The Supreme Court just set argument for November 3 in the case 43 members of Congress say will decide whether states can fence religious schools out of §25F

The unresolved question hanging over the Education Freedom Tax Credit (also called the Federal Scholarship Tax Credit, ECCA, or §25F) is not whether the credit survives. It is how much a participating state may add on top of it. §25F asks a state to submit a list of Scholarship Granting Organizations, and says almost nothing about what a state may require before it puts an organization on that list. We have written about that gap as the question of whether §25F is a federal floor or a federal ceiling. On August 11, 2026, the Supreme Court put a date on the case most likely to answer it: St. Mary Catholic Parish in Littleton, Colorado v. Roy, No. 25-581, is set for argument on Tuesday, November 3, 2026, eight weeks before the credit takes effect.

The case itself has nothing to do with §25F. Colorado runs a universal preschool program that pays for families to send children to the preschool of their choice, public or private, and requires participating preschools to give every family an “equal opportunity” to enroll regardless of race, religious affiliation, sexual orientation, gender identity, income, or disability. Colorado grants a long list of exemptions from that requirement, including for preschools that serve only children of color, only low-income families, or only children with disabilities, but it excluded two Catholic parish preschools that admit only families who accept Catholic teaching on sex and marriage. The Tenth Circuit upheld the exclusion on September 30, 2025 (154 F.4th 752), holding that Colorado's secular exemptions and its discretion did not make the rule less than generally applicable under Employment Division v. Smith, and that Carson v. Makin did not apply because Colorado had not excluded anyone “on the explicit basis” of religion. The Court granted review on April 20, 2026, limited to two questions: what it takes to show a law is not generally applicable under Smith, and whether Carson applies only when a government excludes religious institutions explicitly. It declined to take the petition's third question, whether Smith should be overruled outright.

The connection to the federal credit was drawn by Congress itself. On July 2, 2026, forty-three members of Congress, eight senators and thirty-five representatives, all Republicans, filed a brief supporting the Catholic parishes for one stated reason: if the Tenth Circuit's rule stands, it “will provide states a playbook to discriminate against religious organizations while doling out federal educational benefits.” Their argument is mechanical rather than rhetorical. §25F money reaches families through state-designated SGOs, so a state that can attach conditions to a benefit program without triggering the Free Exercise Clause can attach the same conditions to its SGO list. As they put it, if Colorado can do this to preschools, “then states can attach nondiscrimination conditions to ECCA participation to effectively exclude religious schools.”

The brief names the two states that have already moved, and both are ones we cover. Vermont's H.933, now 3 V.S.A. § 24, bars the state from designating an organization as an SGO unless, among other conditions, it “does not discriminate against any student because of race, color, religion, ancestry, national origin, sex, sexual orientation, gender identity, place of birth, crime victim status, or age or against a student with a disability” when awarding scholarships. Colorado's own HB26-1292 would have gone further, extending the preschool conditions into K-12 and adding sex, sexual orientation, gender identity, and gender expression to what a participating school may not consider, with a carve-out for religious mission and instruction but not a full exemption. That bill died in committee 11-0, which is why Colorado will enter §25F without state-added restrictions. Vermont's language is on the books.

The precedent runs toward the schools, and it is worth being precise about how far. Over the past decade the Court has held three times that a state may not exclude religious institutions from generally available public benefits: Trinity Lutheran v. Comer (2017) on playground resurfacing grants, Espinoza v. Montana Department of Revenue (2020) on a state tax-credit scholarship program, and Carson v. Makin (2022) on Maine's tuition program, the decision that makes Maine's absence from §25F so odd. The United States filed in support of the parishes at both the petition and merits stages. What is genuinely open is whether that line extends to a facially neutral condition that reaches religious schools by effect rather than by name, which is exactly what the Tenth Circuit said it does not. A decision is likely by the end of June 2027, so §25F will run its entire first year before the answer arrives.

None of this touches whether the credit exists, who may donate, or whether an organization can qualify as an SGO under federal law. §25F's requirements are federal and unchanged: 501(c)(3) status, scholarships for at least ten students who do not all attend the same school, and at least 90% of income spent on scholarships. What is at stake is the narrower question of what a state may demand before adding an organization to the list it sends Treasury, and that question only bites in states that have chosen to write conditions. So far one has. Vermont enacted its conditions while authorizing participation it has not completed, and Colorado's attempt died in committee, so none of the thirty states currently on the IRS participation roster has SGO conditions of this kind on the books.

For anyone building now, the practical read is that this is a reason to keep going rather than to wait. Formation, 501(c)(3) status, donor systems, and school relationships are all federal or private questions the case does not reach, and the states most likely to write restrictive conditions are largely the states that have not opted in yet. If you are organizing in a state that has, work through the free SGO builder, check where your state stands on the participation map, and see who else is organizing in the SGO directory. Argument is November 3; the Court posts live audio the same morning, and the questions the justices ask about general applicability will be the first real signal of how much room states have.