An act to add Article 19.2 (commencing with Section 69995) to Chapter 2 of Part 42 of Division 5 of Title 3 of the Education Code, and to add Sections 17132.2 and 17210 to the Revenue and Taxation Code, relating to education expenses. expenses, and making an appropriation therefor.
AB 19 would create the Education Choice and Parental Empowerment Act of 2025 and establish a statewide Education Savings Account (ESA) program. The bill would create an ESA Trust in the State Treasury, governed by an ESA Trust Board, and would allow eligible K-12 students to receive annual deposits that could be used for tuition and a broad range of education expenses at approved schools. For the 2027-28 school year, the deposit amount would be $18,500 per eligible student, with annual inflation adjustments beginning in 2028. The program would initially be income-limited for the first four school years and then expand to all eligible students beginning in 2031-32.
The bill defines eligible schools broadly to include California public colleges and universities, private K-12 schools, private colleges and universities, and vocational education or training institutions that meet accreditation or application requirements. It also requires the Superintendent of Public Instruction and the ESA Trust Board to create application, enrollment, reporting, auditing, and public information systems, including online applications for families and schools, monthly disbursements, and random audits. Homeschool-only students would generally be excluded, though students enrolled in an eligible school to facilitate homeschooling could participate.
AB 19 would also change state tax law by excluding ESA distributions from gross income and allowing a deduction for taxpayer contributions to an ESA, beginning with taxable years on or after January 1, 2026. In addition, the bill would require the Legislature to account for ESA costs in Proposition 98 minimum funding calculations by treating certain ESA students as part of average daily attendance, and it would apportion ESA costs between the General Fund and local school district revenue in the same ratio that would have funded the student in the public system. The bill is contingent on approval of a related constitutional amendment by voters in 2026, and its operative date is January 1, 2027.
The general sentiment reflected in the bill text is strongly supportive of school choice and parental empowerment, with the stated purpose of helping parents send children to better performing schools. No committee transcript or vote record was provided, so there is no recorded discussion in the materials showing support, opposition, or amendments beyond the bill’s detailed structure. The absence of votes and hearing testimony means the available context does not show how legislators or stakeholders reacted in committee.
The main points of contention likely concern the bill’s fiscal and policy effects: it would redirect substantial state and local education funding into private accounts, alter Proposition 98 calculations, and create a new tax expenditure through deductions and exclusions. The bill also limits participation by income in the early years, excludes most homeschooling-only arrangements, and imposes oversight rules such as accreditation, audits, and spending restrictions, which may be viewed as either necessary safeguards or as burdensome conditions depending on the stakeholder. Public school advocates, fiscal watchdogs, and supporters of private-school choice would likely be the principal groups on opposite sides of those issues.
AB 19 would add a new chapter to the Education Code establishing a statewide ESA Trust and a new administrative framework for distributing public funds to eligible students and schools. It would also amend the Revenue and Taxation Code to create a gross-income exclusion for ESA distributions and a deduction for ESA contributions, thereby creating a new tax expenditure. The bill would further require changes to Proposition 98-related funding calculations and to the allocation of education costs between the General Fund and local school district revenue, meaning it would affect state school finance, local district funding, and the flow of public dollars to private and postsecondary educational providers.
The bill’s stated purpose is pro-school-choice and pro-parental empowerment, and its structure reflects a strong policy preference for expanding access to alternatives to traditional public schools. Because no committee transcript or vote history is included, there is no documented floor or committee debate in the provided materials. Based on the text alone, the measure appears designed to appeal to supporters of education savings accounts and school choice, while anticipating opposition from those concerned about public school funding and the use of state funds for private education.
The most likely areas of contention are the bill’s fiscal impact, its interaction with Proposition 98, and the use of General Fund money for private-school and higher-education tuition through ESAs. Opponents are likely to focus on the diversion of funds from public schools, the need to recalculate minimum education funding guarantees, and the creation of a new tax expenditure. Supporters are likely to emphasize parental control, broader educational access, and flexibility for families, while critics may question whether the eligibility rules, accreditation requirements, and audit provisions are sufficient to prevent misuse or inequitable access.