Kroger closing automated fulfillment centers as it tries to make delivery faster and cheaper

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By DEE-ANN DURBIN

Kroger said Tuesday it’s closing three automated fulfillment centers as part of an effort to make its delivery operations faster and more profitable.

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The nation’s largest grocer said it will close facilities in Pleasant Prairie, Wisconsin; Frederick, Maryland; and Groveland, Florida, in January. The company said it will monitor the performance of its five remaining facilities.

“We are taking decisive action to make shopping easier, offer faster delivery times, provide more options to our customers, and we expect to deliver profitable sales growth as a result,” Kroger Chairman and CEO Ron Sargent said in a statement.

Kroger partnered with British grocery technology company Ocado Group in 2018 to build warehouses where robots would pick and pack grocery delivery orders. Initially, the companies planned 20 locations, but only eight have been built so far.

Kroger said it will incur a $2.6 billion charge in its fiscal third quarter related to the closure of its operations. The company said it expects the closures will improve its e-commerce operating profit by $400 million in 2026.

Ocado shares fell 16% Tuesday on the London Stock Exchange. Kroger shares were up 1% Tuesday morning on the New York Stock Exchange.

During a conference call with investors in September, Sargent said that in most locations, it makes sense to use stores to fulfill delivery orders instead of centralized warehouses.

Stores are closer to customers, so orders can be delivered more quickly and cheaply, Sargent said. He said Kroger is capable of delivering orders in less than two hours from 97% of its 2,700 U.S. stores.

“Stores are our most important asset,” Sargent said.

Sargent said that in some high-density areas with strong delivery demand, automated fulfillment facilities are delivering better results.

At the same time, Kroger is also leaning more heavily into partnerships with third-party providers. In September, the company said it was expanding its partnership with DoorDash. DoorDash offered delivery of sushi, flowers and prepared meals from Kroger starting in 2022, but it now offers delivery of Kroger’s full assortment of products.

Last month, Kroger announced a similar expanded partnership with Uber Eats. And earlier this month, Kroger said it was working with Instacart to expand express delivery from its stores. Kroger will also be one of the first retailers to offer access to Instacart’s AI assistant, which builds delivery orders automatically based on customers’ preferences and provides meal ideas.

Court settlement calls for NPR to get $36M in government funds to operate US public radio system

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By MICHAEL KUNZELMAN, Associated Press

WASHINGTON (AP) — National Public Radio will receive approximately $36 million in grant money to operate the nation’s public radio interconnection system under the terms of a court settlement with the federal government’s steward of funding for public broadcasting stations.

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The settlement, announced late Monday, partially resolves a legal dispute in which NPR accused the Corporation for Public Broadcasting of bowing to pressure from President Donald Trump to cut off its funding.

On March 25, Trump said at a news conference that he would “love to” defund NPR and PBS because he believes they are biased in favor of Democrats.

NPR accused the CPB of violating its First Amendment free speech rights when it moved to cut off its access to grant money appropriated by Congress. NPR also claims Trump, a Republican, wants to punish it for the content of its journalism.

On April 2, the CPB’s board initially approved a three-year, roughly $36 million extension of a grant for NPR to operate the “interconnection” satellite system for public radio. NPR has been operating and managing the Public Radio Satellite System since 1985.

But the CPB reversed course under mounting pressure from the Trump administration, according to NPR. The agency redirected federal interconnection funds away from NPR to an entity that didn’t exist and wasn’t statutorily authorized to receive it, NPR says.

CPB attorneys denied that the agency retaliated against NPR to appease Trump. They had argued that NPR’s claims are factually and legally meritless.

On May 1, Trump issued an executive order that called for federal agencies to stop funding for NPR and PBS. The settlement doesn’t end a lawsuit in which NPR seeks to block any implementation or enforcement of Trump’s executive order. U.S. District Judge Randolph Moss is scheduled to preside over another hearing for the case on Dec. 4.

The settlement says NPR and CPB agree that the executive order is unconstitutional and that CPB won’t enforce it unless a court orders it to do so.

Katherine Maher, NPR’s president and CEO, said the settlement is “a victory for editorial independence and a step toward upholding the First Amendment rights of NPR and the public media system.”

Patricia Harrison, the corporation’s CEO, said in a statement that the settlement marks “an important moment for public media.”

Education Department offloads some work to other agencies as Trump presses for its closure

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By COLLIN BINKLEY, AP Education Writer

WASHINGTON (AP) — The U.S. Education Department is handing off some of its biggest grant programs to other federal agencies as the Trump administration accelerates its plan to shut down the department.

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It represents a major step forward for the administration’s dismantling of the department, which has mainly involved cutting jobs since President Donald Trump called for its elimination with an executive action in March.

Six new agreements signed by the Education Department will effectively move billions of dollars in grant programs to other agencies. Most notable is one that will put the Department of Labor over some of the largest federal funding streams for K-12 schools, including Title I money for schools serving low-income communities.

