This case is about allocation of education funding for K-12 schools to private schools during the first year of the COVID-19 pandemic. This case was filed after the state of Washington obtained a preliminary injunction in a separate case that also sought to enjoin the Department of Education’s guidance for allocating Coronavirus Aid, Relief, and Economic Security Act (CARES Act) funds. More information about that case can be found here: PB-WA-0011.

As part of the CARES Act, Congress allocated money to elementary and secondary schools to purchase protective equipment, cleaning supplies, and other items needed to respond to COVID-19 in the classroom. On July 1, 2020, the U.S. Department of Education (DoED) promulgated an interim final rule instructing school districts how to allocate the funds between public and private schools. Believing that the rule contravened Congress’s intent for allocating the CARES money, the state of Washington filed suit against the DoED in the District Court for the Western District of Washington on July 20, 2020. Washington claimed that DoED’s rule funneled money to private schools in violation of the CARES Act, which expressly required that funding for private schools comply with the Elementary and Secondary Education Act (ESEA). Judge Barbara Rothstein was assigned the case. The state of Washington was represented by the Washington State Attorney General's Office while the DoED was represented by the Department of Justice and private counsel.

In the CARES Act, Congress stated that allocation of the relief funds must be done “in the same manner as provided” in the ESEA. The ESEA dictates that funding amounts for private schools should be calculated based on the number of enrolled students from low-income families. The state of Washington argued that the DoED’s rule provided two choices, neither of which complied with the ESEA’s standards. The first option (the “poverty-based formula”) allowed school districts to determine funding for private schools based on the number of low-income students, but only if certain public schools that did not receive federal funding were excluded. Washington argued that this exclusion—which would preclude many public schools with low-income students from receiving CARES funds—contravened Congress’s intent to provide financial assistance to low-income students during the COVID-19 pandemic.

The second choice (the “enrollment-based formula”) allowed schools districts to use the CARES funding for all public schools. But in calculating the funds for private schools, school districts were required to consider all private school students regardless of income, whereas the ESEA only considered students from low-income families. Washington argued that this would result in private schools receiving a disproportionately high share of the funds.

Washington argued that DoED’s rule was an arbitrary and capricious action that exceeded the agency’s authority in violation of the Administrative Procedure Act (APA). Washington also contended that the rule violated separation-of-powers principles and the U.S. Constitution’s Spending Clause by effectively usurping Congress’ lawmaking power. Washington sought a declaration that the DoED's rule was invalid, injunctive relief enjoining the DoED’s rule and dispersing COVID education aid differently, and attorneys’ fees.

Three days after filing the complaint, Washington moved for a preliminary injunction. Washington argued that it was necessary due to the especially negative impact of the COVID-19 pandemic on low-income students. It was argued the DoED’s new rule would worsen this impact by funneling CARES Act funding towards private schools and away from low-income students at public schools. On August 21, 2020, the court granted the preliminary injunction. 481 F.Supp.3d 1184. Finding that the plaintiff was likely to succeed on the merits, the Judge Rothstein noted that the statue was not ambiguous in its directions for allocating CARES funding and that the DoED’s interim final rule “thwart[ed] Congress’s obvious intent.”

However, on October 26, 2020, the Court dismissed the present case as the rule at issue was already enjoined in NAACP v. DeVos (ED-DC-0010). With the rule at issue already negated, the Court held that the matter was moot. On November 9, 2020, Washington filed a motion for reconsideration. They argued that because Washington was not party to NAACP v. DeVos, it would have to file an entirely new suit if the DoED failed to follow NAACP v. DeVos. Additionally, Washington claimed that they had been in discussions with defendants about the possibility of an agreed judgment.

On December 9, 2020, the motion was denied. The court cited the fact that the summary judgment from NAACP v. DeVos was sufficient to prevent the DoED from reinstating the rule at issue. Additionally, the court noted that the DoED had recognized the rule’s unenforceability and claimed they would not pursue it further. This case is presumably closed.

Eric Gripp - 06/18/2021


compress summary