An ESA Leader’s Guide to Federal Government Shutdown

Federal Fiscal Year (FY) 2026 will begin on October 1, 2025. Congress must extend funding to keep the federal government open by midnight on September 30 to avert a government shutdown. As Congress heads toward this deadline without a clear path forward, a government shutdown seems increasingly likely. Here’s what district leaders need to know about how they will (and will not) be impacted.

K-12 Formula Funds: Most K-12 federal funding is “forward-funded”—funds are provided the following July for the upcoming school year—which means the majority of K-12 federal education funding is not immediately impacted by a government shutdown. Impact Aid is the only federal K–12 education program that is not forward funded. As a result, school districts that rely on Impact Aid will experience delays in receiving payments—typically issued at the start of the fiscal year—during a government shutdown.

Additionally, a portion of the funding for Titles I-A and II-A, IDEA Part B and CTE is appropriated on an “advance-funded” basis, meaning that the money does not become available until October 1 of the following fiscal year (i.e. FY 2025 advance-funded money will become available on October 1, 2025). Historically, this funding is not impacted by a government shutdown and goes out as usual. Given this summer’s unprecedented withholding of certain formula funds, there is concern that this funding may also be impacted. However, AESA has confirmed with Department of Education staff that the remaining FY 2025 formula funds should be made available on October 1, even in the event of a federal shutdown.

School Meals: School meal reimbursements will not be impacted in a short-term shutdown. Although the Department of Agriculture (USDA) regularly issues school meal reimbursements to states, it typically has funding on hand for three months of school meals following a shutdown. If a shutdown were to extend beyond three months, USDA would then release guidance on how programs should proceed.

Head Start: Head Start funding may be disrupted based on the individual program cycles. The Department of Health and Human Services (HHS) issues Head Start (including Early Head Start) grants on a rolling basis throughout the fiscal year. Timing varies based on the grant cycles for individual grant recipients (e.g., some grantees may receive funds early in the fiscal year, some later in the fiscal year). Unlike school meals, HHS does not have a reserve of funding to continue operations.