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April 29, 2025
Late Liquidation Period for Elementary and Secondary
Education Funds Provided During COVID-19 Pandemic
In response to the COVID-19 pandemic, Congress enacted 421 of the General Education Provisions Act (GEPA),
several programs that provided federal funds “to prevent, commonly referred to as the Tydings period, extends the
prepare for, and respond to coronavirus” in elementary and period of obligation of funds by governors, state
secondary education, or provided funds that could be used educational agencies (SEAs), local educational agencies
for that purpose. These programs include the Elementary (LEAs), and outlying areas by one year beyond the period
and Secondary School Emergency Relief (ESSER) Fund, of availability included in statutory language. Thus, with
Governor’s Emergency Education Relief (GEER) Fund, the inclusion of the Tydings period, the period of
Emergency Assistance to Non-Public Schools (EANS) availability of funds under the CARES Act was through
program, and Homeless Children and Youth (ARP-HCY) September 30, 2022; through September 30, 2023, for the
CRRSAA; and through September 30, 2024, for the ARPA.
program, which made grants to states (i.e., the 50 states, the
Following the Tydings period, a grantee or subgrantee (e.g.,
District of Columbia, and Puerto Rico). Funds were also
LEA) must liquidate (expend) the obligated funds within
appropriated for programs providing similar types of
120 days or within the ED-approved period of a liquidation
support to the outlying areas and the Bureau of Indian extension. Funds not liquidated accordingly will revert to
Education (BIE). Each of these programs was authorized the Department of the Treasury.
under the Education Stabilization Fund (ESF) or provisions
appropriating funds for similar purposes in response to the For state-administered programs (which include the
pandemic. programs administered by the outlying areas) in accordance
with Uniform Administrative Requirements, Cost
Funds for ESF programs for states were authorized and Principles, and Audit Requirements for Federal Awards,
funded by the three acts listed below. Each act also ED may extend the period for the liquidation of funds
provided funds for the outlying areas and the BIE. beyond the 120-day period following the Tydings period by
approving late liquidation requests. These flexibilities apply
• Coronavirus Aid, Relief, and Economic to the ESSER Fund, GEER Fund, EANS program, ARP-
Security Act (CARES Act;), which HCY, and funds provided to the outlying areas.
authorized ESSER I and GEER I;
Using ED-developed templates, ED permitted an SEA (or
• Coronavirus Response and Relief outlying area) to request an extension of up to 14 months
Supplemental Appropriations Act, 2021 beyond the automatic 120-day period to liquidate properly
(CRRSAA; Division M of the obligated funds for a total extension of 18 months. For
Consolidated Appropriations Act, 2021 ESSER I and GEER I, this 14-month period ended on
[P.L. 116-260]), which authorized ESSER March 28, 2024. For ESSER II, GEER II, and EANS I, the
II, GEER II, and EANS I; and 14-month period ended on March 28, 2025. For ESSER III,
EANS II, and ARP-HCY, the 14-month period was to end
• American Rescue Plan Act of 2021 on March 28, 2026. Similarly, the outlying areas could use
(ARPA;), which authorized ESSER III, ED-developed templates to request an extension of up to 14
EANS II, and ARP-HCY. months beyond the automatic 120-day period to liquidate
These acts collectively provided $200.1 billion in funds received under the CARES Act, CRRSAA, and
appropriations for state programs and $1.4 billion for the ARPA. The templates were posted prior to the end of the
outlying areas. These programs are administered by the period of obligation of funds. For example, the ESSER III
U.S. Department of Education (ED). and EANS II extension templates were posted on January 9,
2024. After the 18-month period expires, ED “will no
This In Focus focuses on changes to the period for the longer grant late liquidation requests, except under
liquidation of funds obligated under the aforementioned extraordinary circumstances or in cases involving lengthy
programs for states and the outlying areas and potential construction contracts.” SEAs and the outlying areas could
issues for congressional consideration. not request extensions beyond the 14-month period,
however, using the ED-developed templates.
Obligation and Liquidation Periods
Each program had a statutorily defined period of obligation State Late Liquidation Requests
(availability) during which grantees were required to As discussed previously, ED indicated that it would accept
obligate the funds awarded and a later date by which the requests from SEAs and outlying areas to extend the
obligated funds had to be expended (liquidated). Section liquidation period for funds awarded under each of the
aforementioned programs using the ED-developed
https://crsreports.congress.gov
Late Liquidation Period for Elementary and Secondary Education Funds Provided During COVID-19 Pandemic
templates provided the funds were properly obligated by the indicated that it will review “each request as it is received
relevant deadline. Data on these requests, their disposition, and work to provide a response as quickly as possible.”
