(CNN) The Obama administration is dropping a last-minute effort to force hundreds of school districts to shift nearly $1 billion in spending from well-financed elementary and secondary schools to their schools with large numbers of low-income students.

The Education Department said Wednesday it is withdrawing a proposed policy that would have dramatically increased federal control over school-district budgets, because it "did not have time to publish a strong final regulation."

As CNN reported Tuesday , the department had been rushing to finalize a regulation before Obama leaves office at noon on Friday and Donald Trump becomes president.

Even if the department had adopted the regulation by Friday, it would have faced strong opposition from Republicans in Congress, who could have overturned it with a majority vote and a presidential signature.

Sen. Lamar Alexander, R-Tennessee, welcomed the department's move today and said the regulation would have violated a federal law enacted in 2015 that aims to give states and school districts more control over education.

Read More