In the biggest education headline this week, Secretary of Education Linda McMahon announced sweeping changes to federal funding for Minority-Serving Institutions. The Department will end discretionary grants to programs that use racial or ethnic quotas, following a determination by the U.S. Solicitor General that these practices likely violate the Fifth Amendment’s equal protection principles. According to Secretary McMahon, “Discrimination based upon race or ethnicity has no place in the United States. The Department looks forward to working with Congress to reenvision these programs to support institutions serving underprepared or under-resourced students without relying on race quotas.” Grant recipients were notified that existing discretionary awards will not be continued, and no new awards will be made for fiscal year 2025. However, about $132 million in mandatory funding—such as for Alaska Native, Native Hawaiian, and STEM-focused Hispanic-Serving Institutions—will still be distributed due to statutory requirements. The Department says it is reviewing the legal implications of even those remaining funds.

Amidst these major funding shifts, the Department of Education and Department of Labor revealed another joint initiative: a new portal to streamline state workforce development programs, integrating adult education, family literacy, and employment preparation. Funding and select staff for these programs will gradually move under Department of Labor management, with Secretary McMahon emphasizing that this “will allow states to more easily and efficiently administer their programs,” and that the reforms aim to create “commonsense” improvements for students, families, and the workforce.

Meanwhile, President Trump signed an executive order directing the Secretary of Education to facilitate the closure of the Department itself, aiming to empower states and local communities. This is a long-term goal requiring Congressional approval—a hurdle that currently lacks political support—but it signals a dramatic shift in federal education policy philosophy. Short-term uncertainties persist for programs like IDEA special education funding and Pell grants, and many organizations, including the American Speech-Language-Hearing Association, warn this could disrupt essential services for vulnerable students.

What’s the impact? For families and students, these changes could mean less direct federal support for colleges and schools that previously relied on targeted funding, particularly those serving under-resourced or minority populations. For states and local school districts, increased autonomy comes with added responsibility—and in some cases, shrinking resources. Businesses may see a workforce increasingly shaped by state and local education policy, as federal oversight recedes and workforce training merges more with labor initiatives. Internationally, policy reversals affecting diversity, equity, and inclusion, and increased scrutiny of international students, are creating additional instability on American campuses, as noted by the American Council on Education.

Listeners should be aware that all existing grants affected by the new policy will expire at the end of fiscal year 2025. For those concerned or wanting a voice, now is the time to engage your local representatives and participate in upcoming public comment windows on education regulations. For more information, check the Department of Education’s website and follow updates on Congressional hearings and federal register notices.

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