Tuition Tax Credits—One Type of School Vouchers—Press Coverage and NPE’s Excellent Toolkit

Washington Post reporter Emma Brown describes Florida’s tuition tax credit program, what Brown and many others believe is the model Betsy DeVos and the Trump administration will try to use for a national program to privatize public education.

Brown describes the essential elements of this program: “Florida’s program, created in 2001 with the full-throated support of then-Gov. Jeb Bush (R), was one of the first to harness corporate tax credits to help low-income families pay school tuition.  Sixteen other states have enacted variations on the idea. Using tax credits to fund the scholarships, instead of direct payments from public treasuries, enabled lawmakers to work around state bans on use of public funds to support religious institutions. The U.S. Supreme Court has ruled that tax-credit programs are constitutional. Taking the idea to the federal level is one of the clearest ways Trump could make good on his promise to supercharge private-school choice across the country. If embedded in a larger tax bill that the GOP-held Congress passes via the budget reconciliation process, it would be protected from a Senate filibuster and therefore would require only 51 votes instead of the 60 usually required to pass legislation… In Florida’s tax-credit program, businesses receive a dollar-for-dollar credit when they donate to nonprofit scholarship-granting organizations. A corporation that owes $50,000 in Florida taxes, for example, could donate $50,000 and pay nothing to the state. The nonprofit then dispenses money to students for tuition at participating private schools…. Private schools do not need to be accredited to participate.” (According to the National Conference of State Legislatures, Florida has capped the amount of tax dollars that can be diverted:  “A corporation can apply for a credit worth up to 75 percent of its total income tax liability. As a whole, the state awards a maximum of $140 million (FY 2011) in scholarship tax credits.”)

Brown adds: “But there is scant evidence that these students fare better academically than their peers in public schools. And there is a perennial debate about whether the state should support private schools that are mostly religious, do not require teachers to hold credentials and are not required to meet minimal performance standards.”

The Network for Public Education’s  fine new toolkit, School Privatization Explained, contains two informative and very readable fact sheets about tuition tax credits. I urge you to read and find a way to use and distribute the information in NPE’s new toolkit. These basic resources help sort out the complex issues about various kinds of school vouchers and their constitutionality.

The fact sheet, Do Education Tax Credit Scholarships Provide Opportunity?, busts some of the myths being promoted by advocates of school privatization: “Education tax credit programs don’t enable families to choose better schools… The amounts of money paid out to families from these programs rarely cover the full cost of private school tuition. Poor families can’t make up the difference, especially to high quality private schools, so substandard privates are being subsidized… Both private and religion-based schools that can receive tax credit money often discriminate on the basis of religion, gender preference, disciplinary history or ability level.  Education tax credit programs don’t provide escape routes from ‘failing’ public schools. Students who use the programs often transfer out of better performing schools, and those students don’t perform any better academically than how they performed before their transfer.”

In this fact sheet, NPE explores examples of the tax credit programs in a number of states—Georgia, Pennsylvania, Arizona, and Florida—and then declares: “Many parents receiving tax credit scholarships can already afford private school and should pay their own way. Private schools on average do not perform better academically than public schools… Redirecting taxpayer money from public education to private schools does little to increase education opportunities, especially for low income families.”

The second of NPE’s fact sheets about tuition tax credits addresses this question: Are Tax Credit Scholarships a Voucher by a Different Name?  According to NPE the best way to think about tax credit vouchers is as a money-laundering scheme to get around the state Blaine Amendments (see here) that prohibit the direct expenditure of tax dollars for sectarian education: “Education tax credit scholarship programs are a money laundering scheme. Whereas vouchers distribute public education funds directly to parents, education tax credit programs use a third party—often called a school tuition organization (STO)—that is set up as a nonprofit by the state or by financial groups connected to the private school industry… The money from the STO is distributed to selected parents to use for private school tuition….”

Tax credit programs are sometimes promoted as a money-saving enterprise.  NPE responds: “Education tax credit scholarship programs don’t save money. They drain financial resources from public schools while providing tax benefits to wealthy businesses and individuals… Education tax credit scholarship programs are a give-away to the rich. High-income taxpayers are the main beneficiaries of the programs. They not only get their donations back as a tax credit; they also can take a federal charitable tax deduction on top of that.” Again, the fact sheet presents examples from a number of states, this time Georgia, Arizona, and Alabama.

Here in a recent USA Today commentary is Joshua Starr, former superintendent of schools in Montgomery County, Maryland and now CEO of PDK International, a professional society for educators: “Betsy DeVos, our new Secretary of Education, claims that she wants the federal government to become more responsive to the will of the American People… Fair enough. So when it comes to pubic education, what do the American people want?  Since 1969, PDK International has conducted an annual poll of the public’s attitudes toward the public schools… Since 1993, we have asked Americans 20 times whether they support allowing parents to choose a private school at public expense, and every time a majority has said ‘No.’ … (O)ur data have shown consistently over many years that a majority of Americans favor spending more money on the public schools, especially on their local schools (which people tend to rate much more highly than the public schools in general.).  A majority of people even say that they would be willing to pay higher taxes as long as the money goes directly to education.”

Here is Starr’s judgement on Betsy DeVos: “Secretary DeVos may have her reasons for wanting to… ramp up funding for her preferred forms of school choice. But let’s be honest: Those reasons are grounded in ideology, not in practical experience (she has none) or evidence (she cannot cite any).