Georgia's public schools move toward §25F: Cobb is pursuing it, and Marietta and Clayton are working with a state foundation

Georgia's public school systems are working out how to use the federal Education Freedom Tax Credit (§25F), and a few in metro Atlanta have started to move. Cobb County is “pursuing” the program and will share more information later, the Atlanta Journal-Constitution reported on Saturday, November 14. Marietta City Schools and the Clayton County School District are working with the Georgia Foundation for Public Education to figure out their options, and the foundation itself will work with Georgia's public schools to reach the federal dollars, according to the AJC. Fulton County's schools are “exploring” the recent guidance and haven't made a decision, a district spokesperson said, and City Schools of Decatur will hold a community engagement process before it decides anything.

These are big systems. Cobb County enrolls 106,358 students in 110 schools, second in Georgia only to Gwinnett County, and Clayton County enrolls 50,832, according to the federal Common Core of Data for 2023-24. Marietta City has 8,642 students in 13 schools, Fulton County 88,043 and Decatur 5,509. The AJC puts the opportunity plainly: some advocates say public school districts are sitting on large donor bases of employees and parents, with the potential to raise millions for tutoring and more.

Who the foundation is. The Georgia Foundation for Public Education is a 501(c)(3) that raises money for Georgia's K-12 public schools, working, in its own words, “with the support of the Georgia Department of Education.” It runs the PEACH Education Tax Credit, a state credit created in 2018 that gives Georgia taxpayers a dollar-for-dollar credit on their state income tax for donations that support public schools. PEACH is capped at $25 million a year and approved first come, first served, and executive director Paige Buzbee told the AJC she expects to hit that cap this year. The foundation says it has funded 324 grants and programs worth $21 million for Georgia schools and districts since 2017. Buzbee calls herself a pragmatist about the federal credit. “This is the reality,” she said. “How can we make things great for schools?”

How federal money reaches a public school student. PEACH grants fund a school's project. A §25F scholarship is awarded to a student, so, as the AJC explains, a school that wants to fund after-school tutoring this way does it student by student, and every student served has to qualify. Under the statute and Treasury's proposed rules, a student is eligible if household income is no more than 300 percent of area median gross income and the student is eligible to enroll in a public school (prop. § 1.25F-1(a)(4)). Scholarships can pay for the expenses on the Coverdell list in section 530, which include tuition and fees, academic tutoring, special needs services, books and supplies, computer equipment, and extended-day programs and transportation that a school requires or provides. Treasury's acting assistant secretary for tax policy said this week that the department will read that list “as broad as we can”. Tutoring also has a shortcut in the proposed rules: when an SGO pays for individual academic tutoring (or special needs services) at a school in a qualified census tract, or a school that certifies at least 80 percent of its students live in one, and the school picks the students on need, those students count as income-eligible without household verification, backed by an annual third-party audit (prop. § 1.25F-3(c)(6)(iii)(C)).

Payroll giving. School systems, like other employers, can set up a way for staff to give from their paychecks, the AJC notes. The proposed rules count an after-tax payroll deduction as cash for a qualified contribution (prop. § 1.25F-1(a)(12)(iii)), and each employee claims the credit, up to $1,700, on their own return. Treasury has said employer guidance on payroll giving is coming “very soon.” In Nebraska, Grand Island Public Schools plans to start its staff campaign with the first payroll of 2027.

A regional alliance for public school students. The Southern Education Foundation is building an alliance of scholarship granting organizations that will focus on getting the money to students in public schools, with high-impact tutoring as the first priority, the AJC reported. Fred Jones, its senior director of public policy and advocacy, said the group has opposed vouchers for decades, but 15 of the 17 states in its coverage area have opted in. “If states are opting in … public school students should benefit the most from the program,” he said. In September Chalkbeat reported that the foundation had decided to start a tutoring-focused SGO of its own (our report). The AJC also says groups that used to work only with Georgia private schools are gearing up to serve private and public schools across the country; Georgia GOAL, the state's largest scholarship organization, set up American GOAL to run the federal credit.

The piece Georgia still has to supply. Gov. Brian Kemp signed Georgia's advance election on January 20, and Georgia is on the IRS's list of participating states. Under Treasury's temporary regulations, a state completes its 2027 election by sending the IRS its list of SGOs by February 15, 2027 (§ 1.25F-5T(c)(3)(ii)). Georgia hasn't published how organizations get on that list or named the office that will build it. Gov.-elect Keisha Lance Bottoms takes office in January. If Georgia's list hasn't gone in by then, sending it is her call, and because states elect one year at a time, so is every year after 2027. We haven't found a public statement from her on the federal credit. The handoff matters, as Virginia showed this week, and it's why the date Georgia's list goes in is the thing to watch (how the timing works).

If you're building in Georgia. A school district is a unit of government, not a 501(c)(3) public charity, so it can't be an SGO itself. A qualifying district foundation can form one, or a district can partner with an existing SGO, the route Sioux Falls and Johnston County are taking. Do the work you control now: pick the structure, line up donors and payroll giving, and ask the Governor's office and the Department of Revenue who will take applications. A school system that can show families, donors and a partner ready for January is the strongest case Georgia's next administration will hear for sending the list. Our Georgia apply page lists the state registrations and fees, the Georgia page tracks the state's status, and the free SGO Builder walks a new organization through each step.