The American Federation of Teachers and a Chicago nonprofit sued the U.S. Department of Education after the agency abruptly halted multiyear Full-Service Community Schools grants, alleging the department ended funding without required procedures. The non-continuation letters affected projects across 11 states and D.C., jeopardizing roughly $168 million in remaining committed funds through 2028. Federal enforcement actions are compounding the funding shock: Homeland Security and FBI activity in Minnesota has expanded into probes of suspected fraud tied to federal programs supporting childcare, nutrition and other services. Campus and community grantees that partner with districts and nonprofits face heightened compliance scrutiny and potential cash-flow disruptions.