AZ SB1516

Lowers the income threshold for low-income scholarship eligibility from 185% of the national school lunch program limit to 133% of the federal poverty guidelines for school tuition organization (STO) scholarships funded by corporate donations.

Requires corporations funding STO scholarships to ensure at least 90% of contributions go to scholarships for students meeting the new lower income threshold, with specific eligibility criteria including prior public school attendance or military-dependent status.

Removes the previous eligibility provision allowing students who meet reduced-price lunch criteria but don't claim the benefit to qualify for scholarships.

Changes the tax credit cap calculation to end the automatic 20% annual increase after fiscal year 2018-2019, capping future increases.

Applies all changes retroactively from June 30, 2019.