HB0841 • 2026

Lottery, Scholarships and Programs

AN ACT to amend Tennessee Code Annotated, Title 4, Chapter 51; Title 37, Chapter 5, Part 5; Title 49 and Title 71, Chapter 3, relative to early learning.

Children Education Parental Rights

Active

The official status still shows this bill as active or still awaiting another formal step.

Sponsor: Haston, Massey
Last action: 2025-02-10
Official status: Assigned to s/c K-12 Subcommittee
Effective date: Not listed

Plain English Breakdown

The bill does not specify exact income limits beyond stating it is below 150% of the state median income.

Lottery Funded Early Learning Scholarships

This bill creates the Promising Futures Early Learning Scholarship Program, which uses lottery funds to help children from low and middle-income families attend high-quality early learning programs.

What This Bill Does

Creates a fund called the 'Promising Futures Early Learning Fund' using excess lottery revenues.
Establishes an online application portal for parents to apply for scholarships.
Defines 'high-quality early learning program' as one that meets certain quality standards set by the Department of Education.
Requires the Department of Education to implement and manage the scholarship program starting July 1, 2026.
Limits the use of fund money to not replace or reduce state funding for child care programs.

Who It Names or Affects

Children aged six weeks up to kindergarten age from families with income below 150% of the state median income.
Parents and legal guardians who meet employment or education requirements.
High-quality early learning program providers in Tennessee.

Terms To Know

Promising Futures Early Learning Scholarship Program: A scholarship program funded by lottery revenues to help children attend high-quality early learning programs.
High-Quality Early Learning Program: An early learning program that meets specific quality standards set by the Department of Education.

Limits and Unknowns

The bill does not specify how many scholarships will be awarded beyond the first year.
It is unclear if there are enough funds to cover all eligible applicants in future years.

Bill History

2025-02-26 Tennessee General Assembly
Assigned to General Subcommittee of Senate Education Committee
2025-02-19 Tennessee General Assembly
Placed on Senate Education Committee calendar for 2/26/2025
2025-02-12 Tennessee General Assembly
Passed on Second Consideration, refer to Senate Education Committee
2025-02-10 Tennessee General Assembly
Assigned to s/c K-12 Subcommittee
2025-02-10 Tennessee General Assembly
Introduced, Passed on First Consideration
2025-02-06 Tennessee General Assembly
P2C, ref. to Education Committee- Government Operations for Review
2025-02-05 Tennessee General Assembly
Sponsor(s) Added.
2025-02-05 Tennessee General Assembly
Intro., P1C.
2025-02-04 Tennessee General Assembly
Filed for introduction
2025-02-04 Tennessee General Assembly
Filed for introduction

Official Summary Text

This bill creates the
promising futures early learning fund
(the "fund"), which will
be used to provide promising futures early learning scholarships and
to defray administrative expenses associated with
the promising futures early learning scholarship pro
gram
established by this bill. This bill prohibits the use of m
onies in the promising futures early learning fund to displace, replace, or supplant state funding for child care or other early learning programs
.

B
eginning July 1, 2025, and each July 1 th
ereafter,
this bill requires the Tennessee education lottery
corporation
to
transfer
1
00% of net lottery proceeds that are not used to fund scholarships other than the promising futures early learning scholarship established by
this bill
, early learning pr
ograms and after school programs, or capital outlay projects for grades kindergarten through
1
2 educational facilities, to the promising futures early learning fund.

This bill establishes the
promising futures early learning scholarship program
(the "pro
gram") to help
children attend a high-quality early learning program.
This bill defines
"high-quality early learning program"
to
mean a program with quality ratings, as determined by the department of education utilizing measurement methods and instrument
s described in
the full text of this bill
, indicating that the program delivers high-quality, teacher-child interaction and instruction predictive of child outcomes.

This bill requires the department of
education
to

do the following:

(1) I
mplement t
he program by July 1, 2026
;

(2) E
stablish and administer a streamlined online portal that parents may use to apply for a promising futures scholarship. The
full text of this bill specifies certain capabilities that the
portal must
include;

(3) Establi
sh
qualifications for high-quality instruction in high-quality early learning programs for purposes of the promising futures early learning scholarships
;

(4) Establish the
measurement methods and instruments for high-quality instruction
;

(5) Establish
procedures to verify scholarship eligibility;

(6)
Pay scholarship funds directly to the high-quality early learning program in which the child who receives the scholarship is enrolled
; and

(7) S
ubmit a report on the implementation of the program, inclu
ding program outcomes, to the education committee of the senate and the committee of the house of representatives with jurisdiction over lottery scholarships by December 31, 2027, and by December 31 of each year thereafter
.

For the first year that promis
ing futures early learning scholarships are awarded,
this bill authorizes the department to
award up to 5,000 scholarships, and the maximum amount of a scholarship is $4,500. For the second and subsequent years that promising futures early learning schola
rships are awarded, the department may award as many promising futures early learning scholarships and in such amount as funding permits.

