This bill establishes the Educational Equity Challenge Grant program within the Department of Education, designed to award funds to eligible entities. These grants aim to address students' academic, social-emotional, mental, behavioral, and physical health needs, including those exacerbated by the COVID-19 pandemic. Eligible recipients include local and state educational agencies, consortia, and partnerships with non-profits, but specifically exclude for-profit entities. The program supports two primary approaches: implementing evidence-based activities and strategies, or designing and implementing field- and educator-initiated proposals , both requiring adherence to specific evidence standards and independent evaluation for efficacy. Funds are allocated with 75% for evidence-based and 25% for field-initiated proposals, after administrative and tribal reservations. Priority is given to applicants serving disproportionately higher percentages of high-need students , such as low-income students, students of color, and those with disabilities. Significant portions of the funding are earmarked for specific demographics, with at least 25% for eligible entities in rural areas and at least 50% for those serving student populations with 20% or more low-income families. Grant applications must detail identified inequities, the impact of COVID-19 on specific student groups, and proposed strategies. Authorized uses of funds include developing high-quality assessments, supporting social-emotional learning, implementing mental health services, and recruiting diverse educators. Both grantees and the Secretary are required to submit annual reports on fund usage and program outcomes, with substantial appropriations authorized from fiscal years 2027 through 2036.