Federal Government Threatens Funding Cuts to Two School Districts Over Transgender Policies

The U.S. Education Department has put two public school districts on notice, warning that their federal funding could be cut due to policies related to transgender students — the latest action taken by President Donald Trump’s administration on the issue.

One of the districts under fire is Anne Arundel County Public Schools in Maryland. Federal officials allege the district broke the Family Educational Rights and Privacy Act, commonly known as FERPA, by labeling a student’s gender identity as “confidential medical information” that parents are not allowed to access.

The second district, Ann Arbor Public Schools in Michigan, is also accused of likely violating FERPA. According to the Education Department, the district has a policy that the Trump administration says requires “school employees to hide a child’s transgender status from his or her parents.”

Anne Arundel County Public Schools pushed back on the accusations, saying through a statement cited by an NBC affiliate that it first found out about the Education Department’s claims through the department’s own public statement on Monday. The district said it had not received any formal correspondence, notice, or supporting documents from federal officials.

“Once such information is received, AACPS and its legal counsel will carefully review it and respond through the appropriate process,” the district said.

Ann Arbor Public Schools did not offer an immediate response to the allegations.

The Trump administration has moved to freeze federal funding for schools and universities over a range of issues, including transgender policies, climate-related programs, pro-Palestinian demonstrations tied to the war in Gaza, and diversity initiatives.

Civil rights organizations have argued that these funding threats go against principles of academic freedom, free speech, and due process.

Federal officials announced that enforcement action will be taken against Anne Arundel County Public Schools. Ann Arbor Public Schools has been given until August 10 to show why similar action should not be pursued against them.

Under FERPA — the main federal law protecting the privacy of student education records and personal information — violations can lead to the loss of federal funding, the Education Department noted.