BRIEF: School Choice in the States – March 2021

LEGISLATION

Arizona

The Arizona Senate passed three bills to expand educational opportunities, all of which were then also passed by the Arizona House Ways and Means Committee, including:

• SB 1452 to expand eligibility for Arizona’s Empowerment Scholarship Account program to include students from low-income families or who are assigned to district schools with a high proportion of low-income students. The bill passed the Arizona Senate followed by the Arizona House Ways & Means Committee. It is now pending before the full Arizona House of Representatives.
• SB 1041 would increase the total amount of tax credits available via Lexie’s Law, a scholarship program for students who have special needs or were adopted through the state’s foster care system, from $5 million to $20 million.
• SB 1273 would expand the eligible categories of expenditures on which families can use their tax-credit scholarships to include career and technical education, uniforms, science lab materials, standardized tests, and a variety of extra-curricular activities.

All three bills are now pending before the full Arizona House of Representatives.

Arkansas

By a vote of 44-52, the Arkansas House of Representatives killed HB 1371, a bill that would have created a new tax-credit funded education savings account program for students from low-income families, the children of active-duty members of the military, students with special needs and children adopted through the state’s foster care system.

California

AB 300 was read a second time in the California State Assembly and referred to the Committee on Education. The bill would create a tax-credit funded education savings account (ESA) under an existing California education program to fund scholarships for private school tuition, online learning programs, tutoring, special needs therapies, transportation, textbooks, testing fees, and computer hardware and software. ESAs are capped at $5,250 for students who remain enrolled in district or charter schools and seek to use funds to supplement their education, and priority for ESAs is granted for students from families earning no more than 300 percent of the Federal Poverty Level.

Connecticut

Connecticut’s HB 6175 received a public hearing. The bill would create a tax-credit scholarship program.

Florida

The Florida Senate Appropriations Committee passed SB 48, a massive 155-page bill that affects many areas of Florida’s education policy, including the state’s educational choice policies. Among other things, the bill would combine the state’s five educational choice programs into two education savings account programs: the McKay-Gardiner ESA for students with special needs and an ESA for low- and middle-income students and students who had been victims of bullying and abuse. The bill is currently pending before the full Senate.

Georgia

The Georgia Senate and House of Representatives both passed SB 47, a bill that expands eligibility for the state’s voucher for students with special needs and expands the eligible categories of expenditures beyond private school tuition to include tutoring, uniforms, transportation, meals, summer school programs, and physical, speech and occupational therapy. The Georgia Senate agreed to the House amendments so the bill will head to Gov. Brian Kemp’s desk.

Kansas

The Kansas House of Representatives passed HB 2119, an omnibus education bill that would, among other things, modify the eligibility criteria for the state’s tax-credit scholarship policy, shifting from a “failing schools” model to eligibility based on family income. The Kansas Senate previously passed SB 61, which contained similar provisions modifying the state’s TCS policy.

Kentucky

In March, Kentucky saw HB 149 and SB 25, which were both introduced in January, amended into a larger education omnibus bill. This legislation, HB 563, provides for the creation of Education Opportunity Accounts (EOAs). HB 563 initially passed the House of Representatives by a vote of 51-45. An amended version passed the Senate by a vote of 21-15. Due to the amendments, the House of Representatives held a vote for concurrence, which was successful by a count of 48-47. Next, this legislation moved to Gov. Beshear’s desk where it was ultimately vetoed. However, on March 29, the legislature was able to overturn the veto with a count of 51-42 in the House of Representatives and 23-14 in the Senate enacting into law Kentucky’s first-ever school choice program.

EOAs will be available to students in households with an annual household income of not more than 175 percent of the amount necessary to establish eligibility for reduced-price meals based on the size of the household as determined annually by the USDA. Students also will be eligible if they have previously received an EOA from an account-granting organization or are a member of the household of an eligible student that currently has an EOA.

Maryland

Maryland’s budget bill, HB 588, passed both chambers of the state legislature. The bill includes a $6.7 million appropriation for Maryland’s Broadening Options and Opportunities for Students Today (BOOST) voucher program. The bill amends the program’s testing requirement to specify the subject area and types of nationally norm-referenced assessments participating schools and students must conduct. Additionally, the bill provides for the possibility of increased funding for BOOOST participants with special needs.

HB 1113, which would create an education savings account program for prior public school students and military dependents, received its second hearing.

Minnesota

HF 2171 was introduced and referred to committee in the Minnesota House. The bill would raise the income limits for Minnesota’s K-12 Education Expense Credit by tying household eligibility to the federal free-and-reduced-price lunch guidelines.

