Education Department Downsizes and Shifts Programs Under New Budget

What Happened

Education Secretary Linda McMahon testified before the House education committee regarding the Trump administration's budget proposal. The Department of Education's staff decreased from approximately 4,200 employees in 2024 to 2,300 in 2026, according to Office of Personnel Management (OPM) data. The administration has transferred over 100 programs and obligations to other agencies, including elementary and secondary education programs to the Department of Labor (DOL) and family engagement efforts to the U.S. Department of Health and Human Services (HHS). In March, the department announced the transition of the federal student loan portfolio to the U.S. Treasury Department. By August, remaining Department of Education employees will move from their Washington, D.C. headquarters to a smaller office located approximately one block away.

The Office of Federal Student Aid (FSA) is currently attempting to hire 334 new staff members. McMahon stated she has met with approximately twenty disability groups regarding concerns over special education oversight. The administration is considering moving the Individuals with Disabilities Education Act (IDEA) to the DOL or HHS. McMahon stated the department will look to transfer and co-administer IDEA programs with other agencies.

The Office for Civil Rights (OCR) saw roughly half of its staff removed during last year's layoffs and firings. Following court intervention, the department placed 247 OCR staff on paid administrative leave, a decision estimated by a government watchdog to have cost taxpayers between $28.5 million and $38 million. In 2025, following the Trump inauguration, the OCR reached resolution agreements in two racial harassment cases. In 2017, the OCR resolved more than 30 racial harassment cases. In 2017, the OCR reached agreements in roughly ten times as many disability discrimination cases as it did in 2025. In 2017, the OCR resolved nearly 60 sexual harassment cases and 15 sexual assault cases. Following the second Trump inauguration, the OCR reached zero resolution agreements in school-based sexual harassment or sexual assault cases for the remainder of the year.

The administration's budget proposes a 35% funding cut to the Office for Civil Rights (OCR). The One Big Beautiful Bill Act established new limits on federal student loan borrowing. Under the new law, graduate student annual borrowing is capped at $20,500 with a total limit of $100,000, except for specific professional programs like medicine, law, and dentistry, which can borrow up to $50,000 a year and $200,000 overall. The University of California at Irvine's Flex MBA program has reportedly lowered its prices in response to the loan caps.

The Education Scorecard report released on Wednesday states U.S. schools have been in a 'learning recession' since approximately 2013. Louisiana is the only state reported to have returned to 2019 student performance levels in both reading and math. From 2022 to 2025, Florida ranked 35th out of 35 states in reading growth. The proposed MEGA (Make Education Great Again) grants would consolidate 17 current programs into a block grant worth less than $2 billion.

Why this Matters to You

If you or your family rely on federal student loans, the new borrowing caps may limit your options for graduate school, though some programs could become more affordable in response. Parents of children with disabilities may see changes in how special education services are administered as oversight of the Individuals with Disabilities Education Act (IDEA) is considered for transfer. Students and families filing civil rights complaints with the Department of Education may face longer processing times or different outcomes as the Office for Civil Rights (OCR) operates with reduced staff and funding. The consolidation of over $6.5 billion in education programs into a smaller block grant could affect funding for specific local school initiatives you care about.

What's Next

The Department of Education will complete its move to a smaller headquarters by August. The Office of Federal Student Aid (FSA) will continue its effort to hire hundreds of new staff members. Secretary McMahon and the department will continue discussions about transferring oversight of the Individuals with Disabilities Education Act (IDEA) to other agencies. Congress will consider the administration's budget proposal, which includes the 35% cut to the Office for Civil Rights (OCR). The full impact of the new federal student loan caps on graduate program pricing and enrollment may become clearer in the coming academic year.