51K low-income students to receive Texas Education Freedom Account funding

Families will be notified by email between May 4-6 if they were awarded funds in the second round of the Texas Education Freedom Accounts program, per a news release from the comptroller’s office. Families can find information about the amount of money they can expect to receive on the program portal.

Over 42,600 students received award notices in late April. Those awardees were low- and middle-income students with disabilities and their eligible siblings, Community Impact previously reported.

Families accepted to the TEFA program will receive state funds to send their children to private schools or homeschool them for the 2026-27 school year. Proponents of the new program have said it will expand educational opportunities for families “stuck” in their local public schools, while critics have expressed concerns that the program will unfairly benefit students already enrolled in private schools and divert funding from public school districts facing financial challenges.

Over 274,000 students applied for the program, and about 248,000 were deemed eligible, according to state documents. Most eligible applicants will be placed on a waitlist, with applications prioritized 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. Over 44,000 Tier 1 students have been accepted.
• 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. Over 51,000 students have been accepted from Tier 2, with nearly 22,000 Tier 2 students on the waitlist.
• Tier 3 includes families earning between 200%-500% of the federal poverty line.
• Tier 4 includes families above 500% of the federal poverty line.

After students from the first priority tier were accepted, the comptroller’s office conducted a randomized lottery to determine which students in the second tier would receive funding. In total, the $1 billion program is expected to serve between 90,000-100,000 students next school year.

Students with disabilities can receive up to $30,000 each in TEFA funding, depending on their individual needs. Other accepted students will receive $10,474 to spend on private school tuition and related expenses, or up to $2,000 for homeschooling.

Next steps

Once families are accepted into the program, they have until July 15 to do one of the following:

• Confirm enrollment at a private school involved in the program
• Notify the state that they will homeschool their participating children
• Opt out of the program

At the Capitol

Eligible families who do not receive funding will be notified of their approximate position on the waitlist by May 11, per the comptroller’s office.

The size of the program’s waitlist could shape how much lawmakers choose to spend on education savings accounts during the 2027 legislative session. Lawmakers allocated $1 billion in program funding for the 2026-27 school year, with the nonpartisan Texas Legislative Budget Board previously projecting that demand would drive lawmakers to expand the program to $3.3 billion by 2028 and $4.8 billion by 2030.

The comptroller’s office asked families interested in applying for the second year of the program to sign up here to receive updates about the 2027 application process. Information from the interest form will be used to “inform the Texas Legislature about public interest in the program.”

Zooming in

Of the 51,000 low-income students accepted into the program this week, about 32% attended a public school in the 2024-25 school year, per state data, while 68% were previously enrolled in a private school or homeschooled.

Thirty-six percent of students accepted this week were white, while 28% were Hispanic and 17% were Black. In the first batch of accepted students, data shows that 42% were white, 25% were Hispanic, and 12% were Black.

During the 2024-25 school year, about 24% of Texas public school students were white, 54% were Hispanic and 13% were Black, according to Texas Education Agency data. About 60% of students in that school year were considered economically disadvantaged, which refers to children eligible for free and reduced-price school meals.

One more thing

State law allows the comptroller’s office to spend up to $30 million to administer the program and pay up to $50 million to Odyssey, a New York-based company managing portions of the program in partnership with the agency. With about $820 million set aside so far for participating students, this means at least $100 million remain available for families who are accepted into the program due to a successful appeal.

Once families are notified of their eligibility, acceptance or waitlist status, they have 30 days to appeal the state’s decision, according to the comptroller’s office. More information about filing an appeal is available here.

Applicants may also be moved off the waitlist if students accepted before them opt out of the program, decide to switch from private education to homeschooling or do not find an education option that works for them, TEFA spokesperson Travis Pillow said April 6.