Education research advocacy groups filed a lawsuit in late June against the Department of Education and Office of Management and Budget over the handling of fiscal year 2025 funds allocated to the Institute of Education Sciences. Congress originally provided $768 million to IES for that fiscal year, with a two-year spending deadline ending September 30. The plaintiffs assert that while public records suggest the White House released most funds in May, approximately $316 million remained unobligated with no clear spending plan disclosed.
IES Acting Director Matthew Soldner committed on August 4 to spending remaining funds in a timely manner, but education research groups including the National Center for Learning Disabilities and the Knowledge Alliance argue the commitment lacks specificity. They contend the spending plan was kept private until after the lawsuit was filed and estimate it still leaves $10 million unapportioned. The plaintiffs maintain that even if all funds are eventually spent, the delay violated federal law and disrupted critical data collection and analysis needed for education policy decisions.
The funding dispute occurs amid significant upheaval at IES. The Trump administration has canceled over $1 billion in contracts and reduced staff from 191 employees before the administration took office to 30 by March 31, according to an inspector general report. Officials have indicated plans to restructure IES, with the agency director outlining proposals for fiscal year 2027 grant competitions.
Transparency has become a central issue in the case. The Department of Education declined to specify exactly how much funding was released by OMB or designated for particular projects. An analysis by Joseph Carlile, an education funding consultant and former OMB staffer, compared spending documentation and found obligations at lower rates than historical precedent, with the updated spending plan appearing less clear than previous versions and containing unexplained notes and discrepancies.
A federal judge will hear arguments on September 3 after the Trump administration files its motion to dismiss. The case carries broader implications for congressional authority over federal spending, with lawmakers and education policy experts emphasizing that only Congress holds constitutional power of the purse and that the executive branch must spend according to appropriations law.
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