New York Governor Kathy Hochul has opted the state into the Trump administration’s Education Freedom Tax Credit, making it the 31st state to join the first nationwide federal school-choice programme.
Ms Hochul is only the second Democratic governor to participate, following Colorado Governor Jared Polis. She announced the decision on 9 October, days after senior Democrats in Albany urged her to reject the scheme.
“I’m not going to leave money on the table when it could help our kids,” Ms Hochul said. She added that New York would take part “if, and only if, all schools and students, including those in our public schools, could benefit.”
The decision puts her at odds with Assembly Speaker Carl Heastie and Senate Majority Leader Andrea Stewart-Cousins, both of whom warned that the scheme could weaken the state’s control over education funding.
“New York should opt out of the federal voucher program and continue investing in the public schools that educate the overwhelming majority of our children,” Mr Heastie said.
Ms Stewart-Cousins said the federal rules “would undercut New York’s ability to establish meaningful guardrails, leaving the state with little control over which schools and expenses qualify or how this funding is used.”
The move comes weeks before Election Day, with Ms Hochul facing Republican nominee Bruce Blakeman, who has criticised her for not opting into the programme sooner.
How New York’s education tax credit will work
The Education Freedom Tax Credit was created by the One Big Beautiful Bill Act, the tax and spending law signed by President Donald Trump in July 2025.
From 1 January 2027, taxpayers will be able to claim a dollar-for-dollar federal tax credit of up to 1,700 dollars for cash donations to approved scholarship-granting organisations. Proposed regulations treat married couples filing jointly as separate taxpayers, allowing them to claim up to 3,400 dollars combined.
The credit reduces federal tax revenue rather than drawing directly on state budgets. Governors must opt in each year for students in their states to receive scholarships, although taxpayers anywhere in the country can donate to organisations in participating states.
In New York, students will qualify if their household income is no more than 300 per cent of the median gross income in their area. The threshold is estimated at about 309,000 dollars in the Bronx and 510,000 dollars in Westchester County.
Scholarships can be used for private and religious school tuition. Public school pupils may use the money for tutoring, special education services, books and technology.
Teachers’ union attacks private-school scheme
New York State United Teachers, the state’s largest teachers’ union, has described the measure as “President Trump’s private-school voucher program” and argued that the income limits, which exceed 500,000 dollars in parts of the state, make it primarily a tax break for wealthy households.
“The governor says this won’t take a dollar from public schools, but it takes federal tax money, which belongs to all of us, and hands it to private schools with no rules about who they must admit or how they account for it,” said Beatriz Beckford of MomsRising.
Supporters, including Catholic and Orthodox Jewish school advocates and Democrats for Education Reform, welcomed New York’s participation. The conservative American Legislative Exchange Council called the move part of a growing bipartisan movement and urged other states to join.
The Scholarships for All New Yorkers coalition has cited a projection that the programme could generate 1.5 billion dollars a year for New York students if one-third of eligible taxpayers participate.
National Treasury projections suggest that more than 11 million taxpayers could donate nearly 26 billion dollars a year through the scheme by 2030. The Joint Committee on Taxation has forecast a much lower cost to federal revenue: 25.9 billion dollars over a full decade.
Treasury and the Internal Revenue Service are accepting public comments on the proposed rules until 1 December, with a public hearing scheduled for 15 December. States that have not joined have until 1 January 2027 to decide whether to participate.
