Why School Choice Now

Parents and students need the option of full-time, in-person schooling this fall. In the spring, most kids missed out on months of learning, and if their schools do not fully reopen this fall, they will fall further behind—particularly minority students, low-income students, and students with disabilities

To respond to the school disruptions caused by COVID-19, President Trump signed into law the CARES Act, providing more than $13.2 billion to states for K-12 districts and schools. Now, Congress is considering providing additional tens of billions of dollars to K-12 education. Any additional appropriation for K-12 education must do the following:

  • Help all students and all teachers, not just those in district public schools. While public schools continue to receive local, state, and federal tax revenues, private schools in lower-income and working-class neighborhoods have faced significant enrollment declines. As private schools are forced to close, public schools may need to absorb up to one million private school students at a cost of more than $15 billion.
  • Enable all schools to safely reopen. Most, if not all, additional funds should be targeted towards supporting schools that have re-opened and are ensuring students continue to learn.
  • Directly empower families. Support schools where families feel well-served and empower families who need different education options. School choice and parental empowerment are particularly important for lower-income communities, where parents often cannot work remotely and are more likely to be dissatisfied with their government-assigned schools.

School Choice Now Act

President Trump has called on Congress to fully authorize and fund Senators Tim Scott and Lamar Alexander’s School Choice Now Act (S.4284), as part of any new COVID-19 response package. The School Choice Now Act will ensure every state can fund K-12 scholarship programs for eligible students, so that students don’t lose access to their school of choice because of economic disruptions, and so that families have choices if their public schools refuse to provide in-person options.

For school year 2020-2021, the School Choice Now Act provides a one-year emergency appropriation:

  • States will set aside funds they receive under the Elementary and Secondary Schools Emergency Relief Fund (ESSER Fund), which was first created under the CARES Act. Those funds will provide scholarships to eligible students.
  • If $70 billion is appropriated to the ESSER Fund, about $63 billion would flow to public districts and schools by formula, and about $7 billion would fund more than a million K-12 scholarships for needy students.
  • Governors will identify Scholarship Granting Organizations (SGOs), which will distribute K-12 scholarships to students in their jurisdictions. Governors will also determine which students and education providers are eligible, including career and technical education, special education services, transportation to any school, and tuition for private schools.

In school year 2021-2022 and beyond, SGOs will continue to support scholarship students by raising voluntary donations:

  • The School Choice Now Act also establishes a federal tax credit to encourage voluntary donations to SGOs, allowing recovering families to keep their children in the best educational environment for them.
  • The federal tax credit is available to both individuals and domestic businesses that contribute to SGOs. The tax credit is capped at 10% of AGI for individuals and 5% of net taxable income for businesses.
  • The total amount of tax credits is capped at $5 billion per year. Each state is assured a fair share of potential scholarships because the tax credits are allotted to states based on ESEA’s Title II-A formula.
  • Because the tax credit encourages new, private donations, it does not hurt public schools or take funds away from their teachers or students.

 

Education Freedom Scholarships
Estimated Initial State Credit Cap Allocations (2019)
Total   $5,000,000,000

Alabama

87,391,574

 

New Hampshire

25,000,000

Alaska

25,000,000

 

New Jersey

102,351,574

Arizona

114,533,606

 

New Mexico

41,541,804

Arkansas

52,285,284

 

New York

277,637,907

California

571,744,187

 

North Carolina

162,223,932

Colorado

58,277,307

 

North Dakota

25,000,000

Connecticut

37,353,018

 

Ohio

171,463,307

Delaware

25,000,000

 

Oklahoma

67,804,424

District of Columbia

25,000,000

 

Oregon

48,646,480

Florida

292,935,686

 

Pennsylvania

156,170,585

Georgia

182,824,243

 

Puerto Rico

123,598,276

Hawaii

25,000,000

 

Rhode Island

25,000,000

Idaho

25,000,000

 

South Carolina

83,099,304

Illinois

172,829,550

 

South Dakota

25,000,000

Indiana

94,309,451

 

Tennessee

106,135,602

Iowa

32,473,928

 

Texas

518,964,355

Kansas

36,679,798

 

Utah

37,228,346

Kentucky

72,492,654

 

Vermont

25,000,000

Louisiana

96,632,041

 

Virginia

96,007,603

Maine

25,000,000

 

Washington

84,021,045

Maryland

62,723,935

 

West Virginia

28,487,448

Massachusetts

68,898,731

 

Wisconsin

67,211,721

Michigan

139,966,914

 

Wyoming

25,000,000

Minnesota

57,019,607

 

 

 

Mississippi

65,861,416

 

American Samoa

7,202,901

Missouri

85,955,168

 

Guam

8,943,703

Montana

25,000,000

 

Northern Marianas

4,476,867

Nebraska

25,000,000

 

Virgin Islands

4,376,529

Nevada

44,218,189

 

 

 

 

 

 

Bureau of Indian Education

25,000,000

 

Note: Based on allocation provisions in H.R. 1434 (116th Congress)

What’s an SGO?

