Judge: Bill to create education savings accounts for special education is unconstitutional

A district court judge in Helena ruled Tuesday that a 2023 bill that would have created education savings accounts for students with special needs, described by defendants as "vouchers," is unconstitutional.

The court found the bill did not meet state appropriations requirements, as mandated by the Montana Constitution. It said the plaintiffs’ claim that the bill gave funds to private individuals was moot and did not find merit in the argument that the bill violated local school boards’ fiscal authority.

Plaintiffs included the Montana Quality Education Coalition and Disability Rights Montana.

State Superintendent Susie Hedalen and Gov. Greg Gianforte, both named as defendants along with bill sponsor Sen. Sue Vinton, R-Billings, expressed disappointment in the ruling but did not comment on whether they would appeal.

Hedalen said the program offered flexibility for families of children with special needs “to choose educational settings and supports that best meet their children’s individual needs.”

The bill would have allowed parents of disabled students to access funds in a special needs education savings account to pay for school tuition, homeschool or other educational expenses approved by the Office of Public Instruction.

Court documents show nearly 50 students participated in the program in 2024. Under the ESA program, some of the funds that would have gone to a student’s public school are redirected into the program.

The order noted Hedalen had previously denied requests that were not authorized categories for reimbursement.

Schools still retain some funding from the student who would have attended. The order offered an example, citing how a Great Falls high school would retain $242 per student and $63 per elementary student.

ESA student families receive full enrollment funding – even if students were previously in public school part-time, are new to the state or are entering kindergarten – which would take funds from their residential school district even if they didn’t previously add to enrollment. That's according to the court order.

The order explained this means the bill would require school districts to “expend additional money from their general fund to cover ESA program payments to parents for students who were not previously enrolled full-time in their districts, and thus not fully funded by the ANB allocation.”

Plaintiffs said this funding reduction would harm traditional public schools, and argued the bill took the fiscal responsibility for the district away from the board of trustees and directed it to OPI. However, the court said the bill didn’t violate the section of the constitution referenced for this count.

The court found the appropriation mechanism for the ESA in the bill doesn’t meet the appropriations requirements outlined in state statute, which also makes it unconstitutional, the order said.

Plaintiffs said the bill also was unconstitutional because it violated the statute against payments to private individuals, but the order said this point was moot as the court “concluded there was no valid appropriation.”

Hedalen said in a statement Tuesday that families participating in the program reported their children were happier and more successful.

“Parents reported significant growth in academic progress and emotional regulation when they were able to access individualized instruction and flexible learning environments,” Hedalen said. “Families also noted that these options reduced stressors such as sensory overload and rigid schedules, allowing their children to thrive.”

Each child is unique and deserves access to the best education possible to meet his or her individual needs, Gianforte said in a separate statement.

“This is especially true for the more than 18,000 students in Montana who require specialized education services,” Gianforte said. “We should empower Montana parents to pursue and secure the education that best meets the individual needs of their child.”

Rylee Sommers-Flanagan, executive director of Upper Seven Law, which represented the plaintiffs said in a statement, “siphoning public school money to unaccountable individual accounts is unconstitutional, not to mention foolish.”

“But the decision here doesn’t even address the misuse of public money because the legislature failed in the first instance to correctly appropriate funding for HB 393,” Sommers-Flanagan said. “And that is unconstitutional enough to stop it in its tracks.”

Director of Advocacy and attorney for Disability Rights Montana Tal Goldin described the bill as a “lose-lose for students with disabilities,” in a statement.

“The Court’s decision today prevents legislative overreach, stopping one attempted incursion into public school dollars and protecting students with disabilities from losing access to free and appropriate public education in the least restrictive environment,” Goldin said.