PENNSYLVANIA — The U.S. Treasury Department previewed guidance regarding the Education Freedom Tax Credit program, advancing Pennsylvania's potential participation in the federal initiative. The program is slated to launch in January 2027.

U.S. Secretary of Education Linda McMahon joined Senator Dave McCormick and education representatives from Pennsylvania at a virtual roundtable. McMahon said, "This program is the largest expansion of education freedom in our nation's history." She added, "Seventy-eight percent of Pennsylvania voters across demographics and party lines favor opting into the Education Freedom Tax Credit."

Congress created the program last summer as part of the One Big Beautiful Bill Act. The initiative provides taxpayers who donate to federally approved scholarship organizations with up to $1,700 in tax credits. Families earning up to 300% of their area's median income can qualify for scholarships, which can be applied to various aspects of a student's education. The U.S. Treasury Department indicated the program would not draw funds from local or state taxes.

As of May, 27 states have officially joined the program. A state can opt in through an order from its governor or by a law passed by its legislature. The governor must then submit a list of official Scholarship Granting Organizations for federal approval to finalize the state's entry. Previously, nine states have experienced disagreements between their governors and legislatures regarding participation.

Rosie Lapowsky, a spokesperson for Gov. Josh Shapiro, said the administration previously cited a lack of federal guidance as the reason Pennsylvania had not yet joined. Lapowsky said the administration "appreciates" the Treasury's recent guidance and is "continuing to review" the program.

Susan Spicka, executive director of Education Voters of Pennsylvania, stated, "Our public schools will lose funding if there is a mass exodus of students who go to voucher schools." Spicka also said the Treasury's previewed guidance "created more questions than answers" concerning how states could directly access and control the funds. She added, "I would hope that Josh Shapiro would take his time and very carefully consider what this program would look like, who would benefit, and what type of control as a state we would have over any of these dollars."

Pennsylvania currently has two programs that offer tax benefits to businesses for sponsoring private school scholarships. McMahon said public school families can use scholarships from their contributions for tutoring, after-school programs, or special education services. She concluded, "The question before us today is not whether the demand exists, but whether or not we will rise to meet it."