II 

116TH CONGRESS 

2D SESSION S. 4284 

To provide for emergency education freedom grants, to amend the Internal 

Revenue Code of 1986 to establish tax credits to encourage individual 

and corporate taxpayers to contribute to scholarships for students 

through eligible scholarship-granting organizations, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JULY 22, 2020 

Mr. SCOTT of South Carolina (for himself, Mr. ALEXANDER, and Mr. CRUZ) 

introduced the following bill; which was read twice and referred to the 

Committee on Finance 

A BILL 

To provide for emergency education freedom grants, to 

amend the Internal Revenue Code of 1986 to establish 

tax credits to encourage individual and corporate taxpayers to contribute to scholarships for students through 

eligible scholarship-granting organizations, and for other 

purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘School Choice Now 

5 Act’’. 


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1 TITLE I—EMERGENCY 

2 EDUCATION FREEDOM GRANTS 

3 SEC. 101. EMERGENCY EDUCATION FREEDOM GRANTS. 

4 (a) DEFINITIONS.—In this title: 

5 (1) DEFINITIONS FROM THE INTERNAL REV6 ENUE CODE OF 1986.—The definitions in section 

7 25E(c) of the Internal Revenue Code of 1986, as 

8 added by section 201, shall apply to this section, ex9 cept as otherwise provided. 

10 (2) EMERGENCY EDUCATION FREEDOM GRANT

11 FUNDS.—The term ‘‘emergency education freedom 

12 grant funds’’ means the amount of funds available 

13 under subsection (b)(1) for this section that are not 

14 reserved under subsection (c)(1). 

15 (3) SECRETARY.—The term ‘‘Secretary’’ means 

16 the Secretary of Education. 

17 (4) STATE.—The term ‘‘State’’ means each of 

18 the 50 States, the District of Columbia, and the 

19 Commonwealth of Puerto Rico. 

20 (b) GRANTS.— 

21 (1) PROGRAM AUTHORIZED.—From any 

22 amounts appropriated for section 18003 of division 

23 B of the CARES Act on or after the date of enact24 ment of this Act, the Secretary shall, notwith25 standing any other provision of title XVIII of diviVerDate Sep 11 2014 00:37 Aug 09, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S4284.IS S4284

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1 sion B of the CARES Act (Public Law 116–136), 

2 use 10 percent of such amounts to carry out sub3 section (c) and award emergency education freedom 

4 grants to States with approved applications, in order 

5 to enable the States to award subgrants to eligible 

6 scholarship-granting organizations under subsection 

7 (d). 

8 (2) TIMING.—The Secretary shall make the al9 lotments required under this subsection by not later 

10 than 30 days after the date of enactment of this 

11 Act. 

12 (c) RESERVATION AND ALLOTMENTS.— 

13 (1) IN GENERAL.—From the amounts made 

14 available under subsection (b)(1), the Secretary 

15 shall— 

16 (A) reserve— 

17 (i) one-half of 1 percent for allotments 

18 for the United States Virgin Islands, 

19 Guam, American Samoa, and the Com20 monwealth of the Northern Mariana Is21 lands, to be distributed among those out22 lying areas on the basis of their relative 

23 need, as determined by the Secretary, in 

24 accordance with the purpose of this title; 

25 and 


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1 (ii) one-half of 1 percent of such 

2 amounts for the Secretary of the Interior, 

3 acting through the Bureau of Indian Edu4 cation, to be used to provide subgrants de5 scribed in subsection (d) to eligible scholar6 ship-granting organizations that serve stu7 dents attending elementary schools or sec8 ondary schools operated or funded by the 

9 Bureau of Indian Education; and 

10 (B) subject to paragraph (2), allot each 

11 State that submits an approved application 

12 under this section the sum of— 

13 (i) the amount that bears the same 

14 relation to 20 percent of the emergency 

15 education freedom grant funds as the num16 ber of individuals aged 5 through 17 in the 

17 State, as determined by the Secretary on 

18 the basis of the most recent satisfactory 

19 data, bears to the number of those individ20 uals, as so determined, in all such States 

21 that submitted approved applications; and 

22 (ii) an amount that bears the same re23 lationship to 80 percent of the emergency 

24 education freedom grant funds as the num25 ber of individuals aged 5 through 17 from 


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1 families with incomes below the poverty 

2 line in the State, as determined by the Sec3 retary on the basis of the most recent sat4 isfactory data, bears to the number of 

5 those individuals, as so determined, in all 

6 such States that submitted approved appli7 cations. 