If there are more eligible applicants than scholarship funds available, then th
is bill gives first priority for a sch
olarship to an
eligible child who received a scholarship in the immediately preceding school year and
remaining scholarships will be d
etermined based on the results of a lottery.

This bill establishes the following
eligib
ility requirements for
a
promising futures scholarship
:

(1) Be at least six weeks of age and not eligible to attend a public school
based on age
;

(2) Be a member of a household with an annual income for the previous year that does not exceed
1
50% the state median income;

(3) Reside with a parent or legal guardian who has primary responsibility for care and control of the child and who is employed and works an average of 30 hours or more per week or is enrolled in and attending full time an eligible postsecondary educatio
n
program
OR r
eside in a household with two parents or legal guardians who are each either employed and work an average of 30 hours or more per week or are enrolled in and attending full time an eligible postsecondary education program;

(4) Be accepted to
a high-quality early learning program; and

(5) Be a
Tennessee
resident.

This bill authorizes the department to do the following:

(
1)

S
uspend or terminate a parent's or legal guardian's participation in the
pr
ogram if the department determines that
the child's parent or legal guardian failed to comply with
program requirements; and

(2) Refer for criminal prosecution a
high-quality early learning program
that
knowingly uses promising futures early learning scholarship funds with the intent to defrau
d the program
.

This bill specifies that a
promising futures early learning scholarship:

(1) Constitutes a scholarship provided for high-quality early learning for a child; and

(2) Does not constitute income of a parent or legal guardian of a child u
nder state law.

Current Bill Text

Read the full stored bill text

SENATE BILL 802
By Massey

HOUSE BILL 841
By Haston

HB0841
002346
- 1 -

AN ACT to amend Tennessee Code Annotated, Title 4,
Chapter 51; Title 37, Chapter 5, Part 5; Title 49
and Title 71, Chapter 3, relative to early learning.

WHEREAS, many children begin kindergarten developmentally and socially behind; and
WHEREAS, child care and preschool promote early learning and development when
they are high quality; and
WHEREAS, parents depend on child care and preschool programs in order to be able to
work; and
WHEREAS, child care and preschool programs, especially those that are high quality,
are unaffordable for most Tennessee families, costing more than in-state college tuition; and
WHEREAS, public payment assistance for child care and preschool programs is limited
to low-income families up to eighty-five percent of state median income; and
WHEREAS, choices for middle income families are especially limited due to lack of
affordability; and
WHEREAS, the Tennessee lottery was established in 2002 by the people of Tennessee
with four purposes for its proceeds, one of which is early learning programs; now, therefore,
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Section 4-51-111, is amended by adding the
following as a new subsection:
(1) There is created a fund in the state treasury to be known as the "promising
futures early learning fund." The fund consists of excess lottery revenues pursuant to
subdivision ( )(2) and monies obtained from any other sources for the purpose of
providing promising futures early learning scholarships.

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(2) Notwithstanding a law to the contrary, beginning July 1, 2025, and each July
1 thereafter, the corporation shall transfer one hundred percent (100%) of net lottery
proceeds that are not used to fund scholarships other than the promising futures early
learning scholarship established by § 49-1-1110, early learning programs and after
school programs, or capital outlay projects for grades kindergarten through twelve (K-12)
educational facilities, to the promising futures early learning fund.
(3) Money in the promising futures early learning fund must be invested by the
state treasurer pursuant to title 9, chapter 4, part 6 for the sole benefit of the fund.
(4) Monies in the promising futures early learning fund must be used to provide
promising futures early learning scholarships and as authorized in § 49-1-1110(j). The
department of education, in collaboration with the state treasurer, shall designate a date
by which the treasurer shall annually make a distribution from the promising futures early
learning fund to the department for the purpose of paying for the scholarships pursuant
to § 49-1-1110(f)(4).
(5) Monies in the promising futures early learning fund must not be used to
displace, replace, or supplant state funding for child care or other early learning
programs.
SECTION 2. Tennessee Code Annotated, Title 49, Chapter 1, Part 11, is amended by
adding the following as a new section:
49-1-1110. Scholarship program for children to participate in high-quality early
learning programs.
(a) The promising futures early learning scholarship program is hereby
established so that children may attend a high-quality early learning program.
(b)

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(1) As used in this section, "high-quality early learning program" means a
program with quality ratings, as determined by the department of education
utilizing measurement methods and instruments described in subdivision (b)(2),
indicating that the program delivers high-quality, teacher-child interaction and
instruction predictive of child outcomes.
(2) The department shall utilize measurement methods and instruments
for determining whether a program delivers high-quality, teacher-child interaction
and instruction that includes, but not limited to, a tested and proven, evidence-
based observational instrument that assesses classroom quality, including
assessing multiple dimensions of teacher-child interactions that are linked to
positive child development, early language and literacy skills, and later
achievement.
(c)
(1) The department of education shall implement the promising futures
early learning scholarship program by July 1, 2026.
(2) The department of education shall establish and administer a
streamlined online portal that parents may use to apply for a promising futures
scholarship. The portal must be capable of:
(i) Making eligibility determinations; and
(ii) Applying for federal funds for which the applicant meets the
eligibility criteria before making state dollars available.
(3) For the first year that promising futures early learning scholarships
are awarded, the department of education may award up to five thousand (5,000)
scholarships, and the maximum amount of a scholarship is four thousand five
hundred dollars ($4,500). For the second and subsequent years that promising

