NASHVILLE — Gov. Bill Lee’s proposed Fiscal Year 2026 budget formally establishes a new statewide school choice initiative titled the Education Freedom Scholarship Program, according to official budget documents released by the administration.
The proposal allocates $148.6 million in recurring funding to launch the program, which would make private school scholarships available to families across Tennessee, prioritizing low-income students and students with disabilities.
An additional $198.4 million in non-recurring funds is included for teacher bonuses related to the program rollout, bringing the total education package to more than $347 million.
Education hearing set for Thursday
Gov. Lee is scheduled to hold an executive budget hearing with the Department of Education on Thursday, November 6, as part of his annual budget review process before submitting a finalized proposal to the General Assembly in January.
The department’s presentation is expected to provide further detail on the program’s implementation, eligibility criteria, and funding mechanisms.
Fiscal and political outlook
If approved by lawmakers, the Education Freedom Scholarship Act would represent the largest expansion of school choice in Tennessee history, moving the concept from a limited pilot into a permanent, statewide program.
The $148.6 million recurring appropriation marks one of the largest single-year increases in base education spending, underscoring the administration’s intent to make the initiative a lasting component of the state’s education system.
The General Assembly will consider the plan when it reconvenes in January. Republican leaders are expected to support the measure, while Democratic lawmakers and some local school officials have signaled opposition, arguing that statewide vouchers could shift funding away from public schools.
What comes next
Following Thursday’s executive hearing, the administration will prepare final adjustments to the FY26 proposal before formally presenting the full budget package to the legislature. The appropriations bill must be enacted before the new fiscal year begins July 1, 2026.
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