In the School Choice Now Act, scholarship-granting organizations (SGOs) will manage the emergency grants that will be distributed to families in the form of K-12 scholarships. Several SGOs already exist across the country through state-based tax-credit scholarship programs.

For states without state tax-credit scholarship programs, Governors can quickly recognize SGOs that will be responsible for managing scholarship programs in their jurisdictions.

Among the major conditions, SGO’s must:

  • Be 501(c)(3) charitable nonprofits, triggering financial reporting to the IRS.
  • Agree to distribute 95% of the appropriated funds as scholarships.
  • Follow the implementation rules outlined in federal law and promulgated by the governor.

Several existing SGOs are ramping up their operations to serve every state. Governors may also choose to deem any existing scholarship entity as an SGO for the purposes of the School Choice Now Act.

How Education Freedom Scholarships Can Expand Private and Home Education Options

Problem:

  • American education needs to evolve to leverage the unique learning styles and cultivate the talents of every child. At a time when students must develop the skills needed to succeed in an ever-changing world, nearly one-fourth of our 15-year-olds cannot read a basic, grade-level text, according to the National Assessment of Educational Progress.
  • Parents are children’s first, primary, and most influential teachers. Yet, too often, only affluent, well-connected parents can choose their children’s learning environment. All families should be empowered to choose an education setting where their children can reach their full potential.
  • Consistent with our country’s rich diversity, families should be free to select the education setting whose mission, instructional approach, or faith values best match the student and family.

Demand:

  1. Today, over half a million families are participating in private school choice programs in 26 States, Washington, D.C., and Puerto Rico, and even more Americans support these programs.
    • The Harvard Kennedy School’s 2019 Education Next survey found support for private school choice programs continues to grow. The most popular form of school choice—tax credit scholarships for low-income students to attend a private school—was supported by 58% of respondents. An American Federation for Children survey shows support is even higher among minority and millennial voters.
  2. Yet, in many States, thousands of students are on tax credit scholarship waitlists.
    • In Florida, 14,000 students will be freed from scholarship waitlists following Governor DeSantis signing into law the Empowerment Scholarship Program.
    • However, in Pennsylvania, more than 50,000 students remain on scholarship waitlists following Governor Wolf vetoing a scholarship program expansion.
  3. The number and percentage of school-age students whose families choose home education has doubled in the past 15 years, according to the National Center for Education Statistics.

Solution:

  • The Education Freedom Scholarships (EFS) proposal creates a $5 billion annual federal tax credit for businesses and individuals who voluntarily donate to scholarship granting organizations (SGOs). Those SGOs provide scholarships to empower families to choose the right education option for their elementary and secondary students, which may be an independent or faith-based private school or a home education.
  • States, not the Federal Government, identify SGOs and determine how to structure scholarship programs, including eligible students, education providers, and education expenses.
  • EFS prohibits religious discrimination and protects parental rights in scholarship use.

States could empower families to use scholarships to pay for:

  • Tuition and fees at a private school, including independent and faith-based private schools;
  • Summer and after-school education programs offered by private schools;
  • Tutoring offered by private school teachers to public and private school students;
  • Advanced Placement, International Baccalaureate, and honors courses;
  • Academic enrichment courses like art, music, or world languages;
  • Online courses offered by private schools and teachers to students, regardless of geography;
  • Special education and related services for students with disabilities or unique learning needs;
  • Remedial education services to assist students who are struggling academically;
  • Educational technology to enhance instruction and support student learning;
  • Internship, corporate work-study, and apprenticeship programs; and
  • Home education expenses, including curriculum and other instructional materials.

How Education Freedom Scholarships Can Expand Preschool Options

Expanding access to high-quality early learning opportunities for preschool children

Problem:

  • The benefits of participating in high-quality early learning opportunities have been well documented, especially for vulnerable children and dual-language learners.
  • However, high-quality early learning opportunities are not available to all children and families and states struggle to fund opportunities.

