Idaho’s new school choice program is now accepting applications, offering eligible families up to $5,000 per student to attend private or home-based education — but the program is drawing scrutiny over what it could mean for public school funding in a state that already ranks last in per-pupil spending.
How the Parental Choice Tax Credit Works
The application period for the Parental Choice Tax Credit opened May 21, following the Legislature’s passage of House Bill 93 in 2025. The program offers a refundable tax credit of up to $5,000 per eligible student for families choosing nonpublic or homeschool education. To qualify, a family’s income must fall below 300% of the federal poverty level. The program carries a $50 million funding cap and awards credits on a first-come, first-served basis.
Supporters argue the program expands access to educational options for working and middle-class families who previously could not afford private schooling. Representative Tim Schwarzenberger, a proponent of the measure, said he believes “parents are in the best position to determine the right educational setting for their children.” The Idaho Department of Education described the benefit as “a refundable tax credit of up to $5,000 per eligible student.”
Idaho Already Leads the Nation in Low Per-Pupil Spending
The launch of the program comes as Idaho continues to rank at the bottom of all 50 states in education spending. In 2024, Idaho spent $11,167 per student — far below states like New Jersey and New Hampshire, which each exceeded $20,000 per pupil. Despite that funding gap, Idaho students perform at average to above-average levels in reading and math compared to peers in other states.
Critics of the school choice program point to research from other states suggesting that diverting students — and the associated enrollment-based funding — away from public schools can create fiscal strain. A study involving charter schools in a North Carolina school district found a fiscal impact of $500 or more per public school student remaining in the traditional system. If a similar dynamic plays out in Idaho, even modest participation in the new tax credit program could place additional pressure on districts already stretched thin.
For Kootenai County families and school administrators in Coeur d’Alene, Post Falls, Hayden, and Rathdrum, the funding question carries real stakes. Many North Idaho districts rely heavily on enrollment-based state allocations, and any reduction in reported student counts could translate directly to budget cuts. Statewide concerns about how Idaho’s school funding formula distributes money have already drawn families and officials into public forums this year.
Special Education Funding Gap Adds to the Pressure
One of the most significant underlying problems in Idaho’s school finance picture is the gap between what the state assumes and what reality requires when it comes to special education. Idaho’s funding model is built on the assumption that 5 to 6 percent of K-12 students need special education services. The actual figure is 11.5 percent — nearly double the assumed rate.
That mismatch has produced an $82.2 million annual shortfall between what Idaho spends on special education and what the actual student population requires. Idaho also provides less special education funding than any of its neighboring states, leaving local districts to cover the difference out of their general operating budgets.
Redirecting any portion of the state’s education budget toward a school choice program, however well-intentioned, adds another variable to an already strained system. Concerns about whether Idaho students are graduating ready for employment are not new — workforce readiness gaps persist across the state, and rural districts often face the steepest climb.
School Facilities Bill Offers Some Relief, But Unevenly
The Legislature did pass a $2 billion school facilities funding bill, which provides some financial relief to districts dealing with aging buildings and infrastructure needs. However, the distribution is based on enrollment, and approximately 40 percent of Idaho’s school districts will receive $2 million or less from the measure — a figure many administrators say is insufficient for meaningful capital improvements.
What Comes Next
With the application window now open and the $50 million cap expected to be reached relatively quickly given first-come, first-served allocation, families interested in the Parental Choice Tax Credit should act promptly. School district administrators across Kootenai County and North Idaho will be watching enrollment figures closely in the months ahead as the program’s real-world fiscal impact on public schools begins to take shape. How Idaho balances expanding parental options with sustaining public school quality will remain a central debate heading into the next legislative session.