Austin ISD gets $41 million from the Education Department. What happens if the agency closes?

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When Christy Fox thinks about why federal funding is important to Austin ISD, she thinks about who those dollars support: staff typically working with the district’s most vulnerable students.

“I think about the human behind it,” she said, “because these are real people that have real relationships to help children be successful.”

Fox is the director of state and federal programs for Austin ISD. She said the district is facing unprecedented uncertainty about the future of grants it receives through the U.S. Department of Education as the Trump administration moves to close it.

“This is generationally different to talk about … reducing a federal agency that has been an important part of all schools’ work and how they best serve children,” Fox said.

President Donald Trump has suggested the department’s responsibilities could be moved to other agencies. But Fox said that could pose a challenge for school districts because different federal agencies operate differently. She said she’s worried that moving education-related grants to other departments could also dilute the focus on serving students – even if that’s not the intent.

“Do we lose sight collectively of the children that these grants and these funds serve?” she said. “That’s the concern I have.”

Any loss of federal funding as a result of the department’s reshuffling could spell trouble for Austin ISD, which has at least a $110 million budget deficit. Fox noted a lot of the money the district receives goes toward funding positions.

“It’s worrisome because our current budget could not absorb every grant-funded position within the district,” she said.

Although only about 11 percent of Austin ISD’s nearly billion-dollar budget comes from the federal government, Fox said the funding is vital.

“Each of those pieces of the puzzle all have a connection directly to students,” she said.

What kind of federal funding does Austin ISD receive?

Austin ISD has received $41 million in formula grants in 2024-25 from the Department of Education – funding that is administered within the state by the Texas Education Agency.

So what exactly is a formula grant?

As the name suggests, this is funding that is allocated based on a formula developed by Congress. Take Title 1 funding, for example, which provides extra dollars to schools with a high percentage of students from low-income households. The amount a district receives is based on a formula that takes into account U.S. Census data on local poverty rates. Austin ISD gets about $18.5 million in Title I funds, Fox said.

Austin ISD gets another $2 million or so in Title II funding to help support new teachers.

The Education Department also distributes what are known as Title III funds to help children learning English. Austin ISD, which has more than 22,000 emergent bilingual students, has received a $2 million grant through that program.

Fox said the district receives millions in federal funding to provide special education services to students as part of the Individuals with Disabilities Education Act, or IDEA. More than 14,000 Austin ISD students receive special education services.

“That grant is typically in the mid-$15 million range, so that … supports mainly staff that provide direct services to children,” she said.

The Education Department provides funding to support students experiencing homelessness, too.

Carla Scott is the administrative supervisor of Project HELP, a program that protects the rights of students under the McKinney-Vento Homeless Assistance Act. She said the federal dollars Austin ISD receives to support homeless students primarily fund six staff positions.

“My staff works with about 35 to 40 campuses each,” she said, “and they are all supporting anywhere between 330 to 340 students across the district.”

Scott’s team also provides services to students in the foster care system.

Funding for homeless students helps provide stability

The funding doesn’t just pay for salaries though, Scott said; it also helps pay for resources kids need.

“Our role is to ensure that we remove barriers to allow students to remain in school, and that could be anything from basic hygiene to uniforms to shoes to getting eyeglasses,” she said. “It could mean all of those things.”

Scott added being able to keep kids in school, especially the school they’ve been going to, creates some consistency for them.

“It is critical. The one place that kids are able to feel secure is their school,” she said. “No matter where they’re sleeping, they know they’re going to go back to the same school, the same schedule, the same teacher, the same friends, the same expectations without moving around the city.”

Scott said federal funding is especially important because the number of Austin ISD students experiencing homelessness is on the rise. The district has identified nearly 1,600 homeless students this school year. That’s up from the previous year, when it counted 1,300 students. And these are just the students the district knows about – Scott said the actual number of homeless students is higher.

“Our team works really hard to build trust with schools, to build trust with families that we work with in hopes they will share with their friends who may also be in this situation,” she said.

Scott said any loss of funding to serve this population of students would be devastating.

“That’s a knife in my chest,” she said. “It would mean that many students would not be served. It would mean that many families would remain in the trauma of homelessness without the supports to help kids engage.”

Scott said she wakes up every morning wondering what might be different.

“We can only move the house of cards so many times before those interior walls begin to move around,” she said. “I think we’re doing everything we can, but with so much unknown, we can only move and shift to the left or right a few inches before we wait to see what’s going to be there.”

Other types of federal funding

Austin ISD also gets money from other agencies, including the Department of Agriculture, which provides approximately $34.5 million for school food services. The district gets another $34 million in federal grants. Some of those funds have already been used up, while others have been awarded but not spent.

A couple of grants that were part of that $34 million total have been terminated. In February, the federal government cancelled a $750,000 grant focused on increasing the number of “highly effective educators.” Austin ISD also lost a $2.9 million grant supporting students and families who are refugees, as first reported by the Austin American-Statesman and confirmed by the district.

As the district navigates uncertainty about funding, Fox said, the goal remains serving students.

“I think on a human level, we will recognize and do our very best to continue supporting children learning what they need to learn and being successful at school,” she said.

This story was produced as part of the Austin Monitor’s reporting partnership with KUT.

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