States’ Education Reclamation Act of 2025

This proposal would shut down the U.S. Department of Education and send that federal education money straight to the states instead. From 2025 through 2033, each state would receive yearly grants equal to what it got for K–12 and college programs in 2025 (not counting programs that move to other agencies). States could use the funds for any education purpose allowed by their own laws, but the money must add to, not replace, state and local funding and be spent within the same or next year .

States would face annual independent audits and public reports. If a state doesn’t follow the rules or misses audits or reports, the Treasury can withhold or reduce future payments. Programs paid with these funds must follow civil rights laws that ban discrimination based on disability, sex, race, color, or national origin, with enforcement if a state fails to comply .

Some current federal education programs would move to other departments within 24 months. For example, job training programs would move to Labor; special education grants and the Institute of Education Sciences to Health and Human Services; Indian education to Interior; Impact Aid to Defense; and Pell Grants and federal student loans to the Treasury. Only program responsibility moves—not agency staff. A federal watchdog (GAO) would study the long-term funding approach, and the President would submit a plan to close the department within one year .

Key points

• Who is affected: Students, families, teachers, school districts, colleges, and state education agencies.
• What changes: Federal education oversight ends; money goes directly to states; audits and public reports are required; anti-discrimination rules still apply; several programs shift to other federal departments .
• When: Grants run 2025–2033; program transfers happen within 24 months; the closure plan is due within 1 year of enactment .