Vermont Gov. Phil Scott signed H.933 into law on June 18, 2026. The legislation restricts scholarship funds under the Education Freedom Tax Credit (EFTC) to public school students and those attending independent schools eligible to receive public funds.

Under H.933, only Approved Independent Schools and Therapeutic Approved Independent Schools may participate in the program. The law requires scholarship-granting organizations (SGOs) to award scholarships exclusively for educational programs occurring after school, during school breaks, or for supplemental tutoring. To qualify, an SGO's core mission must be providing educational opportunities to economically underprivileged students.

The law prohibits SGOs from discriminating against students based on race, color, religion, ancestry, national origin, sex, sexual orientation, gender identity, place of birth, crime victim status, or disability status. It grants the governor or a designee the authority to opt into the EFTC program annually and to audit any SGO participating or seeking to participate. SGOs must submit annual reports to the Vermont House and Senate Committees on Education detailing scholarships awarded, donations received, and operating expenses.

H.933 requires the Vermont Attorney General to notify the governor, the Speaker of the House, and the President Pro Tempore of the Senate if any provisions are invalidated by federal act, agency rule, or court decision. If such an invalidation occurs, the state is prohibited from participating in the EFTC program until the Legislature enacts new legislation to address the invalidated provisions.

There are four types of independent or nonpublic schools in Vermont, with Approved Independent Schools and Therapeutic Approved Independent Schools being the only two eligible to receive public funds. The Vermont House passed H.933 on March 27, 2026, and the Senate approved it on May 5, 2026.

The EFTC is a nonrefundable federal tax credit allowing individuals to receive credits for donations of up to $1,700 to authorized SGOs. The program is scheduled to take effect on January 1, 2027. As of June 30, 2026, the U.S. Department of the Treasury had not issued regulations to implement the program, though a June 10 preview indicated states would likely not be authorized to set stricter standards for participating SGOs than federally required. As of that date, 31 states had either opted into the program or stated intentions to do so; however, Scott had not indicated whether Vermont would participate.