States’ Education Reclamation Act of 2025
This bill, the States’ Education Reclamation Act of 2025, would abolish the U.S. Department of Education and replace federal administration of most education programs with state funding and control. It creates 2025–2033 grant funding to states for both K-12 and postsecondary programs, to be distributed by the Treasury and used to supplement, not supplant, state and local funding. The act outlines a process to transfer many existing DOE programs to other federal departments (e.g., career and technical education to Labor, special education to Health and Human Services, Pell Grants and federal student loans to Treasury) and requires the President to submit a plan for closing the Department within a year. It also imposes extensive state-level auditing, reporting, and compliance requirements, with penalties for misuse and nondiscrimination protections. The overarching aim is to shift power from a centralized federal department to states, communities, and families, arguing that local control will improve educational outcomes. Potential impacts include a dramatic shift in who governs education policy, how funds are used, and how accountability is enforced. States would receive grants equal to their 2025 federal education funding levels through 2033, but would face new reporting, auditing, and potential penalties if funds are misused or if nondiscrimination requirements are not met. Some health, labor, and defense agencies would increasingly oversee education-related programs after transfer, potentially altering program administration and oversight.
Key Points
- 1Abolition of the Department of Education. All DOE programs become repealed unless transferred under section 7, including the Department of Education Organization Act and the General Education Provisions Act.
- 2State grants for education. States receive annual grants (through 2033) for both elementary/secondary and postsecondary education, equal to their 2025 federal funding levels, with requirements to supplement—not supplant—nonfederal funding and to use funds per state law.
- 3Accountability and penalties. States must contract with approved auditing entities to audit grant expenditures; penalties require repayment to Treasury for misused funds, with offsets if unpaid; annual reporting to the Treasury and state legislatures; public disclosure of reports.
- 4Transfer of DOE programs. By 24 months after enactment, key programs are transferred to other federal agencies (e.g., Labor, HHS, Interior, DoD, Treasury) with a limit on transferring personnel; governance shifts to new agencies rather than remaining DOE staff.
- 5Oversight and planning. The Treasury and the Attorney General have limited but defined roles in oversight; GAO must report feasibility of tax-based funding shifts and agency successors; the President must submit a plan for closing DOE within one year.