SF 1525 passed the Education Finance and Policy Committee in the Minnesota Senate. The bill, whose Minnesota House companion is HF 1528, would create Minnesota’s first ESA.

Montana

The Montana House of Representatives passed HB 329, a bill to create an education savings account policy for students with special needs. The bill is currently pending before the state senate. Additionally, the Montana House passed HB 279, a bill that would make 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 was rereferred to the House Appropriations Committee, which passed the bill in a 17-7 vote, and it is now heading back to the full House again.

Nebraska

The Revenue Committee of Nebraska’s unicameral legislature passed LB 364, a bill that would create a tax-credit scholarship policy for children from low-income families. The bill is currently pending before the full legislature.

New Hampshire

On March 11th, SB 130, a bill for the establishment of Education Freedom Accounts (EFAs) program was heard and passed the Senate Education Committee by a vote of 3-2. During the committee, this proposal saw its eligibility criteria amended and now allows for families with a household income below 300 percent of the federal poverty level to be eligible for an Education Freedom Account. One week later, on March 18th, the entire Senate voted on SB 130 and passed it by a vote of 14-10. SB 130 will now move to the House for further consideration. EFAs would let families use a portion of the state funding (on average $4,600 per account) to pay for a variety of educational expenses. Uses include private school tuition, tutoring, textbooks, educational therapy and more.

New York

Lawmakers introduced S 5573, the Education Affordability Act, in the New York Senate. The bill would create a tax-credit scholarship program, with tax credits for donations to various school improvement and scholarship-granting organizations worth 90 percent for donors whose Adjusted Gross Income is less than $300,000 and 75 percent for those whose income is greater than that threshold, with up to $150 million in such tax credits available in the program’s first year. The bill also creates an individual tax credit for home-based education instruction materials, as well as an individual tax credit for low- and middle-income households to assist in paying for private school tuition. The bill was referred to the Investigations and Government Operations Committee.

North Carolina

HB 464 was introduced in North Carolina on March 30. If passed it would create a tax credit in the amount of $1,250 a semester for children enrolled in a homeschool that meets the requirements of G.S. 115C-564. Parents or legal guardians would be ineligible for this tax credit if a child spent any time enrolled in a public school, spent any time as a full-time student in a post-secondary institution, is over the age of 22, or graduated from high school prior to the end of the semester. Similarly, SB 297 would create a $1,000 tax credit for a qualifying child that was homeschooled. Under SB 297, the credit may not exceed the amount of tax imposed on the taxpayer.

HB 32 has moved to the House appropriations committee in North Carolina. 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 percent 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% of the average state per pupil allocation.

Oklahoma

On March 31, Gov. Stitt of Oklahoma signed two significant education reform bills.

HB 2078, authored by Rep. Kyle Hilbert (R-Depew) and Sen. Zack Taylor (R-Seminole), modernizes the education funding formula by basing per-pupil funding on the most recent enrollment data. The previous system gave school districts multiple enrollment figures from which to base their funding, causing some districts to receive state funds for students no longer enrolled. Previously, the state distributed $200 million to some school district to educate 55,000 students that were not actually enrolled and being educated in those districts. Now Oklahoma’s priority is funding students first.

SB 783, authored by Sen. Adam Pugh (R-Edmond), Sen. Kim David (R-Porter) and Rep. Brad Boles (R-Marlow), amends the Education Open Transfer Act to allow students the ability to transfer to another school district at any time, provided the district has space available. The school district board of education shall determine capacity per grade level by the first day of January, April, July and October and shall post this policy publicly. A student denied transfer has the right to appeal to the district board of education. If the student is denied again, the parent may appeal to the state board of education. The state board will conduct a random audit of 10 percent of school districts annually to review compliance with the open transfer law. Students of active-duty military and military reserve shall not be denied the right to transfer regardless of capacity.

Oregon

Lawmakers introduced and read SB 853 in the Oregon Senate. The bill would create an individual tax credit for students utilizing private tutoring expenses, up to $2,000. The bill was referred to both the Finance and Revenue and Tax Expenditures committees.

SB 788, an income tax credit for homeschool expenses, was read in the Oregon Senate and referred to both the Education and Tax Expenditures committees.

Rhode Island

Rhode Island lawmakers introduced SB 455 and its companion bill, HB 6149. The bills would create Rhode Island’s first education savings account program. The program would grant restricted parent accounts to pay for students’ educational support costs, including course materials, tutoring services, technology and at-home learning materials and equipment.

