United States Secretary of Education Betsy DeVos has a $5 billion tax credit proposal called the Education Freedom Scholarship she’s hoping Congress will approve.
Flanked by South Carolina Gov. Henry McMaster and state Superintendent Molly Spearman, DeVos talked about the proposal during a roundtable with various private and charter school leaders at Hidden Treasure Christian School in Greenville on Thursday.
The crux of the proposal is to incentivize donations to the scholarship fund from businesses and organizations, who then receive dollar-for-dollar tax credits they can use to deduct from what they owe in federal taxes.
DeVos’ primary selling point is that the Education Freedom Scholarship could go to any broad number of programs — more classroom course options, private school scholarships, transportation for students to attend out-of-zone schools, and so on — but it would be up to each state to decide how to use the money.
DeVos estimated South Carolina’s cut of the fund would be about $80 million if the $5 billion goal is met. She said there’s no requirement that states have to participate.
“If they do, they would be able to develop one or more programs that would ultimately empower children, students, and parents through scholarship funds. So states would name 501(c)(3) organizations, charitable organizations, that would be recipients of these voluntary contributions, and they would then work on one or more programs to specifically meet the needs of students in that particular state,” DeVos said. “We encourage people to think very broadly about what these different kinds of opportunities would mean.”
DeVos emphasized there would not be any “federal entanglements” or guidelines since the money would be donated by private groups and not pass through a federal agency.
South Carolina currently has a scholarship-granting organization (SGO) called Exceptional SC that provides tuition scholarships for students with special needs to help them attend private special education schools. Individuals and corporations can donate to the scholarship and receive state tax credits.
A spokesperson for Spearman said that if passed, South Carolina would likely use the $80 million to expand Exceptional SC, provide more support for rural schools, and provide more career and technical education opportunities, among other options.
McMaster said the Education Freedom Scholarship would not be used solely for private schools, saying such a proposal wouldn’t pass the state Legislature. If passed, McMaster said he would like to see some of the funds used for rural schools.
“If we can close this education gap in our rural areas in South Carolina, then there’s nothing stopping the state of South Carolina,” McMaster said.
A member of President Donald Trump’s Cabinet, DeVos has had staunch opponents since her confirmation hearing in 2017 because of her long history supporting school choice vouchers and her lack of education experience prior to the confirmation.
Nicole Walker, a member of the South Carolina education group SCforEd, said the group has questions about how the proposal would work.
“In theory, it sounds wonderful, but what amounts of donation would qualify? What entities would qualify for the tax credit?” Walker said. “Since it’s customizable and can be used for so many different opportunities, it has the potential to open a pathway to for-profit charter schools, for example, to donate to this fund, receive a credit, and in turn profit from it if a particular state approves it as a vendor. That would be a huge concern for us.”
The Education Freedom Scholarship has an uphill battle passing through Congress with Democrats controlling the House of Representatives, which DeVos admitted would likely hinder progress on the proposal.
“There is a general reluctance to think very differently about how K-12 education might be approached or what we might try to do differently, and so it is a matter of one-on-one advocacy education to help all of them understand the possibilities that are inherent in this proposal,” DeVos said. “Education is not a partisan issue — it should not be a partisan issue.”