Solution:

  • The Education Freedom Scholarships (EFS) proposal creates a $5 billion annual federal tax credit for voluntary donations to state-based scholarship programs.
  • With EFS, states can seize the opportunity to empower families with preschool age children to access high-quality early learning opportunities, while relieving some of the financial pressure many families experience.

How EFS Can Expand Early Learning and Preschool Options:

  • EFS can be used for preschool age children if the State includes preschool or prekindergarten in its definition of elementary education.
  • States can design their programs to complement and expand existing public and private preschool programs and services. Scholarships can be focused, for instance, on expanding access to high-quality early learning opportunities and programs.
  • The scholarships could cover allowable education expenses including, but not limited to:
    • Tuition and fees at a preschool of a family’s choice;
    • Transportation to a preschool provider;
    • Homeschool, cooperative or community-based preschool education expenses, including specialized preschool curriculum and educational materials;
    • Programs and services that support transition to kindergarten; and
    • Programs and services that complement and expand existing special education programs and services for preschool children with disabilities, including access to high-quality inclusive programs.

Looking Forward:

  • High-quality early childhood interventions have positive effects on test scores. Importantly, positive effects are also sustained in the long-term, improving high school graduation, years of education completed, and earnings, and reducing crime and teen pregnancy according to a report recently published by the Society for Research in Child Development.
  • Empowering preschool children with expanded access to high-quality early learning opportunities through Education Freedom Scholarships can help provide all children the foundation to succeed in school, work, and life.

Fast Facts: Education Freedom Scholarships

“All students should have the freedom to pursue an education that develops their talents, unleashes their unique potential, and prepares them for a successful life.”

Secretary Betsy DeVos

A Historic Investment in America’s Students

  • Education Freedom Scholarships will provide for a $5 billion annual federal tax credit for voluntary donations to state-based scholarship programs.
  • This proposal would empower students and families to choose the best educational setting for them – regardless of where they live, how much they make, and how they learn.
  • Families receive and control the use of scholarships for their child’s elementary and secondary education, which may include career and technical education, apprenticeships, and dual and concurrent enrollment.
  • Privately funded scholarships improve the educational experiences of students across the country, without taking a single dollar away from public schools and the students who attend them.
  • Individual and business taxpayers nationwide contribute to student scholarships through state- identified Scholarship Granting Organizations (SGOs). Such contributions are eligible to receive a non-refundable, dollar-for-dollar federal tax credit, but no contributor will be allowed a total tax benefit greater than the amount of their contribution.

A Locally-Driven and Customizable Approach

  • This proposal gives those closest to students the freedom to decide what’s best for them. No family is forced to accept a scholarship, no taxpayer is forced to contribute, no organization is forced to participate, and no state is forced to participate.
  • Each participating state will determine how it will structure its program, including eligible students, education providers, and education expenses.
  • Some of the ways states can expand students’ access to educational opportunities include:
    • Advanced, remedial, and elective courses;
    • Apprenticeships and industry certifications;
    • Concurrent and dual enrollment;
    • Private and home education;
    • Special education services and therapies;
    • Transportation to education providers outside of a family’s zoned school;
    • Tutoring, especially for students in low‐performing schools; and
    • Summer and afterschool education programs.
  • This is not a new federal program. The proposal establishes a federal tax credit to support state-designed and controlled programs.

How EFS Can Expand Public Education Options

Breaking down barriers between zip code and opportunity by expanding access to public education options.

Problem

  • Most students in America are limited to attending a public school that is assigned to them. Although many families choose their public school by deciding where to live, only 14 percent of students are enrolled in a public school outside of their zoned school according to the National Center for Education Statistics.
  • The most vulnerable students in America do not have the freedom to pursue education opportunities in the same ways the rich, powerful, and connected families always have.

Solution

  • The Education Freedom Scholarships (EFS) proposal creates a $5 billion annual federal tax credit for voluntary donations to state-based scholarship programs, empowering elementary and secondary students and families to choose the right education options for them – regardless of where they live, how much they make, and how they learn.

