By Staff Reporter |
Arizona has not yet opted into a new tax credit to provide school choice funds for families, and the Trump administration is urging Gov. Katie Hobbs to join.
Linda McMahon, education secretary for the Department of Education (ED), chastised the governor during a touring event and press conference at the East Valley Institute of Technology on Tuesday.
Rep. Andy Biggs (AZ-05) — the Republican nominee for governor — and House Speaker Steve Montenegro (R-LD29) were present with McMahon.
The federal Education Freedom Tax Credit, signed into law through the One Big Beautiful Bill last year, enables individuals to receive a dollar-for-dollar federal tax credit up to $1,700 for contributing to approved K-12 scholarship-granting organizations.
ED defines qualifying scholarship granting organizations as those nonprofits that use contribution funds to provide scholarships for education-related services at both private and public schools. These nonprofits must use at least 90% of income on scholarships for educational choice options for K-12 students.
At the Tuesday event, McMahon accused Hobbs of denying Arizona students and their parents the access to “real” educational freedom.
“Governor Hobbs has vetoed three measures that would have allowed Arizona to participate in the Federal Education Freedom Tax Credit, holding Arizona families back from accessing these powerful opportunities expanding across the country,” said McMahon. “This is what real empowerment looks like, giving parents the freedom to choose the path that best serves their child, instead of forcing every student into a rigid, one-size-fits-all system.”
Hobbs must opt in and submit a certified list of scholarship granting organizations by Jan. 1, 2027, for Arizona to participate in the inaugural year of the program.
Even if Hobbs does not opt Arizona into the program, Arizona residents may still claim the tax credit. Instead of their credit going to Arizona students, however, those contributions will go to eligible students elsewhere in participating states.
Hobbs explained in her veto of SB 1142 that she wouldn’t opt Arizona into the program until the Trump administration issues regulatory guidance for it. She compared the tax credit program to the Empowerment Scholarship Account (ESA) program, the state’s universal school choice program.
A bipartisan coalition of 30 states have opted into the federal education tax credit program so far: Alabama, Alaska, Arkansas, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, North Carolina, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, and Wyoming.
New York announced in May it would opt into the program but has not finalized that opt-in.
Four states have declined to join: Hawaii, Minnesota, New Mexico, and Oregon. Similar to Hobbs, the governor of Wisconsin vetoed legislation to opt into the program.
13 states and Washington, D.C. have yet to announce a decision: California, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, New Jersey, Pennsylvania, Rhode Island, Vermont, and Washington.
Rep. Biggs, who is looking to unseat Hobbs this November, published a press release criticizing Hobbs’ refusal to allow Arizona to join the program.
“Because of her failure, Arizona students will miss out on scholarship dollars that could help pay for tuition, tutoring, technology, special education services, and other educational needs,” said Biggs. “Arizonans should not have to watch their tax dollars create educational opportunities for students in other states simply because their governor refuses to participate.”
McMahon also addressed a Scottsdale audience in a “Great American Comeback Tour” event hosted by the America First Policy Institute. The Republican nominee for Congressional District 1, Jay Feely, also participated in the panel.
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