The Trump administration announced a one-time redirection of nearly $500 million in federal education funding to historically Black colleges and universities (HBCUs) and tribal colleges, shifting money largely from grants that had been reserved for institutions serving high concentrations of Hispanic students.
The Education Department said the move follows a review it says found several minority-serving grant programs to be unconstitutional because they restrict eligibility by racial or ethnic enrollment thresholds. Education Secretary Linda McMahon said the changes will move funds "away from ineffective and discriminatory programs toward those which support student success." The department said the package represents a 48 percent one-time increase for HBCUs and more than doubles funding for tribal colleges and universities.
Agency officials said the redirection was made possible in part by a stopgap funding bill Congress enacted earlier in the year that gives the executive branch increased discretion over discretionary accounts. The department said the nearly $500 million boost comes primarily from $350 million in recently cut grants that had gone mostly to Hispanic-Serving Institutions (HSIs). About $60 million will be repurposed for charter school funding and roughly $137 million will support American history and civics grants, the department said.
The cuts drew immediate criticism from Democrats and education advocates who said the grants have long enjoyed bipartisan support and have helped expand access to higher education for working-class and minority students. Supporters of the HSI program note that Congress created the program in 1998 after finding Latino students were attending and graduating from college at lower rates than white students.
Department officials and administration allies point to a July memo from the Justice Department arguing the HSI grants are unconstitutional because eligibility requires a threshold share of Hispanic undergraduates. The department declined to defend the HSI program in litigation brought by the state of Tennessee and the group Students for Fair Admissions (SFFA), which seeks a federal injunction to halt the grants. Tennessee’s lawsuit contends that while its public universities serve Hispanic students, none meet what it calls the program’s "arbitrary ethnic threshold," and therefore those institutions miss out on tens of millions of dollars.
A person familiar with the shift, who was not authorized to discuss the decision publicly and spoke on the condition of anonymity, said additional funds are being taken from programs that support gifted and talented education, magnet schools, international education and teacher training. The person said many of those programs would be zeroed out in the Trump administration’s 2026 budget request.
The department framed the changes as part of broader White House priorities. President Donald Trump issued an executive action in January directing the agency to repurpose federal funds toward charter schools and other school choice initiatives. During his first term, Trump and Congress increased annual HBCU funding by $250 million, and the White House has pledged continued public support, including an annual summit and an advisory board.
Education officials said the money reallocation is focused on programs they consider to be in the best interest of students and families and on initiatives that do not rely on racial enrollment quotas. The administration characterized the move as correcting what it called racially discriminatory grant criteria while expanding support for HBCUs, tribal colleges and other priorities.
Legal challenges and political debate are likely to continue. The Justice Department memo and the Tennessee-SFFA lawsuit unfold against a backdrop of heightened litigation over race-conscious policies in education. Democrats and civil rights groups have warned that dismantling targeted minority-serving grant programs risks undermining efforts to close long-standing equity gaps in college access and completion.
The Education Department said the funding changes are a one-time repurposing of discretionary funds and detailed shifts in agency grant portfolios will be reflected in its forthcoming materials and budget proposals. Congress retains authority over annual appropriations and could choose to restore funding to affected programs in future legislation.