Grant management transfers face technical setbacks
The Education Department, despite being the smallest cabinet-level agency, manages one of the largest pools of federal grants, sending billions of dollars each year to states and schools — including programs serving low-income students and those with disabilities. McMahon defended the restructuring in an interview with Fox News last year: “The funding will continue to flow. If the Department of Education moves different programs to different agencies, that will not shut down the funding.”
The department has decided that how money reaches students should change: some grants will now be processed through payment platforms used by other agencies rather than the single system long used at the Education Department. Education Department employees told NPR that other agencies’ systems — including those at the Labor Department and the Department of Health and Human Services — are not set up for education grants. “Many of the students we serve are the kids that need extra support,” one worker responsible for overseeing hundreds of millions of dollars in grants told NPR. “Personally, I’m very worried [about the money reaching those students] because they’re now going to be sending out funds through a challenging, complicated system.”
Title I grants, worth roughly $18.4 billion per year, go to schools where many students are from low-income families. Staff from the office that oversees those grants have been moved to the Labor Department. Employees told NPR the department has tried twice to use Labor’s systems to send out Title I money and other large grants, and both attempts were halted after states pushed back, citing concerns about technical problems and lack of trained staff. The next tranche of Title I money, going out to students on Oct. 1, will be sent via the Education Department’s system, but the department will try Labor’s system again next year, according to employees.
Other smaller competitive grants have already switched to the Labor Department’s platforms. “It’s not efficient for us and it’s not efficient for them,” one staffer told NPR, referring to states and other groups that rely on grant money. “This was done haphazardly. People don’t feel like they’ve received sufficient training on new systems.” Some employees must learn to use three separate grant management tools instead of one, and grant recipients are having to do the same. A staffer at the Office for Special Education and Rehabilitative Services, which works with dozens of grant recipients, told NPR: “We spend a lot of time calming nerves, which is not what we’re paid to do.”
One grant program that was transferred entirely to Labor’s systems last year was for career and technical education. After the change, several states reported they received their share of the money months late. Some employees who manage grants consider that situation a cautionary tale, although the following round of the same funding was sent on time earlier this summer. Education Department press secretary Savannah Newhouse wrote in an email: “I’d hardly call successfully processing over 7,200 payments totaling over $1.93 billion since October 1, 2025, through the Department of Labor’s payment system a ‘cautionary tale’ on inefficiency.” Newhouse did not share details behind the initial delay.
Bryce McKibben, a higher education policy expert at Temple University, works with colleges and states that rely on federal grants including for low-income student parents, and said many have been struggling. “It’s hard to know where to go for information, the systems/portals have changed, the amount of guidance they’ve been getting has been going down,” McKibben said. “It all seems to be a very intentional effort to simply … make folks less likely to want federal funds in the first place.”
Staff scattered across Washington buildings
“A lot of the frustration we feel is from the fact that they came up with a solution for a problem they have not identified,” an Education Department worker said.
The Education Department has physically moved hundreds of employees out of its longtime headquarters at the Lyndon B. Johnson building to several other federal agencies. More than 100 special education staffers began reporting to work at an HHS building on Sept. 10, and dozens of employees who work on student civil rights moved to the Justice Department. The department has confirmed that some employees have started moving from the LBJ building to a smaller space roughly a block away, with more workers to follow.
McMahon has described the moves as efficiency measures. “Partnering with agencies that are best positioned to deliver results for students and taxpayers … will streamline federal education activities on the legally required programs,” McMahon has said.
The administration is using interagency agreements, or IAAs, to shift workers around. IAAs have routinely allowed federal agencies to share resources and expertise. Newhouse said in an email to NPR that “detailing employees to partner agencies is standard practice across the federal government — not a new phenomenon.” Some members of Congress, including Republicans, called the scope of the IAAs “unprecedented” in a statement. Senate Democrats have requested that the Government Accountability Office evaluate the costs of the interagency agreements and other steps the Trump administration has taken to break up the Education Department, according to Jackie Nowicki, the director of K-12 education research at the GAO, a nonpartisan congressional watchdog.