Department officials said the programs will continue to be funded at levels set by Congress. They did not say whether the changes would bring further job cuts at the department, which has been thinned by waves of mass layoffs and voluntary retirement offers.

“The Trump Administration is taking bold action to break up the federal education bureaucracy and return education to the states,” Education Secretary Linda McMahon said in a statement. “Cutting through layers of red tape in Washington is one essential piece of our final mission.”

The action leaves in place the Education Department’s $1.6 trillion student loan portfolio and its funding for students with disabilities, though McMahon has suggested both would be better managed by other federal departments.

McMahon and her staff have spent months hammering out the deals, which allow the department to lop off large parts of its footprint without action from Congress. It’s being done through formal agreements that agencies often make with one another when their work overlaps.

The Education Department tested the idea in June with a deal that moved adult education programs to Labor. The new agreements take it a step further and lay the groundwork for more.

Officials say the new agreements provide a “proof of concept” as the administration works to persuade Congress to close the agency. The goal is to convince Congress that the deals should be cemented into legislation, eliminating a need for the department.

Under the new plan, Labor will oversee almost all grant programs that are now managed by the Education Department’s offices for K-12 and higher education. Along with the $18 billion Title I program, that includes smaller funding pools for teacher training, English instruction and TRIO, a program that helps steer low-income students to college degrees.

It will effectively outsource the department’s Office of Elementary and Secondary Education and Office of Postsecondary Education, two of the agency’s largest units. Two major roles of the postsecondary office will remain with the Education Department: oversight of student loan policy and the accreditation of colleges for eligibility to receive students’ federal financial aid.

States and schools should not expect any disruptions in their funding, the department said, but their federal money will now come from the Department of Labor.

Another deal will put Health and Human Services in charge of a grant program for parents who are attending college, along with management of foreign medical school accreditation. The State Department will take on foreign language programs. Interior will oversee programs for Native American education.

Opponents have urged against such a shake-up, saying it could disrupt programs that support some of the nation’s most vulnerable student populations. Some argue that other agencies don’t have the expertise that schools and families rely on at the Education Department. Some also question the plan’s legality, noting that legislation requires the Education Department to oversee some of its operations in-house.

Department officials say their plan is legally sound and argue it will make programs more efficient.

McMahon has increasingly pointed to what she sees as failures of the department as she argues for its demise. In its 45 years, she says it has become a bloated bureaucracy while student outcomes continue to lag behind. She points to math and reading scores for the country’s K-12 students, which plummeted in the wake of pandemic restrictions.

Her vision would abolish the Education Department and give states wider flexibility in how they spend money that’s now earmarked for specific purposes, including literacy and education for homeless students. That, however, would require approval from Congress. The task is complicated by the fact that some of the department’s core work has long had bipartisan support.

The new deals are part of a broader plan to prove that America’s schools and colleges can operate without the department. As part of the plan, officials say McMahon will continue touring the country to highlight the successes of local schools — and she will also spend more time making her pitch to lawmakers on Capitol Hill.

The Associated Press’ education coverage receives financial support from multiple private foundations. AP is solely responsible for all content. Find AP’s standards for working with philanthropies, a list of supporters and funded coverage areas at AP.org.

Judge tosses DoJ lawsuit challenging a New York law barring immigration agents from state courts

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By MICHAEL HILL, Associated Press

ALBANY, N.Y. (AP) — A judge has dismissed a Trump administration legal challenge to New York policies that block immigration officials from arresting people at state courthouses, saying the federal government can’t force states to cooperate with those enforcement efforts.

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U.S. District Judge Mae D’Agostino late Monday granted New York’s motion to dismiss the government’s lawsuit, one of several legal actions from the Republican administration targeting state and local policies over immigration enforcement.

The lawsuit challenged a 2020 state law banning federal immigration officials from arresting people who are coming and going from New York courthouses or in court for proceedings unless they have a warrant signed by a judge. The law, called the Protect Our Courts Act, was approved in response to enforcement actions at courthouses during President Donald Trump’s first term.

In its lawsuit, the Department of Justice claimed that the New York law and two related state executive orders were unconstitutional because they obstructed the execution of federal immigration authorities.

D’Agostino, though, found that New York’s decision not to participate in enforcing civil immigration law is protected by the 10th Amendment, which sets boundaries on the federal government’s powers.

“Fundamentally, the United States fails to identify any federal law mandating that state and local officials generally assist or cooperate with federal immigration enforcement efforts. Nor could it,” the judge wrote. “No such federal laws exist because the Tenth Amendment prohibits Congress from conscripting state and local officials and resources to assist with federal regulatory schemes, like immigration enforcement.”

The Justice Department didn’t immediately respond to a Tuesday email seeking comment about the ruling, including whether it plans to appeal.

New York Attorney General Letitia James, a Democrat whose office argued for the lawsuit to be dismissed, said she was fighting for the “dignity and rights of immigrant communities.”

“Everyone deserves to seek justice without fear,” James said in a statement. “This ruling ensures that anyone can use New York’s state courts without being targeted by federal authorities.”