(CNN) — The Obama administration issued guidance Friday directing public schools to allow transgender students to use bathrooms matching their gender identity.

A joint letter from the Departments of Education and Justice went to schools Friday with guidelines to ensure that “transgender students enjoy a supportive and nondiscriminatory school environment,” the Obama administration said Thursday.

The announcement comes amid heated debate over transgender rights in schools and public life, which includes a legal standoff between the administration and North Carolina over its controversial House Bill 2. The guidance goes beyond the bathroom issue, touching upon privacy rights, education records and sex-segregated athletics, all but guaranteeing transgender students the right to identify in school as they choose.

“There is no room in our schools for discrimination of any kind, including discrimination against transgender students on the basis of their sex,” Attorney General Loretta Lynch said. “This guidance gives administrators, teachers and parents the tools they need to protect transgender students from peer harassment and to identify and address unjust school policies.”

The letter does not carry the force of law but the message was clear: Fall in line or face loss of federal funding.

North Carolina Gov. Pat McCrory slammed the guidance and called on Congress to address the issue.

“Most Americans, including this governor, believe that government is searching for a solution to a problem that has yet to be defined.

Now, both the federal courts and the U.S. Congress must intercede to stop this massive executive branch overreach, which clearly oversteps constitutional authority,” McCrory said in a statement.

Justice and Education Department officials have repeatedly made clear that under their interpretation of Title IX, the federal anti-discrimination law in education, schools receiving federal funds may not discriminate based on a student’s sex, including a student’s transgender status.

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