This week, the U.S. House Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies (LHHS) unveiled its FY27 appropriations bill. The bill’s provisions advance several of President Trump’s key budget priorities for education as reflected in his administration’s “skinny budget” proposal, including a 10% cut to the Education Department’s budget from FY26. Here are a few highlights: 

K-12

  • Title I: Reducing Title I, Part A, of the Elementary and Secondary Education Act (ESEA), grants to districts, from $18.4 to $16.8 billion (-9%).
  • Title II: It all but eliminates funding for ESEA Title II, which supports teacher professional development and recruitment. The bill also includes language to rescind the upcoming October Title II allocation of FY26 funding. (We saw this last year as well, but it went nowhere.)
  • Title III: The bill eliminates ESEA Title III, Part A, English Language Acquisition entirely.
  • IDEA: The bill includes marginal increases for the Individuals with Disabilities Education Act (IDEA). The bill would provide $15.5 billion for services, compared to $15.4 billion in FY26, with state grants remaining near $14.2 billion.
  • Head Start: The bill also includes a marginal increase for Head Start, from $12.35 billion to $12.36 billion. 
  • Charter Schools: A $60 million increase for the Charter School Grant Program.

Importantly: All funding would be contingent on guarantees that educational institutions do not “withhold or conceal” information regarding students’ gender identity from their parents, or that allow transgender girls to participate in women’s sports.

Higher Education

  • Federal Student Aid: 
    • FSA Office Operations: The bill would provide $2.1 billion for the operations of the Education Department’s Federal Student Aid (FSA) Office.
    • Pell Grants: The proposal includes a $50 increase to the maximum Pell Grant award, from $7,395 to $7,445. It also includes $22.7 billion total for the Pell program, a $250 million increase above FY26.
    • Student Loans: The proposal would end the Direct Subsidized Loan program for undergraduate students beginning on July 1, 2027. Direct Subsidized Loans are one of the primary federal student loan programs, specifically available to undergraduates with financial need.
    • FSEOG Program: The proposal would decrease funding for the Federal Supplemental Educational Opportunity Grant (FSEOG) program, which provides federal grants for undergraduate students with exceptional financial need, to $546 million, a $364 million decrease from FY26. This proposed funding level contrasts the administration’s FY27 budget proposal, which proposed the elimination of FSEOG entirely.
    • Federal Work Study Program: Federal Work Study (FWS) would receive $908 million, a $322 million decrease in funding from FY26. 
  • College Access Programs: TRIO programs would see funding increased by $6 million, totaling $1.2 billion, and GEAR UP would be increased by $6 million, totaling $394 million. The proposed increases counter the Trump administration’s proposed elimination of both programs in its FY27 budget request. 

What’s Next

This morning, the House LHHS Subcommittee passed the draft LHHS appropriations legislation along party lines in a 11-7 vote. The bill will now be sent to the full House Appropriations Committee for a markup next week, followed by a full House vote, which is yet to be scheduled. The Senate will develop its own version of appropriations legislation simultaneously, and the chambers will then agree on a final version using their respective drafts as the starting points for negotiations.

The LHHS bill carries funding for most federal education and workforce programs, but it is only one piece of the yearly federal budget process. Congress is simultaneously working on funding for all other government agencies and activities including homeland security, agriculture, and veterans affairs among others. Unless the government passes a continuing resolution to extend the deadline, it must pass appropriations legislation that funds all government activities by September 30, the end of the federal fiscal year. 

Complicating the process is the OMB proposed rule addressed above. The OMB is fast-tracking their proposed rules, with the goal of them going into effect by October 2026. The new UGR would allow the agency full discretion over the second part of FY26 and all of FY27 (now being negotiated). Stay tuned.

This article is sourced from Whiteboard Notes, our weekly newsletter of the latest education policy and industry news read by thousands of education leaders, investors, grantmakers, and entrepreneurs. Subscribe here.