8 (2) MINIMUM ALLOTMENT.—No State shall re9 ceive an allotment under this subsection for a fiscal 

year that is less than 1 10 ⁄2 of 1 percent of the amount 

11 of emergency education freedom grant funds avail12 able for such fiscal year. 

13 (d) SUBGRANTS TO ELIGIBLE SCHOLARSHIP-GRANT14 ING ORGANIZATIONS.— 

15 (1) IN GENERAL.—A State that receives an al16 lotment under this section shall use the allotment to 

17 award subgrants, on a basis determined appropriate 

18 by the State, to eligible scholarship-granting organi19 zations in the State. 

20 (2) INITIAL TIMING.— 

21 (A) STATES WITH EXISTING TAX CREDIT

22 SCHOLARSHIP PROGRAM.—By not later than 30 

23 days after receiving an allotment under sub24 section (c)(1)(B), a State with an existing, as 

25 of the date of application for an allotment 


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1 under this section, tax credit scholarship pro2 gram shall use not less than 50 percent of the 

3 allotment to award subgrants to eligible schol4 arship-granting organizations in the State. 

5 (B) STATES WITHOUT TAX CREDIT SCHOL6 ARSHIP PROGRAMS.—By not later than 60 days 

7 after receiving an allotment under subsection 

8 (c)(1)(B), a State without a tax credit scholar9 ship program shall use not less than 50 percent 

10 of the allotment to award subgrants to eligible 

11 scholarship-granting organizations in the State. 

12 (3) USES OF FUNDS.—An eligible scholarship13 granting organization that receives a subgrant under 

14 this subsection— 

15 (A) may reserve not more than 5 percent 

16 of the subgrant funds for public outreach, stu17 dent and family support activities, and adminis18 trative expenses related to the subgrant; and 

19 (B) shall use not less than 95 percent of 

20 the subgrant funds to provide qualifying schol21 arships for qualified expenses only to individual 

22 elementary school and secondary school stu23 dents who reside in the State in which the eligi24 ble scholarship-granting organization is recog25 nized. 


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1 (e) REALLOCATION.—A State shall return to the Sec2 retary any amounts of the allotment received under this 

3 section that the State does not award as subgrants under 

4 subsection (d) by March 30, 2021, and the Secretary shall 

5 reallocate such funds to the remaining eligible States in 

6 accordance with subsection (c)(1)(B). 

7 (f) RULES OF CONSTRUCTION.—The rules of con8 struction under section 25E(d) of the Internal Revenue 

9 Code of 1986, as added by section 201, shall apply to this 

10 section in the same manner as such rules apply to section 

11 25E of such Code, as so added. 

12 TITLE II—TAX CREDITS FOR 

13 CONTRIBUTIONS TO ELIGI14 BLE SCHOLARSHIP-GRANT15 ING ORGANIZATIONS 

16 SEC. 201. TAX CREDITS FOR CONTRIBUTIONS TO ELIGIBLE 

17 SCHOLARSHIP-GRANTING ORGANIZATIONS. 

18 (a) CREDIT FOR INDIVIDUALS.—Subpart A of part 

19 IV of subchapter A of chapter 1 of the Internal Revenue 

20 Code of 1986 is amended by adding after section 25D the 

21 following new section: 

22 ‘‘SEC. 25E. CONTRIBUTIONS TO ELIGIBLE SCHOLARSHIP23 GRANTING ORGANIZATIONS. 

24 ‘‘(a) ALLOWANCE OF CREDIT.—Subject to section 

25 202(c) of the School Choice Now Act, in the case of an 


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1 individual, there shall be allowed as a credit against the 

2 tax imposed by this chapter for the taxable year an 

3 amount equal to the sum of any qualified contributions 

4 made by the taxpayer during the taxable year. 

5 ‘‘(b) AMOUNT OF CREDIT.—The credit allowed under 

6 subsection (a) for any taxable year shall not exceed 10 

7 percent of the taxpayer’s adjusted gross income for the 

8 taxable year. 

