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'States should lead:' McMahon grants Iowa first-of-its-kind education funding waiver

1:12
Education Secretary Linda McMahon on proposed 2026 Department of Education budget
Alex Brandon/AP
ByArthur Jones II
January 08, 2026, 10:36 AM

U.S. Secretary of Education Linda McMahon granted Iowa a first-of-its-kind waiver to use millions of unrestricted federal dollars on education in a move that inches the Trump administration closer to its goal of transferring education power and decision-making to states.

"States should lead -- Washington should support their sound approaches and get out of the way," McMahon announced on Wednesday. "We hope that as we partner with congressional leaders to return education to the states we can work with them [Iowa] to expand these opportunities for states and local leaders to run their education systems."

The over $9 million waiver will help the Hawkeye State save millions in "compliance costs" over four years as the money flows directly back into the classroom, McMahon said in a post on X.

PHOTO: Linda McMahon
FILE - Education Secretary Linda McMahon speaks with reporters in the James Brady Press Briefing Room at the White House, Thursday, Nov. 20, 2025, in Washington. (AP Photo/Alex Brandon, File)
Alex Brandon/AP

"Iowa now has the flexibility to cut paperwork and simplify a hundred percent of state activities funding streams. It can invest in proven strategies to build a world-class teacher pipeline, close achievement gaps, and open post secondary opportunities to prepare for a great career," McMahon said.

Under the waiver, certain federal requirements will be dropped so that less strings are attached giving the state more flexibility in using the aid. Prior to the formal waiver request, the state submitted a Unified Allocation Plan to show how it would use its funds to improve academic outcomes for Iowa’s education programs. The plan includes supporting effective educator development, English language acquisition, among other topics, according to state education leaders.

The approval of the waiver bolsters McMahon's mission to reduce the federal government's role in education nationwide. But education is already a local-level issue in the U.S. On average, state and local education agencies provide about 90% of public school funding across the country. 

The agency is also working with about six additional states on their waiver requests, an Education Department spokesperson confirmed to ABC News.

Title VIII of the Elementary and Secondary Education Act of 1965 allows states and tribes to submit requests to waive any statutory or regulatory requirement seeking to "reduce administrative burden" and align programs with the needs of its students, according to a release from the Department of Education.

In addition to Iowa's $9 million in flexible federal funding, the Education Department approved the state's application for "Ed-Flex authority," which allows the state to grant individual school districts waivers from certain federal requirements without first having to submit individual waiver requests, according to the release from the department.

McMahon made the announcement during her "Returning Education to the States Tour."

During her first year as the nation's top education official, McMahon has made about two dozen stops in states across the country aiming to identify the best educational practices on the local level and work with local leaders to scale those practices nationwide, she says.

Wednesday's announcement allows state leaders to focus federal dollars on work that best improves the achievement of Iowa students, according to the release from the department. For the announcement, McMahon was joined by Iowa Gov. Kim Reynolds, director of Education McKenzie Snow, and surrounded by about a dozen students at Broadway Elementary School in Denison.

Reynolds touted Iowa's education models, including teaching the science of reading and using evidence-based math and reading practices. She stressed that the move Wednesday means "moving the dial" towards returning education to the states.

"The more red tape that we cut from the federal level, the more Iowa can increase education quality," she added.

"I look forward to continuing to improve student outcomes, reduce red tape for schools, support teachers, and ensure federal education dollars are focused toward state and local priorities where they make the greatest difference," Reynolds said in a statement.

However, critics of the Trump administration's education initiatives say they believe abolishing the agency and giving sole power to the states could harm the millions of students across the country.

The top Democrat on the House Education and Workforce Committee slammed McMahon's approval of the education waiver for allegedly ignoring the law and abandoning marginalized students. 

In a statement, Ranking Member Bobby Scott, D-Virginia, urged the Department to "refrain" from granting similar waivers to other states.

"Congress must not sit idly by as the Trump administration makes every effort to drag students, educators, and parents back into an era where students were denied the opportunities and resources they needed to succeed," Scott said.

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