This bill enacts the “Education Freedom Act of 2025” and creates a statewide education freedom scholarship program administered by the Tennessee Department of Education. Beginning with the 2025-2026 school year, eligible students may receive a scholarship equal to the state’s base funding amount to attend approved private schools in Tennessee. The program is capped at 20,000 scholarships in the first year, with half reserved for lower-income students or certain students already identified under existing education programs, and half available more broadly. If demand is high, the cap may increase in later years, and if applications exceed available scholarships, the bill sets a priority order that favors returning recipients, very low-income students, certain special-needs students, current public school students, and then other eligible applicants.
Scholarship funds may be used for tuition and fees first, and then for approved educational expenses such as textbooks, curricula, tutoring, transportation, technology, summer programs, certain postsecondary exams, industry credentials, and educational therapy services. The bill also requires participating private schools to administer annual assessments to scholarship recipients in grades 3-11 and to report certain test results to state education oversight officials in aggregated or deidentified form. Private schools that accept scholarship students are declared autonomous and are not treated as agents of the state, and the bill limits additional regulation of those schools beyond what is necessary to administer the program.
The bill also changes several other education funding provisions. It adds a mechanism to supplement TISA funding for local education agencies that experience disenrollment, beginning in the 2026-2027 school year, so that affected districts can be held harmless at prior-year funding levels under specified conditions. In addition, it provides a one-time bonus of at least $2,000 to K-12 public school teachers for the 2024-2025 school year, subject to local participation resolutions and other conditions, and excludes legislators who are also teachers from receiving that bonus. The bill further revises the use of certain privilege tax revenue for public school construction and maintenance, directing funds through a state treasurer-administered disbursement account for qualifying LEAs and related emergency or demonstrated needs.
The bill’s impact on state law is broad: it adds a new scholarship program to Title 49, modifies TISA funding rules, creates a teacher bonus program, and rewrites the distribution of certain tax revenues for school facilities. It also specifies that scholarship payments are state or local public benefits, are not paid directly to parents or students, and are not taxable income. Students must establish lawful presence in the United States to receive a scholarship, and recipients enrolled in the program may not simultaneously participate in the Tennessee education savings account pilot program or individualized education account program. The act takes effect in stages, with the tax-revenue provisions effective July 1, 2025 and the rest effective upon becoming law.
The general sentiment reflected in the available voting history is supportive but not unanimous. The Senate Education Committee recommended passage with amendments by an 8-1 vote, and the Senate Finance, Ways and Means Committee also recommended passage by an 8-3 vote. The bill’s findings and structure indicate strong support for school choice, parental control, and expanded educational options, while the committee votes suggest there was meaningful opposition or concern from some members.
The main points of contention are likely the creation and funding of a large private-school scholarship program, the use of public funds for private education, and the degree of oversight imposed on participating schools. Additional likely concerns include the impact on public school enrollment and funding, the adequacy and fairness of the scholarship priority system, the testing and reporting requirements for private schools, and the new tax-revenue allocation rules for school facilities. Supporters appear to emphasize parental choice, access to alternatives, and teacher compensation, while critics likely focus on fiscal effects, accountability, and the diversion of resources from public schools.
The bill amends Tennessee law in Title 49 to create a new statewide education freedom scholarship program, establishes eligibility, funding, award priorities, allowable uses, testing requirements, and administrative rules, and limits the state’s regulatory authority over participating private schools. It also amends TISA funding provisions to provide hold-harmless supplemental funding for LEAs experiencing disenrollment, creates a one-time state-funded teacher bonus program, and revises the distribution and administration of certain privilege tax revenues for public school construction and maintenance. The act also addresses scholarship payment mechanics, tax treatment, lawful presence requirements, and interactions with existing education savings account and individualized education account programs.
The available record shows generally favorable sentiment toward the bill, with committee recommendations for passage in both the Senate Education Committee and the Senate Finance, Ways and Means Committee. The bill’s stated purpose and findings strongly favor school choice, parental control, and expanded educational options, suggesting broad support among sponsors and committee majorities. However, the non-unanimous votes indicate that some members had reservations about the program’s scope, funding, or policy implications.
The most notable contention centers on whether public funds should be used for private-school scholarships and how much accountability should accompany those funds. Opponents are likely concerned about the effect on public school enrollment and finances, especially given the scholarship program’s size and the bill’s redirection of certain revenue streams. There may also be disagreement over the autonomy granted to private schools, the testing/reporting requirements, the eligibility restrictions tied to lawful presence and participation in other programs, and the fairness of the scholarship prioritization scheme. Supporters, by contrast, appear focused on parental choice, educational access, and relief for families seeking alternatives to public schools.