Missouri Empowerment Scholarship Accounts Program
- Tax-Credit Education Savings Account
- Enacted 2021
- Launched 2021
The Missouri Empowerment Scholarship Accounts Program is a tax-credit education savings account (ESA) that allows eligible parents to receive funding to pay for tuition at the school of their choice, as well as other educational expenses such as tutoring, educational therapies, individual classes and extracurricular programs. Individuals and businesses may receive tax credits for donations to educational assistance organizations (EAOs), nonprofits that administer ESAs. Learn more about the program’s details on this page, including eligibility, funding, regulations and more.
We do not administer this program.
Missouri’s First School Choice Program
Nation’s 2nd Tax Credit-Funded Education Savings Account
of Families Income Eligible in Applicable Missouri Cities and Counties
Maximum Account Value as a Percentage of Public School Per-Student Spending
Percentage of students eligible for Missouri Empowerment Scholarship Accounts Program
Students may use Empowerment Scholarship Accounts (ESAs) for private school tuition fees or a variety of a la carte educational expenses, including textbooks, educational therapies, tutoring services, curriculum, virtual school tuition, standardized tests, public school classes and extracurricular activities, certain approved computer hardware and technological devices, summer education programs, after-school programs, and transportation to and from school.
EAOs determine ESA amounts, up to the annual state adequacy target ($6,375 in 2020–21), which is about 52 percent of average total per-pupil funding in Missouri. EOAs must distribute funds quarterly or, at the request of a participating parent, in one lump sum at the beginning of the school year.
The total credits claimed for donations to educational assistance organizations cannot exceed $25 million (adjusted annually for inflation).
Only students from charter counties or cities with more than 30,000 residents are eligible for ESAs. These include Clay, Jackson, Jefferson, St. Charles, and St. Louis counties, as well as the cities of Columbia, St. Joseph, Joplin, Jefferson City, Cape Girardeau, and the City of St. Louis.
Additionally, a student must be enrolled in a public school at least one semester during the previous 12 months or just starting kindergarten or the first grade and must be either (1) have an Individualized Education Program (IEP) for students with special needs, or (2) be from a family whose income does not exceed 200 percent of the federal free-and-reduced-price lunch income eligibility level ($102,675 for a family of four in 2022-23). Once enrolled in the program, students remain eligible for ESAs until withdrawing from school or graduating high school.
EdChoice Expert Feedback
Missouri’s Empowerment Scholarship Accounts Program is the country’s second tax credit-funded ESA and has the potential to help thousands of Missouri students obtain the educational services that best fit their needs. However, policymakers could do more to expand educational opportunity.
Eligibility for the ESAs is limited to students with special needs or those from families earning up to 200 percent of the federal free-and-reduced-price lunch program (the equivalent of 370 percent of the federal poverty line), and only those currently living counties with a charter form of government or cities with at least 30,000 inhabitants. This limitation hampers potential growth of educational options in rural areas of Missouri.
The value of each ESA is only about $6,375 at most. That’s barely half of the average expenditure per student at Missouri’s district schools. Moreover, the program provides only $25 million in tax credits for donations to the educational assistance organizations. At most, the program will be able to serve only about 3,900 students, or less than 1 percent of Missouri’s K–12 student population.
To expand access to educational choice, Missouri policymakers should increase the ESA amounts to be comparable with the per-pupil spending at district schools and expand eligibility to all students. The tax credits for the donations that fund the ESAs are also set to expire after 2026. The Missouri legislature should work quickly to extend the ESA policy long term.
Missouri’s ESA program generally avoids counterproductive regulations. Administration of the program is overseen by nonprofit educational assistance organizations, which should give ESA families a voice to ensure that the program is run effectively.
Rules and Regulations
- Income Limit: 200 percent of the federal reduced price lunch income threshold ($98,050 for a family of four in 2021-22) (non-special needs students)
- Prior Year Public School Requirement: Yes, with exceptions
- Geographic Limit: Charter government counties and cities with >30,000 residents
- Enrollment Cap: None
- Account Deposit Cap: $6,375
- Testing Mandates: State test or Nationally norm-referenced tests
- Credit Value: 100 percent
- Per Donor Credit Cap: 50 percent of tax payer’s liability
- Total Tax Credit Cap: $25 million (adjusted annually for inflation up to $50 million)
- Provide a state-treasurer approved receipt to taxpayers for contributions made the organization
- Prioritize awards by:
- IEP status
- Students from families earning up to 200 percent FRL ($95,050 for a family of four in 2021-22)
- All other qualified students
- Ensure all interest and dividends income is spent on scholarships
- Spend no more than 10 percent of revenue on non-scholarship expenses
- Distribute scholarship account payments quarterly or in a lump sum at the beginning of the school year upon a parent’s request
- Conduct criminal background checks on all employees and board members
- Conduct annual audits by a CPA
- Report aggregate student demographic data to state treasurer
- Conduct and report on an annual parental satisfaction survey
- No more than 10 EAOs in any one single year may be certified to administer scholarship accounts.
- Parent must sign an agreement that:
- The qualified student shall enroll in a qualified school and receive an education in at least the subjects of English language arts, mathematics, social studies, and science;
- Except for a qualified student who is in the custody of the state, the qualified student shall not be enrolled in a public school operated by, or a charter school located within, the qualified student’s district of residence, and shall release the district of residence from all obligations to educate the qualified student while the qualified student is enrolled in the program.
- The moneys deposited in the qualified student’s Missouri empowerment scholarship account shall be used only for qualified expenses.
Mo. Rev. Stat. §§ 135.712–14; 135.716; 135.719; 166.700; 166.705; 166.710; 166.715; and 166.720
No legal challenges have been filed against this program.
Missouri Empowerment Scholarship Accounts Program State Groups
That Support School Choice
The mission of the Children’s Education Alliance of Missouri (CEAM) is to improve Missouri’s K-12 education system by advancing education policies and innovations that ensure all families have the right to choose the education they determine is best for their children.