Senate Committee advances expansion of original Education Savings Account program, despite passage of the Education Freedom Scholarship Act

Senate committee room (Photo by Sky Arnold)

The Tennessee Education Freedom Scholarship program isn’t even up and running yet, but lawmakers in the Senate Education Committee chose to advance a bill Wednesday that would expand the program’s predecessor to three additional counties.

Senator Todd Gardenhire (Photo by the Tennessee General Assembly)

Senator Todd Gardenhire’s, R-Chattanooga, legislation would expand the Education Savings Account (ESA) pilot program implemented in 2022 to include students in Montgomery, Knox, and Rutherford Counties. The ESA program was created to allow low-income families in Davidson and Shelby Counties to use taxpayer funds to send their children to private school. Gardenhire played a pivotal role helping to expand it to include Hamilton County.

The program, frequently referred to as school vouchers, is currently in its third year and there is not an existing plan to sunset it.

Next year it will allow for 12,500 students and reach a cap of 15,000 students the following year. Those numbers would not change under Gardenhire’s proposal. To qualify for the ESA program, families must have an annual household income that does not exceed twice the federal income eligibility guidelines for free lunch and must attend a school identified as a low-performing or priority school.

The ESA program is separate from the Education Freedom Scholarship Act, which passed in January. It will provide 20,000 scholarships Tennessee families can use for expenses to send their children to private schools. They are available to any Tennessee child eligible to attend public school from kindergarten through twelfth grade. The first 10,000 vouchers are reserved for students whose families' annual household income is less than 300 percent of the income threshold set to qualify for free or reduced-price lunches, and for students with disabilities. Any income caps are lifted for the remaining 10,000 vouchers.

On Wednesday, Senator Gardenhire told members of the Senate Education Committee the removal of that income cap concerns him, and he wants to expand the state’s ESA program to ensure low-income families still have other options. He says he thinks once the income cap for Education Freedom Scholarships is lifted, private schools will show preference to higher income families.

“When they have a choice between students whose parents can afford to attend all the functions, donate to the athletic fund, donate to the library fund, be involved in the school. In my opinion, after two or three years, these students, the students that need the help, will be muscled out or not really be able to compete for the seats,” said Gardenhire. “This just keeps the income level for those students down below and the opportunity to have a scholarship through a savings account to a private school.”

Gardenhire told committee members that during the debate about the Education Freedom Scholarship Act earlier this year, nearly a dozen Tennessee school superintendents called him to oppose it. But he says they also had a surprising request.

“Several of those superintendents are represented by people on this committee. They called me up, begged me to vote against it (Education Freedom Scholarship Act), and said, ‘You need to bring back that ESA bill, we’ll support that.’ Well, here I am, bringing it back,” he said.

Senator Bill Powers, R-Clarksville, represents Montgomery County and he says school officials there are opposed to ESA expansion to their district. He says expansion of the program is redundant because any Montgomery County families interested in a scholarship would be able to apply for one under the Education Freedom Scholarship Act. He also took issue with the funding mechanism for ESAs. He pointed out that ESAs are partially funded with locally generated dollars, while Education Freedom Scholarships are covered entirely with state funds.

“This would mean a portion of local funds generated in Montogomery County, my home county, for our schools, would be going towards private education expenses,” said Powers.

Powers also pointed out that the current ESA program would award a higher amount per scholarship than EFS scholarship. ESA scholarships are expected to increase to up to $8,684 dollars per student. The proposed amount for an Education Freedom Scholarship for the 2025-26 school year is $7,295 dollars per student.

Senator Joey Hensley, R-Hohenwald, reiterated that students in any of the counties under Gardenhire’s legislation would already be eligible for Education Freedom Scholarships because it covers students statewide. He wanted to know why Knox, Montgomery, and Rutherford Counties were specifically chosen for an expansion of the ESA program.

“These are the last three big urban counties, and because of that, that’s where they have, according to the data I’ve seen, more underprivileged children that would have access to a private school,” explained Gardenhire. “The cynic in me tells me that after two or three years those families, and they’re probably single parent families or grandparents raising those kids, probably won’t have the muscle or influence to get in there and apply for those (Education Freedom Scholarship Act) scholarships.”

Senator Powers then told committee members Montgomery is one of the fastest-growing counties in the state, and even with an influx of students, schools within the district there regularly meet or exceed state standards.

“We know something about education in Montgomery County,” said Powers. “We have no failing schools in Montgomery County. Zero.”

The bill passed in a 6-2 vote, with Senators Hensely and Powers voting against the measure. It now moves on to the full Senate.