The proposed Education Savings Accounts for Minnesota Students Act (ESA4MSA) aims to establish education savings accounts (ESAs) in Minnesota. These accounts would allow eligible families to receive public education funds to be used for various private educational expenses, including tuition, curricula, tutoring, transportation, and other related costs.

Key Provisions:

1. Eligibility:

   • Students must reside in Minnesota and come from households with incomes at or below four times the threshold for reduced-price school meals.
   • A priority system is set for student acceptance, favoring:
     • Kindergarten students.
     • Students who previously attended public schools.
     • Students with siblings already in the ESA program.

2. Use of Funds:

   • Parents can use ESA funds to pay for tuition at nonpublic schools (including homeschool-related expenses, except payment to a parent as an instructor), tutoring, textbooks, online courses, college expenses, and other approved educational purposes.
   • Unspent funds can be carried over for future education and used for postsecondary tuition.
   • After four years of inactivity post-high school graduation, unused funds revert to the state.

3. Program Administration:

   • The Minnesota Department of Revenue (or a contracted organization) will oversee the program.
   • The Commissioner has authority to approve, monitor, and remove educational service providers.
   • A Parent Review and Advisory Panel will be established to provide oversight and input.

4. Funding & Payments:

   • Funding per student will be based on Minnesota's per-pupil funding formula.
   • Electronic payments will be made monthly, and ESA debit cards will be issued beginning in 2026.
   • The state may withhold up to 5% of appropriations in the initial years and 3% thereafter for administrative costs.

5. Fraud Prevention & Compliance:

   • A system for anonymous fraud reporting will be implemented.
   • If misuse is detected, parents may have to repay funds or face program expulsion.
   • Providers with a history of fraud or legal violations may be barred.

6. Student Withdrawal and Public School Re-Entry:

   • Students can return to public school at any time.
   • Upon re-enrollment, ESA accounts will be closed, and remaining funds will return to the state's general fund.

7. Legal Protections & Severability:

   • Eligible schools remain autonomous and are not required to change curriculum or admissions policies.
   • If parts of the law face legal challenges, parents can intervene in court to defend the ESA program.
   • If any section of the law is ruled unconstitutional, the remaining portions remain valid.

Implementation Timeline:

• The program would begin accepting applications for the Fall 2026 term in December 2025.
• The Parent Review and Advisory Panel must be established by Fall 2028.

This bill is designed to expand education choices for families, particularly low- and middle-income households, by redirecting public education funds to private and alternative learning opportunities. However, it also introduces new financial oversight responsibilities for the state.