FY 2026 Funding Bill Sets $14.8B for K-12, Blocks Funds for 8 Climate Orders, and Rescinds Billions from Health Programs

The annual appropriations bill for the Departments of Labor (DOL), Health and Human Services (HHS), and Education (ED) for Fiscal Year 2026 is here, and it’s much more than just a budget. It’s a massive piece of legislation that allocates over $14.8 billion for K-12 education, but also uses the power of the purse to impose significant policy restrictions on everything from climate change initiatives to student loan forgiveness and Title IX enforcement.

This bill sets the spending for the year, but it also contains numerous policy riders—specific, non-budgetary rules—that dictate what federal agencies can and cannot do. For busy people, the key takeaway is that this bill funds crucial services you rely on, but it also takes away the enforcement power for several recent federal rules, potentially changing how certain protections are delivered or accessed.

The Budget Breakdown: Where the Money Goes

For the Department of Labor, the bill sets aside over $2.5 billion for workforce programs, including $1.8 billion for state grants aimed at adult and dislocated worker training. If you’re a veteran, the bill earmarks over $276 million from the Unemployment Trust Fund for veterans’ employment services and the Transition Assistance Program (TAP), with flexibility for states to use this money to help service members transitioning out of the military. If you’re a worker in a trade, you’ll be interested to know that $285 million is dedicated to expanding registered apprenticeship programs.

On the healthcare side, HHS gets massive funding for programs like the Ryan White HIV/AIDS program ($2 billion) and the National Institutes of Health (NIH), which receives billions for research on cancer, heart disease, and mental health. For those in rural areas, the bill sets aside $415 million for rural health initiatives, including $74 million for the Medicare Rural Hospital Flexibility grants. This includes a new $100 million fund to help small hospitals (under 50 beds) in the poorest states maintain their staff.

For the Department of Education, the bill allocates $14.8 billion for K-12 programs, including $15.4 billion for the Individuals with Disabilities Education Act (IDEA), ensuring continued support for students with special needs. Crucially, it locks in the maximum Pell Grant award for the 2026–2027 award year at $6,335, providing certainty for students planning their college finances.

Policy Riders: The Fine Print That Changes Everything

While the funding itself is substantial, the policy riders attached to this bill are what will truly impact day-to-day life and policy enforcement. This bill uses funding restrictions to block the implementation of numerous federal rules and executive orders (EOs):

• Climate and Environmental Policy: The bill blocks funding for the enforcement of eight specific EOs related to climate change, clean energy, and environmental justice. This means federal agencies funded by this bill cannot use these dollars to implement key parts of the administration’s climate agenda, potentially slowing down federal efforts to address climate-related financial risks or push clean energy.
• Healthcare Access: The bill prohibits funding for Title X family planning services unless providers certify they encourage parental involvement for minors and counsel minors on resisting sexual pressure. Furthermore, it explicitly blocks federal funding for any entity that performs abortions (except in cases of rape, incest, or life endangerment), potentially limiting access to comprehensive reproductive health services in areas served by federal grants.
• Student Loan and Debt Relief: For anyone hoping for student loan forgiveness, the bill blocks the Department of Education from using these funds to implement or enforce numerous specific rules related to debt discharge, loan servicing, and institutional accountability that were recently proposed or finalized. This creates a significant hurdle for any future student debt relief efforts.
• Title IX and Nondiscrimination: The bill prohibits the Department of Education from using its funds to enforce recent rules and interpretations regarding Title IX related to sex discrimination, sexual orientation, and gender identity. This includes blocking enforcement of the proposed rule concerning sex-related eligibility criteria for sports teams, effectively curtailing the Department’s ability to enforce protections for LGBTQI+ students using these funds.

Rescissions and Restrictions: Who Pays the Cost?

This bill doesn't just spend money; it takes some back. It rescinds $12.8 billion from the Child Enrollment Contingency Fund and takes back $183 million in unspent funds from the American Rescue Plan Act. While these are unspent funds, pulling them back reduces the financial cushion available for future health and social service needs.

Perhaps most controversially, the bill includes broad language blocking the use of funds for any activities related to "diversity, equity, and inclusion (DEI)" or "Critical Race Theory (CRT)." If you work for a federal agency, a school, or a contractor that receives federal money, this means funding cannot be used for DEI training, offices, or personnel. This restriction is significant and could force organizations to restructure how they address workplace equity and inclusion.

Finally, for those who rely on social services, the bill includes a provision that makes it easier for private entities to sue state governments or recipients of federal funds if they violate certain funding conditions regarding abortion services. This creates a new legal avenue for challenging how public funds are used, potentially leading to increased litigation against state agencies.

In short, this appropriations bill is a complex trade-off: it provides essential funding for the next fiscal year, but it also uses that funding to push a specific, restrictive policy agenda, impacting everything from healthcare access and student loans to climate change efforts and workplace diversity programs.