Tennessee Senate Bill SB0802

Tennessee 2025-2026 Regular Session

• Introduced: 2/4/25

Caption

AN ACT to amend Tennessee Code Annotated, Title 4, Chapter 51; Title 37, Chapter 5, Part 5; Title 49 and Title 71, Chapter 3, relative to early learning.

Summary

SB0802 creates Tennessee’s “Promising Futures Early Learning Scholarship” program and a dedicated “promising futures early learning fund” to support it. Beginning July 1, 2025, excess net lottery proceeds that are not already committed to other scholarship, early learning, after-school, or K-12 capital projects would be transferred into the new fund. The fund would be invested by the state treasurer and used to pay scholarships for children to attend high-quality early learning programs, with the Department of Education administering the program and setting the rules for eligibility, quality standards, attendance, and reporting. The scholarship program would begin by July 1, 2026, and would be available to Tennessee children at least six weeks old who are not yet eligible for public school, live in Tennessee, and meet income and work-or-school requirements. Eligible households could have income up to 150% of state median income, which is broader than many existing child care assistance programs. For the first year, the department could award up to 5,000 scholarships worth up to $4,500 each; after that, awards would depend on available funding. The bill also requires the department to create an online application portal, verify income, pay providers directly, and report annually on implementation and outcomes. In state law, the bill would add a new funding mechanism and a new scholarship program within Title 49, while also amending the lottery fund statute in Title 4 to direct excess lottery proceeds to the new early learning fund. It also specifies that scholarship payments are not treated as income for parents or guardians, limits administrative costs to 10% of the fund balance in any fiscal year, and requires the State Board of Education to adopt implementing rules. The act is expressly not an appropriation, so spending would still depend on specific appropriations in the general appropriations act. The overall sentiment reflected in the bill text is strongly supportive of expanding access to early learning. The findings emphasize that many children enter kindergarten behind, that child care and preschool are unaffordable for many families, and that middle-income families have limited options. The bill frames the scholarship program as a way to improve school readiness, support working parents, and use lottery revenues for one of the lottery’s original purposes: early learning. The main points of potential contention are fiscal and policy-related rather than ideological in the text itself. The bill would redirect all excess net lottery proceeds not otherwise committed, which could affect future funding for other lottery-supported priorities. It also sets income and work/school eligibility rules that may exclude some families, and it relies on the Department of Education to define what qualifies as a high-quality program and to administer a new statewide scholarship system. The absence of committee discussion or recorded votes means there is no additional public record here showing specific support or opposition from legislators or stakeholders.

Impact

The bill would amend Tennessee’s lottery and education statutes to create a new state-funded early learning scholarship program and a dedicated treasury fund for it. It would shift excess net lottery proceeds into the new fund beginning in 2025, establish eligibility and administration rules in Title 49, authorize direct payments to approved providers, and require annual reporting and rulemaking. It also clarifies that scholarship assistance is not taxable income to parents or guardians and caps administrative spending at 10% of the fund balance in a fiscal year.

Sentiment

The bill is framed in highly favorable terms toward early childhood education and family support, with legislative findings stressing kindergarten readiness, affordability concerns, and the need for more access to quality child care and preschool. The text suggests a broad policy goal of expanding opportunity for working and middle-income families. No committee transcripts or votes were provided, so there is no recorded debate to indicate measured support, opposition, or amendments beyond the bill’s own stated purpose.

Contention

Likely areas of contention include the diversion of excess lottery revenues away from other uses, the cost and sustainability of the scholarship program, and the administrative burden placed on the Department of Education. The bill’s eligibility rules—income capped at 150% of state median income and requiring parental work or full-time postsecondary enrollment—could also be debated as either appropriately targeted or too restrictive. Another possible issue is the bill’s reliance on the department to define “high-quality” programs and to implement a new portal, verification process, and provider payment system.