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I Told You So: Five Predictions for the New Federal Voucher Program

ByAccountabaloney

I have been closely following Florida education policy for more than 15 years. Long enough, apparently, that I sometimes joke that I am going to get a tattoo on my forehead that says:

I told you so.

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I said Florida’s voucher programs would grow far beyond what lawmakers initially described. They did.

I said income limits would continue to rise and eventually disappear. They did.

I said programs initially promoted as helping disadvantaged children would eventually become universal. They did.

And as Florida continued expanding publicly funded private-school options while public schools struggled with funding that failed to keep pace with their costs and obligations, I came to see those developments not as isolated policy choices, but as part of a larger pattern: moving Florida away from a system centered on publicly operated schools and toward one in which public education dollars increasingly flow to private providers.

I have warned that pattern would lead to the privatization of public education itself. And just last week, Florida’s new Commissioner of Education said “While a free society has a real interest in an educated citizenry, that interest does not require the state to run the schools.” He suggested it was time to “Separate finance from provision. Let the market discipline the industry that is supposed to prepare the next generation of workers and citizens.” This is the definition of privatization.

So today I am going to make some predictions about the new federal voucher program, before it even begins.

That way, a few years from now, we can come back and see whether I was right.

Here We Go Again

There will be a lot of discussion this week about the new Federal Scholarship Tax Credit (FSTC), sometimes called the Education Freedom Tax Credit. The IRS is expected to release the rules for the program soon.

The program was enacted as part of the “One Big Beautiful Bill” and begins January 1, 2027. States must opt in, and Governor Ron DeSantis quickly announced Florida’s participation.

This morning, the Tampa Bay Times reported that Pasco County school officials have “high hopes” for the new tax-credit scholarship program.

District officials see it as an opportunity to bring additional resources to public-school students for before- and after-school academic programs and other services. Pasco plans to work with the Florida Chamber of Commerce and Step Up For Students through the new Step Further Scholarship Fund.

Pasco’s superintendent is former state Sen. John Legg, who was deeply involved in shaping Florida’s school-choice policies long before taking over a traditional public-school district.

Legg served in both the Florida House and Senate and chaired K–12 education committees in both chambers during years when Florida continued expanding charter schools and tax-credit scholarships. He also co-founded Dayspring Academy, a Pasco County charter school.

And Legg was no stranger to Florida’s voucher political network. In his 2012 state Senate race, the American Federation for Children, whose Florida political operation was chaired by Step Up For Students founder John Kirtley, counted Legg among its election victories. Kirtley later served alongside Legg on the board of Step Up For Students.

That history matters now because Pasco, under Legg, is proposing to work with the Florida Chamber of Commerce and Step Up For Students on Step Further, Step Up’s vehicle for the new Federal Scholarship Tax Credit. Step Up itself describes the federal program as having the potential to bring “Florida-style scholarships” nationwide and says it is prepared to operate the program “at scale.”

In other words, Legg is not encountering this school-choice infrastructure for the first time. He helped shape Florida’s system, was supported politically by organizations promoting it, later served on the board of its largest scholarship administrator, and is now proposing that his public-school district participate in that administrator’s federal expansion.

And I understand the attraction.

The idea sounds ingenious: if Washington is offering “free money,” why shouldn’t public schools try to claim some of it?

Because the money isn’t free AND because the structure of the program tells us a great deal about where it is likely to go.

The federal program allows individual taxpayers to receive a dollar-for-dollar federal income-tax credit of up to $1,700 for contributions to approved Scholarship Granting Organizations, or SGOs.

There is no overall federal spending cap.

Experts tracking implementation told attendees at the Network for Public Education’s annual conference on September 26 that more than 500 SGOs were already preparing to participate nationwide aand predicted the FTCS program would rapidly grown to more that $50 BILLION/year.

The requirements for becoming an SGO are remarkably limited. An organization must be a qualifying nonprofit, serve at least 10 students who do not all attend the same school, and spend at least 90% of its income on scholarships.

That means SGOs can keep as much as 10% for “administration.” 

And the potential market is enormous.

The program limits scholarships to students from households earning less than 300% of their area’s median income. That sounds restrictive until you look at the numbers.

Researchers estimate that roughly nine out of ten American schoolchildren could qualify. In some high-income communities, families earning more than $500,000 a year could remain eligible.

So let me put my predictions in writing.

Prediction #1: Like Florida’s Universal Vouchers, This Program Will Become Much Bigger Than Its Supporters Initially Suggest

There is no overall federal cap.

The credit is dollar-for-dollar.

Taxpayers can redirect up to $1,700 of what they otherwise would owe in federal income taxes to participating scholarship organizations.

That is an extraordinarily powerful incentive.

Early official estimates of the program’s cost are relatively modest, but outside analyses have shown that the potential exposure is enormous. Depending on taxpayer participation, the program could eventually cost tens of billions of dollars annually.

Some estimates place the potential annual cost at $50 billion or more.

I predict participation will grow.

