Update: The General Assembly gave final approval Wednesday to Republican-backed bills providing tax credits for contributions to scholarships for low-income children attending private, nonprofit schools.

Republican Lt. Gov. Bill Bolling cast the tie-breaking vote in the evenly divided, 40-member Senate. Voting largely along party lines, the House passed the legislation 57-40.

The bill, a component of Gov. Bob McDonnell's education agenda, would allow individuals and corporations to write off 65 cents for each dollar donated. It would cap state funding for the program at $25 million a year.

Scholarships would be limited to children from families with income no greater than 300 percent of poverty level, and to students with disabilities.

Republicans say the credits would help children and improve school competition.

"This legislation will truly spur private-sector investment in education by encouraging individuals and corporations to give to nonprofit organizations that provide scholarships for low-income students or students with disabilities to attend a non-public school," McDonnell said in a news release, adding that he looked forward to signing the bill.

Democrats argue the credits would siphon money from the state treasury that otherwise would go to public schools (school choice advocates say that it will save the system money by excusing those children from the public system and having parents and supporters of private schools bear more of the cost of educating them) and have cited the measure as one of the reasons they voted against the state budget in the Senate, causing an impasse that could last beyond the General Assembly's scheduled March 10 adjournment.

Original Story: The Virginia Senate passed last week a bill that would create the state's first-ever private school choice program.

If Senate Bill 131 is signed into law, the bill would create a corporate scholarship tax credit program for children from low-income families. Lieutenant Governor Bill Bolling cast the tie-breaking vote in favor of the legislation after a party-line 20-20 vote left a stalemate on the Senate floor.

The American Federation for Children-the nation's voice for school choice-has worked closely with allies in Virginia to pass legislation that would expand educational options for children in low-income families.

The bill, sponsored by Senators Bill Stanley and Mark Obenshain, went to the House Committee on Finance and is expected to be signed by Gov. Bob McDonnell if it heads to his desk. A similar bill, HB 321 and sponsored by Del. Jimmie Massie, passed the House 64-35 earlier this session.

"Virginia's Educational Improvement Tax Credits will ensure that quality of education doesn't depend on a student's zip code," Obenshain said. "Most of our public schools do a great job of educating our children, but when a school isn't right for a child, parents should have the opportunity to pursue other options."

Alberta Wilson, the founder of Faith First Educational Assistance, a Christian organization that offers scholarships to needy K-12 students in Pennsylvania and Virginia, said that SB 131 is important because it would provide parents with a choice about what schools their children attend.

She said it would also allow businesses to become more intentional about where their tax dollars are going. "Education should have competition," she said. "Competition drives quality and it levels the playing field."

Organizations like Faith First provide scholarships to parents and children who cannot afford to keep their children in private school. Wilson's organization has educated parents and legislators about school choice and pushed for tax credits for donor companies since 2001.

Wilson has previously spoken before the General Assembly advocating for a school choice and tax credit bill and spoke at the rally held at Virginia's capitol on February 7 in support of education freedom. When the news came on her Blackberry that the bill had passed, she couldn't help shouting "Hallelujah!" in the middle of her car. "So many people had prayed," she said.

If SB 131 is signed into law, Virginia would be the fourteenth state in the country to enact a publicly funded school choice program. There are 27 private school choice programs across the nation, 10 of which are scholarship tax credit programs.

Before the bill becomes law, however, there are a few issues that have to be addressed. At the Senate vote last Friday, according to the Roanoke Times, Sen. John Watkins was the swing vote for the bill. He had originally voted against the bill in the Senate Finance Committee but changed his mind partly because the Senate version calls for the tax credit to sunset in 2017. The Roanoke Times also reports that the House version of the bill contains no sunset clause.

According to the Family Foundation website, Sen. John Edwards also voiced his concerns about the bill to the Senate. He said that Virginia's public schools already have too-high of a teacher-student ratio, and because of this, public education should be "fully funded" prior to considering a school choice tax credit. A Family Foundation blog post countered Edwards' concerns that "…SB 131 could actually serve to decrease the teacher-student ratio as kids are benefitted with scholarships to attend private schools."

The Associated Press contributed to this report.