New York Just Opted Into the Nationwide School-Choice Credit — Over the Teachers Unions

Friday night, New York Gov. Kathy Hochul opted the state into the federal Education Freedom Tax Credit — becoming only the second Democratic governor to do so voluntarily after Colorado's Jared Polis. Teachers unions called it a "failure of leadership." School-choice groups called it political courage.

Starting Jan. 1, taxpayers can donate up to $1,700 a year ($3,400 for married couples) to a scholarship-granting organization and get a dollar-for-dollar federal credit. Those dollars go to families for tuition, tutoring, and other K–12 expenses. Anyone in any state can donate, but kids only benefit if their governor opts in. An IRS tracker already shows about 30 other states in.

Hochul had been waiting on Treasury's rules for a "poison pill." She says she didn't find one that forces New York to raid its own school budgets, and she won't leave federal money on the table. She also can't pick the scholarship groups or limit them to low-income kids only — families up to 300% of area median income qualify.

This is the concrete step after last week's Treasury regs: a deep-blue state choosing parental options over union veto. The midterms will tell whether other Democratic governors follow her or Mulgrew.

Sources: https://www.chalkbeat.org/2026/10/09/ny-gov-hochul-opts-into-federal-scholarship-tax-credit/ https://www.irs.gov/newsroom/the-trump-administration-advances-the-establishment-of-americas-first-nationwide-school-choice-program