Gov. Shapiro sues Trump administration over withheld education funds as Supreme Court greenlights DOE layoffs

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The U.S. Supreme Court granted the Trump administration a major win Monday, allowing it  to fire more than 1,300 Department of Education employees. Those terminations, initiated in March, were previously put on pause by a judge who ordered employees be reinstated.

Meanwhile, Gov. Josh Shapiro joined a slew of Democratic states suing the federal government for withholding billions in already-approved K-12 dollars just before they were set to be distributed July 1. The Trump administration’s eleventh-hour announcement about the pause on funds left Pennsylvania short about $230 million. Data aggregated by New America using fiscal year 2022 records found that Philadelphia has the fourth-largest amount of dollars to lose out of all school districts across the nation.

“This week’s developments underscore a dangerous executive overreach that threatens students in Pennsylvania and across the country,” said Maura McInerney, Education Law Center-PA’s legal director. “The consequences for students — especially the most marginalized — are dire.”

Why is Gov. Shapiro suing the Trump administration?

In an email sent the day before states were set to access FY 2025 federal education dollars, the DOE broke years of precedent and stated that certain funding streams were under review to ensure their accordance with “the President’s priorities and the Department’s statutory responsibilities.” No clear timeline was provided.

Now, 23 states and the District of Columbia are suing the Trump administration, arguing that withholding the funds is illegal. Documents from Monday’s lawsuit described the move as “arbitrary and capricious, and unconstitutional.”

While most states had their attorneys general file litigation, Pennsylvania Republican Attorney General Dave Sunday did not join the lawsuit. Shapiro individually joined the list of state plaintiffs in his “official capacity as Governor” as he has in several other multistate lawsuits against the federal government this year.

“I’m suing to force the Trump Administration to deliver the money our students and schools were promised and are owed – critical funds that school districts rely on to meet their budgets, train high-quality teachers, provide afterschool programs for kids, and so much more,” Shapiro said in a statement. “Because if anyone tries to hurt students here in Pennsylvania, they’ll have to go through me.”

The missing funds accounted for at least $26,930,000 of Philadelphia’s school district budget last year. Title II-A, which supports teacher training and recruitment, provided $70 million to Pennsylvania and $9.13 million to Philadelphia in 2024; Title III-A, which supports language instruction for English-learning students, accounted for $20 million statewide and $4.6 million to Philly; Title IV-A, which supports academic enrichment, school conditions, student well-being and technology use, delivered $55 million to the state, $13.2 million of which went to Philly schools.

That’s in addition to the $12.6 million through Title IV-B, which was set to be distributed among dozens of Out-of-School Time providers in Philadelphia. Those dollars fund free after-school and summer enrichment programs, which are critical for working families struggling to afford childcare. Providers such as the Sunrise of Philadelphia are unsure whether they can maintain their after-school programs if their expected funding never arrives.

“We still have a lot of unanswered questions and don’t quite know what to tell our families yet,” Morgyn Yates, director of K-12 programs at Sunrise, said.

Dozens of staff positions at Pennsylvania’s Department of Education are funded through the withheld funding streams and are now also at risk, according to court documents. That includes 18 employees paid through Title II-A alone.

What does the Supreme Court DOE ruling mean?

The Supreme Court’s ruling does not amount to an immediate change to DOE functions because the nearly 1,400 affected employees have already been off-duty and in limbo since March. Among them is the entire staff of Philadelphia’s regional outpost for the DOE’s Office for Civil Rights.

The Trump administration issued terminations in March, placing those employees on administrative leave with full pay and benefits until June 9. In May, Massachusetts U.S. District Judge Myong Joun ordered the employees to be reinstated, arguing that the layoffs were functionally an attempt to dismantle the DOE — which only Congress has the right to do. DOE officials went through the motions of compliance, telling employees via email that they were planning to bring them back to work, while still appealing the case in court. Then, on Monday, the Supreme Court granted an emergency application from the Trump administration and blocked Judge Joun’s ruling.

The decision means that those employees can now be officially terminated. However, whether those layoffs are legal is still being ruled on in the lower courts.

The severity of the staffing cuts, if finalized, will make them difficult to reverse regardless of the courts’ ultimate ruling.

“Trying to undo them later would be kind of like trying to put fire back on a match,” NPR education correspondent Cory Turner explained.

The DOE is at half its original size, with only about 2,183 of the original 4,133 employees responsible for distributing critical funding streams to states, enforcing non-discrimination policy, gathering and sharing data on student performance and more.

Some of those functions have lagged in recent months since the reduction in force. The distribution of Title I funding took three times as long as it did last year. An annual report of national education data was significantly delayed before the department stated that it would be released on a rolling basis and then released a starkly small amount of data compared to past precedent. The Philadelphia Office for Civil Rights has been shuttered, leaving families in the region without the free legal mechanism to pursue civil rights complaints — that loss has an outsized impact on students with disabilities, who represent the largest portion of complaints handled by OCR.

The developments ultimately point towards “the erosion of civil rights protections,” McInerny said. “Lack of federal enforcement of disability laws is a devastating setback for students with disabilities who have thrived in supportive, inclusive classrooms.”