Further proving that cash rules everything around education policy, recent headlines again were dominated by school funding conversations. Notably, these discussions cut across both the completed 2025-26 budget and the looming 2026-27 one. First, involving last year’s allocations, consternation continued over “31aa (School Safety and Mental Health)” funds, which were conditioned on districts agreeing “to comply with an investigation of a ‘mass casualty event’” should one occur and acquiescing to changes to how “Michigan’s government immunity laws shield educational institutions” (MASA 10/3 Legislative Update; November 2025 Capitol Perspectives; MASA 11/14 Legislative Update; Chalkbeat Detroit; December 2025 Capitol Perspectives). At December’s end, the judiciary weighed in, and a state court upheld the Michigan Legislature’s language in a case brought by various districts who argued that the conditioning of funds “is ‘exceedingly vague,’” invites “unintended legal consequences,” and “undermin[es] local decision making” (Chalkbeat Detroit; Chalkbeat Detroit; WZMQ).
Following this ruling, the case was appealed to the Michigan Court of Appeals, where it is likely to be heard “in early February, with a decision...expected within 30 days of oral argument (early to mid-March)” (MASA 31aa – Meeting Summary & Resources). In the meantime, this January, faced with the choice of agreeing to the state’s terms or walking away empty-handed, “hundreds of Michigan school districts rejected” these conditional dollars after they had previously “signed agreements saying they would waive privilege and agree to state investigations if a mass casualty event...occur[red]” (Chalkbeat Detroit; The Oakland Press; WZMQ). Consequently, barring some judicial intervention, “512 districts and schools [who agreed to the conditions] will share in the school safety and mental health funding” (Chalkbeat Detroit). Others will have to eliminate desired line items or find alternate funding sources.
Second, state funding was also in the news this month as a back-and-forth continued over the December move by Michigan House Republicans to block “nearly $645 million in funding for state departments’ projects heading into 2026” via “a relatively obscure provision in state law [the Management and Budget Act of 1984] that allowed them to lapse...funding without buy-in from the state Senate” (Bridge; MASA 12/12 Legislative Update; December 2025 Capitol Perspectives). Previously, in response to this action, “the Michigan Senate Appropriations Committee heard testimony from leaders of nonprofits and local government entities” concerning the cuts, the Michigan Senate “voted...to restore the canceled funding,” and leaders encouraged “Attorney General Dana Nessel...to issue an opinion on the [move’s] legality” (Bridge; Michigan Advance; Michigan Senate Democrats; December 2025 Capitol Perspectives).
In January, Attorney General Nessel issued that opinion, which argued that Michigan House Republicans “violated both ‘separation of powers’ and ‘bicameralism and presentment’ requirements in the Michigan Constitution” when they blocked the funds (Bridge). Resultantly, “State Budget Office officials [said] that means money [could] resume flowing to affected groups” (Bridge). Addressing this development, state House Republicans filed a lawsuit in the Michigan Court of Claims, asking for “a preliminary injunction blocking the state from spending [these] $645 million,” which they received from a judge (WILX 10). Consequently, “all state departments [were ordered] to stop spending the tax dollars” until the legal questions at play can be decided (MLive; WILX 10). With these funds currently in limbo, including some resources for K-12 educational endeavors, as mentioned in the December 2025 Capitol Perspectives, House Speaker Matt Hall (R – Richland Township) moved to the negotiations stage of this saga, saying “he’d be open to restoring funds to some work projects through a supplemental budget, provided the Senate’s Democratic leadership abides by [various] transparency rules” (Michigan Advance).
Finally, and tied to future school funding, this month had the January Consensus Revenue Estimating Conference (CREC) on Friday, January 16th. Annually, this gathering serves as “the starting point for the Governor's executive budget” and helps education leaders plan for future contingencies by providing “estimates of K-12 pupil membership” (Michigan Department of the Treasury; December 2025 Capitol Perspectives). This year, the January CREC’s predictions from the House and Senate Fiscal Agencies and the State Budget Office were a mixed bag, with “General Fund revenues...down significantly from the May 2025 projections” and districts facing “slightly steeper than previously anticipated” student enrollment declines but “School Aid Fund revenues...expected to increase steadily compared to the previous year and the May 2025 estimates” (MASA 1/16 Legislative Update). Discussing the findings, some economists suggested that the declines can be attributed to “tax law changes at the state and federal levels, as well as Michigan’s recently passed...road funding package” (Bridge).
