New Mexico Gov. Lujan Grisham opts in to Trump education tax credit, prompting rebuke from educators

New Mexico Gov. Michelle Lujan Grisham announced Wednesday that the state will join a new federal scholarship tax program created by the Trump administration, a move New Mexico teachers’ unions are describing as a “betrayal.”

The Federal Scholarship Tax Credit program, established in President Trump’s One Big Beautiful Bill Act enacted last year, allows eligible taxpayers to receive a federal tax credit of up to $1,700 annually for charitable contributions to qualified nonprofit “scholarship granting organizations.” Those organizations then award scholarships to eligible K-12 students in public and non-public schools to cover qualified educational expenses such as tutoring, special education services, instructional materials and more. States can opt in to the program, which takes effect on Jan. 1, 2027.

The Treasury Department issued rules for the new program last month.

The new program has sparked controversy nationally as the Trump administration has made significant cuts to federal funding for public education. Education experts and advocates in September urged Congress to repeal the program, and expressed concerns that it would divert money away from public schools and to private institutions.   

With Lujan Grisham’s decision, New Mexico becomes the 32nd state to opt in to the program, and she becomes the third Democratic governor to do so, alongside New York Gov. Kathy Hochul and Colorado Gov. Jared Polis. Democratic Minnesota Gov. Mike Walz and Oregon Gov. Tina Kotek declined to opt in, two Democratic governors in Wisconsin and Arizona vetoed state legislation that would have required their states to join and 15 states, including Washington D.C., have yet to make a decision.

“At a time of diminishing federal investment in education, New Mexico must take advantage of every dollar we can to bolster public education and continue our state’s upward trajectory in literacy and student achievement,” Lujan Grisham said in a statement. 

The New Mexico Public Education Department will now establish a process for scholarship-granting organization certification in the coming weeks and SGOs can apply to participate once guidelines are released, the governor’s office said.

State Rep. Rebecca Dow (R-Elephant Butte), who lost her reelection bid Tuesday to Democrat David Mooney, urged the governor last March to opt into the program. On Thursday, she praised the move in a phone call with Source NM. “The governor has done the right thing,” Dow said, adding that “public schools and charter schools are eligible to receive these funds to build programs on their campuses without costing the New Mexico taxpayer a dime.”

The governor’s decision also earned praise from state Sen. Gabriel Ramos (R-Silver City), ranking member of the Senate Education Committee, who issued a statement that said opting into the program “is common sense. It puts more opportunities in front of New Mexico students and lets parents choose the tutoring, services, or school that fits their child’s needs. Every student learns differently, and this gives families the tools to help their kids succeed in the classroom and in whatever career path they choose.”

But in a Wednesday joint news release, both Whitney Holland and Bethany Jarrell — presidents of the American Federation of Teachers New Mexico and National Education Association New Mexico unions, respectively — called the governor’s decision to opt in “nothing short of a betrayal” to students and families in the state’s public schools.

Both teacher unions called the tax program “a voucher scheme” that promises “tax credits to well-off individuals who can donate thousands of dollars” to so-called “scholarship-granting organizations” in order to “reduce their individual federal taxes.” They added that Lujan Grisham “lowered herself” to partnering with Trump and Education Secretary Linda McMahon “as they dismantle federal educational supports and programs.”

Jarrell told Source NM that she was “shocked” when she saw Lujan Grisham’s announcement. She added that NEA-NM had been talking with her over the last few months and had “educators reaching out and asking her not to.”

“I expected her to listen to constituents and the people who helped get her in office and supported her, so it was devastating that she would make that decision,” Jarrell said. 

Source NM has a pending request to the governor’s office for a response to the unions’ criticism. 

“Every child deserves a well-funded, fully supported public school in their community, and this is just not the way to do that,” Jarrell said.