9 ‘‘(c) DEFINITIONS.—For purposes of this section— 

10 ‘‘(1) ELIGIBLE SCHOLARSHIP-GRANTING ORGA11 NIZATION.—The term ‘eligible scholarship-granting 

12 organization’ means— 

13 ‘‘(A) an organization that— 

14 ‘‘(i) is described in section 501(c)(3) 

15 and exempt from taxation under section 

16 501(a), 

17 ‘‘(ii) provides qualifying scholarships 

18 to individual elementary and secondary 

19 students who— 

20 ‘‘(I) reside in the State in which 

21 the eligible scholarship-granting orga22 nization is recognized, or 

23 ‘‘(II) in the case of the Bureau of 

24 Indian Education, are members of a 

25 federally recognized tribe, 


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1 ‘‘(iii) a State identifies to the Sec2 retary as an eligible scholarship-granting 

3 organization under section 202(c)(5)(B) of 

4 the School Choice Now Act, 

5 ‘‘(iv) allocates at least 90 percent of 

6 qualified contributions to qualifying schol7 arships on an annual basis, and 

8 ‘‘(v) provides qualifying scholarships 

9 to— 

10 ‘‘(I) more than 1 eligible student, 

11 ‘‘(II) more than 1 eligible family, 

12 and 

13 ‘‘(III) different eligible students 

14 attending more than 1 education pro15 vider, or 

16 ‘‘(B) an organization that— 

17 ‘‘(i) is described in section 501(c)(3) 

18 and exempt from taxation under section 

19 501(a), and 

20 ‘‘(ii) pursuant to State law, was able, 

21 as of January 1, 2021, to receive contribu22 tions that are eligible for a State tax credit 

23 if such contributions are used by the orga24 nization to provide scholarships to indi25 vidual elementary and secondary students, 


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1 including scholarships for attending private 

2 schools. 

3 ‘‘(2) QUALIFIED CONTRIBUTION.—The term 

4 ‘qualified contribution’ means a contribution of cash 

5 to any eligible scholarship-granting organization. 

6 ‘‘(3) QUALIFIED EXPENSE.—The term ‘quali7 fied expense’ means any educational expense that 

8 is— 

9 ‘‘(A) for an individual student’s elementary 

10 or secondary education, as recognized by the 

11 State, or 

12 ‘‘(B) for the secondary education compo13 nent of an individual elementary or secondary 

14 student’s career and technical education, as de15 fined by section 3(5) of the Carl D. Perkins Ca16 reer and Technical Education Act of 2006 (20 

17 U.S.C. 2302(5)). 

18 ‘‘(4) QUALIFYING SCHOLARSHIP.—The term 

19 ‘qualifying scholarship’ means a scholarship granted 

20 by an eligible scholarship-granting organization to 

21 an individual elementary or secondary student for a 

22 qualified expense. 

23 ‘‘(5) STATE.—The term ‘State’ means each of 

24 the 50 States, the District of Columbia, the Com25 monwealth of Puerto Rico, the outlying areas (as deVerDate Sep 11 2014 00:37 Aug 09, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S4284.IS S4284

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1 fined in section 1121(c) of the Elementary and Sec2 ondary Education Act of 1965 (20 U.S.C. 6331(c)), 

3 and the Department of the Interior (acting through 

4 the Bureau of Indian Education). 

5 ‘‘(d) RULES OF CONSTRUCTION.— 

6 ‘‘(1) IN GENERAL.—A qualifying scholarship 

7 awarded to a student from the proceeds of a quali8 fied contribution under this section shall not be con9 sidered assistance to the school or other educational 

10 provider that enrolls, or provides educational services 

11 to, the student or the student’s parents. 

12 ‘‘(2) EXCLUSION FROM INCOME.—Gross income 

13 shall not include any amount received by an indi14 vidual as a qualifying scholarship and such amount 

15 shall not be taken into account as income or re16 sources for purposes of determining the eligibility of 

17 such individual or any other individual for benefits 

18 or assistance, or the amount or extent of such bene19 fits or assistance, under any Federal program or 

20 under any State or local program financed in whole 

21 or in part with Federal funds. 

22 ‘‘(3) PROHIBITION OF CONTROL OVER NON23 PUBLIC EDUCATION PROVIDERS.— 

24 ‘‘(A)(i) Nothing in this section shall be 

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1 thorize any Federal control over any aspect of 

2 any private, religious, or home education pro3 vider, whether or not a home education provider 

4 is treated as a private school or home school 

5 under State law. 

6 ‘‘(ii) This section shall not be construed to 

7 exclude private, religious, or home education 

8 providers from participation in programs or 

9 services under this section. 

10 ‘‘(B) Nothing in this section shall be con11 strued to permit, allow, encourage, or authorize 

12 an entity submitting a list of eligible scholar13 ship-granting organizations on behalf of a State 

14 pursuant to section 202(c)(5) of the School 

15 Choice Now Act to mandate, direct, or control 

16 any aspect of a private or home education pro17 vider, regardless of whether or not a home edu18 cation provider is treated as a private school 

19 under State law. 

