City charter schools will be able to give some student groups preference in admissions lotteries and still receive federal funds, after the U.S. Department of Education changed its rules today.

The new regulations, which come too late to change how students are admitted to city schools this year, allow charter schools to conduct “weighted lotteries” in an effort to engineer diverse student populations. Previously, the Obama administration interpreted the state’s charter school law as prohibiting weighted lotteries.

The interpretation became a problem last year when the U.S. Department of Education threatened to withhold funding from some city schools unless they eliminated policies giving some high-needs students preference in admission. Some charter operators in New York say the preferences are necessary if they are to follow a state law that requires them to serve student populations that reflect their local districts. (That law was a response to criticism — borne out by enrollment data — that charter schools were not serving their fair share of high-needs students.)

Success Academy Charter Schools, the city’s largest network, dropped its policy of giving English language learners admissions preference because of the threat.

“[T]he millions of dollars in funding that your Department is threatening to withdraw is a gun pointed at our head,” Success CEO Eva Moskowitz wrote in a letter to U.S. Secretary of Education Arne Duncan last year.

That message appears to have been heard. The regulatory change followed concerted lobbying by Moskowitz, other charter school advocates, and officials from New York and other states, who worked to ease federal authorities’ concerns that weighted lotteries could be used to create racially segregated schools in addition to diverse ones.

James Merriman, CEO of the New York City Charter School Center, especially credited State Education Commissioner John King, who worked in charter schools before joining the State Education Department, for urging federal officials to make the change.

“Commissioner King advocated strongly for this change because of his fundamental belief that charter schools should serve their fair share of English language learners and students in poverty and therefore wanted to make sure the feds provided us with the tools we need to do that,” Merriman said.

King took no credit but did applaud the change. “The new USDOE rules regarding weighted lotteries for at risk students are a good step toward ensuring charter schools are able to serve high needs students,” he said in a statement.

The rule change comes too late for charter schools to change their admissions policies for this year, at least in New York. Success Academy’s authorizer required admissions preferences be set by Jan. 1, so the schools will select students in April without considering whether the students are English language learners, according to a spokeswoman.

In addition, charter school admissions season is well underway. The Charter Center announced today that families have already submitted 28,000 applications to city charter schools for this fall, two months before lotteries can be held.