Dismantling the Education Department without abolishing it: Congress funds it at $79 billion while programs and staff move to Labor, HHS, Justice and other agencies (2025-2026)

Case

The Trump administration is shrinking the Education Department by moving its programs and staff to other agencies through interagency agreements, even though Congress funded the department at about $79 billion for fiscal 2026 and barred spending to relocate offices or reorganize programs. Department staff fell from about 4,200 in 2024 to about 2,300 in 2026, and more than 100 programs or obligations have moved; Title I and career and technical education are at Labor, special-education staff at HHS, and civil-rights enforcement staff are moving to Justice. Secretary Linda McMahon says the aim is to return authority to states and that the moves are lawful; critics call them illegal and say money is reaching schools late.

Funding: Congress kept the department funded
Congress approved about $79 billion in discretionary spending for the Education Department for fiscal 2026, more than $200 million above fiscal 2025. The administration had proposed cutting it by $12 billion.
The spending package bars covered agencies from using funds to "relocate an office or employees" or to "reorganize programs or activities." The department's press secretary says the spending law does not prevent partnerships with other agencies.

The transfers: programs and staff moved out (2025-2026)
On Nov. 18, 2025 the department announced six interagency agreements with the Departments of Labor, Interior, Health and Human Services, and State. The transfers would move more than half of federal K-12 funds, including about $30 billion across roughly 50 grant programs to Labor, according to a Dec. 4, 2025 letter from 36 Senate Democrats.
Department staff fell from about 4,200 in 2024 to about 2,300 in 2026, roughly 45%, per OPM data cited by NPR. More than 100 programs or obligations have moved to other agencies, and federal student loans are shifting to the Treasury Department.
As of September 2026, the office overseeing Title I (about $18.4 billion a year) is at Labor, career and technical education is fully on Labor's grant systems, over 100 special-education staff began working at an HHS building on Sept. 10, and dozens of civil-rights staff moved to the Justice Department.
Hundreds of department employees are now spread across at least nine other federal buildings in Washington, and the Energy Department is slated to move into the department's headquarters building.

Effects reported and the civil-rights office
Five department employees told NPR the changes add bureaucracy and that grant systems at Labor and HHS were not built for education grants. Two attempts to send large grants through Labor's systems were halted after states raised technical concerns, and several states reported receiving career-and-technical-education funds months late.
The department says Labor's payment system has processed over 7,200 payments totaling over $1.93 billion since Oct. 1, 2025. The next Title I distribution on Oct. 1, 2026 was set to go through the Education Department's own system, though staff expect another attempt through Labor next year.
A GAO review found the department spent up to $38 million paying laid-off Office for Civil Rights staff who did not work from March to December 2025. Seven of OCR's 12 regional offices closed, and about 90% of the 7,000-plus complaints OCR resolved from March to September 2025 were dismissed before investigation.
The administration's budget proposes a 35% cut to OCR funding. McMahon told the House Education and Workforce Committee on May 14, 2026 that this is a minimum hiring floor and not a target, and that the department is rehiring attorneys.

Legal status and what Congress can do
The department acknowledges it cannot fully dismantle itself without congressional approval. McMahon described the staff reassignments as temporary, and officials call them a proof of concept for Congress.
A federal court in Massachusetts temporarily blocked the 2025 reorganization, but the Supreme Court stayed that injunction. The sources reviewed do not report a ruling on the interagency agreements themselves.
Senate Democrats asked GAO to evaluate the costs of the interagency agreements, and bipartisan legislation has been proposed to stop them. Congressional staffers say cost information was not shared in required briefings, which reportedly stopped in June.
McMahon said special education (IDEA) services have not been assigned a destination and will first be co-administered with other agencies; Rep. Suzanne Bonamici pressed her on whether they will be transferred and did not get a yes-or-no answer.

Perspectives

Official position — Education Secretary Linda McMahon and the department
President Trump was elected with a mandate to wind the department down and return authority to states, parents, teachers and local leaders. Funding will continue to flow, cutting red tape is part of the department's final mission, detailing employees to other agencies is standard practice, and the moves save taxpayers money. The department says the spending law does not bar partnerships with other agencies and that the arrangements have produced good results.

Critic — 36 Senate Democrats (led by Sens. Murray, Baldwin, Sanders and Schumer) and Rep. Bobby Scott
The Nov. 18, 2025 actions are \"outrageous, illegal\": appropriations law bars transferring funds to another agency unless Congress expressly authorizes it, the Economy Act does not support moving major program functions, and dismantling the department would require legislation that has not been proposed. Scott calls the agreements legally dubious and says the administration is effectively dismantling a key civil-rights institution. They demand the moves be reversed.

