Governor Kathy Hochul announced in May that New York State would participate in the One Big Beautiful Bill’s tax credit for Scholarship Granting Organizations (SGOs). This program offers taxpayers a credit of up to $1,700 for contributions to SGOs. These organizations use the funds to provide scholarships, tutoring, or other educational expenses for families earning up to 300 percent of the median gross income in their area. Importantly, this initiative incurs no cost to New York State.

Some individuals expressed concerns that this decision might reduce funding for New York’s public schools. However, this tax credit program operates separately from the existing school funding framework. The credit incentivizes private donations, supplementing but not diverting existing public funds for education. Thus, the financial resources for New York’s public schools remain unaffected by the tax credit acceptance.

The introduction of the tax credit aligns with efforts to expand educational opportunities for families needing financial assistance. By enabling more families to access educational resources, the program aims to support better educational outcomes. These outcomes are achievable without compromising the financial integrity of the public school system.