Student Funding

Use of Funds 

 Qualifying expenses for education savings accounts include textbooks, curriculum, or other instructional materials; tutoring services approved by the Department of Education; computer hardware or other technological devices; fees for nationally norm-referenced testing, advanced placement exams, or similar assessments; industry certification exams; examinations related to college or university admission; educational services and therapies for students with disabilities from a licensed or accredited practitioner or provider; unbundled courses, services, extracurricular activities, and tutoring from a public school district; contracted teaching services and education classes approved by the Department of Education; up to $750 for transportation associated with services from an eligible provider; fees for ESA account management; and any other educational expense approved by the Department of Education. All funds remain in the student’s account until they graduate high school or turn 21 years old, whichever occurs first. Caution: This program cannot be used to pay for tuition. 

Funding Amount and Source 

 The South Carolina legislature appropriated $30 million to the Education Scholarship Trust Fund for its initial year of operation, meaning no more than 5,000 students will be able to participate, or less than 1% of South Carolina’s K–12 population. The South Carolina ESAs are initially funded at $6,000 per scholarship. The General Assembly must appropriate funding for the Education Scholarship Trust Fund and has discretion over increasing or decreasing the per-ESA funding amount. The ESA program may not currently be combined with the Educational Credit for Exceptional Needs Children Fund (Tax-Credit Scholarship) Program. 

(Last updated April 27, 2024) 

Student Eligibility

ESA-eligible students must have attended public school in the prior school year, except for students entering kindergarten and prior ESA recipients. Additionally, student eligibility is based on a family’s needs through year three, at which point the General Assembly may decide to expand.

• 2024–2025: Targeted eligibility for students from households earning 200% or less of the Federal Poverty Level (FPL).
• 2025–2026: Targeted eligibility for students from households earning 300% or less of the Federal Poverty Level (FPL).
• 2026–2027 and beyond: Targeted eligibility for students from households earning 400% or less of the Federal Poverty Level (FPL).

Student enrollment is capped through year three, at which point the General Assembly may decide to expand.

• 2024–2025, the program is limited to 5,000 scholarship students;
• 2025–2026, the program is limited to 10,000 scholarship students; and
• 2026–2027, and for all subsequent school years, the program is limited to 15,000 scholarship students.

(Last updated April 27, 2024) 

EdChoice Expert Feedback

The South Carolina Education Scholarship Trust Fund ESA Program is broadly available to most families (albeit subject to enrollment caps) and offers flexible use for the child’s education. But policymakers could do even more for South Carolina students. The ESA program may not currently be combined with the Educational Credit for Exceptional Needs Children Fund (Tax-Credit Scholarship) Program. The $6,000 ESA amount is fixed at the time of the program’s launch, with no cost-of-living adjustment or escalator for awards to increase with the rising cost of educational expenses. The enrollment cap should be phased out after year three, or automatically adjusted to meet demand. The means testing and prior public requirements should phase out after year three to offer universal funded eligibility to South Carolina K-12 students. Administration of the South Carolina Education Scholarship Trust Fund Program is overseen by the Department of Education, which may contract with a third-party manager if it chooses to do so. This administrative structure should give the state department the flexibility to adapt to the needs of parents and ensure the program is run effectively. High school students are required to take a nationally norm referenced assessment, except for students with disabilities. The program generally avoids counterproductive regulations. (Last Updated December 14, 2023)

Rules and Regulations

Program Guidelines

• Income Limit: Year 1 – 200% x FPL, Year 2 – 300% x FPL, Year 3 and thereafter, 400% x FPL
• Prior year public school requirement: Yes
• Budget Cap: None
• Account Cap: $6,000
• Enrollment Cap: Year 1 – 5,000; Year 2 – 10,000; Year 3 and thereafter, 15,000
• Testing Mandates: National norm Referenced (High School Only, Except Disability Status)
• Special Needs Pathway: None

Participant and Family Guidelines

• Click Here for the Program Administrator’s Parent Handbook
• Education Requirements: Provide instruction in writing, math, social studies, and science
• Parent Supplemented Funds/Scholarships: Allowed
• Disbursement/Payment Frequency: Quarterly
• Reimbursement: No
• Miscellaneous:
  • Initial application and annually reapply
  • Only use funds for qualified expenses under South Carolina Code § 59-8-110 through 59-8-220
  • Take required assessments
  • Not participate in a home instruction program
  • Provide all Individualized Education Plan (IEP) documentation and acknowledge explanation of rights under Individuals with Disabilities Education Act (IDEA) for parental placement of students with disabilities

(Last updated October 10, 2024) 

Governing Statutes

South Carolina Code §§ 59-8-110 – 59-8-170.  

(Last Updated August 1, 2024) 

Legal History

This program was partially halted by the South Carolina Supreme Court. On October 26, 2023, a group of plaintiffs including the South Carolina Education Association and the South Carolina State Conference of the NAACP filed a Petition for Original Jurisdiction in the Supreme Court of South Carolina challenging the state’s ESA program. Eidson v. South Carolina Department of Education, No. 2023-1673 (S.C. 2023). The court ruled that parents may no longer use the program for private school tuition but may still use it for other educational services, concluding that the structure of the current ESA program causes tuition payments to be a “direct benefit” for religious schools and “private educational institutions” in violation of Art. XI, Sec. 4 of the state constitution. Critically, the South Carolina Supreme Court faulted the program because it “does not open the market for the scholarships to all public and private institutions, but only those the Department chooses and only for students who agree not to attend a public school in their district.” Excluding use of ESTF to pay for transfer to a different public school left only private schools as potential recipients of tuition payments under the program. “This is not the kind of free trade envisioned by Adam Smith or Milton Friedman,” the Court wrote. 

(Last updated October 1, 2024)