SB 2303 would create a new Education Savings Account (ESA) program in North Dakota under Title 15.1. The bill allows eligible K-12 students who are residents and eligible to attend public school, as well as students already participating in the program, to receive state-funded deposits into individual accounts that parents can use for approved education expenses. Those expenses include private school tuition and fees, tutoring, therapies, curriculum, online learning, testing, transportation, college-prep costs, and certain postsecondary tuition and textbooks. The bill also allows unused funds to carry forward within limits and permits a transfer to a North Dakota education savings plan upon graduation.
The measure sets out a detailed administrative structure involving the Bank of North Dakota, the Department of Public Instruction, and an outside administrator. It requires account auditing, quarterly payments, rules for misuse and fraud, and participation standards for private schools and other providers. Participating schools must meet health and safety requirements, background-check employees, provide receipts, and comply with nondiscrimination rules. The bill also requires testing and reporting so the state can publish aggregated outcomes such as test results, learning gains, graduation rates, college attendance, and parental satisfaction.
In terms of state law, SB 2303 would shift a portion of state education funding away from school districts and into individual ESA accounts, while still counting participating students in district enrollment calculations and providing a smaller payment to the home district. It would also create new duties for school districts to release student records and potentially provide transportation, and it would declare ESA funds not to be taxable income. The bill would add a new chapter to Title 15.1 and establish new regulatory, auditing, and appeal procedures for program administration.
The general sentiment reflected in the vote was unfavorable to the bill. SB 2303 failed on Senate second reading by a vote of 20-24 on February 14, 2025, indicating it did not secure majority support. No committee transcript was provided, so there is no recorded discussion to show support or opposition beyond the floor vote and the bill’s failure.
The main points of contention likely centered on school choice versus public-school funding and oversight. Supporters of ESA programs generally favor expanding parental control and access to private, tutoring, and specialized education options, while opponents often raise concerns about diverting state aid from public schools, accountability for private providers, and the use of public funds for nonpublic education. The bill’s requirements for testing, audits, and provider standards suggest an attempt to address accountability concerns, but the close-to-divided vote and final failure indicate those safeguards were not enough to overcome opposition.
SB 2303 would have created a new statutory framework for education savings accounts in North Dakota, requiring the state to fund and administer individual accounts for eligible students and authorizing payments for a broad range of educational services. It would have affected state aid formulas by redirecting funds from a student’s resident school district into the ESA program, while also imposing new obligations on school districts, the Bank of North Dakota, the Department of Public Instruction, and participating private schools and service providers. The bill also would have established new reporting, auditing, and compliance rules, and it would have excluded ESA deposits from taxable income.
The bill’s overall reception appears negative, as reflected by its failure on Senate second reading by a 20-24 vote. With no committee transcript available, the only clear indicator of sentiment is the floor vote, which shows the proposal did not command majority support. The outcome suggests substantial skepticism about the program’s policy tradeoffs, even though the bill included accountability and reporting provisions.
The central controversy is the use of public funds for private and nonpublic education through education savings accounts. Supporters would likely emphasize parental choice, flexibility, and access to tutoring, therapies, and private schooling, while opponents would likely focus on the diversion of state aid from public school districts and the adequacy of oversight for private providers. Additional concerns include whether the accountability measures are sufficient, how the program would affect district funding and enrollment, and whether the state should subsidize private education and postsecondary expenses through a new entitlement-like account program.