Across twenty years of legislation, Tennessee created three different account-based programs—IEA, ESA, and EFS—each with its own purpose and origin story. Tracing that history shows how the current system took shape and impacts today’s landscape.

2000s–2010: Early Voucher Proposals and Virtual Schools

In the early 2000s, lawmakers in the Tennessee General Assembly debated voucher-style bills that would have allowed some students to use public funds to attend private schools. None of these proposals passed both chambers, but they kept the idea of vouchers and publicly funded school choice active in committee discussions and floor debates, especially in the House and Senate education committees. Around the same time, Tennessee expanded options inside the public school system. In 2011, the legislature passed the Virtual Public Schools Act, which allowed full-time online public schools. This was one of the state’s first major steps toward offering more learning choices without directing public funds to private schools.

2011–2014: Repeated Voucher Debates and Attention on Urban Districts

From about 2011 to 2014, voucher proposals returned repeatedly, including bills for statewide programs that would have let eligible students in many districts use public funds for private school. None of these bills passed both chambers. During hearings, lawmakers from Metro Nashville, Memphis, and other large districts strongly pushed back, raising concerns about local budgets and fairness. At the same time, state reports and policy discussions highlighted ongoing achievement gaps and performance challenges in major urban districts such as Metro Nashville Public Schools and Shelby County Schools. As this information gained attention, lawmakers began moving away from broad statewide voucher plans and instead explored more targeted pilot programs for specific high-need areas. Education committee leaders and bill sponsors worked on narrower proposals, while school boards, educator groups, and parent organizations continued to oppose wide-ranging voucher efforts.

2015–2017: Creation of the Individualized Education Account (IEA)

A major change came in 2015, when the Tennessee General Assembly created the Individualized Education Account (IEA) Program for students with certain disabilities. Governor Bill Haslam signed it into law, and it directed the Tennessee Department of Education (TDOE) to build an account system that would let eligible families receive state funds and use them for approved educational services. To qualify for IEA, students must have a disability listed in state rules, have an Individualized Education Program (IEP), and meet prior-public-school or similar enrollment requirements. Families can use IEA funds for tuition at participating non-public schools, therapies, specialized curriculum, and some home-based or umbrella-school services that meet program rules. From 2015 to 2017, TDOE wrote regulations, published handbooks for parents and schools, and recruited participating schools. The first IEAs were awarded in the 2017–18 school year. Lawmakers who supported the bill, disability advocates who wanted more flexible options, and TDOE staff who built the program all helped create Tennessee’s first working education-savings-account model.

2017–2019: The District-Limited Education Savings Account (ESA)

Once the IEA program was running, lawmakers again considered creating a broader education savings account, but this time they focused on only a few districts instead of the whole state. After years of debate about statewide vouchers, the Tennessee General Assembly passed a new Education Savings Account (ESA) Program in 2019. This program applied only to students in certain areas, including parts of Metro Nashville and Shelby County, based on rules written into the law. The ESA law, passed during Governor Bill Lee’s administration, allowed eligible families in those districts to use ESA funds to pay for private-school tuition and other approved education costs at participating schools. Lawmakers who supported the bill designed it to be limited to a few high-need districts, and school-choice advocacy groups that had long backed voucher ideas supported the effort. Almost immediately, Metro Nashville, Shelby County, and others filed lawsuits challenging the ESA law. They argued that it unfairly singled out specific counties and school systems.

2020–2022: Court Decisions and the ESA Restart

In 2020, a Tennessee trial court ruled that the ESA law violated the state constitution’s “home rule” provisions, holding that the law wrongly targeted only certain counties and school districts. Because of this ruling, the program was stopped before families could use it in a meaningful way, and the case moved into the appeals process. The lawsuit eventually reached the Tennessee Supreme Court. In 2022, the Court overturned the lower court’s decision and ruled that the ESA law did not violate the home-rule clause, clearing the way for the program to move forward. After that ruling and some additional legal steps, state officials—including the Attorney General’s office and the Tennessee Department of Education—restarted the work of putting the program in place. They finalized rules, confirmed which schools would participate, and opened the application process. ESA began serving students in the 2022–23 school year, about three years after the law was first passed.

2022–2024: Expansion Debates and Early Universal-Choice proposals

Once ESA and IEA were operating, the debate shifted from whether Tennessee should have these programs to how far they should reach. From 2022 to 2024, lawmakers introduced bills to expand ESA into more districts or turn it into a statewide “universal” program. None of these proposals passed both chambers, so ESA remained limited to the districts named in the original law. At the same time, families, advocacy groups, and policy organizations began using terms like “universal ESA” and “universal school choice” in public meetings, reports, and media. Supporters argued that all students should have access to ESA-style accounts, while critics raised questions about costs, oversight, and the effect on public schools. These discussions were loud and ongoing, but they did not result in major changes to ESA or IEA during those years.

2024–2025: Adoption of the Education Freedom Scholarship (EFS)

After several years of debate about expanding school choice, the General Assembly passed the Education Freedom Scholarship Act in early 2025, creating the Education Freedom Scholarship (EFS) Program. Governor Bill Lee signed the law, and state leaders described EFS as a new statewide option that uses an education-savings-account model. Under the EFS Act, eligible K–12 students who are entitled to attend Tennessee public schools may apply for one of up to 20,000 scholarships in the first full year. Students must enroll in a participating Category I, II, or III non-public school to use the funds. Money is added to each student’s account four times a year and must pay for tuition and required school fees first; any remaining funds may then be used for other approved educational expenses.