Expert view — Education nonprofits, former department staff and current employees (unnamed)
Other agencies lack the staff, expertise and IT systems to manage education grants, so the changes add bureaucracy and costs. Staff say the administration \"came up with a solution for a problem they have not identified,\" and worry that funds will not reach students efficiently, especially low-income students and students with disabilities.

Editorial read — The Author (site author)
The author views the changes as dismantling the nation's education system and describes them as defunding the department. The sources show Congress funded the department at about $79 billion; what they document is the removal of its programs and staff to other agencies and a smaller workforce, which is the basis of this entry.

Research notes
Why this framing: the department has not been \"defunded\" in the sense of its appropriation. Congress funded it above the prior year and rejected a proposed $12 billion cut; the contested actions are moving programs and staff out through interagency agreements against a spending-law provision. The Author's wording of this as \"defunding\" is a shorthand the sources do not support; the entry states what is documented.\n\nSourcing: Federal News Network (Feb. 2026), NPR via OPB (May 15 and Sept. 24, 2026), and a Dec. 4, 2025 letter from 36 Senate Democrats (Senate Appropriations Committee minority site). The Sept. 24 NPR piece rests on interviews with five unnamed department employees.\n\nWhat the sources do not establish: that any transfer has been ruled unlawful (a Massachusetts federal court blocked the reorganization in 2025 but the Supreme Court stayed that order; that was about layoffs, and I found no current lawsuit over the interagency agreements in these sources); whether students have been harmed in measurable ways (the sources report late funds and halted grant transfers, not outcomes); where special-education (IDEA) services will end up, which McMahon said is undecided.\n\nRelated entry: this case is separate from the UNC settlement, which concerns federal civil-rights enforcement on one campus.\n\nOpen leads:\n- The interagency agreements themselves, and the Labor payment data behind the department's $1.93 billion figure.\n- The GAO report on paid leave for civil-rights staff, and the Senate Democrats' request for a GAO review of the agreements' costs.\n- The bipartisan bill to stop the agreements and any litigation over them.\n- The Oct. 1 Title I distribution and whether the planned 2027 shift to Labor goes ahead.\n- Bloomberg's step-by-step timeline of the dismantling, which was not read.

Note
Whether the interagency transfers are lawful is contested: 36 Senate Democrats and Rep. Bobby Scott call them illegal, the department says the spending law does not bar partnerships with other agencies, and the department acknowledges it cannot fully abolish itself without Congress. No court has ruled on the transfers in the sources reviewed.

Sources
[1] Federal News Network — Congress fully funded Education Dept, but it's moving ahead with reassigning employees to other agencies (https://federalnewsnetwork.com/reorganization/2026/02/congress-fully-funded-education-dept-but-its-moving-ahead-with-reassigning-employees-to-other-agencies/) · 2026-02
[2] NPR via OPB — The Education Department hasn't been dismantled. It's become more inefficient, staff say (https://www.opb.org/article/2026/09/24/education-department-inefficient/) · 2026-09-24
[3] NPR via OPB — Linda McMahon defends dismantling the Education Department, shifting its work (https://www.opb.org/article/2026/05/14/linda-mcmahon-again-defends-dismantling-the-education-department/) · 2026-05-15
[4] Senate Appropriations Committee (minority) — Murray, Baldwin, Sanders, Schumer and 32 colleagues' letter to Secretary McMahon (https://www.appropriations.senate.gov/news/minority/murray-baldwin-sanders-schumer-colleagues-slam-latest-efforts-to-dismantle-the-department-of-education-call-on-mcmahon-to-reverse-illegal-moves-that-weaken-support-for-students) · 2025-12-04

Connections

Related — Schools and libraries: book bans, 'patriotic education,' religion in classrooms, and dismantling the Education Department
The published schools entry summarizes the Education Department dismantling in one line; this entry covers it in detail.

Same context — UNC-Chapel Hill settles federal antisemitism and race-discrimination probes with no payment and no finding, agreeing to end race-based admissions and DEI programs (Oct. 19, 2026)
Both involve the second-term administration reshaping education policy and civil-rights enforcement; the Education Department's civil-rights office is part of the UNC settlement's investigations, and OCR staff are moving to Justice.