BRIEF: School Choice in the States – April 2021

LEGISLATION

Alabama

HB 559 was introduced and referred to Ways and Means and Education Policy committees. If passed, the bill would allow a taxpayer to claim a tax credit of up to 75 percent of the tax liability of the of the taxpayer, not to exceed $75,000 per taxpayer or a cumulative amount of $30 million annually. This amount is an increase in the individual taxpayer cap of $50,000. The cumulative amount of $30 million annually remains the same.

HB 633 was introduced on April 15. If passed, it would create an education savings account. Eligible students would be those children whose parents are active-duty military or killed in the line of duty, students with an Individualized Education Plan or 504 plan, and foster children who recently achieved permanency through adoption or guardianship. The amount of the scholarship would be equivalent to 95 percent of the calculated amount the eligible student would have received in the district school he or she was assigned. Allowable uses include tuition and fees at participating schools, textbooks and tutoring.

Arkansas

Arkansas Gov. Asa Hutchinson signed SB 680, a new tax-credit scholarship policy for students from low-income families. Arkansas is now the 20th state in the nation to adopt a tax-credit scholarship policy.

Florida

Both chambers of the Florida legislature reached agreement on HB 7045, a bill that raises the income thresholds on the state’s tax-credit scholarship and school voucher policies for low- and middle-income students. The bill also merges the state’s two educational choice policies for students with special needs—the McKay voucher and the Gardiner Education Savings Account—into a new ESA policy that is a part of the state’s Family Empowerment Scholarship policy. The bill is now awaiting the signature of Gov. Ron DeSantis.

Indiana

Indiana passed its budget last month, which not only increased the income limit of the state’s school voucher program to 300 percent of the free and reduced-price lunch income limits but also increased funding to 90 percent of per-pupil spending in public schools for every eligible student. Perhaps most notably, the state created an education savings account (ESA) for students with special needs.

Iowa

Earlier this month, House File 847 passed the Senate. It contains expansions to the School Tuition Organization (STO) Tax Credit and Individual Tuition and Textbook Tax Credit programs. The STO expansion includes a cap increase from $15 million to $20 million on Jan. 1, 2022 while increasing the tax credit for donors from 65 percent to 75 percent. Additionally, the Individual Tuition and Textbook Tax Credit program will see the credit increase from 25 percent of the first $1000 spent to 25 percent of the first $2000 spent. This means the credit will increase to a maximum of $500 per student.

Maryland

Maryland’s budget bill, HB 588, passed its second chamber and is awaiting the signature of Gov. Larry Hogan. The bill fully funds Maryland’s BOOST voucher program, which previously received a $6.5 million appropriation, at $10 million.

Massachusetts

Lawmakers introduced S 1864, a bill which would create a tax-credit scholarship program for low- and middle-income students unable to afford private school tuition as well as students in foster care. The credit value is set at 30 percent of a qualified donation to a scholarship-granting organization, not to exceed $250,000 per taxpayer. The bill was referred to the Massachusetts Joint Committee on Revenue.

Minnesota

The Minnesota Senate passed HB 1065, an education funding omnibus bill that includes a provision that would create an education savings account policy students from low- and middle-income families. The bill now returns to the Minnesota House of Representatives.

Additional bills affecting school choice in Minnesota also advanced. SF 961, which would increase Minnesota’s Education Deduction, passed its committee and was read a second time in the senate. HF 991, which would also increase the Education Deduction, passed both chambers and is also heading to a conference committee.

Montana

Both chambers of the Montana legislature passed HB 279, a bill that makes several modifications to the state’s tax-credit scholarship program, including raising the per-donor tax credit cap from $150 to $200,000 and expanding the “escalator” on the total tax credit cap from 10 percent to 20 percent. The bill is now awaiting the signature of Gov. Greg Gianforte.

North Carolina

SB 671 was filed on April 7. If passed it would make changes to the state’s low-income voucher program, Opportunity Scholarship, by expanding eligibility for children in a household with an income level of 150 percent to 175 percent of the federal free and reduced-price lunch program. It would also expand eligibility to children in foster care regardless of household income. Additionally, the bill would change the amount of the scholarship from a set amount ($4,250) to an amount up to 90 percent of the average state per-pupil allocation. Additionally, the bill would also create a variety of other changes to the choice programs in the state, including the creation of the Opportunity Scholarship Grant Fund Reserve to hold unexpended funds to be used to scholarships the following year and the combining of the state’s two disability programs into a single ESA.

HB 569 was filed on April 14. If passed it would require the administration of a common examination to a sample of certain private and public school students for the purposes of reporting on the opportunity scholarship.

HB 32 crossed over to the Senate on April 14. If passed it would expand eligibility of the low-income voucher program, Opportunity Scholarship, to include children entering kindergarten, first, and second grade. The bill would also change the scholarship amount from a maximum amount of $4,200 to 70 percent of the average state per-pupil allocation, and for those children coming from a household that qualifies for free and reduced-price lunch, 80% of the average state per-pupil allocation. The bill would also allow up to $500,000 from the Opportunity Scholarship Grant Fund Reserve to be expended on a nonprofit representing parents and families for outreach and scholarship education. The bill would also make changes to the Personal Education Student Accounts for children with disabilities, a special needs ESA program in the state. The bill would change scholarship amounts from a maximum of $9,000 to the state’s formula allocation of a child with disabilities plus 85 percent of the average state per-pupil allocation.

LITIGATION

South Carolina

On April 14, 2021, Liberty Justice Center, representing the Bishop of Charleston, of the Roman Catholic Diocese of Charleston, filed litigation in federal court alleging that the state’s Blaine Amendment is unconstitutional and should not be used to deny the state the right to use federal COVID relief funds for private education.

Bishop of Charleston v. Adams, U.S. District Court, Charleston Division, Case No. 2:21-cv-01093-BHH

Tennessee

The Tennessee Supreme Court scheduled oral arguments in the lawsuit against the state’s ESA Pilot Program for June 3, 2021.

The Metropolitan Government of Nashville and Davidson County et. al. vs. Tennessee Department of Education et. al., Tennessee Supreme Court, Case number M2020-00683-SC-R11-CV (2020)