A federal judge in New York issued a preliminary order Tuesday blocking the Trump administration from cutting off states’ access to hundreds of millions of dollars in pandemic relief funds for public schools, including more than $77 million for Illinois.
U.S. District Judge Edgardo Ramos, of the Southern District of New York, issued a preliminary injunction blocking enforcement of an order that Education Secretary Linda McMahon issued on Friday, March 28. That order reversed earlier decisions to grant the states additional time to spend funds they had been allocated.
The effect of McMahon’s order was to immediately cut off access to funds that states said they had already committed to spend but not yet made the actual expenditures.
Illinois Attorney General Kwame Raoul joined a coalition of 17 states in suing the federal government to block McMahon’s order.
“The Trump administration’s shortsighted and illegal decision to attempt to rescind already-appropriated education funding would hurt vulnerable students the most and could wreak havoc on the budgets of school districts throughout Illinois and the nation,” Raoul said in a statement Tuesday.
The lawsuit over pandemic-related education money is one of more than a dozen multistate suits Raoul has joined, in combination with other Democratic state attorneys general, challenging actions Trump has taken since being sworn in for a second term Jan. 20.
In 2020 and 2021, Congress passed several relief and economic stimulus packages totaling trillions of dollars to help individuals, businesses and state and local governments deal with the financial consequences of the pandemic. For schools, that included costs associated with preparing for the safe return to in-person learning, addressing the learning loss students suffered during the extended period of school closures, and addressing some of the unique needs of homeless children that were exacerbated by the pandemic.
According to the complaint, Illinois was awarded just over $5 billion in “education stabilization” funds under the American Rescue Plan Act, or ARPA, which was enacted in March 2021. Of that, $77.2 million remained obligated but not yet spent as of the end of March 2025.
Those funds had been earmarked for such things as teacher mentoring, statewide instructional coaching, new principal mentoring, trauma response initiatives, the creation of social-emotional learning hubs and contracts for technology infrastructure upgrades, according to the complaint.
Under ARPA, those funds were intended to cover expenses incurred through Sept. 30, 2023. Subsequent legislation gave states an additional year, to Sept. 30, 2024, to “obligate” their funds. And under agency regulations, they had another 120 days beyond that to draw down the funds, although they were also given the option of requesting further extensions.
In January 2025, Illinois requested, and later received, permission to extend its deadline for drawing down the remainder of its funds to March 28, 2026. Other states involved in the lawsuit also received extensions.
But on Friday, March 28, 2025, the Department of Education issued a memo rescinding those extensions, effectively cutting off the states’ access to any unspent funds.
“Extending deadlines for COVID-related grants, which are in fact taxpayer funds, years after the COVID pandemic ended is not consistent with the Department’s priorities and thus not a worthwhile exercise of its discretion,” McMahon said in a memo to state education agency heads.
The injunction means the Department of Education cannot enforce the order, at least while the case is still being litigated or until the court issues a different order.
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