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Texas Teachers' Union Sues Over Paused Federal School Funds

Texas AFT, representing 66,000 school employees, joins a lawsuit over the paused release of $6 billion in federal education funds, citing risks to jobs and programs.

Published July 24, 2025 at 11:00am


The Texas American Federation for Teachers, which represents 66,000 school employees, is among a handful of teachers’ unions and school districts nationwide that filed a lawsuit this week over the paused release of $6 billion in federal funding.

The lawsuit claims that because of the funding pause, some members of the unions are at immediate risk of losing their jobs or access to training and support, and that districts could lose critical funding.

State education agencies expected the U.S. Department of Education to release the funds July 1. At the end of June, however, the department notified states it was instead reviewing those funds, which pay for programs such as English language learning, academic enrichment and education for children of migratory workers.

According to the lawsuit, school districts “have had to cancel orders for new curriculum, delay critical teacher training, pause contracts for services for English language learners, or take other actions to avoid incurring expenses that they cannot afford to pay.”

The lawsuit was filed Monday in the U.S. District Court of Rhode Island and follows one filed last week by more than 20 states over the same pause on federal funds.

The uncertainty about this chunk of federal funding — about $661 million for Texas, according to an analysis by the Learning Policy Institute — comes at a time when many school districts in the state are facing particularly tight budgets, said Zeph Capo, president of Texas AFT.

“The ink was barely dry on the first increase in state funding for public schools in six years when we learned that previously reliable federal funding was being withheld,” Capo said.

This year, state lawmakers approved a $8.5 billion bump for public schools, the first comprehensive increase in state funding for public schools since 2019.

“Now, we're farther behind again, with districts across the state worried about finding money to support hundreds of staffing positions that provide on-the-ground, essential support for students,” Capo said.

Also on Monday, Austin school district Superintendent Matias Segura posted a letter to families warning that the loss of federal funds could require the district to reassess the depth of programming available for students.

“We will be evaluating how to make the most of our remaining resources, which may mean restructuring some programs, consolidating efforts or scaling back in areas where we can no longer sustain the same level of support,” Segura said in the letter. “These are not decisions we take lightly, and they will not be made without careful planning.”

The Austin district receives about $9.6 million from the funds that had been on hold as of July 1, Segura told reporters last week. He said those funds pay for all or part of the salaries of 109 district employees.

On Friday, the Education Department announced it would reverse course and release about $1.3 billion of the withheld $6 billion. The funding is specifically for 21st Century Community Learning Centers, which fund academic enrichment during non-school hours.

Texas is set this year to receive about $130.6 million in 21st Century funding, which pays for programs like the Boys & Girls Club.