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SB 6001

Education - As enacted, enacts the "Education Freedom Scholarship Act." - Amends TCA Title 4, Chapter 49; Title 8 and Title 49.

114th First Extraordinary Session (January 2025)

Creates the Education Freedom Scholarship program to provide state-funded private-school scholarships, plus a Disbursement Account funded by sports wagering tax for LEA capital needs.

Comp. became Pub. Ch. 7
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Bill Summary · SB 6001

Summary — SB 6001 / HB 6004 — Education Freedom Act of 2025 (Pub. Ch. 7)

Status & procedural history
- Filed: January 22, 2025 (SB 6001). Companion: HB 6004.
- Committee and floor actions in January 2025; enrolled bill became Public Chapter 7 on February 25, 2025.

Purpose
- Establishes the Education Freedom Scholarship (EFS) Program to provide state-funded scholarships that may be used toward tuition and allowable expenses at approved private schools, and creates a related Disbursement Account for school capital needs funded in part by privilege tax on sports wagering.

Key provisions (core enacted elements)
- Creation of EFS Program (administered by TN Dept. of Education)
- Scholarships first available for the 2025–26 school year, subject to appropriation.
- 2025–26 award cap: up to 20,000 scholarships (10,000 reserved for income‑eligible or ESA/IEA‑type students; 10,000 open to any eligible student).
- Scholarship amount = the TISA base funding amount (per‑pupil base defined in TISA), paid with state funds. (TISA base cited: $7,075 for FY24‑25; estimated increases ~3.13% annually.)
- Students may not receive an EFS in the same year they participate in the Tennessee ESA or IEA programs.

  • Eligibility and prioritization

    • “Eligible student” generally = Tennessee resident entitled to attend public school, excluding students enrolled in home schools or certain church‑related schools (various amendments refined definitions and local participation requirements).
    • Award order and annual prioritization rules for subsequent years (continuing recipients, low‑income, public school enrollees, etc.). Department may increase award cap in future years under specified application thresholds.

  • Academic accountability & reporting

    • Private schools enrolling EFS recipients must annually administer TCAP (or a nationally standardized achievement test in some versions) to recipients in grades 3–11 and provide results to parents and to the Office of Research and Education Accountability (OREA) by June 30 each year.
    • OREA must report results annually to legislative education committees. Several amendments add or clarify: aggregated/de‑identified reporting, ability to group by grade, income, sex, race; sanctions in some versions (e.g., 15% lower performance could bar future enrollment of recipients).
    • Additional enacted/considered measures in amendments: private‑school audits of scholarship funds, criminal background checks, non‑discrimination requirements for students with disabilities, and private school reporting requirements.

  • LEA financial protection (TISA hold‑harmless)

    • Beginning with specified TISA cycles, if an LEA’s TISA allocation declines due to disenrollment connected with the program, DOE must allocate additional state funds so the LEA’s allocation equals the prior year (and in later years equals the prior year plus any prior additional funds). Those additional funds are state‑funded and substitute for certain other transition/safety net funds.

  • Teacher bonus

    • One‑time $2,000 bonus to each K–12 public school teacher for the 2024–25 school year (state‑funded), subject to LEA participation procedures and excluding legislators who were teachers on the effective date.

  • Disbursement Account (school capital)

    • 80% of the privilege tax collections on sports wagering (otherwise going to the Lottery for Education Account) are directed to a Disbursement Account administered by the State Treasurer for LEA construction/maintenance needs.
    • The treasurer distributes funds to eligible LEAs (e.g., economically distressed/at‑risk counties, high‑performing LEAs, fast‑growth LEAs) with an application, reporting, and milestone/disbursement process. Unspent funds and investment earnings are carried forward.

Fiscal impact (summary of fiscal notes)
- Significant state expenditure and fund shifts:
- Estimated state General Fund expenditures (as amended): approximately $347.4 million in FY25‑26 and $191.3 million in FY26‑27 (ongoing > $191.3M). (Fiscal notes present closely related estimates.)
- Redirects a portion of Lottery for Education Account receipts (privilege tax on sports wagering): estimated reduction/deposit in the Disbursement Account on the order of $62.7M–$77.2M annually (FY25‑26 onward), depending on the fiscal-note version.
- Positions required: 13 (state).
- Local impact: Mandatory/local revenues tied to funds distributed to LEAs for school building projects; precise local capital spending increase is not fully quantified.

Who is affected
- Students: public‑school‑zoned students who may apply for scholarships; private‑school students accepting EFS funds; ESA/IEA participants (exclusion from simultaneous receipt).
- Private schools: must meet approval/eligibility criteria, administer state assessments for recipient students, comply with reporting/audit/background check requirements in enacted or adopted amendments.
- Local education agencies (LEAs): may experience student disenrollment and receive state hold‑harmless TISA adjustments; eligible LEAs gain access to Disbursement Account capital funds.
- Teachers: eligible for a one‑time $2,000 bonus for 2024–25 (public K–12).

Notable procedural/implementation details
- Program administration assigned to the Department of Education; Treasurer to invest and administer program and Disbursement Account funds. Unspent program funds do not revert to the general fund.
- Many amendments were filed addressing private‑school accountability, eligibility narrowing/expansion, application caps, and distributions; some of these provisions (testing, reporting, treasurer investment rules, disbursement criteria, teacher bonus, TISA hold‑harmless) are reflected in the enacted version(s) and fiscal analyses.

Sources
- Bill text (SB 6001 / HB 6004), reported amendments, and Fiscal Review Committee fiscal notes (January 23 and 28, 2025).

Compiled from official sources — confirm details with the bill’s official record.

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