West Virginia

HB 2013 was signed by Gov. Jim Justice on March 27, 2021 creating the Hope Scholarship Account. It is the first school choice program in the Mountain state and the most expansive education savings account in the nation. The value of the ESA is 100 percent of the prior year’s average state aid per pupil. Every kindergartner in the state is eligible for the ESA. All children in grades 1-12 are eligible for the program with a prior public enrollment requirement of 45 days or a prior public enrollment of one full instructional term the previous year. If less than 5 percent of the public school population is a part of the program on July 1, 2024, then – in 2026 – eligibility would expand to every school-age child in West Virginia. There is a wide variety of eligible expenses for the ESA including private school tuition, summer education programs and educational services or therapies. The bill will become effective 90 days from passage on June 15, 2021.

HB 2778 failed to cross over in West Virginia. The bill would have created up to a $3,000 tax credit against West Virginia state income tax for parents or legal guardians with children in a nonpublic school. The tax credit would only have been available as a credit against state taxes actually owed.

Wyoming

Two education choice bills were introduced in the Wyoming House of Representatives. HB 147 would create an individual education expense tax credit worth up to $1,000 per child. Eligible expenses include private school tuition, software, textbooks, curriculum and school supplies. The bill was referred to the House Education Committee, where it received a hearing.

HB 201 was also introduced in the Wyoming House. The bill would create an education savings account for students with special needs to pay for special education programs and services.

LITIGATION

Maine – U.S. Supreme Court

On March 11, EdChoice filed a brief in support of parents represented by the Institute for Justice in Carson v. Makin, a case that originated in Maine. This amicus brief supports the parents’ Petition for Writ of Certiorari, which is a request for the U.S. Supreme Court to consider the case. These Maine parents wish to choose a religious school for their children’s education under Maine’s town tuitioning program. Parents were permitted to choose religious schools through town tuitioning from the beginning of the program in 1873 until 1980, when an attorney general suggested that including religious schools may be contrary to the U.S. Constitution (Maine has no Blaine Amendment), and legislators subsequently changed the law to exclude religious schools. In ruling against parents, the First Circuit Court of Appeals distinguished its ruling from the June 2020 U.S. Supreme Court ruling in Espinoza v. Montana Dept of Revenue. The First Circuit said that while Espinoza prohibits states from blocking religious schools as parent choices because those schools are religious, Maine does not block religious schools based on their status as religious schools. Rather, Maine blocks from participation those private schools that use tuition funding for any religious purpose. The state of Maine has a May 21, 2021 deadline to file a response in this case.

Carson v. Makin, Case No. 20-1088, U.S. Supreme Court (2020).

Nevada

On March 1, the Nevada Supreme Court heard oral arguments in Flor Morency v. Nevada Dept of Ed. Parents represented by the Institute for Justice sued the state for repealing the escalator clause in the state’s tax-credit scholarship program, which will result in hundreds of students losing scholarship funding and may lead to the eventual demise of the program. The main issue in the case is whether the legislature was constitutionally required to pass the legislation with a two-thirds vote (it did not) or a simple majority. Decision pending.

Flor Morency v. Nevada Dept of Ed, Case number 81281, Nevada Supreme Court (2020).

On March 26, the Nevada Supreme Court issued an order scheduling oral arguments for May 3, 2021, in Legislature of the State of Nevada v. Settelmeyer. This case disputes the enactment of legislation that extended a particular business tax and repealed Nevada’s education savings account program (a program that was found constitutional but lacked a proper funding mechanism; thus, it has remained law but has not yet been funded). The main issue in the case is whether the legislature was constitutionally required to pass the legislation with a two-thirds vote (it did not) or a simple majority (same as Morency, above).

Legislature of the State of Nevada v. Settelmeyer, Case Number 81924, Nevada Supreme Court (2020).

Tennessee

On March 8, the State of Tennessee and the Institute for Justice on behalf of parent intervenors filed briefs with the Tennessee Supreme Court in support of Tennessee’s Education Savings Account Pilot Program. The main issue in this case is whether the ESA Pilot law, applying to two counties (Davidson and Shelby counties – where Nashville and Memphis are located), violates the Tennessee Constitution’s Home Rule provision which prohibits the legislature from enacting legislation targeting “a particular county.”

On March 9, EdChoice and brief partner ExcelinEd filed an amicus brief in support of parent intervenors and Tennessee’s ESA Pilot program. Briefs by Davidson and Shelby counties are expected April 7.

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).