HB 2632: The Bill and What It Means for Your School

According to the engrossed bill text, House Bill 2632 would end Pennsylvania's current EITC and OSTC programs after the 2026-27 fiscal year and replace them beginning in 2027-28 with a new Education Options Tax Credit program, a new scholarship-granting-organization framework, and a new restricted account called the Accountability for Diverted Tax Dollars account.

Schools that currently receive EITC and OSTC scholarships would see those programs replaced. According to the engrossed bill text, participating nonpublic schools would submit admissions requirements, financial aid policies, expulsion policies, enrollment counts, and rejection counts for annual publication, and the Auditor General would conduct compliance audits of scholarship organizations and participating schools.

The bill as passed keeps the $680 million overall cap and the $375 million general scholarship allocation; a unanimous House Appropriations Committee amendment restored the roughly $102 million the original bill would have cut. The credit on general scholarship contributions would drop from 90 percent for a two-year commitment to a flat 75 percent, while the economically disadvantaged category would grow to $200 million at a 99 percent credit with no per-donor cap. Scholarship organizations would also remit 2 percent of contributions to the new accountability account.

On June 22, 2026 the Pennsylvania House passed House Bill 2632 by a vote of 105 to 97. The State Senate has not taken it up, and the 2026-27 state budget signed on July 12 left EITC and OSTC unchanged. The bill remains pending until the session ends on November 30, 2026, and because its new program would begin in 2027-28, a version reintroduced next session could still take effect on that date. The decisions that matter get made over the next twelve months.