WASHINGTON (AP) — The Trump administration is giving Indiana more flexibility over how it decides to spend its federal grant money, the third state to receive such exemptions from the Education Department as it seeks to “return education to the states.”
Indiana's plan will consolidate $50 million in federal money from five funding streams into one with fewer spending restrictions, similar to exemptions over federal spending granted to Iowa and Louisiana
earlier this year. State officials said the waiver would reduce the costs associated with compliance and documentation by about $20 million.
Education Secretary Linda McMahon approved the state's plan at an event Tuesday in Indiana, appearing with state Secretary of Education Katie Jenner and Gov. Mike Braun, a Republican.
Jenner said the state welcomes the expanded control over federal money.
“As states, we have significant control over education in that we set the standards, we can choose our curriculum, we can design our assessments,” Jenner said. “But when it comes to federal funding, our hands have always been tied. Until now.”
The Education Department sends billions of dollars each year to American schools, based on funding levels set by Congress. The money makes up a small but critical part of most school district budgets, arriving in dozens of separate grants and funding streams set aside for specific purposes.
Waivers from the federal government have been offered for years, and were widely used during the pandemic. Under the Trump administration, which has vowed to dismantle the federal Education Department, they have gained traction as a new way to reduce the federal footprint in state and local education decisions.
Indiana's waiver is also the first granted by the Trump administration that allows a change in accountability systems, allowing Indiana to reduce how heavily academic indicators are weighted in school performance scores.
Still, the department can grant only so much flexibility. Indiana's request sought to create a school choice program by giving money set aside to improve low-performing districts to higher-performing ones that enroll students from other schools, but that was denied.
An Education Department official said that proposal was not approved because it would have changed how funds are allocated to recipients, an explicit restriction on the secretary's waiver authority.
Iowa's plan faced similar hurdles. The state originally sought flexibility for major grants like Title I, which sends more than $100 million to Iowa schools with high percentages of low-income students, and to consolidate 10 funding streams into a single grant. The department approved a much smaller waiver — collapsing four funding streams totaling $9.8 million for programs that fund teacher training, English learners, after-school programs and academic enrichment.
More waivers are likely to come, as a handful of conservative-led states have either expressed interest or submitted their own proposals for expanded flexibility.
President Donald Trump's administration has described the waivers as an effort to empower state leaders and minimize administrative burden.
At the same time, Trump has lent support to a growing school choice movement. States are using taxpayer money to finance kids' private school or homeschooling expenses, encouraging them to leave public school. The federal government is set to launch its own school choice program next year.
Programs supported by federal money often support disadvantaged students, such as additional funding for rural schools, low-income schools and English-language learners.
Without these explicit designations, critics say, money for vulnerable populations may be rolled into more general spending initiatives that do not specifically address the challenges those students face. The three waivers approved so far roll funding set aside for English-language learners into a broader spending pool.
The Education Department also approved Indiana's request for a unified school accountability system that relies on benchmarks developed by the state. The new system places a greater focus on college and career readiness.
Denise Forte, CEO of EdTrust, a group that advocates for educational equity, criticized the waiver and the new accountability system for limiting transparency and accountability and for de-emphasizing reading and math scores.
“The Department of Education will allow Indiana to rewrite its accountability system in a way that will mask student performance and move millions of dollars in dedicated funding away from students who need it most,” Forte said in a statement.
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