20 ‘‘(C) No participating State or entity act21 ing on behalf of a State pursuant to section 

22 202(c)(5) of the School Choice Now Act shall 

23 exclude, discriminate against, or otherwise dis24 advantage any education provider with respect 

25 to programs or services under this section based 


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1 in whole or in part on the provider’s religious 

2 character or affiliation, including religiously3 based or mission-based policies or practices. 

4 ‘‘(4) PARENTAL RIGHTS TO USE SCHOLAR5 SHIPS.—No participating State or entity acting on 

6 behalf of a State pursuant to section 202(c)(5) of 

7 the School Choice Now Act shall disfavor or discour8 age the use of qualifying scholarships for the pur9 chase of elementary and secondary education serv10 ices, including those services provided by private or 

11 nonprofit entities, such as faith-based providers. 

12 ‘‘(5) STATE AND LOCAL AUTHORITY.—Nothing 

13 in this section shall be construed to modify a State 

14 or local government’s authority and responsibility to 

15 fund education. 

16 ‘‘(e) DENIAL OF DOUBLE BENEFIT.—The Secretary 

17 shall prescribe such regulations or other guidance to en18 sure that the sum of the tax benefits provided by Federal, 

19 State, or local law for a qualified contribution receiving 

20 a Federal tax credit in any taxable year does not exceed 

21 the sum of the qualified contributions made by the tax22 payer for the taxable year. 

23 ‘‘(f) CARRYFORWARD OF CREDIT.—If a tax credit al24 lowed under this section is not fully used within the appli25 cable taxable year because of insufficient tax liability on 


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1 the part of the taxpayer, the unused amount may be car2 ried forward for a period not to exceed 5 years. 

3 ‘‘(g) ELECTION.—This section shall apply to a tax4 payer for a taxable year only if the taxpayer elects to have 

5 this section apply for such taxable year. 

6 ‘‘(h) ALTERNATIVE MINIMUM TAX.—For purposes of 

7 calculating the alternative minimum tax under section 55, 

8 a taxpayer may use any credit received for a qualified con9 tribution under this section.’’. 

10 (b) CLERICAL AMENDMENT.—The table of sections 

11 for subpart A of part IV of subchapter A of chapter 1 

12 of the Internal Revenue Code of 1986 is amended by in13 serting after the item relating to section 25D the following 

14 new item: 

‘‘Sec. 25E. Contributions to eligible scholarship-granting organizations.’’. 

15 (c) CREDIT FOR CORPORATIONS.—Subpart D of part 

16 IV of subchapter A of chapter 1 of the Internal Revenue 

17 Code of 1986 is amended by adding at the end the fol18 lowing new section: 

19 ‘‘SEC. 45U. CONTRIBUTIONS TO ELIGIBLE SCHOLARSHIP20 GRANTING ORGANIZATIONS. 

21 ‘‘(a) ALLOWANCE OF CREDIT.—Subject to section 

22 202(c) of the School Choice Now Act, for purposes of sec23 tion 38, in the case of a domestic corporation, there shall 

24 be allowed as a credit against the tax imposed by this 

25 chapter for the taxable year an amount equal to the sum 


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1 of any qualified contributions (as defined in section 

2 25E(c)(2)) made by such corporation taxpayer during the 

3 taxable year. 

4 ‘‘(b) AMOUNT OF CREDIT.—The credit allowed under 

5 subsection (a) for any taxable year shall not exceed 5 per6 cent of the taxable income (as defined in section 

7 170(b)(2)(D)) of the domestic corporation for such taxable 

8 year. 

9 ‘‘(c) ADDITIONAL PROVISIONS.—For purposes of this 

10 section, any qualified contributions made by a domestic 

11 corporation shall be subject to the provisions of section 

12 25E (including subsection (d) of such section), to the ex13 tent applicable. 

14 ‘‘(d) ELECTION.—This section shall apply to a tax15 payer for a taxable year only if the taxpayer elects to have 

16 this section apply for such taxable year.’’. 

17 (d) CREDIT PART OF GENERAL BUSINESS CRED18 IT.—Section 38(b) is amended— 

19 (1) by striking ‘‘plus’’ at the end of paragraph 

20 (32); 

21 (2) by striking the period at the end of para22 graph (33) and inserting ‘‘, plus’’; and 

23 (3) by adding at the end the following new 

24 paragraph: 


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1 ‘‘(34) the credit for qualified contributions de2 termined under section 45U(a).’’. 

