North Dakota to Participate in New Tax-Credit Scholarship Program — And That’s a Win for Families 

Something important is happening in education policy, and it isn’t coming from Washington mandates or teachers’ union talking points. It’s coming from states embracing a landmark expansion of educational opportunity that relies on private donations rather than federal or state spending.

Scheduled to take effect Jan. 1, 2027, the new federal tax-credit scholarship program provides federal tax credits of up to $1,700 for individuals who donate to approved Scholarship Granting organizations (SGOs). These SGOs use those contributions to issue scholarships that families can direct toward a range of qualified educational expenses (established under the existing federal Coverdell Education Savings Account program). 

This tax-credit model is more market-oriented than many tax incentives already in the federal tax code. It relies on voluntary transactions, empowers parents rather than bureaucracies, and routes resources through civil society instead of government agencies.

Growing state momentum

State leaders from multiple regions have publicly announced their intent to participate in the program, as opting in is a requirement in order for eligible students to receive the scholarships. 

Based on a recent announcement by Gov. Kelly Armstrong, North Dakota joins a growing list of states, including its neighbors South Dakota and Montana, whose leaders have said they will also opt their states in to the program. 

Alabama, Alaska, Arkansas, Colorado, Georgia, Iowa, Idaho, Indiana, Louisiana, Mississippi, Missouri, Nebraska, Nevada, North Carolina, Ohio, Oklahoma, South Carolina, Tennessee, Texas, Utah, Virginia, West Virginia, and Wyoming are the other states whose governors have said they plan to opt in. Four governors have said they won’t participate (Oregon, New Mexico, Wisconsin, and Hawaii), while 20 governors and the mayor of the District of Columbia have not formally decided or haven’t announced decisions. 

What will Minnesota do?

Minnesota now stands at a crossroads.

The state prides itself on educational quality, yet outcomes tell a more complicated story. More than half of students continue to not reach grade-level benchmarks in reading or math. Achievement gaps persist. The state’s academic declines on national assessments serve as a cautionary benchmark, suggesting that past strengths are no longer enough to keep pace with states pushing faster and harder on academic reform. 

If Minnesota opts in, struggling students in both public and non-public school settings could access tutoring, special education services, or enrichment or supplemental learning opportunities they don’t currently have access to, just to name a few, without creating a new government program, raising taxes, or pulling money out of Minnesota’s public school budgets. In many cases, the per-student cost of a scholarship is significantly lower than public school spending, creating room for innovation without fiscal strain. Sending students back into the classroom better prepared would also benefit teachers.

With hundreds of millions of dollars in potential student scholarships at stake, will Minnesota leaders step up for students or let the opportunity slip away? 

If Minnesota decides to sit this one out, Minnesotans don’t have to — taxpayers now have another state (and another neighboring one) where they can donate to scholarship-granting organizations and help students whose leaders chose to opt in. 
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Let Gov. Walz know here that Minnesotans want our state’s next generation of leaders to have the opportunity to receive these education scholarships.