20250ACR_022999INT INTRODUCED 2026-06-23 2025 ACR INT Introduced by Assembly Member Hoover (Coauthors: Assembly Members Castillo, Hadwick, and Sanchez) LEAD_AUTHOR ASSEMBLY Hoover COAUTHOR ASSEMBLY Castillo COAUTHOR ASSEMBLY Hadwick COAUTHOR ASSEMBLY Sanchez Relative to the federal Education Freedom Tax Credit. the federal Education Freedom Tax Credit Federal Education Freedom Tax Credit. This measure would urge Governor Gavin Newsom to exercise his executive authority to promptly submit California’s election to participate in the federal Education Freedom Tax Credit program, as provided. YES

WHEREAS, The federal Education Freedom Tax Credit, established in

Section of Public Law 119-21 and codified in

Section 25F of Title of the United States Code, provides a nonrefundable dollar-for-dollar federal tax credit of up to $1,700 per individual taxpayer (with carryforward for up to five years) for cash contributions to qualifying scholarship granting organizations (SGOs); and

WHEREAS, This program enables SGOs to award scholarships to K–12 pupils from households with income up to percent of the area median income, covering approximately percent of pupils nationwide, for qualified educational expenses, including tuition, tutoring, textbooks, supplies, transportation, technology, and special education services; and

WHEREAS, California’s public K–12 schools serve approximately 5,800,000 pupils, with roughly percent identified as socioeconomically disadvantaged; and

WHEREAS, Participation in this program would provide critical additional resources to California families, particularly low- and middle-income households, without any cost to state taxpayers or reduction in public school funding; and

WHEREAS, Data from similar state-level tax credit scholarship programs demonstrates substantial increases in private donations to SGOs and expanded scholarship opportunities for pupils. Nationally, the federal Education Freedom Tax Credit is projected to generate billions of dollars in new scholarship funding annually, with every $1 billion potentially supporting tuition for approximately 77,000 pupils or tutoring for more than 300,000 pupils; and

WHEREAS, Analysis indicates that if California opts in, the state could access up to $4.91 billion in scholarship contributions between and alone, directly benefiting hundreds of thousands of California pupils and families; and

WHEREAS, Failure to opt in risks a significant decline in donations to California-based SGOs, as taxpayers nationwide can still claim the federal tax credit, but will direct contributions to SGOs in participating states, resulting in scholarship funds flowing out of California to benefit pupils elsewhere; and

WHEREAS, As of June 2026, 30 or more states have already opted in to the program, positioning their pupils to receive these new scholarship resources while California pupils stand to lose out without swift action. Participating states include Alabama, Alaska, Arkansas, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New York, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, and Wyoming;

now, therefore,

be it Resolved by the Assembly of the State of California, the Senate thereof concurring, That the Legislature urges Governor Gavin Newsom to exercise his executive authority to promptly submit California’s election to participate in the federal Education Freedom Tax Credit program of the United States Department of the Treasury and the United States Internal Revenue Service, including the annual submission of a list of qualifying California SGOs that meet all federal requirements; and be it further Resolved, That the Legislature urges the Governor and relevant state agencies to take all necessary steps to designate and approve qualifying SGOs and ensure full compliance with federal guidelines so that California families can benefit starting January 1, 2027; and be it further Resolved, That the Chief Clerk of the Assembly transmit copies of this resolution to the Governor of California, the Superintendent of Public Instruction, each member of the California congressional delegation, and to the author for appropriate distribution.