Commenting on the implications of the January CREC, Michigan Senate Republican Leader Aric Nesbitt (R – Porter Township) argued that “the state’s next budget ‘must shrink government’” while Michigan Senate Appropriations Chair Sarah Anthony (D – Lansing) posited that she is “confident in our state’s ability to create another fiscally responsible budget” (WILX 10). State Budget Director Jen Flood added that “we will have some tough decisions to make” (Bridge). Looking ahead, these quotes have added to some concerns that “the projections could complicate a budget process that was already fraught last year, as the Republican-led House, Democratic-led Senate and Gov. Gretchen Whitmer failed to finalize a deal by [the] constitutional deadline” for doing so (Bridge). Between now and a final 2026-27 School Aid Fund, hopefully before October 1st, lie months of action items, including Governor Whitmer’s executive budget release in February, the State of the State on February 25th, budget frameworks from the Michigan House and Senate this spring, and the May CREC (MASA 1/16 Legislative Update; Bridge). It remains to be seen how much the January CREC predictions and other state news influence these deliverables.
In December, the Michigan Legislature created some momentum with an agreement between the Michigan House and Senate “to move 20 bill packages before the end of the year” and the passage of HB 4836 and SB 349 (with substitute H-1 adopted) to “create an opt-out process for the ACT WorkKeys assessment” and no longer require “all 11th grade students...to take” this exam as part of the Michigan Student Test of Educational Progress (M-STEP) (MASA 12/12 Legislative Update; December 2025 Capitol Perspectives). It was unclear if this bipartisanship could be sustained or if cooperative efforts would flounder. Suggesting some optimism, in January, the Michigan House and Senate jointly passed HB 4141 and SB 495, which cover wireless devices in schools (MASA 1/16 Legislative Update).
The first piece of legislation “establish[es] a statewide prohibition on student cell phone use during the school day,” albeit with “several key exemptions” covering “basic phones,” “devices used for instructional purposes,” “students with Individualized Education Programs (IEPs),” “medically necessary devices,” “district-owned devices,” and “emergency situations” (MASA 1/16 Legislative Update). In particular, the legislation “require[s] districts to create their own policies for removing cellphones from at least instructional time, although they can go further” (The Detroit News). Notably, it also covers “other wireless communication devices, such as tablets,” in seeking to offer a complete approach (The Detroit Free Press). On top of that, the second bill would “require districts to develop and maintain a protocol for when and how students are permitted to use cell phones during an emergency,” which sought to address some resistance to the policy from parents and advocacy groups (MASA 1/16 Legislative Update).
Writ large, support for the legislation, which would go into effect during the 2026-27 school year, was “broad and bipartisan” after “a [previously] drawn-out school cellphone policy debate” that saw the Michigan House fail “to pass an earlier version of the bill last year” (Chalkbeat Detroit; Michigan House). Advocates of the law point to “a growing body of research that indicates constant cellphone use impacts student learning” (Chalkbeat Detroit). They also note that restrictions can help with “curbing bullying online and distractions” and can make teachers’ lives easier by preventing them from “need[ing] to be cellphone police” (The Detroit News). Though, the bills were not universally backed, with “some students already experiencing a cellphone ban in their districts complain[ing] that the rules are overly stringent” and suggesting that districts should teach “accountability” instead of simply removing devices (The Detroit News). With that, some parents worried that they could lose “the sense of security they get from being able to reach their child at school” on their smart devices (The Detroit News).
Going forward, Governor Whitmer still technically needs to sign these bills. That said, it would be surprising if she vetoed them, given that she previously “called on lawmakers to pass phone restrictions in class in her 2025 State of the State speech” (The Detroit Free Press). Thus, assuming she gives this legislative package the green light, Michigan will join “about three dozen states” that “have similar policies in place” (Chalkbeat Detroit). Additionally, there will be another example of the Democrat-controlled Michigan Senate coming to terms with the Republican-led Michigan House after months of gridlock. Speaker Hall appreciated this point, saying that this vote helps “start the legislative year off ‘on a fresh foot’” (Chalkbeat Detroit). Such collaboration would presumably be welcomed by Michigan educators and administrators in “a pivotal year for education in Michigan” (Chalkbeat Detroit).