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futures early learning scholarships are awarded, the department may award as
many promising futures early learning scholarships and in such amount as
funding permits.
(4) If there are more eligible applicants than scholarship funds available
in a year that there is sufficient funding to award promising futures early learning
scholarships, then the department of education shall award the scholarships in
the following order:
(A) An eligible child who received a scholarship in the
immediately preceding school year; and
(B) As determined based on the results of a lottery.
(d) The department of education shall establish:
(1) The qualifications for high-quality instruction in high-quality early
learning programs for purposes of the promising futures early learning
scholarships, including, but not limited to, qualifications for high-quality teachers
and assistant teachers, high-quality teacher-child interaction and curricula, and
high-quality environments; and
(2) The measurement methods and instruments for high-quality
instruction, which must include, at a minimum, a tested and proven evidence-
based observational instrument to assess classroom quality, including assessing
multiple dimensions of teacher-child interactions that are linked to positive child
development, early language and literacy skills, and later achievement.
(e) To be eligible to receive a promising futures scholarship, a parent's or legal
guardian's child must:
(1) Be at least six (6) weeks of age and not eligible to attend a public
school pursuant to § 49-6-3001;

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(2) Be a member of a household with an annual income for the previous
year that does not exceed one hundred fifty percent (150%) the state median
income;
(3)
(A) Reside with a parent or legal guardian who has primary
responsibility for care and control of the child and who is employed and
works an average of thirty (30) hours or more per week or is enrolled in
and attending full time an eligible postsecondary education program; or
(B) Reside in a household with two (2) parents or legal guardians
who are each either employed and work an average of thirty (30) hours or
more per week or are enrolled in and attending full time an eligible
postsecondary education program;
(4) Be accepted to a high-quality early learning program; and
(5) Be a resident of this state.
(f) For purposes of creating and implementing the promising futures program,
the department of education shall:
(1) Establish procedures to determine a child's eligibility to receive a
scholarship in accordance with subsection (e);
(2) Establish an income verification process for purposes of subdivision
(e)(2);
(3) Determine which postsecondary education programs are eligible
programs for purposes of subdivision (e)(3);
(4) Pay scholarship funds directly to the high-quality early learning
program in which the child who receives the scholarship is enrolled;

- 6 - 002346

(5) Ensure that each child who receives a scholarship continues to meet
the requirements outlined in subsection (e);
(6) Establish the number of days a child who receives a scholarship must
attend a high-quality early learning program; and
(7) Ensure that each child who receives a scholarship attends a high-
quality early learning program for the number of days established pursuant to
subdivision (f)(6).
(g) The department of education may suspend or terminate a parent's or legal
guardian's participation in the promising futures early learning scholarship program if the
department determines that the child's parent or legal guardian failed to comply with this
section.
(h) If a high-quality early learning program knowingly uses promising futures
early learning scholarship funds with the intent to defraud the promising futures early
learning scholarship program, then the department of education may refer the matter to
the appropriate enforcement authority for criminal prosecution.
(i) A promising futures early learning scholarship:
(1) Constitutes a scholarship provided for high-quality early learning for a
child; and
(2) Does not constitute income of a parent or legal guardian of a child
under title 67, chapter 2 or any other state law.
(j) The department of education may use funds in the promising futures early
learning fund for expenses incurred by the department due to the department's
administration of the promising futures early learning scholarship program; provided, that
such expenses must not exceed ten percent (10%) of the balance of the promising
futures early learning scholarship program in any fiscal year.

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(k) The department of education shall submit a report on the implementation of
the promising futures program, including program outcomes, to the education committee
of the senate and the committee of the house of representatives with jurisdiction over
lottery scholarships by December 31, 2027, and by December 31 of each year
thereafter.
SECTION 3. The state board of education shall promulgate rules necessary to
effectuate this section. The rules must be promulgated in accordance with the Uniform
Administrative Procedures Act, compiled in Tennessee Code Annotated, Title 4, Chapter 5.
SECTION 4. This act is not an appropriation of funds, and funds shall not be obligated
or expended pursuant to this act unless the funds are specifically appropriated by the general
appropriations act.
SECTION 5. The heading in this act is for reference purposes only and does not
constitute a part of the law enacted by this act. However, the Tennessee Code Commission is
requested to include the heading in any compilation or publication containing this act.
SECTION 6. This act takes effect July 1, 2025, the public welfare requiring it.