At the start of a pivotal campaign cycle, Democratic governors will face a politically high-stakes decision this year on a new education policy that President Donald Trump signed into law last year. 

One provision of Republicans’ sweeping spending package adopted in 2025 — dubbed the “One Big Beautiful Bill” by Trump — was a measure that provides a dollar-for-dollar federal tax credit for people who donate to approved scholarship organizations that can support a range of education expenses, including private school tuition and tutoring. 

Individual states must opt in for taxpayers to be eligible for the credit of up to $1,700 annually. 

So far, the policy has been a no-brainer for Republican governors, who already support school choice programs, to allow parents to receive a federal tax credit to support private schools, including religious schools. Twenty-three states have formally opted in as of last month, and at least two other Republican-led states (Florida and Utah) said they plan to do so. 

Democratic governors, skeptical of school choice programs and wary of powerful teachers’ unions, face a trickier choice. They have to opt in by the end of the year for taxpayers to be eligible for the credit. The National Education Association urged lawmakers to vote against the bill last year, and has said that “voucher-inspired schemes” like the federal tax credit program “erode public education, the foundation of our democracy.” (An NEA spokesperson declined to comment on Wednesday.)

Orthodox Jewish groups have long supported school choice efforts, including vouchers, while most non-Orthodox groups — including umbrella organizations such as the Jewish federations — sat out those matters in the past or opposed them. Now, Orthodox leaders are being joined by the Jewish Federations of North America as the umbrella group urges Democratic governors to support the bill. The Union for Reform Judaism, which opposed an earlier version of the tax credit that was farther-reaching, ultimately did not come out against the measure. 

“We think this should be a priority for the entire Jewish community, to support students, especially in Jewish day schools,” said Rabbi A.D. Motzen, national director of government affairs at Agudath Israel, a major Orthodox organization. “I think it’s very helpful, because in many of those blue states, the more governors see that this is a politically wise idea, and that there is widespread support among different faiths, whether it’s Catholic clergy or Jewish leaders and business leaders, then it will make it easier for them to to opt in.”

Marc Baker, CEO of Combined Jewish Philanthropies, Boston’s Jewish federation, said the tax credit “aligns with CJP’s vision to make day school more affordable and accessible for families in Greater Boston,” and that he plans to discuss it with Massachusetts Gov. Maura Healey, a Democrat. 

Part of the pitch that Gil Preuss, CEO of the Jewish Federation of Greater Washington, is making to Democratic leaders in Maryland, Virginia and Washington, is to differentiate the tax credit from more controversial voucher programs.

“I know, particularly for Democratic governors, they place significant value in public education, and we as a Jewish community strongly support public education,” said Preuss. “We don’t believe it’s taking away money from public education, but it is a way for individual households to direct some of their federal taxes.”

Colorado Gov. Jared Polis is so far the Democrat who has expressed the most enthusiasm about the tax-credit scholarship program. 

“It supports donors to give more money to our schools,” Polis said in November. “I mean, I would be crazy not to” opt in. A spokesperson for Polis confirmed in December that he plans to add the state to the program. 

North Carolina Gov. Josh Stein, a Democrat, has also said he intends to opt in his state once more information is released from the federal government. “School choice is good for students and parents,” Stein said last year. “I intend to opt North Carolina in so we can invest in the public school students most in need of after school programs, tutoring, and other resources.”

A handful of blue-state governors — in Wisconsin, Oregon, New Mexico and Hawaii — have stated they will opt out of the program. 

Most Democratic governors, including in states with the largest Jewish communities, are taking a wait-and-see approach, saying they need to see formal regulations from the IRS and the Treasury Department outlining what the funds can be used for and how they can be collected. Activists in the Jewish community working on this issue say they are still in conversation with Democratic governors even though the timeline for implementation is not totally clear. 

“The governors that we speak to on a regular basis about this are very clear that they want to see the regulations first, which we don’t hold against them. We think that’s fair. You don’t want to play a game until you see the rules of the game,” said Sydney Altfield, CEO of Teach Coalition, a project of the Orthodox Union that advocates for federal funding for nonpublic schools. “We think that in the long run, it will be a positive outcome, but we understand that there’s no movement yet.” 

Rosie Lapowsky, a spokesperson for Pennsylvania Gov. Josh Shapiro, said his administration “is awaiting federal guidance to address key questions about how this program would work, including which students will be eligible, how this federal initiative will interact with existing programs, and more. We look forward to reviewing that guidance.”