How EFS Can Expand Public Education Options

  • States can design their programs to work hand-in-hand with existing public education options to enhance individual students’ education experiences, not replace them.
  • The scholarships can be focused on expanding access to education programs and services for public school students enrolled in:
    • District public schools, perhaps focusing on low-performing schools, or those in specific regions, such as urban or rural areas;
    • Out-of-district public schools;
    • Magnet schools;
    • Public virtual schools; and
    • Public charter schools.
  • The scholarships could cover allowable education expenses as defined by States, including, but not limited to:
    • Advanced courses, like Advanced Placement or International Baccalaureate;
    • Elective courses, like art, music, or world languages;
    • Credit recovery or other remedial courses;
    • Tutoring services;
    • Special education services and therapies not required by a student’s Individualized Education Program;
    • Purchasing educational technology, including learning software or hardware.
    • Transportation to education providers outside of a family’s zoned school;
    • Open or dual enrollment allowing high school students to earn college credit; and
    • Fees for summer education programs and specialized after-school education programs.

How EFS Can Expand Career Training Options

Expanding career training options for students and closing the skills gap for employers.

Problem

  • The United States is in the midst of a profound workforce skills gap—about 7 million jobs remain unfilled today. According to the Georgetown University Center on Education and the Workforce, in 2018 alone, the U.S. workforce required at least 4.7 million new workers with postsecondary certificates.
  • Too many students lack experiences that allow for career exploration, adult mentorship, and sound advice on postsecondary options that match their career interests and prepare them for jobs that will close the skills gap.

Solution

  • The Education Freedom Scholarships (EFS) proposal creates a $5 billion annual federal tax credit for voluntary donations to state-based scholarship programs, empowering students to pursue their career goals.
  • State leaders can take a bold step toward the creation of an enhanced talent development pipeline by aligning state-based scholarship programs to the vision and strategies in state workforce development plans, including their Strengthening Career and Technical Education for the 21st Century Act (Perkins V) and Workforce Innovation and Opportunity Act (WIOA) State Plans.

How EFS Can Expand Career Training Options

  • States can design their programs to provide more students with access to authentic career-based experiences that their family’s zoned school might not offer.
  • The scholarships can be targeted to students interested in:
    • Concurrent or dual enrollment in high-demand career pathways, or to help ease a student’s transition from secondary to postsecondary institutions;
    • Apprenticeship pathways, including pre-apprenticeships, industry-recognized 
apprenticeships, and registered apprenticeships; and
    • Industry certifications.
  • The scholarships can cover allowable education expenses including, but not limited to:
    • Tuition for dual or joint enrollment courses online or in-person at local community colleges or short-term job training programs like a coding boot camp or accelerated training program;
    • Books and fees required by a technical program or community college of choice;
    • Industry-based exams and certification fees necessary for an in-demand occupation;
    • Transportation to an apprenticeship training center or worksite, magnet school, career and 
technical education academy, or public or private school of a family’s choice; and
    • Tools, supplies, and personal protective equipment required for in-person or online career 
and technical education programs such as steel-toed boots, welding gloves, a computer, or scrubs.

How EFS Can Expand Special Education Options

Expanding access to individualized learning opportunities for children with disabilities.

Problem

  • Children and students with disabilities deserve to benefit from both high expectations and appropriate supports, so that they are challenged to reach their full potential.
  • Too often though, the individualized services and learning opportunities they need can be limited by existing programs and practices that prioritize the needs of the “system” over the needs of the child.
  • The pursuit of individualized learning environments and programs often puts financial pressure on families, which may be acutely felt by the families of children with disabilities.

Solution

  • The Education Freedom Scholarships (EFS) proposal creates a $5 billion annual federal tax credit for voluntary donations to state-based scholarship programs.
  • This is a vital opportunity states can seize to empower children with disabilities and their families to access individualized learning opportunities, while relieving some of the financial pressure many families experience.

How EFS Can Expand Special Education Options

  • States can design their programs to complement and expand existing special education programs and services, and scholarships can be focused on expanding access for children with disabilities to individualized supports, services, instruction, interventions, and therapies.
  • The scholarships could cover allowable education expenses including, but not limited to:
    • Educational therapies and services from a licensed or accredited practitioner or provider, including behavior therapy, occupational therapy, physical therapy, recreational therapy, social group therapy, speech therapy, vision therapy, and more;
    • Tuition and fees at a private school of a family’s choice;
    • Homeschool education expenses, including specialized curriculum and educational and 
therapeutic materials;
    • Programs and services that support transition to postsecondary education or employment;
    • Programs and services that support the early childhood needs of children with disabilities, 
including Developmental Delay;
    • Assistive technology, including adaptive and rehabilitative devices such as prosthetics, 
communication boards, power lifts, refreshable Braille displays, assistive listening devices, 
and more;
    • Cost of a paraprofessional or educational aide; and
    • Educational and psychological evaluations to identify a child’s unique strengths, 
interests, and needs.