A worker from the special education office who must now work at a federal HHS building said they see some benefit to collaborating with that agency, but do not understand what the physical move accomplishes. “We could walk over there and talk to these folks, have virtual meetings, but to pay … to move us basically across the street, it is asinine,” the worker said.
The agreement between OSERS and HHS lasts until September 2027. Staff are detailed to HHS only for renewable 120-day blocks, during which they report to the Education Department while working at HHS. An email from leadership emphasized that employees “remain OSERS’ team members and Department of Education employees” and that their “work and responsibilities remain the same.” “So then what? Are we going to move again in 120 days? A year?” an employee of that office told NPR. “They have framed it as a permanent solution to our country and it’s not.”
Documented costs and stopped briefings
The Education Department, which has fired thousands of workers and is now on a hiring spree, has also generated documented cost issues from the restructuring. The Education Department’s efforts to fire staff have cost over $28 million, a watchdog previously reported. In a separate report last year, the GAO found the Education Department spent as much as $38 million between March and December 2025 paying staff not to work after it laid them off. During that period, the GAO found that the Office for Civil Rights resolved more than 7,000 discrimination complaints, but approximately 90% were resolved by the department dismissing the complaint — meaning staff received information from complainants but did not proceed to investigate.
In January, Congress directed the Education Department to provide biweekly briefings about the implementation of IAAs, including on costs and how staff transfers would affect grant management quality. According to two congressional staffers familiar with the briefings, the department did not share cost information at those meetings. Both staffers, who were not authorized to speak publicly about the briefings, said the department stopped the briefings in June after Rep. Suzanne Bonamici, an Oregon Democrat, proposed impeaching McMahon. Newhouse wrote that the department has continued to provide “significant updates on the IAAs” to committee members.
Others in Congress, on both sides of the aisle, have proposed legislation to halt the IAAs, including Democratic Sen. Patty Murray of Washington, who recently said, “Tell Congress and the public what these interagency agreements actually cost taxpayers.” She added, “show us the receipts.”
Building costs omitted from public savings claims
The physical unwinding of the Education Department has also come at a cost to taxpayers, contrary to the department’s public claims. In a March press release, the department announced that staff would leave the LBJ building for a smaller space roughly a block south, “saving taxpayers approximately $4.8 million annually in operating costs and eliminating wasted space in a building that is roughly 70% vacant.” The release also announced that staff from the Department of Energy would then leave their “outdated” headquarters and move into the LBJ building, saving taxpayers “over $350 million in deferred maintenance costs.”
NPR also asked the Education Department how it arrived at those numbers. Newhouse did not respond to those questions but wrote: “Taxpayers shouldn’t be paying to keep the lights on in empty government buildings, and the Department of Energy shouldn’t spend a single dollar building a new facility when an existing one can be renovated and put to better use.”
Two key costs of those moves were omitted from the department’s announcement. The LBJ building cannot accommodate the needs of Energy staff without a major overhaul, according to Rachel Gittleman, president of AFGE Local 252, which represents federal employees. Republicans on the House committee that manages federal buildings freed up $215 million over the summer for such a renovation. The renovation would follow a yearslong overhaul of the LBJ building that began during the first Trump administration, originally projected at $37 million in 2019 but with roughly $49 million spent since 2021, according to government records. The purpose of that earlier renovation was the opposite of what is happening now: to consolidate Education staff in one building “in the name of efficiency and collaboration.”
“This is a huge waste of taxpayer dollars,” Gittleman said. She also said the Education Department is paying for the employees moved to other offices to have up to three desks each — at the department’s current headquarters, its new headquarters, and at agencies where they are being detailed. “This is not efficiency, this is chaos,” Gittleman said.
Every employee who spoke to NPR shared a similar sentiment, and each told NPR they are staying in their jobs because they care about the department’s mission of serving American students. One education staffer who now works out of the Labor building told NPR they feel physically and ideologically further from that mission: “I reported to a building this week that doesn’t say ‘education’ anywhere.”