3 (e) CLERICAL AMENDMENT.—The table of sections 

4 for subpart D of part IV of subchapter A of chapter 1 

5 is amended by adding at the end the following new item: 

‘‘Sec. 45U. Contributions to eligible scholarship-granting organizations.’’. 

6 (f) EFFECTIVE DATE.—The amendments made by 

7 this section shall apply to taxable years beginning after 

8 December 31, 2020. 

9 SEC. 202. EDUCATION FREEDOM SCHOLARSHIPS WEB POR10 TAL AND ADMINISTRATION. 

11 (a) IN GENERAL.—The Secretary of the Treasury 

12 shall, in coordination with the Secretary of Education, es13 tablish, host, and maintain a web portal that— 

14 (1) lists all eligible scholarship-granting organi15 zations; 

16 (2) enables a taxpayer to make a qualifying 

17 contribution to one or more eligible scholarship18 granting organizations and to immediately obtain 

19 both a pre-approval of a tax credit for that contribu20 tion and a receipt for tax filings; 

21 (3) provides information about the tax benefits 

22 under sections 25E and 45U of the Internal Rev23 enue Code of 1986; and 

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1 ship-granting organizations for informational pur2 poses only, including information on— 

3 (A) student eligibility; 

4 (B) allowable educational expenses; 

5 (C) the types of allowable education pro6 viders; 

7 (D) the percentage of funds an organiza8 tion may use for program administration; and 

9 (E) the percentage of total contributions 

10 the organization awards in a calendar year. 

11 (b) NONPORTAL CONTRIBUTIONS.—A taxpayer may 

12 opt to make a contribution directly to an eligible scholar13 ship-granting organization, instead of through the web 

14 portal described in subsection (a), provided that the tax15 payer, or the eligible scholarship-granting organization on 

16 behalf of the taxpayer, applies for, and receives pre-ap17 proval for a tax credit from the Secretary of the Treasury 

18 in coordination with the Secretary of Education. 

19 (c) NATIONAL AND STATE LIMITATIONS ON CRED20 ITS.— 

21 (1) NATIONAL LIMITATION.—For each fiscal 

22 year, the total amount of qualifying contributions for 

23 which a credit is allowed under sections 25E and 

24 45U of the Internal Revenue Code of 1986 shall not 

25 exceed $5,000,000,000. 


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1 (2) ALLOCATION OF LIMITATION.— 

2 (A) INITIAL ALLOCATIONS.—For each cal3 endar year, with respect to the limitation under 

4 paragraph (1), the Secretary of the Treasury, 

5 in consultation with the Secretary of Education, 

6 shall— 

7 (i) allocate to each State an amount 

8 equal to the sum of the qualifying con9 tributions made in the State in the pre10 vious year; and 

11 (ii) from any amounts remaining fol12 lowing allocations made under clause (i), 

13 allocate to each participating State an 

14 amount equal to the sum of— 

15 (I) an amount that bears the 

16 same relationship to 20 percent of 

17 such remaining amount as the num18 ber of individuals aged 5 through 17 

19 in the State, as determined by the 

20 Secretary of Education on the basis of 

21 the most recent satisfactory data, 

22 bears to the number of those individ23 uals in all such States, as so deter24 mined; and 


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1 (II) an amount that bears the 

2 same relationship to 80 percent of 

3 such remaining amount as the num4 ber of individuals aged 5 through 17 

5 from families with incomes below the 

6 poverty line in the State, as deter7 mined by the Secretary of Education, 

8 on the basis of the most recent satis9 factory data, bears to the number of 

10 those individuals in all such States, as 

11 so determined. 

12 (B) MINIMUM ALLOCATION.—Notwith13 standing subparagraph (A), no State receiving 

14 an allocation under this section may receive less 

than 1 15 ⁄2 of 1 percent of the amount allocated 

16 for a fiscal year. 

17 (C) ALTERNATIVE ALLOCATION.— 

18 (i) IN GENERAL.—Not later than the 

19 end of the fifth year of the program or 1 

20 year after the end of the first fiscal year 

21 for which the total amount of credits 

22 claimed under section 25E and section 

23 45U of the Internal Revenue Code of 1986 

24 is $2,500,000,000 or more, whichever 

25 comes first, the Secretary of the Treasury, 


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1 in consultation with the Secretary of Edu2 cation, shall, by regulation, provide for an 

3 alternative allocation method that shall 

4 take effect beginning with the first fiscal 

5 year after such regulation takes effect. 

