Hawaiʻi, 23 states sue over $6.8B withheld in education funding

Hawaiʻi Attorney General Anne Lopez has joined a multistate lawsuit challenging the federal government’s decision to freeze billions in education funding, including an estimated $33 million earmarked for Hawaiʻi programs. The lawsuit, filed by a coalition of 24 attorneys general and the District of Columbia, claims the funding halt is unlawful and unconstitutional.

In a statement Monday, Lopez said the decision threatens a range of essential services in Hawaiʻi, including English-language instruction, digital literacy programs and educator training, just weeks before the 2025–2026 school year.

“The federal administration has abruptly and illegally frozen billions of dollars in education funding used for English-language instruction, supporting effective instruction and improving digital literacy, among other critical services,” Lopez said. “Freezing these federal formula funds, appropriated by Congress, on the eve of the next school year threatens important education programs and violates numerous statutory and constitutional provisions.”

The states are seeking declaratory and injunctive relief, arguing that the Department of Education’s action violates several federal statutes, including the Antideficiency Act and the Impoundment Control Act, as well as the constitutional separation of powers and the Presentment Clause.

The lawsuit targets the freeze of six longstanding formula grant programs administered by the US Department of Education. States typically receive about 25% of these funds on or around July 1, allowing them to finalize school-year budgets, staffing plans and service contracts. But on June 30, state agencies were informed that funding for the six programs would not be obligated as scheduled.

The plaintiffs say this sudden funding freeze has thrown plans for the upcoming school year into chaos. They say education agencies have approved budgets, developed staffing plans and signed contracts to provide vital educational services under these grants. But now, as a result of the federal administration’s actions, they are without sufficient funding for these commitments, just weeks before the start of the 2025-2026 school year.

According to Lopez, the move “is already impacting” essential education programs and child care services in Hawaiʻi, and wreaking havoc on key teacher training programs, as well as programs that make school more accessible to children with special learning needs, such as English learners.

In Hawaiʻi, an estimated $33 million in federal education funding is frozen, which would have been used to support English-language and literacy programs for children and adults, student support and academic enrichment programs and educator instruction, according to Lopez.

The lawsuit emphasizes that it is Congress—not the executive branch—that controls federal spending. The plaintiffs argue that the freeze amounts to an unconstitutional refusal to disburse appropriated funds.

Joining Hawaiʻi in the lawsuit are the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Rhode Island, Vermont, Washington, Wisconsin and the District of Columbia. The governors of Kentucky and Pennsylvania are also named plaintiffs.

A copy of the lawsuit is available here.