Alabama lawmakers passed tweaks to the state school choice landscape during the 2023 session, but turned down proposals for sweeping expansions.

Two school choice bills, one expanding the decade-old Alabama Accountability Act to allow school choice for students with disabilities, and one remaking the eight-year-old public charter school commission, received final passage Thursday.

The Alabama Accountability Act was expanded to allow more students to be eligible for tax credit scholarships, more money for individual scholarships, higher amount of tax credits available and more schools designated as priority – previously called “failing” – meaning more families could claim tax credits for moving their child away from a priority school.

The act now allows students with disabilities, specifically those with an Individualized Education Program or Plan called an IEP, to be eligible for tax credit scholarships to pay for tuition and fees. In addition, students with IEPs can use scholarship proceeds to pay for therapeutic services such as speech and occupational therapy.

More than 80,000 students statewide have IEPs.

Currently, only students whose family income is below 185% of the federal poverty level are eligible. That level was raised to 250% under the changes.

About 2,800 students are using tax credit scholarships during the current school year according to the Alabama Department of Revenue. At its peak, more than 4,000 students used the scholarships.

Scholarship availability depends on how much money was contributed to the scholarship granting organizations that determine student eligibility and distribute scholarships. That figure, too, was increased to $40 million from the current level of $30 million. Just under $20 million in contributions were claimed for tax credit purposes in 2021, according to the Department of Revenue.

The scholarship amount was increased to $10,000 for all grade levels – where previously only high school students received $10,000 scholarships, while younger grades received a lower amount.

Another change addressed a complaint about the law from the beginning: using “failing” to describe schools in the bottom 6% of achievement in reading and math statewide. The “failing” designation gave parents the ability to claim an income tax credit for costs associated with moving their child to a different school.

The term failing was dropped, instead using “priority” to describe schools that made a ‘D’ or ‘F’ on the most recent state report card. Seventy-nine schools were declared failing for the current school year, based on spring 2022 test scores. Using the new measure, families in 219 schools will be eligible for the tax credit.

Gov. Kay Ivey, who serves as president of the state school board, even asked in 2019 whether there were any other terms to use besides “failing.” The number of people utilizing the tax credit has declined year over year, peaking at 180 in 2016, while only 53 people claimed the tax credit in 2021, the latest year for which tax data is available.

But with more schools on the priority list, the number of parents claiming the credit could increase.

The changes will go into effect not earlier than September.

Alabama’s charter schools are also impacted by changes lawmakers made. HB363, sponsored by Rep. Terri Collins, R-Decatur, said the changes were needed because

Remaking the charter commission

The law removes the Alabama Board of Education from appointing the commissioners. The appointments were often plagued with numerous tie-breaking votes, with long-time board member Stephanie Bell often voicing her objection to having to vote on nominees that the board didn’t know.

Other changes for commissioners include:

• Four-year instead of two-year terms, a total of eight years on the commission,
• New commissioners will be required to complete an orientation and an annual training program, and
• The Senate and House minority leader each will appoint one member of the commission.

Changes to and new rules for the charter application and appeal process include:

• Local charter authorizers will not be granted automatic authorizer status, instead have to apply to become an authorizer,
• Local charter authorizers must complete annual training,
• Local charter authorizers who are approved must reapply to become an authorizer every five years,

The bill distinguishes funding for start-up charter schools from conversion charter schools. Start-up charter schools will receive state funding for their anticipated enrollment and the amount will be adjusted after enrollment is finalized.

Conversion charter schools will be guaranteed the same amount of funding they had prior to conversion. Currently the only conversion charter schools are in Montgomery.

The changes are effective after Gov. Ivey signs the bill into law.