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Back to HB 2532
Tennessee General Assembly· HB 2532Transmitted to Governor for his action.

Education - As enacted, revises education law, including, but not limited to, increasing, from 25,000 to 35,000, the maximum number of education freedom scholarships that may be awarded to eligible students. - Amends TCA, the official text

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                         ~tate of ffl:ennessee

                           PUBLIC CHAPTER NO. 963

                                                  HOUSE BILL NO. 2532

  By Representatives Lamberth, Maberry, Reeves, Davis, White, Cepicky, Slater, Kumar,
                                                         Raper, Todd

                                       Substituted for: Senate Bill No. 2247

                                           By Senators Johnson, Stevens

         AN ACT to amend Tennessee Code Annotated, Title 49, relative to education.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:

          SECTION 1. Tennessee Code Annotated, Section 49-6-3502(7), is amended by adding
"any of the grades kindergarten through twelve (K-12) at" after "enrolls in".

          SECTION 2. Tennessee Code Annotated, Section 49-6-3504, is amended by adding the
following as a new subsection (f):

                    (f) Notwithstanding subsection (b) and subject to appropriation, the department
          shall make a maximum of thirty-five thousand (35,000) scholarships available to eligible
          students for the 2026-2027 school year in the order required in subsection (c).

          SECTION 3. Tennessee Code Annotated, Section 49-3-108(i), is amended by deleting
the subsection and substituting:

                    (i)

                              (1) For the 2026-2027 school year, if an LEA's TISA allocation for the
                    current school year is less than the LEA's TISA allocation for the 2025-2026
                    school year and the LEA experienced disenrollment, then the department shall
                    allocate additional funds to the LEA in the amount of the difference between the
                    LEA's TISA allocation for the current school year and the LEA's TISA allocation
                    for the 2025-2026 school year.

                               (2)

                                        (A) For the 2027-2028 and 2028-2029 school years, if an LEA's
                              TISA allocation for the current school year is less than the LEA's TISA
                              allocation for the 2025-2026 school year and the LEA experienced
                              disenrollment, then the department shall allocate additional funds to the
                              LEA in the amount of the average per pupil state funds received by the
                              LEA in the immediately preceding school year for each student who
                              disenrolled from the LEA in the immediately preceding school year and, at
                              the time of the student's registration or enrollment, provided the LEA with
                              the student's social security number.

                                        (8) The department shall require each LEA, as a condition to the
                              receipt of any additional funds pursuant to this subdivision (i)(2), to report
                              to the department the reason for disenrollment provided by each non-
                              virtual student who disenrolled from the LEA in the immediately preceding
                              school year; regardless of whether the student provided the LEA with
                              their social security number at the time of registration or enrollment.

                                        (C) The sum total of any additional funds received by an LEA
                              pursuant to this subdivision (i)(2) must not exceed the difference between
                              the LEA's TISA allocation for the current year and the LEA's TISA
                              allocation for the 2025-2026 school year.

                               (3)
HB2532

                                       (A) Beginning with the 2029-2030 school year, if an LEA's TISA
                             allocation for the current school year is less than the LEA's TISA
                             allocation for the 2025-2026 school year and the LEA experienced
                             disenrollment, then the department shall allocate additional funds to the
                             LEA in the amount of the average per pupil state funds received by the
                             LEA in the immediately preceding school year for each student who
                             disenrolled from the LEA for the immediately preceding school year and
                             received, for the immediately preceding school year, an education
                             freedom scholarship pursuant to chapter 6, part 35 of this title.

                                       (8) The sum total of any additional funds received by an LEA
                             pursuant to this subdivision (i)(3) must not exceed the difference between
                             the LEA's TISA allocation for the current year and the LEA's TISA
                             allocation for the 2025-2026 school year.

                               (4)

                                       (A) Any additional funds provided to an LEA pursuant to this
                             subsection (i) must be solely state funded.

                                       (B) If an LEA is eligible for additional funds under subdivision (i)(1)
                             and subsection (b) or subsection (c), then the department shall only
                             award additional funds to the LEA pursuant to subdivision (i)(1) and shall
                             not award any additional funds to the LEA pursuant to subsection (b) or
                             subsection (c).

                                       (C) If an LEA is eligible for additional funds under subdivision (i)(2)
                             or (i)(3) and subsection (b) or subsection (c), then the department shall
                             only award additional funds to such LEA pursuant to subdivision (i)(2) or
                              (i)(3), subsection (b), or subsection (c), whichever results in the LEA
                              receiving the greatest amount of additional funding.

                              (5) As used in this subsection (i), "disenrollment" means that the LEA's
                    non-virtual average daily membership for the current school year is lower than
                    the LEA's non-virtual average daily membership for the immediately preceding
                    school year.

