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Published in Print: June 17, 1998, as Hill Negotiators Unveil Revised Education-Tax-Breaks Bill

Hill Negotiators Unveil Revised Education-Tax-Breaks Bill

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The House and the Senate plan to vote this week on a quickly crafted compromise version of the "education savings account" bill that Republicans hope will force President Clinton to reverse his opposition to it.

To entice a presidential signature of the legislation--which would create tax breaks for parents' public and private education expenses--House and Senate negotiators have included a new reading program in it and deleted language that would have blocked plans for new national tests and transformed most federal education funding into block grants.

Despite the changes, the revised bill drew a prompt thumbs-down from the White House Office of Management and Budget. "This bill directs vital resources from public education, which is where 90 percent of American students are educated, and we are still planning to veto it," Linda Riccy, an OMB spokeswoman, said last Thursday.

The GOP sponsors, however, maintained that if Mr. Clinton followed through with a veto, he would be making a big mistake. "We are on the verge of providing assistance to millions of American families," said Sen. Paul Coverdell of Georgia, the chief Republican sponsor of HR 2646. "There is a massive reach embraced in this concept."

The bill has the support of a handful of Democrats--including Sens. Dianne Feinstein of California and Robert G. Torricelli of New Jersey--but Sen. Coverdell and GOP sponsors in the House said they were unsure if they had enough votes to override a veto.

Sen. Coverdell and sponsors of the block-grant legislation and the proposed ban on new federally sponsored national tests held a news conference June 10 to announce the compromise. The lawmakers said they agreed that the bill was too important to be weighed down with provisions that would give the White House ammunition for a veto. But the Republicans promised that the deleted language would re-emerge in other legislation later this year, setting up a second and possibly a third clash with the president over K-12 priorities.

Separately last week, Mr. Coverdell chalked up a victory for a broad anti-drug bill that he co-sponsored, which was approved as an amendment to major tobacco-settlement legislation in the Senate. As part of the proposed Drug-Free Neighborhoods Act, school districts would be allowed to use federal money to provide vouchers for students who were victims of school violence, allowing them to attend the public, private, or religious school of their choice. The amendment also would allow compensation for teachers and students who were victims of such crimes. The tobacco bill itself remained under debate in the Senate at press time last week.

Tax-Break Provisions

The core provision of HR 2646, the "education savings accounts," would allow parents to set aside up to $2,000 a year in tax-free accounts for any education-related expense, from kindergarten through college, including the cost of private school tuition, transportation, personal computers, tutoring, or school uniforms. ("Bill Previews Future Education Policy Battles ," April 29, 1998.)

Sen. Coverdell estimates that 14 million families would use such savings plans, and that 75 percent of those families would have children attending public schools.

But opponents of the accounts dispute those figures, charging that the legislation would only provide tax breaks for wealthy families who could afford to contribute funds. Last week, David Frank, the Department of Education's director of public affairs, said the department had not softened its opposition to the bill.

The bill now also contains the language of the proposed Reading Excellence Act, previously introduced by Rep. Bill Goodling, R-Pa., which would direct $210 million in fiscal 1998 dollars to a new literacy program and training for teachers based on research-proven methods for teaching children to read.

Last year's education appropriations bill stipulated that a major new literacy program--such as the one President Clinton called for during his 1996 re-election campaign--must be approved by July 1 in order to receive funding. The Senate does not plan to pass such a bill separately if the education-savings-account legislation is vetoed. The House passed a reading measure last fall. ("Reading Funds May Shift to Special Education," May 6, 1998.

During the June 10 press conference, Rep. Goodling, who chairs the House Education and the Workforce Committee, brandished a letter from Speaker of the House Newt Gingrich, R-Ga., and Senate Majority Leader Trent Lott, R-Miss., promising that the ban on national testing would be attached to the education spending bill later this year.

On June 8, two days before the compromise bill was released, Sen. Torricelli and six other Democrats wrote to Sen. Lott, saying they would support the educational-savings-account measure if the provisions on block grants and national testing were removed.

Sen. Slade Gorton, R-Wash., whose amendment to turn most federal education programs into block grants has emerged several times in both chambers over the past year, vowed that it would resurface soon.

Dubbing himself "the supporting, but disappointed rebel," Mr. Gorton hinted at the qualms his proposal has caused some of the more moderate members of his party. "My portion of the bill disappeared like dew off the grass on a sunny morning."

But Rep. Dick Armey, R-Texas, the House majority leader, promised during the news conference that the measure would find support in the House. "Senator Gorton is showing us where we can and will go," he said.

HR 2646 also includes GOP-backed language authorizing a new program that would give money to states to make cash awards to public schools with outstanding scores on state assessments.

The language would also authorize incentives to states that implemented teacher testing and merit-pay programs.

Vol. 17, Issue 40, Page 35

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