-funded,” meaning the money Congress approves this fall pays for the next school year. That nine-month buffer shields schools when Congress misses its budget deadlines. Right now, schools already have their 2025–26 federal allocations.
2. Reimbursement system: Federal funds are largely paid on a reimbursement basis. Districts spend first, then submit receipts to their state agencies, who in turn request funds from the federal government. For example, if a district uses its IDEA allocation to pay for special education paraprofessional salaries, it has to submit its payroll receipts to its state education agency (SEA) for reimbursement from its IDEA allocation. The SEA then submits those receipts to the federal government to withdraw those funds from the state allocation at the federal level. Normally this takes 3–4 days. Recently, scrutiny has slowed reimbursements. The Department of Education says that reimbursements will continue during the shutdown, however with fewer staff, the wait could stretch even longer.

So what does the federal government shut-down mean for districts and states?

Because federal K–12 dollars are forward-funded, schools already have their allocations for this year. That means districts can keep paying salaries, covering student services, and buying supplies – and classrooms won’t feel an immediate hit.School meals, however, are more vulnerable. Millions of students rely on them every day, and USDA’s contingency plan shows Child Nutrition Programs (CNP) only have enough carryover to cover October reimbursements. Breakfast and lunch will continue in the short term, but reimbursements require USDA staff to process them. If furloughs slow that work—or if the shutdown stretches on—delays and disruptions become far more likely.

The Department of Education’s September 28 shutdown plan confirmed that Title I and IDEA funding will remain available, and grantees can still draw down from the billions awarded over the summer. On paper, the impact “should be minimal.”

In practice, though, schools may experience delays in receiving their funds. Districts and states can spend money, but how soon will they be reimbursed? Even before the shutdown, ED had been taking longer to approve routine transactions. With most staff furloughed, those delays could easily worsen.

Programs on pause:

New grantmaking is frozen, so districts and organizations planning to apply to grant opportunities such as the recently announced Education Innovation and Research (EIR) grants might find those grant application cycles disrupted by the shut-down. Prospective grantees should continue to work toward the Department’s published deadlines unless there are updates.

There will also be a pause to technical assistance and investigations (including Office for Civil Rights reviews). For districts, this might translate to slower response times from their SEAs if the state needs to seek federal guidance.

The impact on Early Childhood

K–12 dollars are forward-funded, but early childhood funding isn’t. The Child Care Development Fund (CCDF), which helps working families pay for child care, is run by HHS’s Administration for Children and Families — and its grants are not forward-funded.

ACF has said states will still receive their mandatory CCDF dollars in mid-October, since those funds aren’t subject to Congressional approval. That provides some short-term stability, but states with little carryover could hit a funding cliff quickly if the shutdown drags on. HHS also funds Head Start, which has faced temporary closures during past shutdowns. Although very few Head Start grant cycles start on October 1st. The longer the shutdown continues, the greater the risk that more programs could be disrupted.

What can districts and states do to mitigate impact?

1. Stay the course: In times of uncertainty, it’s tempting to hit the pause button. But we recommend, to the extent possible, districts and states continue operations and spend federal funds as planned. Holding back out of caution makes it harder to demonstrate the need for federal funds. It’s understandable that uncertainty might lead people to cautiously hold and wait and see. It’s important that schools communicate the impact of this uncertainty or any delays to their SEA, which might be able to escalate support.
2. Plan for delays: Reimbursements may take longer, and questions about federal grants may go unanswered until the government reopens. Smaller, rural districts and charter schools are particularly vulnerable because they have fewer alternative funding streams. Superintendents should work with their business managers now to identify potential cash-flow risks, and prioritize the initiatives that matter most for students.
3. Communicate: State education agencies should be actively monitoring district situations, keeping communication lines open, and issuing state-specific FAQs about what the shutdown means for schools. Districts should look to SEAs for guidance so that they are getting the most accurate information for their local context. 

Let’s Get Muddy

State and district leaders: How else are you preparing for the potential for a long shutdown? What else would you add to our list?

Want more on the shutdown? @Mark Lieberman at @EdWeek is doing fantastic reporting so be sure to follow his work.