Federal Court Reinstates $85 Million in COVID-Relief Education Funds for New Jersey

Judge grants injunction in multistate lawsuit, preserving nearly $1 billion in ARPA funding for K-12 recovery programs nationwide

A federal court has ordered the U.S. Department of Education to restore nearly $1 billion in COVID-19 relief funding to states, including approximately $85 million earmarked for New Jersey schools, following a legal challenge led by New Jersey Attorney General Matthew J. Platkin and a coalition of state attorneys general.

The preliminary injunction, issued by Judge Edgardo Ramos of the U.S. District Court for the Southern District of New York, blocks the Department of Education from enforcing a March 28, 2025, directive that rescinded access to funds previously awarded under the American Rescue Plan Act (ARPA). The order requires the immediate restoration of access to these funds while the case proceeds.

The legal action, filed on April 10, 2025, contends that the Department’s decision to cut off funding was both abrupt and unlawful, undermining state plans to support vulnerable students and school systems still recovering from the long-term effects of the COVID-19 pandemic. The lawsuit was filed by a coalition of 16 attorneys general and the Governor of Pennsylvania.

New Jersey’s $85 million share of the contested funds was designated to support services addressing the educational impacts of the pandemic, including programs aiding students experiencing homelessness and other at-risk populations. These funds were initially intended to be available through March 2026, as communicated by federal authorities prior to the March 2025 reversal.

Attorney General Platkin and other coalition members argued that the sudden revocation of access to ARPA funding created unanticipated budget shortfalls that threatened essential services for students and educators. 

“We are grateful that today’s decision puts a stop to the Trump Administration’s reckless and cruel attempts to cut off critical education funding to our state. Because of our lawsuit, schools, students, and teachers across our state will now continue to have access to $85 million in federal funding jeopardized by the Trump Administration,” said Attorney General Platkin. “As the court’s decision today makes clear, stripping access to federal funding that helps some of our state’s most vulnerable students violates the law, plain and simple. We look forward to continuing our case and permanently stopping the Trump Administration from inflicting further harm on our schools, students, and teachers.”

The American Rescue Plan Act, enacted in 2021, included substantial funding for state education agencies to address pandemic-related learning loss, provide mental health resources, and improve academic support for K-12 students. In New Jersey, these funds have underpinned local efforts to expand tutoring, social services, and support for disadvantaged communities.

This ruling temporarily preserves access to those funds as the broader legal case against the U.S. Department of Education continues to unfold. States joining New Jersey in the lawsuit include New York, California, Illinois, Maryland, Oregon, and others, as well as the District of Columbia.