Would offer state-funded scholarships for private school students

The education department would administer scholarships for eligible students who enroll in approved private schools. Eligible students are Tennessee residents who may attend public school, except students enrolled in qualifying home schools or church-related schools. The program would depend on money set aside for scholarships and other available funds. For the 2025-2026 school year, up to 20,000 scholarships would be available, with priority for certain lower-income students and students with specified eligibility categories. Beginning with the 2026-2027 school year, awards would follow income, prior participation, public-school enrollment, and application-order priorities when applications exceed available scholarships. Students or their parents must apply, provide the required education through a private school, and not enroll the student in a K-12 public school during a scholarship year. Scholarships would be available for the 2025-2026 school year and later school years, subject to funding and the program's limits.

Scholarship funds would pay private-school tuition and fees first, then approved education costs such as materials, tutoring, transportation, technology, and therapy. The rules would apply to scholarship recipients and private schools participating in the program. Recipients in grades 3 through 11 would have to take an approved standardized test or the required state test each year. Private schools would give test results to parents and report results to the comptroller's research office, including grouped information by grade, income, sex, and race. A student could not receive this scholarship for the same year as participation in the education savings account pilot program or individualized education account program. The department would deny an application if the student cannot establish lawful presence in the United States. The testing requirement would apply each year to recipients in grades 3 through 11 while they receive scholarships; accounts would close when a listed ending event occurs, such as graduation, public-school enrollment, withdrawal, or disqualification.

The education department would give a local education agency enough extra money to keep its state education allocation from falling after student disenrollment. The protection would cover a local education agency whose current non-virtual student membership is lower than in the prior school year. The additional funding would apply when the agency's calculated allocation is lower than its prior-year allocation because of disenrollment. The provision would compare non-virtual average daily membership from the current and prior school years. The protection would begin with the Tennessee Investment in Student Achievement allocation for the 2025-2026 school year.

The education department would award a one-time $2,000 bonus to each qualifying public-school teacher, if money is appropriated. The bonus would cover teachers employed by Tennessee K-12 public schools during the 2024-2025 school year; a separate funding rule would direct 80% of a specified privilege tax to local education agencies for public-school buildings. The teacher bonus would be solely state funded and would not count as salary, a salary supplement, or part of the Tennessee Investment in Student Achievement allocation. School-building funds would be allocated with consideration for economic distress, serious damage from an emergency or natural disaster, and other demonstrated local need. The teacher bonus would apply to the 2024-2025 school year and would depend on an appropriation; the school-building distribution rule would take effect July 1, 2025.