Three States Seek ESSA Waivers to Consolidate Education Funding

Louisiana, Iowa, and Alabama have submitted proposals to pool multiple federal education grant programs into single block structures controlled at the state level — a move that could reshape how billions in Title I and targeted education dollars reach schools and nonprofits.

Louisiana, Iowa, and Alabama Lead the Push

The three states are pursuing waivers under the Trump administration's "return to the states" initiative, which encourages consolidating direct federal program funds into pools that state governments would administer. The approach builds on a 2020 campaign proposal to collapse dozens of federal grant programs into a single block grant.

Supporters argue block grants spur innovation by giving states flexibility to allocate resources based on local needs. Critics warn the approach eliminates dedicated funding streams that serve the most vulnerable student populations — including low-income students in Title I schools, English learners, and students with disabilities.

Targeted Populations Face an Uncertain Future

The waiver proposals arrive alongside broader federal grant rule changes. The administration is requiring schools to certify they do not operate diversity, equity, and inclusion initiatives as a condition of grant eligibility. Meanwhile, routine grant competitions for programs supporting Native Hawaiian and Alaskan Native education have not launched on their scheduled timelines.

Taken together, these moves signal a fundamental shift in how federal education funding flows to communities — from categorical programs with congressionally mandated targeting to state-controlled pools with broader discretion.

Why Education Nonprofits Should Engage State Agencies Now

Organizations that depend on Title I passthrough funding, afterschool programs, or other federally targeted education grants should engage their state education agencies immediately. If waivers are approved, state officials — not federal law — will drive allocation decisions.

Whether additional states follow Louisiana, Iowa, and Alabama will likely depend on how the administration handles the initial waiver requests and whether courts weigh in on the scope of permissible consolidation under the Every Student Succeeds Act. Grant seekers can track these developments on grantedai.com, where education funding policy changes are analyzed as they unfold.

In-depth analysis of how education grant policy changes affect your organization is available on the Granted blog.