School Choice
On July 4, President Trump approved legislation allowing the federal tax scholarship program to proceed. The Educational Choice for Children Act (ECCA) offers a tax credit that individuals can use to lower their tax bills by donating money for private school expenses for students. The program is set to begin in 2027. Individuals (not corporations) who donate can cut their tax liability by $1 for every $1 donated to accredited Scholarship-Granting Organizations (SGOs), up to $1,700. The SGOs must be federally recognized 501(c)(3) nonprofit organizations.
The program makes students eligible for the scholarship funds if their families’ income does not exceed 300% of the local median gross income—a large pool of potential recipients. For example, in Boise, ID, the median family income is $81,308. So, a family living there would qualify for scholarships if they earned less than $244,000.
The scholarships cover various educational expenses, including private school tuition, tutoring, educational therapies, transportation, and technology. They may also help cover additional costs for students enrolled in public schools.
Additionally, per the law’s final version, states can opt out of participating, meaning no students in those states would be eligible for the program. Politically, this could have consequences. It might be advantageous for Republicans because Democrats are divided on the issue.
While teacher union leaders and white progressives overwhelmingly oppose public support for private schools, school choice remains popular in black and Hispanic communities. In a recent poll, 63% of Hispanics and 68% of Blacks expressed support for a private option.
Nationally, only 39% of public school parents are satisfied with their child’s education, according to an Education Opportunity in America report by 50CAN in 2024.
It’s worth noting that statewide tax-credit scholarships are common. There are 22 such programs in 18 states at this time.
Frozen Funds
On June 30, the Trump administration announced its decision to withhold $6.8 billion in federal education funds for K-12 schools. The Office of Management and Budget at the White House said that its review found that states had “grossly misused” the money to “subsidize a radical leftwing agenda.”
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