6 (ii) ALTERNATIVE ALLOCATION METH7 OD.—The alternative allocation method 

8 shall be expressed as a formula based on 

9 a combination of the following data for 

10 each State, as reported by the State to the 

11 Secretary of the Treasury: 

12 (I) The relative percentage of 

13 students in the State who receive an 

14 elementary or secondary scholarship 

15 through a State program that is fi16 nanced through State tax-credited do17 nations or appropriations and that 

18 permits the elementary or secondary 

19 scholarship to be used to attend a pri20 vate school. 

21 (II) The total amount of all ele22 mentary and secondary scholarships 

23 awarded through a State program 

24 that is financed through State tax25 credited donations or appropriations 


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1 compared to the total amount of cur2 rent State and local expenditures for 

3 free public education in the State. 

4 (iii) ALLOCATION FORMULA.—For any 

5 fiscal year to which clause (i) applies, the 

6 Secretary of Treasury, in consultation with 

7 the Secretary of Education, shall— 

8 (I) for each State, allocate an 

9 amount equal to the sum of the quali10 fying contributions made in the State 

11 in the previous year; 

(II) allocate 2 12 ⁄3 of the remaining 

13 amount (after application of subclause 

14 (I)) of the national limitation for that 

15 year using the alternative allocation 

16 method under clause (ii); and 

(III) allocate 1 17 ⁄3 of the remaining 

18 amount (after application of subclause 

19 (I) and (II)) in accordance with sub20 paragraph (A)(ii). 

21 (iv) INELIGIBILITY.—For any fiscal 

22 year to which clause (i) applies, a State 

23 that does not provide the Secretary of the 

24 Treasury with information described in 

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1 cation through the alternative allocation 

2 method under such clause. 

3 (3) ALLOWABLE PARTNERSHIPS.—A State may 

4 choose to administer the allocation it receives under 

5 paragraph (2) in partnership with one or more 

6 States, provided that the eligible scholarship-grant7 ing organizations in each partner State serve stu8 dents who reside in all States in the partnership. 

9 (4) TOTAL ALLOCATION.—A State’s allocation, 

10 for any fiscal year, is the sum of the amount deter11 mined for such State under subparagraphs (A) and 

12 (B) of paragraph (2), except as provided in para13 graph (2)(C). 

14 (5) ALLOCATION AND ADJUSTMENTS.— 

15 (A) INITIAL ALLOCATION TO STATES.—Not 

16 later than November 1 of the year preceding a 

17 year for which there is a national limitation on 

18 credits under paragraph (1) (referred to in this 

19 section as the ‘‘applicable year’’), or as early as 

20 practicable with respect to the first year, the 

21 Secretary of the Treasury shall announce the 

22 State allocations under paragraph (2) for the 

23 applicable year. 

24 (B) LIST OF ELIGIBLE SCHOLARSHIP25 GRANTING ORGANIZATIONS.— 


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1 (i) IN GENERAL.—Not later than Jan2 uary 1 of each applicable year, or as early 

3 as practicable with respect to the first 

4 year, each State shall provide the Sec5 retary of the Treasury a list of eligible 

6 scholarship-granting organizations, includ7 ing a certification that the entity submit8 ting the list on behalf of the State has the 

9 authority to perform this function. 

10 (ii) RULE OF CONSTRUCTION.—Nei11 ther this section nor any other Federal law 

12 shall be construed as limiting the entities 

13 that may submit the list on behalf of a 

14 State. 

15 (C) REALLOCATION OF UNCLAIMED CRED16 ITS.—The Secretary of the Treasury shall re17 allocate a State’s allocation to other States, in 

18 accordance with paragraph (2), if the State— 

19 (i) chooses not to identify scholarship20 granting organizations under subparagraph 

21 (B) in any applicable year; or 

22 (ii) does not have an existing eligible 

23 scholarship-granting organization. 

24 (D) REALLOCATION.—On or after April 1 

25 of any applicable year, the Secretary of the 


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1 Treasury may reallocate, to one or more other 

2 States that have eligible scholarship-granting 

3 organizations in the States, without regard to 

4 paragraph (2), the allocation of a State for 

5 which the State’s allocation has not been 

6 claimed. 

7 (d) DEFINITIONS.—Any term used in this section 

8 which is also used in section 25E of the Internal Revenue 

9 Code of 1986 shall have the same meaning as when used 

10 in such section. 

Æ 


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