🛝 Funded First, Figured Out Later

Welcome to Playground Post, a bi-weekly newsletter that keeps education innovators ahead of what's next.

This week's reality check: The first nationwide school-choice tax credit starts flowing to families in January, and the rules governing it won't be finished until September. The microschools that money will fund have sharply increased their reliance on it in a single year, yet no one can prove the schools work. And in California's "Lithium Valley," colleges spent millions training students for an industry that still hasn't shown up.

Data Gem

The post-pandemic recovery didn't reach boys and girls equally. Among 9-year-olds, boys posted significant gains on the latest NAEP Long-Term Trend test, rising 7 points in reading and 5 in math since 2022, while girls gained just 1 point in reading and 3 in math.

A Nationwide School-Choice Program Starts in January. But Rules Land in September

The country's first nationwide school-choice program will start putting money in families' hands in January. 

The rules telling everyone how it works won't exist until fall.

Starting January 1, 2027, taxpayers can donate up to $1,700 to a scholarship-granting organization and claim a 100% federal tax credit for it. That money funds K-12 scholarships covering private school tuition, tutoring, special-needs services, and even some public school expenses.

Twenty-seven states have already opted in.

The catch is the calendar - the Treasury Department previewed the program this week, but said the actual proposed rule won't land until the end of September. Scholarship groups, states, and the technology vendors who were in the room have to start building on a two-page summary.

Scholarship-granting organizations have to confirm that a family earns no more than 300% of the area's median income, in a way the IRS says must be "reliable but not burdensome."

The organizations can sit on several states' lists at once. States can't layer on their own requirements.

Each of those provisions is a system someone has to design before the first dollar moves.

Supporters are already pushing for that clarity. Norton Rainey, CEO of the scholarship group ACE Scholarships, said the program's reach depends on it: "The more streamlined and predictable the process is, the greater the program's impact will be."

For education innovators, the space between January's money and September's rules is the opportunity. SGO administration platforms that handle donations, eligibility, and disbursement in one place. Income-verification tools that hit the "reliable but not burdensome" standard the IRS just set. The vendors were already at Treasury's table. The build starts now.

Microschools Are Running on Public Money No One Can Measure

The microschools absorbing all that choice money have leaned into it fast.

Half of all microschools now draw more than a quarter of their tuition from state school-choice programs, according to a new National Microschooling Center survey of 1,000 schools across all 50 states, DC, and Puerto Rico. 

A year ago, 38% said the same. Another 18% have families using education savings accounts for part of the bill.

And the dependence is about to deepen. Texas launches its ESA program this fall, Iowa just cleared microschools to participate in its program, and Alabama's started this year.

The sector taking the money is also changing who runs it.

What no one can establish is whether any of it works.

RAND researchers said last year it was "nearly impossible" to measure the academic impact of attending a microschool. Too many of the schools don't collect enough assessment data to track whether students grow in reading and math.

Running the schools is its own challenge. Founders spend an average of 93 hours a year on compliance, a fifth of it just securing government approvals. And many lack the business basics of budgeting, invoicing, and insurance, the unglamorous work that one funder called what makes "the business durable."

For education innovators, microschools are a fast-growing sector running on public money it can't yet account for. Assessment tools built for schools of 20 to 30 students that currently fly blind on outcomes. ESA claims-and-payment systems that handle the choice funds now bankrolling half the sector. And back-office platforms for budgeting, invoicing, and compliance that turn a passionate founder into a durable operator. The money is arriving. The infrastructure to manage it isn't built.

A College Trained 173 Students for Future Jobs. 16 Got One.

Corban Dillon has earned two certificates for jobs that don't exist yet. He's working on a third.

When Imperial Valley College launched a program to train workers for California's promised lithium industry, Dillon, 41, enrolled in the first class. 

He finished in 2024 to find no lithium jobs, enrolled in a second certificate, finished that, and still found nothing. He'll complete his third in December, when the hundreds of anticipated positions still likely won't be there.

This is what happens when the training arrives before the industry.

Southeastern California was rechristened "Lithium Valley" after companies eyed the lithium beneath the Salton Sea, enough to power an estimated 375 million EV batteries. Governor Newsom called it "the Saudi Arabia of lithium," and one company promised commercial operations by 2026.

The colleges moved fast. 

San Diego State spent $80 million in state funding on a new STEM campus, and Imperial Valley College used a federal grant to build three lithium certificates it marketed as a "fast track" into the industry.

The jobs never came.

Commercial extraction is still at least two years out by the companies' own estimates, and federal money has since shifted to lithium projects in Arkansas and Nevada. One of the Salton Sea companies pivoted toward data centers.

The result, in a county with a 16.9% unemployment rate: of 173 students who enrolled since 2023, just 16 have found jobs related to their training.

"Workers can't train and then wait around," said Betony Jones, a UC Berkeley labor researcher who calls the mistiming "incredibly common" in emerging industries.

Imperial Valley College is now scaling back, cutting cohorts and pausing two of its three certificates until 2027, when it hopes the industry will have arrived.

For education innovators, Lithium Valley is a workforce-training market failure up close. Real-time labor-demand tools that tell a college whether the jobs are two months or two years out before it launches a program. Employer-commitment platforms that turn a hiring promise into something binding before students enroll. The pipeline ran years ahead of the jobs. The product closes the gap.

⚡️More Quick Hits

This week in education:

• 29 NYC council members want a two-year pause on AI in the nation's largest school district — the members say the city has never evaluated its AI tools for algorithmic bias, equity impact, or instructional effectiveness, and a state audit found its policies didn't fully align with the NIST cybersecurity framework

• Hackers hit 100-plus organizations through Oracle PeopleSoft, 68% of them colleges — Google's threat researchers tied the campaign to ShinyHunters, the same group behind May's Canvas breach that exposed data across more than 8,800 educational institutions

• California makes personal finance a graduation requirement, the 26th state to do so — under AB 2927 every high school must offer the course by 2027-28 and every student must pass it starting with the class of 2031, creating statewide demand for curriculum and trained teachers

• An AI tutor doubled students' learning gains in one study, but only with the right design — EdSurge reports the same technology produced outsized results in an intro physics course and a Sierra Leone math program, yet researchers warn the effects swing sharply depending on scaffolding and teacher support

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