and the amount of funds for which an extension was
granted, were provided to CRS by ED on March 5, 2025. Possible Issues
According to ED, the data were current as of February 28, The withdrawal of the late liquidation extension authority
2025. that ED previously approved occurred on the last day on
which funds provided under the CRRSAA could be
Based on the data provided by ED, 47 states had submitted expended based on the up-to-14-month late liquidation
and received approval for a liquidation extension for at least extensions requests. The ED-approved authority for late
one of the programs discussed in this In Focus. In addition, liquation of ARPA funds had originally extended through
some states had applications for liquidation extensions March 28, 2026. Based on data available from
under ESSER II, EANS I, EANS II, or ARP-HCY that were USAspending.gov on March 18, 2025, $2.8 billion in
either under review or pending approval by ED. Overall, ESSER III funds had not yet been expended as well as $592
164 liquidation extension requests submitted by the states million in EANS II funds and $104 million in ARP-HCY
had been approved, allowing $4.8 billion (2.4% of total funds.
state grant awards) to be expended for up to 14 months
beyond the automatic 120-day extension period to liquidate As states and outlying areas received different grant
funds. Of these funds, $3.3 billion (69.5% of the total amounts and have been expending these funds at different
approved for late liquidation extensions) in ESSER III rates, some entities may be more affected by ED’s change
funds were approved for the late liquidation extension. The in policy than others. For example, based on the March
states that had not submitted a request for any liquidation 2025 spending data, 97.7% of ESSER III funds had been
extensions as of February 28, 2025, were Louisiana, spent by states. However, this percentage ranged from
Washington, and West Virginia. The aforementioned 83.9% in Puerto Rico to 100.0% in Hawaii. In terms of
unpublished data provided to CRS suggest that no requests dollars remaining for liquidation, this ranged from $0 in
for a liquidation extension had been denied. Each of the Hawaii to $234.7 million in Texas and $477.3 million in
outlying areas received approval for at least one liquidation Puerto Rico.
extension request, totaling $384 million (27.1% of total
grant awards to outlying areas). State education chiefs (e.g., Mississippi) have argued in
letters to the Secretary of Education that the withdrawal of
ED Termination of Late Liquidation the late liquidation authority will cause financial hardship
Period for schools and disrupt student services. For example, the
On March 28, 2025, ED sent a letter to State Chiefs of Mississippi letter noted that “districts have contractual
Education, including the outlying areas, indicating that ED obligations that cannot simply be terminated without
had “reconsidered” state requests for late liquidation significant financial, educational, and legal consequences.”
extensions and was modifying the extensions of the late
liquidation period for the ESF, “including all programs On April 10, 2025, 16 states, the District of Columbia, and
funded by the CRRSA and ARP acts,” to end that day at the governor of Pennsylvania sued ED and the Secretary of
5:00 pm ET. As discussed above, ED had previously made Education over ED’s withdrawal of the late liquidation
late liquidation templates available in advance of the extension authority. The lawsuit says that the change in ED
expiration of the period of obligation for the relevant policy “triggered chaos” for SEAs and LEAs and has
programs. In making this new announcement, ED indicated created a “massive, unexpected funding gap that is causing
that states “could not rely on the Department adhering to its serious harm to the public, cutting off vital education
original decision” and this was “especially true because the services, all to the detriment of the students whom Congress
extension was a matter of administrative grace” and that intended to benefit.”
“any reliance on a discretionary extension subject to
reconsideration by the agency was unreasonable.” The letter As of April 23, 2025, ED reported receiving over 150
also stated that “extending deadlines for COVID-related project-specific requests for late liquidation extensions from
grants...years after the COVID pandemic ended is not 29 states and outlying areas. If an extension request is
consistent with the Department’s priorities and thus not a denied, the state agency may appeal the decision consistent
worthwhile exercise of its discretion.” with 2 C.F.R. §200.342.
In the same letter, ED indicated that it will consider For More Information About the ESF
extensions to the liquidation period on an individual
project-specific basis. In making a request, a state or CRS Report R47027, Education Stabilization Fund
outlying area has to explain “how a particular project’s Programs Funded by the CARES Act, CRRSAA, and ARPA:
extension is necessary to mitigate the effects of COVID on Background and Analysis
American students’ education” and “why the Department
should exercise its discretion” to grant a state’s request. CRS Report R48186, Education Stabilization Fund:
Expenditures for Elementary and Secondary Education
On April 3, 2025, ED followed up with additional details
about how an application for an extension to the liquidation
period for an individual project could be submitted. It
Rebecca R. Skinner, Specialist in Education Policy
https://crsreports.congress.gov
Late Liquidation Period for Elementary and Secondary Education Funds Provided During COVID-19 Pandemic
IF12978
Isobel Sorenson, Research Assistant
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https://crsreports.congress.gov | IF12978 · VERSION 1 · NEW