AZ HB2146

Requires school tuition organizations (STOs) to award at least 66% of educational scholarships and tuition grants only to students whose family income does not exceed 185% of the income threshold for reduced-price lunches under federal nutrition programs.

Adds a new violation for STOs that fail to meet the 66% means-testing requirement, subjecting organizations to notice and potential removal from the state registry if not corrected within 90 days.

Requires STOs to publicly disclose on their websites the percentage and dollar amount of scholarships awarded to students at or below the federal reduced-price lunch threshold and those between that threshold and 185% of it.

Modifies audit requirements for STOs receiving $1,000,000 or more annually to specifically evaluate compliance with the 90% scholarship allocation requirement and the new 66% means-testing requirement.