Federal school-choice tax credit: Hochul's plan to opt New York in
In May 2026 Hochul told Agudath Israel, then confirmed through a spokesperson, that she intends to opt New York into the federal tax-credit scholarship created by the 2025 One Big Beautiful Bill Act: a dollar-for-dollar federal credit up to $1,700 for donations to scholarship-granting organizations that can pay private tuition, tutoring and other education costs, starting January 2027. Governors must opt in; 30 states have, and Colorado's Jared Polis is the only other Democratic governor to do so. Her office says the final decision waits on Treasury regulations expected in late September 2026 and a review for "poison pills." On Sept. 16, 2026, AFT, UFT, NYSUT, the NAACP and several legislators held a rally at UFT headquarters and launched a petition demanding she opt out; a Sept. 10 letter from 37 anti-poverty groups, community organizations and charter leaders urged her to stay in. The split lands inside her own coalition weeks before the election: NYSUT and UFT back her reelection.
The case on each side
Hochul's office says the credit can benefit all New York students, including public school students through tutoring and after-school programs, and that it costs the state education budget nothing because the money is federal. The American Federation for Children, Teach NYS and Agudath Israel call it long-sought relief for tuition-paying families; a coalition of 37 anti-poverty groups and charter leaders argues New York can shape participation to help lower-income public school students. Supporters note states that stay out still see their taxpayers donate to scholarship groups elsewhere.
AFT, UFT, NYSUT, the NAACP and Sen. John Liu call it a voucher program: private schools can select students and turn away higher-need children, scholarship organizations face little accountability for how money is spent, and families earning up to 300% of area median income qualify. Critics also read the timing, first announced to an Orthodox Jewish advocacy group during a reelection year and alongside her earlier push to ease yeshiva oversight, as courting a voting bloc. Governors in Wisconsin and Oregon have rejected the program outright.