Implications for Therapeutic Schools and Youth-Serving Programs

This month, 24 states and the District of Columbia filed suit against the Trump administration over its decision to pause the release of $6 billion in federal education funding, including funds designated for after-school programs, English language instruction, teacher training, expanded STEM and arts curricula, and anti-bullying initiatives.

The lawsuit, led by New York Attorney General Letitia James, argues the federal government’s actions violate both the Constitution and multiple federal statutes. Traditionally, these funds are distributed by July 1; however, this year’s funding was abruptly withheld with no warning and no clear timeline for release. According to the states, this has already led to the cancellation or disruption of critical summer learning and support programs.

For NATSAP member programs, this pause is particularly concerning. Many programs—especially those working with youth from immigrant, multilingual, or lower-income backgrounds—rely on these federal resources to expand access to individualized education, enhance trauma-informed teaching practices, and deliver wraparound support that extends beyond the school day. Programs serving English learners or offering teacher development initiatives may face immediate financial strain and uncertainty in planning for the 2025–2026 academic year.

The Office of Management and Budget defended the move, stating the pause was part of a “programmatic review” amid concerns that certain states misused grant dollars to support what they described as “radical leftwing agendas.” Federal officials cited examples from New York and Washington state, though specific audits or investigations have not been released publicly.

Plaintiffs are seeking a preliminary injunction to compel the federal government to release the funds immediately. The outcome of this legal challenge could have broad implications not just for state education systems but also for private and nonprofit organizations that deliver supplemental educational services.

Why This Matters for NATSAP Members:

• Programs with public-private partnerships may experience direct funding disruptions.
• Any changes in federal education priorities or restrictions on grant eligibility could shift how therapeutic and residential schools access resources.
• The lawsuit reflects a broader tension between state-level priorities for youth support and the federal government’s current direction on education funding.

NATSAP will continue monitoring developments and will provide updates to members as the lawsuit progresses. In the meantime, programs impacted by the pause are encouraged to document how the delay is affecting operations, staffing, or youth outcomes, as these details may be useful for advocacy or future grant discussions.