Federal

Ed. Dept. Imposes Funding Restrictions for 5 Districts Over Transgender Policies

The districts let transgender students use bathrooms consistent with their gender identity
By Brooke Schultz — August 19, 2025 | Updated: August 19, 2025 6 min read
A commuter walks past the headquarters of the U.S. Department of Eduction, which were ordered closed for the day for what officials described as security reasons amid large-scale layoffs, Wednesday, March 12, 2025, in Washington.
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Updated: This story was updated to add a statement from Fairfax County public schools.

Five northern Virginia school districts will have to request reimbursement to receive all their federal funds following a U.S. Department of Education finding that the districts violated Title IX, the department announced Tuesday.

It’s a new lever for the Education Department to use federal dollars to corral schools into falling in line with President Donald Trump’s agenda of cracking down on transgender students’ participation in athletics.

The five districts—Alexandria City, Arlington, Fairfax County, Loudoun County, and Prince William County public schools—will now have extra hoops to jump through to get their subsidies after the department found them each in violation of the federal law that prohibits sex discrimination in education institutions.

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Maine's Democratic Gov. Janet Mills delivers her State of the State address, Jan. 30, 2024, at the State House in Augusta, Maine.
Maine Gov. Janet Mills delivers her State of the State address on Jan. 30, 2024, in Augusta, Maine. The U.S. Department of Health and Human Services found Maine had violated Title IX just four days after Mills told President Donald Trump that she would see him in court over the state's refusal to comply with an executive order seeking to bar transgender girls from girls' sports.
Robert F. Bukaty/AP

The department is alleging the districts violated the law by allowing transgender students to access “intimate facilities”—such as restrooms and locker rooms—that align with their gender identity. It gave the districts until Aug. 15 to sign a proposed resolution agreement, which directs them to rescind their policies, issue a memo to each school adhering to new interpretation, and adopt the federal government’s definitions of “male” and “female.”

The districts rejected the proposed resolution, and the department then put the districts in “high-risk status,” which will require them to submit documentation, receipts, and additional verification when they request federal dollars. It will ultimately place more of a fiscal burden on the districts, which will have to cover expenses from their own funds while it awaits a federal determination on reimbursing them, said Julia Martin, the director of policy and government affairs for the Bruman Group, an education law firm that represents states and school districts.

“I would assume these districts are now operating under the assumption that some of those drawdown requests will be denied, because there seems to be a desire to review those very closely, and either the department is going to deny some drawdown requests, or they’re going to use those documents that they received through that process to further an investigation or lawsuit,” Martin said.

The reimbursement status would affect all the districts’ federal funding, the department said, which includes major formula funds—such as Title I that supports students from low-income backgrounds and money under the Individuals with Disabilities Education Act for students with disabilities—and competitive funding, totaling in the millions of dollars. The districts range in size from 16,000 students in Alexandria to more than 180,000 in Fairfax County.

Districts dispute that they violated Title IX

The districts had previously made a joint request to the Education Department for a 90-day extension to “engage in thoughtful discourse,” Fairfax County Superintendent Michele Reid wrote in an Aug. 15 notice to community members. But the department denied it, and instead moved the districts to “high-risk” status and announced it would start administrative proceedings to terminate their federal funds altogether.

A Loudoun County spokesperson disagreed with the Education Department’s finding that it violated Title IX. In addition, the district “disputes that we have engaged in activity that would warrant being characterized as a ‘high risk’ grantee and will consider appropriate next steps.”

A Prince William County spokesperson said it hadn’t received official notice of the high-risk determination. “We are committed to creating inclusive, future-ready learning environments that empower all students to thrive,” the spokesperson said.

Alexandria City public schools said it had received the Education Department’s notice and was reviewing it.

Whether Title IX protects transgender students and athletes in school contexts is still an open legal question, Martin said. Some courts have found it does, while multiple courts ruled against the Biden administration’s expansion of Title IX regulations last year to prohibit discrimination based on sexual orientation and gender identity.

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Bill Oxford/Getty

No court, however, has ever said Title IX requires exclusion of trans students, legal experts have said.

One ruling—out of the federal appeals court covering Virginia—supports the districts’ policies, they argue.

In Gloucester County, Va., a transgender student, Gavin Grimm, sued his school district in 2015 after it barred him from the boys’ restrooms, alleging a violation of Title IX. After a yearslong legal battle, the 4th Circuit Court of Appeals sided with Grimm.

In her memo to parents last week, Reid, the Fairfax County superintendent, said the district is following Virginia law and the 4th Circuit ruling. The district reiterated that in a Tuesday statement, in which it said it was reviewing the latest notice from the Education Department.

“FCPS remains dedicated to creating a safe, supportive, and inclusive school environment for all students and staff members, including our transgender and gender-expansive community,” the statement said. “Any student who has a need or desire for increased privacy, regardless of the underlying reason, shall continue to be provided with reasonable accommodations.”

But Virginia’s Republican governor and attorney general have sided with the Education Department, arguing its districts are breaking the law .

“The Northern Virginia School Divisions that are choosing to abide by woke gender ideology in place of federal law must now prove they are using every single federal dollar for a legal purpose,” U.S. Secretary of Education Linda McMahon said in a Tuesday news release. “We have given these Northern Virginia School Divisions every opportunity to rectify their policies which blatantly violate Title IX. Today’s accountability measures are necessary because they have stubbornly refused to provide a safe environment for young women in their schools.”

The Education Department has threatened funds over Title IX before

It’s not the first time Trump’s Education Department has moved to cut off federal funds to schools or states that don’t align with the administration’s transgender-student policies. It referred cases over state transgender student policies in Maine and California to the U.S. Department of Justice, which sued the states.

Determinations on whether Title IX explicitly protects transgender students from discrimination have waxed and waned between recent Democratic and Republican administrations.

Under Democratic presidents Barack Obama and Joe Biden, there were efforts to expand protections to transgender students and athletes. But Trump has aggressively rolled those back. Since the first day of his second term, he’s issued executive orders on gender identity and barring transgender girls from girls’ sports and tasked the Education Department with rooting out what he calls “transgender insanity.”

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Education Secretary Linda McMahon accompanied by Attorney General Pam Bondi, right, speaks during a news conference at the Department of Justice headquarters in Washington, Wednesday, April 16, 2025.
Education Secretary Linda McMahon, accompanied by Attorney General Pam Bondi, right, speaks during a news conference at the Department of Justice headquarters in Washington, Wednesday, April 16, 2025. The pair were announcing a lawsuit against the state of Maine over state policies that allow transgender athletes to compete in girls' sports.
Jose Luis Magana/AP

Roughly 3% of high school students identify as transgender, and 2% are questioning their gender identity, but those students face high rates of bullying.

As Maine and California face threats to their federal school funding, districts are in a different position, as they don’t have the same authority as states under federal law, Martin said.

The use of high-risk status isn’t unusual—the federal government uses it from time to time with states and colleges over things like the administration of federal financial aid. But the use of it with school districts is less common, she said.

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