Texas school districts are reporting funding losses ranging from hundreds of thousands to millions of dollars as the state’s first-year private-school voucher program seeks to double its budget. Pflugerville ISD says it lost an estimated $1.2 million after 149 students who otherwise would have enrolled there instead accepted vouchers through Texas Education Freedom Accounts, and the district is now closing four elementary schools. Meanwhile, the Texas comptroller’s office is asking state lawmakers for $2 billion in total funding to keep the program running.
TEFA is described as the state’s $1 billion education savings account program, according to Community Impact, providing taxpayer dollars for private education and homeschooling. Texas House lawmakers passed the law creating the program in April 2025, and state lawmakers allocated $1 billion for its launch in the 2026-27 school year. Participating students are receiving $10,474 each for private education and related expenses, homeschool families can receive up to $2,000 per eligible child, and students with disabilities are eligible for up to $30,000 each.
State law requires the comptroller’s office to give priority to students with disabilities and applicants from low-income families. About 248,000 applicants had been deemed eligible for the program as of Aug. 3, and roughly 70% of selected students had attended a private school in the 2024-25 school year, while 30% had previously been enrolled in a Texas public school.
How the Tiered Priority System Breaks Down
The program sorts applicants into four tiers. Tier 1, covering students with disabilities and household incomes at or below 500% of the federal poverty line, made up about 12% of applicants but 39% of awardees. Tier 2, for children with incomes at or below 200% of the federal poverty line, represented about 32% of applicants and 60% of awardees. Tier 3, for families earning between 200% and 500% of the poverty line, made up about 29% of applicants but had fewer than 30 participating students as of late July. Tier 4, for families earning above 500% of the poverty line, accounted for about 27% of applicants and had no accepted participants…