A few weeks ago, the December 2025 Capitol Perspectives summarized efforts by the Trump administration “to shut down the” U.S. Department of Education by “handing off some of its biggest grant programs to other federal agencies,” cut “more than 10 separate ongoing projects” connected to the “Full-Service Community Schools program,” and reallocate canceled funds to “65 new [initiatives]...to boost school mental health services” (AP; EdWeek; EdWeek). It also covered his nationwide address in December, which highlighted his perceived accomplishments, including breaking “the grip of sinister woke radicals in our schools” and sending “control over those schools...back” to “our great and loving states” (New York Times). Some of these efforts continued in January. For instance, mid-month, “the Education Department announced...it will be moving some employees to the Department of Labor as it looks to integrate some postsecondary education and workforce development programs” (The Hill). That said, other federal priorities stalled and were overshadowed by different January developments.
One such topic, taking oxygen from these previous Trump administration efforts, was federal education funding. Following the end of the “longest-ever [government] shutdown in November,” Congress passed and “President Donald Trump...signed half of the annual slate of federal funding bills for the fiscal year that’s already close to one-third of the way over” (EdWeek). Additionally, “the House...approved fiscal 2026 funding bills for the remaining eight agencies, including the Education Department” (EdWeek). That said, on Thursday, January 29th, “a key vote intended to head off a partial government shutdown [by passing the House’s budgets] failed in the Senate” as “Democrats refused to back funding for the Department of Homeland Security (DHS) unless it included reforms” (The Guardian). Consequently, it seemed like “a partial shutdown [was] set for midnight Friday” that would leave the Department of Education “on the chopping block,” again (Axios). Moreover, there were worries about a resumption of shutdown-related challenges last discussed in the October 2025 Capitol Perspectives, including furloughed employees, delayed “grant competitions and...civil rights investigations,” Impact Aid pauses, uncertainty about Head Start, and “another delay in...clarity” for administrators curious about federal funding levels (EdWeek). Thankfully, at the last minute, “Senate Democrats...struck a deal with Republicans and the White House to pass five spending bills to fund a large portion of the government for the remainder of the fiscal year, as well as a stopgap measure to fund the Department of Homeland Security for two weeks” (The New York Times). However, the worry from this event will likely linger.
Further, federal K-12 debates were dominated by disagreements over immigration enforcement and the place of such efforts in and around schools, following local developments and reports on the death of “at least eight” people who were “either...killed by federal agents or who have died while in Immigration and Customs Enforcement (ICE) custody in 2026 so far” (The Guardian). Previously, “the Trump administration...revoked a ‘sensitive locations’ memo which, since 2011, had prevented ICE enforcement actions near schools” (Bridge; January 2025 Capitol Perspectives). In January, the appropriateness of this approach was reviewed following the detention of “multiple parents of students at Ypsilanti Community Schools...at a bus stop...during student drop-off times” and coverage of “four students [at Western International High School in Southwest Detroit] seeking asylum in the U.S.” who were “detained by ICE” (Chalkbeat Detroit; Chalkbeat Detroit). In response to ICE's actions, Ypsilanti Superintendent Alena Zachery-Ross commented that “there are no words to fully capture the pain, fear and disruption this causes” and noted that the district will “not voluntarily cooperate with ICE” (Chalkbeat Detroit). Likewise, Detroit educators have called for the district to “update its 2019 ‘Sanctuary District’ policy,” “train...staff in protocols around interacting with ICE,” and “offer know-your-rights training, more counseling, and safer transportation options for students” (Chalkbeat Detroit).
For their part, ICE officials have said that they do not “target schools for enforcement actions or bus stop locations” (Bridge). That said, Michigan Democrats did not appear to be persuaded, raising the prospect of passing “potential ICE restrictions” that would, among other things, “prevent immigration enforcement at schools” (Bridge). Though, “even if approved by the Democratic-led Senate, the package faces little chance of passing the Republican-led House, where Speaker Matt Hall previously said similar...legislation...is ‘dead on arrival’” (Bridge). As such, how Michigan responds to this evolving federal priority, impacting K-12 schools, remains to be seen. It seems more likely to be influenced by local actors, including educators and administrators, than via state or federal bills, given deep ideological polarization. That said, with current levels of scrutiny of ICE and their role in a near-shutdown in January, anything is possible.
For questions or more information, please contact Tyler Thur in the Office of K-12 Outreach at thurtyle@msu.edu.