Connecticut’s public‑school community is sounding the alarm over the Federal Scholarship Tax Credit (FSTC) that the Treasury Department released guidelines for this week. The credit, which will become available on Jan. 1, 2027, allows donors to claim a dollar‑for‑dollar credit of up to $1,700 per individual or $3,400 per household, with no income caps.
Administration’s Intent
The Trump administration has emphasized that the credit is not limited to private‑school tuition. Officials say the program is designed to give families, including those with public‑school children, a new way to fund special‑education services, autism support, high‑dosage tutoring and other educational options.
Teachers’ Concerns
Connecticut teachers and the state education association argue the Treasury’s rules tell a very different story. The guidelines permit scholarship‑granting organizations (SGOs) to retain a 10 percent administrative cut and to decide unilaterally how the money is allocated. That authority could allow SGOs to direct funds primarily to religious or private schools, without any state‑level guardrails.
“We have seen private‑equity firms use education‑service providers as a steady cash flow source, often at the expense of students and local hospitals,” said Joslyn DeLancey, vice president of the Connecticut Education Association and a longtime public‑school teacher in Darien. “This credit codifies those inequities and hands away decision‑making from parents, teachers and school boards.”
No State Oversight
Under the new guidance, states cannot require SGOs to earmark funds for low‑income families, prevent discrimination, or ensure that the money is used where it would do the most good. Critics warn that without such safeguards, the billions of federal dollars slated for the program could flow largely to private‑equity‑owned tutoring firms and faith‑based schools, leaving public‑school districts under‑funded.
Local Impact
In Fairfield County, where income disparities between districts are already stark, the credit could enable affluent families to divert tax dollars to private programs that are not subject to the same accountability standards as public schools. DeLancey noted that “those dollars will not find their way to our public schools,” and urged governors to decline participation by the Dec. 31 deadline.
Private‑Equity Track Record
State educators point to recent examples of private‑equity‑owned education providers that have shuttered abruptly, such as FEV tutoring, which closed overnight and left families in 30 states scrambling for alternatives. They argue the same pattern could repeat in Connecticut if the credit proceeds unchecked.
What Parents Should Know
For families considering the credit, the association recommends asking three key questions: Is the program truly saving money for my child? Will it help students who need the most support? Or is it simply moving public dollars into private systems without oversight?
The association concludes, “If it sounds too good to be true, it probably is. Say no to the Federal Scholarship Tax Credit.”
Original reporting: The Connecticut Mirror — read the source article.