A spokesperson for Maryland Gov. Wes Moore said he has not yet taken a position. Alana Davidson, director of communications at the Massachusetts Executive Office of Education, told JI that Gov. Healey “is awaiting official guidance from the U.S. Department of Education and Treasury at this time.” 

Jen Goodman, a spokesperson for Gov. Kathy Hochul of New York, took a swipe at the Trump administration while saying Hochul has not yet made up her mind.

“While this proposal doesn’t take effect until 2027, it’s surprising that the federal government continues to fail to share any policy details with states,” Goodman told JI. “Gov. Hochul is supportive of anything that would help students and schools, but given this administration’s record of including poison pills in policies, the state needs to thoroughly review the proposal before making commitments.”

Spokespeople for Illinois Gov. JB Pritzker, California Gov. Gavin Newsom, New Jersey Gov. Mikie Sherrill, Washington, D.C., Mayor Muriel Bowser and Virginia Gov. Abigail Spanberger did not respond to requests for comment. 

Spanberger is in a different position from other Democrats, because her predecessor — Republican Gov. Glenn Youngkin — already opted Virginia in last month before he left office, so she would have to formally revoke that permission. 

Preuss said his goal at the moment is not necessarily to get area governors in the Washington area to a yes anytime soon, with IRS regulations not likely to come out for a few more months. He just wants to convince them to leave the door open.

“It’s very early on,” Preuss said. “We mostly want to make sure that governors do not come out against it.”

As the Senate closed out its marathon session of amendment votes on Republicans’ budget bill, the so-called Big Beautiful Bill, it added back a provision fought for by Orthodox Jewish groups, creating a major new national school-choice program, which had been stripped from the bill days earlier. 

The program, known as the Educational Choice for Children Act, passed through the House but was ultimately struck from the bill by a ruling of the Senate parliamentarian, a nonpartisan official responsible for ruling on whether provisions meet the standards for a reconciliation bill, which is limited to certain budgetary and tax matters.

The ECCA would create a tax credit for individuals who donate to scholarship programs for children that can be used for a variety of different purposes, including religious schooling. The latest version of the program included in the Senate bill allows individual states to opt into the program and approve the specific scholarship programs eligible to receive the money in that state, rather than automatically instituting the program nationwide.

It also removes the total nationwide cap on the program, but lowers the individual contribution cap to $1,700 per taxpayer.

Nathan Diament, the executive director of public policy for the Orthodox Union, said that Sens. Ted Cruz (R-TX), Tim Scott (R-SC) and Bill Cassidy (R-LA) had been negotiating with the parliamentarian since her initial ruling late last week to revise the legislation to address her objections.

“This really is historic,” Diament told Jewish Insider. “This is unquestionably the single largest federal school choice program ever passed. It’s been a long time coming. … It’s going to be helpful to countless numbers of families.”

“We thank Senator Cruz for his relentless efforts the last few days, but it really is a larger effort, whether it’s the House speaker or other Senate leaders … it was one of President Trump’s priorities, school choice, 50 states, and there are many House and Senate leaders and sponsors who made that a reality over the last few months,” Rabbi A.D. Motzen, national director of government affairs for Agudath Israel of America, said.

Though some state governments generally oppose school choice policies and have sought in the past to limit taxpayer funding to religious schools, citing First Amendment concerns, both Diament and Motzen argued that state opposition is less likely to happen in this case.

Diament said that the OU will be working with the Trump administration to ensure that the regulations implemented to govern the program will “lean into encouraging states to do this as broadly as possible.” He noted that recent Supreme Court rulings suggest that any state that tries to exclude religious school scholarships from the program would lose in court.

“Any governor who would choose not to opt in would seem foolish,” Motzen said. “This is all federal funds, it’s not taking away any money from the state. The money could be used by eligible families in public or private school, for a wide range of uses. Preventing a donor from contributing and a scholarship organization to operate in the state would be preventing families from using the money for tutoring or books or other approved expenses.”

He added, “If a state decides not to submit a list of [approved] scholarship organizations, the donors of that state will make a donation to scholarship organizations in other states. So not only are you leaving money on the table, and you’re not allowing your families, all families across the state — every type, public, private, religious school — but you’re actually leading to money leaving the state. What governor would want to do that?”

Motzen noted that the changes in the contribution limits mean that “the strategy of raising funds went from Wall Street to Main Street. It’s going to require a retail fundraising effort across the country, so that taxpayers who want to support scholarships, every one of them gives $1,700.”