On Thursday, the U.S. Department of Education said Denver Public Schools violated Title IX, the federal law against sex discrimination in education, after the district opened all-gender bathrooms and allowed students to use restrooms and locker rooms that corresponded to their gender identity instead of their biological sex.

The investigation, opened by the department’s Office for Civil Rights in January, centered on East High School, where a girls’ restroom was remodeled to be an all-gender facility. The department said the move ran counter to federal guidelines established by Title IX.

Here’s a closer look at the controversy and what comes next for the district and the federal government.

Denver Public Schools, which is the largest school district in Colorado, first moved to remodel one of the girls’ bathrooms into an all-gender restroom while keeping a boys’ bathroom on the same floor unchanged. District officials maintained the decision was student-led, noting that the all-gender bathrooms were equipped with taller partitions around toilets to ensure privacy and security.

In the federal government’s findings, Acting Assistant Secretary for Civil Rights Craig Trainor called the choice to remodel the bathroom “misguided” and said it denied students equal access to restrooms. Trainor also accused the district of “singling out” students based on their sex and creating a “hostile environment” on campus in violation of Title IX.

A second all-gender restroom was added later to the same floor in response to fairness concerns, and district leaders noted that students could still use single-stall, all-gender bathrooms throughout East High School in addition to the existing boys’ and girls’ bathrooms.

The Department of Education sent a proposed resolution letter to Denver Public Schools earlier this month that detailed four conditions for the district to meet within 10 days if it wanted to avoid federal enforcement action.

The resolution would require the district to:

Designate all all-gender multi-stall restrooms as sex-segregated facilities.

Remove all policies that allow students to use bathrooms and locker rooms that are not aligned with their biological sex.

Define “male” and “female” “in a biology-based manner” in all policies and practices that receive Title IX funding and are related to bathrooms and locker rooms.

Send a letter to schools directing them to “protect the privacy, dignity, and safety” of their students in bathrooms and locker rooms and ensure that they are equally available to students of both sexes.

The department is allowing 10 days for Denver Public Schools to accept or reject the proposed resolution, which could lead to enforcement actions if the district doesn’t acquiesce. Actions could include the loss of federal dollars.

In a statement, Trainor called the district’s decision to remodel the bathroom “outrageous” and accused the school district of allowing a policy “that endangers student safety, privacy, and dignity.”

“Denver Public Schools violated Title IX and its implementing regulations by converting a sex-segregated restroom designated for girls in East High School to an ‘all-gender’ facility and by allowing students to use the high school’s intimate facilities on the basis of their gender identity rather than their biological sex,” Trainor said.

“Denver is free to endorse a self-defeating gender ideology, but it is not free to accept federal taxpayer funds and harm its students in violation of Title IX,” he added. “The Trump Administration will work relentlessly to hold accountable school districts that harbor the ideological fanatics and policies that sully students’ educational experience with sex discrimination.”

The district has defended its bathroom policy decision, which was made after students called for the move in a school-led process. District officials said the bathrooms were put in place to meet changing student needs while also ensuring privacy and security.

Denver Public Schools has not yet responded to the department’s findings but previously said the district “provides numerous bathroom options for all students,” including single-stall, all-gender bathrooms for students who needed additional privacy.

The debate over gender identity policies at Denver Public Schools comes as schools nationwide face decisions on the issue. In March, President Donald Trump signed an executive order that would block transgender girls from participating on sports teams that did not correspond with their biological sex.

Republican lawmakers in Congress have also proposed legislation to ban transgender students from using bathrooms or locker rooms that corresponded with their gender identity or from playing on sports teams that did not align with their biological sex.

The Education Department has pursued multiple investigations over gender identity policies in schools and colleges. Just this week, the department said George Mason University violated federal law by using unlawful diversity, equity, and inclusion (DEI) practices under Title VI.

Denver Public Schools must decide within 10 days whether to accept the resolution the Education Department offered or to reject it and risk enforcement action that could include the loss of millions of dollars in federal funding.

The district has 10 days to respond to the department and could decide whether to roll back its policy allowing students to use all-gender bathrooms.