          SECTION 4. Tennessee Code Annotated, Section 49-6-3504(c), is amended by deleting
"Beginning with the 2026-2027 school year" and substituting "For the 2026-2027 school year"
and by designating the existing language as subdivision (1) and adding the following as a new
subdivision (2):

                    (2) Beginning with the 2027-2028 school year, the department shall award
          scholarships in the following order:

                              (A) An eligible student who received a scholarship in the immediately
                    preceding year, in the order in which the department receives completed
                    scholarship applications;

                              (8) If scholarships remain available after all eligible students described in
                    subdivision (c)(2)(A) receive a scholarship, then an eligible student whose annual
                    household income does not exceed one hundred percent (100%) of the amount
                    required for the student to qualify for free or reduced-price lunch, as provided in
                    the income eligibility guidelines published by the United States department of
                    agriculture's food and nutrition service, or an eligible student who is an eligible
                    student as defined in § 49-6-2602 or § 49-10-1402, in the order in which the
                    department receives completed scholarship applications;

                              (C) If scholarships remain available after all eligible students described in
                    subdivision (c)(2)(8) receive a scholarship, then an eligible student whose annual
                    household income does not exceed three hundred percent (300%) of the amount
                    required for the student to qualify for free or reduced-price lunch, as provided in
                    the income eligibility guidelines published by the United States department of

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HB2532

                    agriculture's food and nutrition service, in the order in which the department
                    receives completed scholarship applications;

                              (D) If scholarships remain available after all eligible students described in
                    subdivision (c)(2)(C) receive a scholarship, then an eligible student whose annual
                    household income exceeds three hundred percent (300%) of the amount
                    required for the student to qualify for free or reduced-price lunch, as provided in
                   the income eligibility guidelines published by the United States department of
                    agriculture's food and nutrition service who, at the time of submitting a completed
                    scholarship application, is currently enrolled in a public school or is eligible to
                    enroll in kindergarten in a public school for the respective school year, in the
                    order in which the department receives completed scholarship applications; and

                              (E) If scholarships remain available after all eligible students described in
                    subdivision (c)(2)(D) receive a scholarship, then an eligible student whose annual
                    household income exceeds three hundred percent (300%) of the amount
                    required for the student to qualify for free or reduced-price lunch, as provided in
                    the income eligibility guidelines published by the United States department of
                    agriculture's food and nutrition service, or an eligible student, in the order in
                    which the department receives completed scholarship applications.

          SECTION 5. Tennessee Code Annotated, Title 49, Chapter 6, Part 35, is amended by
adding the following as a new section:

                    (a) The department shall annually report, in accordance with subsection (b), the
          number of eligible students who applied for a scholarship, disaggregated by:

                              (1) The number of applications received from each county;

                              (2) The number of eligible students who, at the time of submitting a
                    completed scholarship application, were enrolled in a public school;

                              (3) The number of eligible students who, at the time of submitting a
                    completed scholarship application, were not yet enrolled in school, but who were
                    applying for a scholarship for kindergarten enrollment; and

                              (4) To the extent such data is available to the department, the number of
                    eligible students whose annual household income:

                                        (A) Does not exceed one hundred percent (100%) of the amount
                              required for the student to qualify for free or reduced price lunch, as
                              provided in the income eligibility guidelines published by the United
                              States department of agriculture's food and nutrition service;

                                        (8) Does not exceed three hundred percent (300%) of the amount
                              required for the student to qualify for free or reduced price lunch, as
                              provided in the income eligibility guidelines published by the United
                              States department of agriculture's food and nutrition service; and

                                        (C) Exceeds three hundred percent (300%) of the amount
                              required for the student to qualify for free or reduced price lunch, as
                              provided in the income eligibility guidelines published by the United
                              States department of agriculture's food and nutrition service.

                    (b) The department shall submit the report required in subsection (a) to the
          education committee of the senate and the committee of the house of representatives
          having jurisdiction over kindergarten through grade twelve (K-12) education by June 1,
          2026, for the 2025-2026 school year; by October 1, 2026, for the 2026-2027 school year;
          and by each October 1 thereafter for the immediately preceding school year.

                    (c) The report must not include personally identifiable information.

          SECTION 6. This act takes effect upon becoming a law, the public welfare requiring it.

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                     HOUSE BILL NO. 2532

PASSED:  April 16, 2026

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                         CAMERON SEXTON, SPEAKER
                         HOUSE OF REPRESENTATIVES

                                             RANDYMCN
                                SPEAKER OF THE SEN

:1... APPROVED this  ~ dayof ~            2026

     A~• ~• .~

BILL LEE, 'GOVERNOR
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