Kentucky lawmakers introduced a bill Thursday seeking to circumvent a recent state Supreme Court ruling that invalidated funding for charter schools. House Bill 1, sponsored by Representatives Kim Moser and T.J. Roberts, along with House Speaker David Osborne, aims to allow Kentucky residents to participate in a novel federal scholarship tax credit program.
The move comes after the Kentucky Supreme Court this week deemed state funding for charter schools unconstitutional. House Bill 1 would enable Kentuckians to take advantage of the Education Freedom Tax Credit, established through HR 1 passed by Congress in 2025, according to Representative Moser.
The federal program, set to commence in the 2027 tax year, offers a dollar-for-dollar tax credit of up to $1,700 for contributions to qualified scholarship granting organizations (SGOs). These organizations provide scholarships for students attending private schools, as well as for public and home school students. States must actively opt-in to the federal program for their residents to participate.
“By participating in the Education Freedom Tax Credit, Kentucky students will not miss out on these scholarships, which would otherwise go to students in other states,” Moser stated.
As of January 27, 23 states have already opted into the Education Freedom Tax Credit, including Virginia, Colorado and New Hampshire. According to reporting from Kentucky Today, the bill’s provisions would allow Kentuckians to utilize the federal tax credit for donations to Kentucky-based SGOs.
House Bill 1 has been assigned to the House Appropriations and Revenue Committee for consideration. The bill is considered a top priority for House Republicans during the 2026 legislative session, according to Yahoo News.
Critics have already voiced opposition, with House Democrats issuing a statement calling the bill “another attempt to undermine our public schools.”
Representative T.J. Roberts, a constitutional attorney first elected to the Kentucky House in 2024, is a co-sponsor of the legislation.
