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Fairfax County Public Schools is pressing ahead with a federal appeal as the division faces the potential loss of up to $167 million over its bathroom and locker room policies for transgender and gender-expansive students.

The dispute began at the start of the school year, when the U.S. Department of Education demanded changes to FCPS policies governing access based on a student’s gender identity. Superintendent Michelle Reid said complying would require the division to violate binding court precedent and discriminate against students.

The department designated FCPS as “high-risk,” putting federal funding in jeopardy. FCPS contends that the designation and funding threat are not supported by identifiable evidence or other factors.

A federal judge in the Eastern District of Virginia dismissed the school division’s challenge to the designation in early September. FCPS appealed that decision to the Fourth Circuit Court of Appeals, which agreed to expedite the case.

The division filed its opening brief in October. The Department of Education responded Nov. 19, and FCPS submitted its reply brief Dec. 5. Oral arguments are scheduled for late January 2026.

FCPS and other school divisions have already lost several federal grants supporting student learning and mental health services. Those grants helped the division expand comprehensive mental health support for its roughly 180,000 students.

Additional federal money at risk helps pay for food and nutrition programs, cafeteria staffing, services and instruction for students with disabilities, technical education, teacher development, community education programs and efforts to improve student achievement.

Reid said the court action is necessary to protect student health and safety and preserve services used by tens of thousands of children. She added that FCPS intends to maintain a safe, supportive and inclusive environment for students and employees, including transgender and gender-expansive members of the school community.