On January 7, 2026, the U.S. Department of Education (the “Department”) approved Iowa’s “Returning Education to the States Waiver,” making Iowa the first state to receive such approval. This waiver frees Iowa from several requirements related to the Every Student Succeeds Act (“ESSA”) and thereby give it greater flexibility in how it uses certain federal education funds.

Background: July 29, 2025 Dear Colleague Letter

On July 29, 2025, the Department’s Office of Elementary and Secondary Education issued a Dear Colleague letter to the chief school officers of each state, along with an accompanying press release. The letter began by noting, “[T]he results of the 2024 National Assessment of Educational Progress (NAEP) provided a stark reminder of how poorly our education system serves many American students.” It stated that “[d]espite strides made by the Every Student Succeeds Act to provide States with greater flexibility and decision-making, there are still many instances where ESSA requirements hinder rather than help States’ efforts to improve academic achievement.” The Department, therefore, invited relevant state and tribal entities “to seek creative and effective waivers for improving student academic achievement and maximizing the impact of Federal funds.”

The letter also described various pre-existing options for states under the ESSA that could be utilized without the need for a waiver. These included flexibility in the use of “innovative assessments” and “school support and improvement activities.”

The Department then outlined the waiver process in full, including: a public notice and comment period; creation of a plan describing the specifics of the waiver and how it would be implemented and monitored; submission of a waiver request; and Department review of the waiver request. Upon receipt of a request for a waiver, the Department has 120 days to review and issue a final determination on whether to grant or deny it. These waivers can last up to four years unless the state requests an extension.

The letter finished by outlining the limitations of the Department’s waiver authority under the ESSA. Finally, a related press release stated that “[t]he waiver process can provide state leaders more discretion over federal programs so that they can put dollars toward options that best meet the needs of students free from bureaucratic red tape.”

Iowa Waiver Details

Iowa submitted its official waiver request on September 22, 2025. On January 7, 2026, the Department issued a letter to the Iowa Department of Education Director approving the State’s waiver request. In the accompanying press release, the Department stated, “[t]his waiver’s flexibility will reduce compliance costs, allowing nearly $8 million to be redirected from bureaucratic red tape to the classroom over four years. State education leaders will use the redirected funds and the greater flexibility they afford to expand support for evidence-based literacy training, strengthening their teacher pipeline and narrowing achievement gaps.”

Specifically, the Department’s January 7 approval allows Iowa to consolidate state-level funds through FY 2028 for the following programs:

• Title II, Part A of the ESSA (Supporting Effective Instruction)
• Title III, Part A of the ESSA (English Language Acquisition)
• Title IV, Part A of the ESSA (Student Support and Academic Enrichment), and
• Title IV, Part B of the ESSA (21st Century Community Learning Centers).

In addition, the Department granted Iowa several program-specific waivers: a waiver of the Title I, Part A carryover limitation for FY 2024; a waiver of the Title IV, Part A content area spending limitations for FY 2025; and a waiver to permit its Title I, Part D, Subpart 1 subgrantees to spend more than 30% of funds on transition activities through FY 2028. Finally, Iowa was approved for authority under the Education Flexibility Partnerships Act of 1999 (“Ed-Flex”) to grant waivers to its LEAs of ESSA sections 1127(b) and 4106(e)(2)(C-E) in subsequent fiscal years without seeking Department approval. Iowa must submit an annual report to the Department on the implementation and impact of these waivers. Iowa’s plan is linked here.

The Department’s approval letter finishes by stating, “Through this waiver, we expect that [Iowa] will advance achievement by targeting investments in core priorities, ensuring access to high-quality instructional materials, strengthening instruction in literacy and mathematics, and directing resources to students with the greatest needs.”

What This Means to You

The Department’s push towards states’ enhanced usage of these waivers and the pre-existing flexibility within the ESSA could potentially impact many different stakeholders. If state education departments can use these funds more flexibly, this may lead to a more efficient use of federal funding toward areas where states need it most. A reduction of administrative burdens can free up additional funding to use toward improving important substantive objectives like student achievement. Encouraging states to implement more creative programs compliant with the Act’s language could enable the discovery of new and better methods that can then be adopted state-wide.

However, the ability to reallocate funds from one program to another means that certain programs may be deprioritized, and the populations benefiting from these funds could suffer from a lower level of funding. For example, resources could be moved away from the 21st Century Community Learning Centers initiative, which is intended to fund after-school programs benefiting low-performing schools and high-poverty communities. Funds previously directed toward English learning resources could also be redirected elsewhere. In addition, reducing red tape or administrative burdens could result in a funding system that is staffed inadequately, monitored for effectiveness, or lacking compliance.

Ultimately, the details regarding which states may apply for similar waivers and what each such state might propose to do with them will dictate the overall impact of these changes and whether it is positive.

If you have questions about how these developments could impact your state, school, or district, please reach out to the authors or your Husch Blackwell attorney.