CHOOSE Act

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The Creating Hope and Opportunity for Our Students' Education Act of 2024, abbreviated as the CHOOSE Act (Act of Alabama 2024-21) is an Alabama law, passed in 2024, which establishes an income tax credit of up to $7,000 per child for parents who do not enroll their children in public schools.

School voucher or school choice programs have been proposed in the past, with a number of relatively small-scale measures being implemented. In her "State of the State" address in January 2024, Governor Kay Ivey said that signing a "landmark school choice bill" would be her top priority for the upcoming legislative session.

Passage

Several such proposals were expected to be introduced, with the source of public funding to be earmarked for the program, and the degree to which private schools would be accountable for their use of public funds, as the main points of contention. Consensus among advocates, primarily Republicans, solidified around the idea of the state contributing to "educational savings accounts".

The bill that was passed was put forward as House Bill 129, co-sponsored by Danny Garrett (District 44), Nathaniel Ledbetter (District 24), and Terri Collins (District 8). It was introduced to the House Ways and Means General Fund Committee on February 7 and sent back with a favorable report on February 22. It then was considered by the House Ways and Means Education Committee, chaired by Garrett. A substitution introduced by Representative Troy Stubbs (R-District 31) was adopted in that committee before the bill returned to the house on Tuesday February 27.

During that day's session, several packages of amendments were offered. The first change, offered by Joe Lovvorn (R-District 79) stipulated that no provision of the bill would affect eligibility for student athletes. It was adopted by a vote of 74-17. Representatives Arnold Mooney (R-District 43), Ernie Yarbrough (R-District 7), and Ben Harrison (R-District 2), proposed amendments that would remove requirements that the Department of Education would certify "participating schools," reduced reporting requirements, and eliminated a restriction against making payments directly to students or parents. Those amendments were all tabled, and the bill passed the house without them on a 69-34 vote.

Senator Arthur Orr (R-District 3) took up the proposed legislation in his chamber as Senate Bill 61 on February 28. It was scheduled to be debated in the Senate Finance and Taxation Education Committee on Wednesday March 6, but instead was considered at a specially-called meeting after Tuesday's recess, where it passed the committee 10-3. It proceeded to the full senate the next day. During that session, Senators Rodger Smitherman (D-District 18) and Bobby Singleton (D-District 24) offered amendments which sought to preserve funding for special needs students in public schools and to enhance certification requirements for teachers. Those amendments were voted down. Senator Larry Stutts (District 6) also introduced amendments seeking to prioritize the children of service members and to have surplus ESA funds roll over from year to year unless students became ineligible. His amendments were tabled and the bill passed the senate on a 23-9 vote. Ivey signed the CHOOSE Act into law on March 7.

Provisions

As enacted, the CHOOSE Act directed the Alabama Department of Revenue to create a $100 million CHOOSE Act Fund, drawn from the Alabama Education Trust Fund, from which payments would be made into individual "Educational Savings Accounts", in the form of state income tax credits. The accounts would then be used to pay for qualified educational expenses for children not enrolled in public schools.

Eligible students are residents of Alabama between the ages of 19 who do not already have a high school diploma, do not already receive benefits under the Alabama Accountability Act of 2013, are not enrolled in non-participating private schools, and are "lawfully present in the United States." Qualifying expenses include tuition and fees for regular, after-school or summer instruction at participating schools, for "nonpublic online learning programs", for contracted services from participating public schools, or for private tutors. It also includes expenses for textbooks, instructional materials, educational software, college admissions and advanced placement tests, and special education services for students with disabilities.

Educational Savings Accounts are set at a maximum $7,000 per year for each student enrolled in a participating non-public school, with no limit per household; and at a maximum of $2,000 per year for each student not enrolled in a participating school, with a cap of $4,000 per household. Applications for savings accounts are prioritized by the Department of Revenue according to stipulations in the law. The first 500 accounts are designated to be awarded to special needs students. After that, first priority goes to applicants who have siblings already benefitting from the program; second to students enrolled in "priority schools" as defined by the Alabama Accountability Act who are the children of active-duty service members; and third by evaluating a household's adjusted gross income relative to the federal poverty line. The law stipulates that all special needs students are still eligible to receive services provided by their local public school districts and that all participating students remain eligible to compete in AHSAA or other inter-scholastic athletic competitions.

ESAs are not available to any student who graduates from high school, enrolls in a public school, becomes a resident of another state, reaches the age of 19, is found to be unlawfully present in the United States, or fails to submit all required documentation to the program. Tax credits awarded through the CHOOSE Act are not categorized as taxable income, and are not subject to offset or debt collection procedures.

Participating schools submit information on programs offered to students enrolled under the act, and affirm that they will use funds solely to provide qualifying services, without offering kick-backs to parents. They must agree, "not to discriminate based on grounds of race, color or national origin," in offering services or setting fees. Participating schools must subject students to standardized assessment examinations, unless prevented by student disability. Individual results would be reported only to parents, with aggregate anonymized results submitted to the Department of Revenue. The Department is required to collect, analyze and report on the operation of the program and to randomly audit account holders and service providers and collect public comments in order to detect fraud or misuse.

In order to have the program running by 2025, the law specifically authorizes the Alabama Department of Revenue to adopt rules on an "emergency" basis, without complying with the requirements of the Alabama Administrative Procedure Act, and expenditures for necessary materials and services can be approved as "special procurements" as set forth in Act of Alabama No. 2021-296.

The law stipulates that for the first two years of the program, only applicants whose adjusted gross household income does not exceed 300% of federal poverty level would be accepted. Household income would not apply, except for prioritization, after 2027. The legislature expects to increase allocations year by year in order to meet demand. Any unexpended funds in an ESA would return at the end of each academic year. If for any reason the fund balance grew to exceed $500 million, any excess would be returned to the Education Trust Fund.

References

External links

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