A coalition of 20 states and the District of Columbia sued the U.S. Department of Education after the agency moved major K–12 and higher-education grant programs to other federal departments, lawyers and state officials said. The amended complaint argues federal statutes require the Education Department to operate these programs directly and that the administration’s interagency agreements — notably with the Department of Labor — amount to an unlawful outsourcing that risks service disruptions and layoffs. Plaintiffs include school districts, unions and disability advocates who warned the reassignments have already produced funding delays and operational confusion. The Education Department defended the reorganizations as efficiency and parental-control measures. The litigation raises questions about statutory authority, the future of federally managed datasets and potential interruptions to formula grants, career-technical education funding and student services nationwide.