In the first successful veto override of this year's legislative session, North Carolina lawmakers are opting the state into a new federal tax credit program. The federal program lets taxpayers get a dollar-for-dollar tax credit up to $1,700 for making a donation to North Carolina non-profits that grant scholarships to K-12 students.
The federal bill that originally proposed the tax credit was designed to support scholarships for private school tuition, so it's been widely cast as being akin to a school voucher program. But supporters of North Carolina's new law say the final version of the federal program passed in President Trump’s "One Big Beautiful Bill" Act could serve students in both private and public schools.
Senator Michael Lee sponsored the new state law, also known as the Educational Choice for Children Act.
"A lot of folks have kind of just tied this to private schools or other types of non-public type institutions. That's really not true," Lee said during the bill's final vote on the Senate floor. "This really applies to all children in all schools."
Lee has also argued that the bill would cost the state nothing, because the program provides a tax break on federal taxes without affecting state revenue.
Critics of the tax credit say that, based on the way the program is written, it would primarily help private school students. The Public School Forum of North Carolina is working with other organizations to strategize how the program might support public school students, too.
"We're going to do the best that we can to help steer it in a way that benefits as many public school students as it can," said Sara Howell, the Public School Forum's associate director of policy programs.
But, she added, that's a complicated task.
"Could it benefit public school students? Yes, with like the biggest asterisk of all time, it could," Howell said. "According to the law, it can, but the how and the practical parts of it are what are problematic right now."
The law says scholarships can pay for many expenses that public schools don't charge for, including: tuition, room and board, transportation, special education services, books, supplies and technology. The scholarships must go to elementary and secondary school students, and it is not intended to pay for college scholarships.
Howell said there might be room to support public schools via supplemental programs that schools are not legally required to provide free of charge.
"So that's something that people are talking about: tutoring programs, supplemental summer programs, after-school tutoring, things like that," Howell explained.
"Is it a net benefit for public school students? I would say almost certainly not," said the Public School Forum's interim director, Lauren Fox.
Fox said she worries the loss of federal revenue from this tax credit will lead Congress and the U.S. Department of Education to make further funding cuts to public schools.
Gov. Josh Stein said he vetoed the bill to wait for more federal guidance on exactly how the program will work. That guidance has not yet been released by the U.S. Treasury Department, but could be later this summer. Stein said he would have opted into the program himself if it was more clear how it could serve public school students.
