Texas Just Passed the Largest School Voucher Program in American History
HB 3 gives $10,000 per student in public funds to private and homeschool families. Here's what that actually means for the 5.4 million children in Texas public schools.
Sunday, June 1, 2025
In April, the Texas legislature passed House Bill 3, creating an Education Savings Account program that will eventually direct $10,000 per student in public funds toward private school tuition, homeschool expenses, and tutoring. Governor Abbott signed it within 48 hours.
The number that gets cited is $1 billion. The number that matters is 5.4 million — the children currently enrolled in Texas public schools who will absorb the fiscal consequence of that transfer.
What the bill actually does
HB 3 creates an Education Savings Account (ESA) administered by the Texas Education Agency. Families who withdraw their children from public school receive a debit card loaded annually with $10,000 — or up to $11,500 for students with disabilities. The funds can be used for private school tuition and fees, homeschool curriculum and materials, tutoring services, and therapy services for students with disabilities.
There is no income cap in the final version. A family earning $400,000 per year qualifies on the same terms as a family earning $40,000.
Who benefits, and who doesn’t
The Texas Public Policy Foundation and other voucher advocates have spent years arguing that ESAs will liberate low-income students from underperforming schools. The evidence from other states tells a different story.
Arizona implemented a universal ESA program in 2022. A subsequent analysis found that 75% of the funds went to families who were already in private school before the program launched — meaning the program primarily subsidized existing private school enrollment rather than expanding access for new students.
The structural problem is simple: private schools in most Texas communities either don’t exist, are at capacity, or charge tuition far exceeding $10,000 annually. In rural West Texas, where many of the Republican legislators who championed this bill represent, there are no private schools. The voucher is a check families in those districts can’t cash.
The public school math
Texas funds public schools through a combination of property tax revenue and state allotments. The state allotment follows the student — when a student leaves, the funding leaves. HB 3’s fiscal note estimates the program will cost the state $1 billion in its first full year, rising to $3.5 billion by year five as the program expands.
That $3.5 billion doesn’t come from new revenue. It comes from the same pool that funds teacher salaries, school buses, special education services, and building maintenance.
The state is not creating a new funding stream. It is redirecting an existing one away from the institutions that serve everyone and toward institutions that serve whoever can access them.
The national template
Texas is not the first state to pass a universal ESA program, but it is by far the largest. What happens here — the enrollment numbers, the fiscal impact, the legal challenges — will set the template for the dozen other states where similar legislation is advancing.
Watch Arizona for what comes next. Their program has already cost more than projected, triggered a ballot initiative fight, and produced ongoing litigation over whether public funds can flow to religious schools under the state constitution. Texas will face the same battles, at three times the scale.
The legislature meets again in 2027. By then, the first-year enrollment data will be in. The question is whether that data changes anything — or whether this was never really about the data at all.