Gov. Joe Lombardo is proposing to use more than $3 million in federal COVID-19 aid dollars to help backfill funding for the state’s Opportunity Scholarship program, setting up another battle with Democratic lawmakers over the program’s future after they rejected a proposal for increased funding for the private school scholarship program in the 2023 legislative session.

In a Friday afternoon news release, Lombardo’s office said it would submit an item to the upcoming meeting of the Legislature’s Interim Finance Committee — which makes decisions about state spending when lawmakers are out of session — to maintain existing funding levels and avoid hundreds of children receiving scholarships from potentially losing them, a fear school choice advocates have noted in recent weeks.

The issue has also been the subject of a social media campaign from a Lombardo-aligned PAC, which is accusing Democrats of "defunding" the program, a claim that Assembly Speaker Steve Yeager (D-Las Vegas) has pushed back on. 

The proposed spending would need to be approved by the Democrats who make up a majority of the committee, and who in the most recent legislative session remained skeptical of Lombardo’s calls to expand the program.

“I have been fighting for these children since I took office,” Lombardo said in a statement. “The Democrats in the Legislature refused to fund these scholarships, and the result is that unless we take action now, these children will be forced out of their schools for the upcoming school year. It's unacceptable to me to let that happen."

Formally known as the Nevada Educational Choice Scholarship, Opportunity Scholarships use a limited pool of private donations exchanged for tax credits to provide private school scholarships for students under 300 percent of the federal poverty line. Created in 2015 during Republican control of the Legislature, the program has often become a sticking point of legislative negotiations in past sessions, with Democrats seeking to starve the program on the basis that public resources should be saved for public schools and Republicans seeking expansion. 

In 2019, the Legislature capped the program at just under $6.7 million a year. But lawmakers allocated $4.7 million in additional, one-time funds to the program during the 2021 legislative session as part of a bipartisan compromise to impose a new mining tax. Those extra dollars are no longer available, bringing the program back down to its cap. 

This year, Lombardo pushed to increase the tax credit funding to $50 million over the next two years, and to reinstate a mechanism for the program’s funding to grow annually until it reached $500 million by 2032. Lombardo’s bill, AB400, would also have expanded the program’s eligibility to families at 500 percent of the federal poverty line, or about $150,000 a year for a family of four. 

The increase was later amended out of Lombardo’s bill as part of a deal with Democratic legislative leaders in order to advance the bill, which also contained provisions to fund charter school transportation and reform student discipline policies. 

Legislative Democratic leaders, including Yeager, have remained critical of the program — Yeager called the scholarships “handouts to more wealthy students to go to unaccountable private schools” in a May interview. He did not immediately respond to a text message seeking comment on Lombardo’s announcement.

According to a memorandum submitted by the Governor’s Finance Office on Friday, the office is requesting a transfer of more than $3.2 million in federal COVID-19 relief funds to fund the Opportunity Scholarship program for the upcoming school year.

In the press release announcing the budget maneuver, Governor’s Finance Office Director Amy Stephenson said using the federal dollars “in this way is fully compliant with the final federal rules and is consistent with how these funds were allocated under the prior administration.”

Last school year, about 1,400 students received a scholarship through the program, according to a report from the Nevada Department of Education.