Funding for Texas’ $1 billion education savings account program is expected to dry up before it reaches some low-income applicants, the state comptroller’s office announced April 2.
The big picture
More than a quarter of a million students applied for the first year of Texas Education Freedom Accounts, which will give participating families access to state funds to send their children to private school or homeschool them. Applications closed March 31 after the deadline was extended by two weeks due to concerns that Islamic private schools had been excluded from the program.
Texas law states that any school-age child who is a U.S. citizen, resides in Texas and is eligible to attend a Texas public school, open-enrollment charter school or prekindergarten program can apply for education savings accounts.
The comptroller’s office deemed about 247,000 applicants eligible for program funding and said another 2,210 students’ applications were under review. Nearly 25,000 students did not qualify to participate, including about 19,000 prospective pre-K students who must meet stricter eligibility requirements under state law.
Most eligible students will be placed on a waitlist for the 2026-27 school year, as the $1 billion program is expected to serve between 90,000 and 100,000 students. State officials said all funds are expected to go to students with disabilities, their siblings and children from low-income families.
“It's always hard to have to turn people away,” Travis Pillow, a program spokesperson with the comptroller’s office, told Community Impact. “We don't want any families who are turned away in year one due to lack of available funds to get discouraged. This is Year 1 of a brand new program, and for us to see this level of demand and have to prioritize available funding to a very high-needs group is a very encouraging first step.”
Keep reading for details on the acceptance process and next steps for families.
How it works
The comptroller’s office is currently reviewing applications to confirm eligibility, Pillow said. The education savings account program is designed to prioritize students in the following order:
- Tier 1 includes students with disabilities whose annual household incomes are at or below 500% of the federal poverty line, or about $165,000 for a family of four. Nearly 30,000 applicants are in this tier, the comptroller’s office said.
- Tier 2 includes children with household incomes at or below 200% of the federal poverty line, which is about $66,000 for a family of four. About 79,000 students are in this tier.
- Tier 3 includes families earning between 200%-500% of the federal poverty line.
- Tier 4 includes families above 500% of the federal poverty line.
If a child is accepted into the program, their eligible siblings who applied will be automatically accepted, Pillow said. Families will be notified beginning this month if they are accepted into the program, and participants will start receiving funding in July.
The comptroller’s office said it anticipates accepting the nearly 30,000 eligible applicants in the first priority tier. Officials will then run a randomized lottery to determine which of the roughly 79,000 Tier 2 applicants make it into the program, although funding is expected to run out before reaching some low-income families. Students who are not selected in the lottery or fall in a latter tier will be put on a waitlist.