Federal Voucher Program Regulations Released! Everything You Need to Know Right Now

media release (from Wisconsin Public Education Network): In 2025, the Trump administration slipped a dangerous federal tax credit voucher program into HB1 - the so-called “Big Beautiful Bill” - arguing that both public and private schools alike could benefit from a scheme that would - starting in 2027 - provide a dollar-for-dollar tax break. The scheme would allow  affluent Americans to redirect up to $1700 each of their federal tax bill to a “Scholarship Granting Organization” (SGO)  of their choice. The funds would in turn be distributed to a student or family selected by the SGO to receive a scholarship, for private school tuition or other “qualified educational expenses” while the SGO keeps 10% off the top.

Experts, educators, and public school champions nationwide have sounded the alarm ever since, urging state leaders to opt out of the scheme and national leaders to repeal the program.

In Wisconsin, Gov. Tony Evers saw this scheme for what it was immediately and has stood strong in his commitment to opting Wisconsin out of the program. This year, he vetoed a bill that attempted to force compliance. In his veto statement, Gov. Evers made the stakes clear:

The ‘Big Beautiful Bill’ created the first major federal program to effectively redirect public funds to private school tuition through tax incentives…the federal government is now going to use public funds that should be used for public schools to essentially reimburse donors for helping fund private schools instead. No joke.

Republicans in Washington have given private voucher expansion carte blanche to run roughshod over public education in this country—and a blank check to do so at taxpayer expense, clearly without any regard for whether it actually does what is best for kids.

Public funds should go to public schools. Period. 

The guidance released yesterday by the U.S. Treasury affirms Gov. Evers’ assessment of the fundamental imbalance in the federal voucher: taxpayer dollars can flow freely into private schools with minimal accountability and no protections against discrimination, while public schools face significant barriers to accessing benefits of the program for their students, while states bear costs for maintaining the program and have very limited opportunities for oversight.

According to Jessica Levin of Education Law Center, “The proposed regulations confirm that the federal voucher program is intended mainly to divert public funds to private education uses. The documentation accompanying the proposed rules acknowledges that the program could cost tens of billions of dollars per year. Crucially, the proposed regulations prohibit states from placing requirements on scholarship granting organizations (SGOs), which hand out vouchers, that are more restrictive than the minimal requirements imposed by the statute. This means states cannot guarantee voucher funds go to public school students and it dramatically limits states’ ability to prevent this voucher scheme from funding segregation and discrimination against students and families.”

Public dollars should come with public accountability. Instead, these rules allow federal dollars to flow to private schools without requiring the same transparency, civil rights protections, student safety standards, or obligation to serve every student that is required of public schools.  In fact, the new guidelines disallow states from requiring taxpayer-funded private schools to serve students with disabilities, English language learners, or LGBTQ+ students. The federal voucher program has no cap, meaning it could funnel tens of billions, if not hundreds of billions, of dollars to unaccountable private schools, potentially adding over $50 billion to the national deficit. 

Heather DuBois Bourenane, executive director of Wisconsin Public Education Network, shared the following statement: 

“The long-overdue guidance from the Treasury Department confirms what we have been warning all along: like all voucher scams, the federal tax credit program is an entitlement scheme that will benefit the wealthy and students already attending private schools while American taxpayers foot the bill and public school students pay the price.

We applaud Governor Evers for his foresight in protecting Wisconsin students by opting Wisconsin out of this program, and urge state leaders nationwide to provide the same protections while they can. 

Congress must repeal this act immediately and instead commit our federal tax dollars to fully funding IDEA and investing in the public schools that serve the vast majority of America’s children.

At a time when our public schools are struggling with inflation and underfunding nationwide, America cannot afford this reckless entitlement, and Wisconsin cannot afford to buy into any scam that widens our existing gaps between “haves” and “have nots” by letting people who know how to game the system pick and choose where to send our tax dollars.” 

State and national leaders must act quickly to reject and repeal this scam before it goes into effect. We urge all to share concerns with their elected officials, and to join us at WisconsinNetwork.org to stay informed of updates and action opportunities. Learn more at the Public Funds Public School webinar Friday, Oct. 2 at 12 pm ET/11 am CT.