Fifteen states are asking a federal judge to block the U.S. Department of Education from terminating roughly $1 billion in school-based mental health grants, the same awards a court ordered reinstated in December 2025. The states argue the department is evading the injunction by pursuing termination of the grants rather than discontinuation. The department says it has no finalized plan and that challenges to its decisions belong in the U.S. Court of Federal Claims, according to Courthouse News Service.
Congress created the two grant programs in 2018 and 2020, in response to the shooting at Marjory Stoneman Douglas High School in Parkland, Florida. The programs were later expanded after the 2022 shooting at Robb Elementary in Uvalde, Texas. The Mental Health Service Professional Demonstration Grant Program and the School-Based Mental Health Services Grant Program were meant to bring 14,000 additional mental health professionals into schools that needed them most. The preliminary injunction order in the original case listed about 48 grantees across the 16 plaintiff states, from school districts and universities to state education agencies.
The first cancellation was ruled unlawful
According to the court's summary judgment order, in February 2025 the department's Office of Planning, Evaluation, and Policy Development instructed staff to review all new and existing grants for alignment with the new administration's priorities, including a requirement that funds not support diversity, equity, and inclusion practices that conflict with law or department policy. On April 29, 2025, the department sent identical boilerplate discontinuation notices to most or all grantees in the states that later sued, saying the awards conflicted with current administration priorities and would end on December 31, 2025. The department told Congress it was discontinuing roughly $1 billion in awards.
On December 19, 2025, Judge Kymberly Evanson of the U.S. District Court for the Western District of Washington granted summary judgment to the states. The court found the department's cancellations violated the Administrative Procedure Act, vacated the directive, the notices, and related denial letters, and permanently barred the department from using new priorities when deciding continuation awards or recompeting the funds. Evanson concluded that the regulations did not support ending multiyear grants whenever administration priorities shifted. The 9th U.S. Circuit Court of Appeals had denied an emergency stay of the earlier preliminary injunction on December 2, 2025.
A second effort and a new lawsuit
Courthouse News Service reported that after the ruling, the department said it intended to terminate the grants instead of discontinue them and asked the court whether termination would violate the injunction. The states filed a new lawsuit and received a temporary restraining order. At a hearing on their request for a preliminary injunction, Justice Department attorney Brian Kipnis argued the department had not finalized a termination plan, said the proper venue for disputes over grant funds is the Court of Federal Claims, and told the judge the court should not be running the Education Department.
Lawyers for the states gave a different account. Washington Assistant Attorney General Jennifer Chung said schools were already feeling the effects because they needed to know their full-year funding to hire mental health staff, recruit graduate student interns, and plan services. State lawyer Ellen Range cited notices to grantees saying next year's money would stop and departmental webpages describing the termination plan as evidence that the plan was real.
K-12 Dive reported that in a July 1, 2026, filing, the department said the states were reading the original order too broadly, as a shield against all discontinuations rather than only those made through improper procedures. It also said the order never gave states a legal entitlement to receive federal funding.
Further procedural moves
According to the court's order on the states' second motion to enforce, on December 30, 2025, the department moved to amend the judgment and extend its compliance deadlines. It acknowledged that an extension would leave grantees without money for a time and offered five weeks of interim funding while it worked on new determinations. The states opposed the motion and said it would strip the court's order of practical effect. The court denied the states' second motion to enforce without prejudice, leaving the door open to refiling if future funding decisions violate earlier orders.
K-12 Dive reported that the department has also awarded $208 million in new mental health grants under revised priorities that bar recipients from promoting or endorsing gender ideology, political activism, or racial stereotyping. The new awards were limited to hiring school psychologists rather than also covering counselors and social workers, who often provide mental health support in schools.
State-level impact
EdWeek reported that the losses vary sharply across the original plaintiff states. New York would lose at least $19 million, including $7.6 million for the State University of New York system. California would lose at least $98 million across 21 county offices of education and local districts. In Washington state, 35 school districts had used grant money to add 19 mental health professional positions to schools serving students who previously lacked access because of geographic isolation.
The original lawsuit was brought by California, Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, New Mexico, New York, Nevada, Oregon, Rhode Island, Washington, and Wisconsin, according to the Michigan attorney general's office. The new suit involves 15 of those states.
What the program data shows
Court filings in the case cite National Association of School Psychologists findings showing that in the programs' first year, grantees served nearly 775,000 elementary and secondary students and hired nearly 1,300 school mental health professionals. The states have also attributed to the programs lower suicide risk, less absenteeism, fewer behavioral problems, shorter wait times for services, and stronger recruitment of mental health professionals into underserved communities. Those results come from the states' court filings and are not the product of an independent peer-reviewed evaluation.