Why Blue States (except for two) are afraid of the Federal Scholarship Tax Credit (FSTC),
Unions and control of who gets the money are the main reasons that 20 other states haven’t opted in the Federal Scholarship Tax Credit (FSTC).
Also, here’s what scares them when the money goes to private schools. Private schools report higher graduation and achievement levels nationwide.
Only New York and Colorado have opted in from the blue states. Under the guidelines, individual taxpayers can receive a dollar-for-dollar federal income tax credit of up to $1,700 for donations made to Scholarship Granting Organizations (SGOs). These organizations then distribute the funds to families with incomes up to 300% of their area’s median gross income, helping them cover private tuition, tutoring, or specialized educational services.
Colorado Governor Jared Polis became the first Democrat to break ranks, opting his state into the program in January 2026. Polis dismissed critics at the time, telling local media he “would be crazy not to” join, noting the credit would empower parents to afford after-school or summer programs that were previously out of reach.








