Senate completes veto override, opts NC into federal school-choice tax credit

North Carolina will join a growing list of states that have opted into a new federal school-choice tax-credit program, after the state Senate voted 30-19 on June 3 to override Gov. Josh Stein’s veto of House Bill 87.

The party-line vote mirrored the Senate’s original passage of the bill in July 2025 and followed the House’s 73-46 override last month. With both chambers having now overridden the veto, the measure becomes law.

In a statement, Senate Leader Phil Berger, R-Rockingham, said the program is another option layered on top of the state’s existing schools.

“Families across the state want to have a choice in where to send their children to school,” Berger said. “In North Carolina, we have great public schools that are supplemented by public charter, private, and home schools. Participating in President Trump’s landmark school choice program gives parents another opportunity to obtain an education that best fits their child’s needs.”

Senate Majority Leader Michael Lee, R-New Hanover, said the credit complements traditional public education.

“Our state’s educational landscape proves that you can have a thriving public education system while having robust educational freedom,” Lee said in a statement. “This federal tax credit adds to that. We must continue to provide families with avenues to pursue the best education for their children.”

The new program will begin in 2027, when individuals can claim a dollar-for-dollar federal tax credit of up to $1,700 a year for donations to Scholarship Granting Organizations. Those organizations can then issue scholarships for tuition, tutoring, dual enrollment, special-education therapies, transportation, curriculum materials, testing fees, and other qualified educational expenses. Families earning up to three times their area’s median income would be eligible.

The State Education Assistance Authority — which already administers North Carolina’s Opportunity Scholarship Program — would maintain the list of approved scholarship organizations and submit it to the US Treasury Department. The agency must establish rules by July 1, 2026, or within 120 days of federal guidance, whichever is later.

The override was the latest in a series of Republican victories over Stein, a first-term Democratic governor. Senate Republicans have now overridden 13 of Stein’s 15 vetoes.

In his own statement, Stein criticized the timing of the override but signaled he may try to steer the program toward public-school students.

“I vetoed House Bill 87 because at the time we were awaiting sound guidance from the federal government before opting in,” Stein said. “Despite not receiving that guidance yet, the General Assembly decided to opt the state into the program.”

“This legislature has dropped North Carolina to second to last in the nation in per public school pupil spending,” Stein added. “We need to put more public dollars into our public schools, and I will continue to do everything I can to provide more support for public school kids.”

Stein said he would look for ways to direct federally reimbursed donations toward organizations that benefit public-school students “once the federal guidance has been provided.”

The new scholarship program was authorized under the One Big Beautiful Bill Act that President Donald Trump signed on July 4, 2025. At least 29 states have already announced plans to participate, most of them Republican-led but including some with Democratic governors, such as Colorado, according to a Ballotpedia tally. A handful of Democratic governors have declined or vetoed opt-in measures.

Parents for Educational Freedom in North Carolina (PEFNC), a school-choice advocacy group, praised the vote. 

“Today’s veto override of House Bill 87 marks a historic step forward for North Carolina families,” said PEFNC president Mike Long, calling it “a common sense policy that expands opportunity, strengthens parental choice, and aligns North Carolina with a growing national movement to ensure education dollars follow students, not systems.”

North Carolina remains a strongly pro-school-choice state. A January Carolina Journal poll of likely voters put support for the Opportunity Scholarship Program at 61%.

“Senate completes veto override, opts NC into federal school-choice tax credit” was originally published on www.carolinajournal.com.