I predict SGOs will aggressively market the credit.

I predict lawmakers will face pressure to increase the $1,700 limit.

And I predict the program will ultimately cost far more than early projections suggested.

Florida has already taught us how that story goes.

Prediction #2: Private-School Students Will Receive a Disproportionate Share of the Money

Supporters increasingly emphasize that public-school students can benefit from this program too.

Technically, that is true.

Scholarships may be used for tutoring, technology, therapy, after-school programs and other educational services.

But that does not mean public and private-school students will benefit equally.

Brookings researchers examining the program have already predicted that private-school students will receive a highly disproportionate share of Federal Scholarship Tax Credit funds.

I predict they are right.

Private schools and the organizations already embedded in the school-choice ecosystem have an enormous head start. They already have the institutions, donor networks, marketing systems and scholarship infrastructure necessary to maximize participation.

Public schools do not.

Prediction #3: Money Advertised as Helping Public Schools Will Often Not Go to Public Schools

This distinction matters.

A scholarship used by a public-school student is not necessarily money going to a public school.

A student might receive tutoring from a private vendor.

Technology might be purchased from a private company.

A student could attend an after-school program operated by an outside provider.

Those services may benefit individual children.

But the money is unlikely to become revenue that a school district can use to hire teachers, operate buses, pay paraprofessionals, maintain buildings or meet its other obligations.

So when we begin hearing how much federal voucher money is “benefiting public-school students,” pay close attention to where the money actually goes.

I predict much of it will flow through SGOs to private vendors providing supplemental services rather than into public-school operating budgets.

That is not the same thing.

Prediction #4: Wealthier Communities Will Have an Advantage

This is one of the program’s most fundamental structural problems.

The amount of money available in a community depends, in significant part, on taxpayers having federal income-tax liability they can redirect.

Communities with more high-income taxpayers therefore have more potential money to redirect.

Brookings researchers have estimated that the wealthiest counties could generate roughly three times as much scholarship funding per child as the poorest counties.

Think about what that means.

Schools serving affluent communities could have access to significantly more scholarship money than schools serving communities with fewer taxpayers able to make these contributions.

I predict rural communities will receive less.

I predict many high-poverty communities will receive less.

And I predict the communities whose schools already struggle most to provide enrichment opportunities will be least able to take advantage of this supposed new source of “free money.”

Prediction #5: We Will Find Tens of Billions of Federal Dollars for Vouchers While Continuing to Say We Cannot Afford to Fully Fund IDEA

For more than 50 years, Congress has maintained a 40% federal “full-funding” benchmark for the Individuals with Disabilities Education Act.

It has never reached it.

Today, closing that IDEA funding gap would require roughly $40–42 billion more per year.

Now Congress has created an uncapped federal scholarship tax credit that could eventually cost that much, or more.

Think carefully about that.

Washington has spent half a century telling public schools they cannot afford to meet their longstanding commitment to students with disabilities.

Yet they have created a new federal tax expenditure that could ultimately cost more than filling the entire IDEA funding gap.

That isn’t a question of whether the money exists. It is a question of what Congress chooses to fund.

And there is an additional irony.

Public schools have a legal obligation under IDEA to identify and serve eligible students with disabilities and provide them with a free appropriate public education.

Private schools accepting federally subsidized scholarship tuition generally do not assume that same individual IDEA obligation.

Students requiring the most intensive (and often most expensive) special-education services will continue to be disproportionately educated in public schools.

Those obligations do not disappear when money leaves the federal treasury through a tax credit.

So here is another prediction:

Congress will continue to fall short of its IDEA funding benchmark even as the new federal voucher tax expenditure grows.

The Trojan Horse of “Free Money”

That is why I am skeptical when I hear this program described as an opportunity public schools simply cannot afford to pass up.

Of course school districts want additional resources for their students.

They should.

But tax credits are not magic money.

Every dollar of federal tax liability redirected through this program is a dollar that does not flow into federal general revenue.

The question therefore is NOT simply:

Can public schools get some of it?

The larger question is:

What kind of education system are we building with it?

I predict this program will normalize publicly funded private-school tuition.

I predict money will flow to a large, and lucrative, new industry of Scholarship Granting Organizations, consultants, payment processors and educational vendors.

I predict private-school families will capture a disproportionate share of the benefits.

I predict wealthy communities will generate more scholarship dollars than poor ones.

I predict public-school participation will be repeatedly cited as proof that the program benefits public education, even when much of the money never enters a public-school budget.

And I predict that, once established, the program will grow.

Perhaps I will be wrong.

Maybe private-school students will not receive a disproportionate share.

Maybe scholarship dollars will flow primarily to children with the greatest needs.

Maybe rural and high-poverty communities will receive as much as affluent ones.

Maybe public schools will receive meaningful new resources rather than watching federal tax dollars move through SGOs and private vendors.

I hope so.

But I have watched this movie before.

So I am writing the predictions down now.

Check back in a few years. If history is any guide, I may finally have to get that tattoo.

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