NEA To Give Up Tax Break

November 01, 1997 3 min read
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The National Education Association has announced it will lobby Congress to kill its own property-tax exemption in the District of Columbia, provided that ending the tax break isn’t linked to the creation of a local voucher program.

The tax change could cost the union more than $1 million a year, but it would put to rest an issue that has dogged it for years. Critics have long charged that the union should not receive the property-tax break on its $51.7 million headquarters in Washington, D.C. The exemption dates to 1906, when the NEA, then a professional association not involved in collective bargaining, received a congressional charter, a largely symbolic designation that recognized the group’s mission. Some critics have said the NEA should have lost the exemption after it was first recognized as a union in the late 1970s. Although dozens of other nonprofit organizations based in Washington are excused from paying property taxes, the NEA is the only one that is a labor union.

“Our action today is another step toward taking responsibility for students across America,” NEA President Bob Chase said at a September press conference. The union, Chase added, hopes the capital city will use the new revenue to help its struggling public schools.

The 2.3 million-member NEA, with an annual operating budget of some $185 million, will not have to raise member dues to cover the estimated $1.1 million tax bill, Chase said.

The union’s willingness to give up its tax break is not unconditional. Chase vowed that the union would support measures to revoke the exemption only if federal lawmakers did not “attach unrelated provisions that would harm D.C. children.” According to Chase, that includes provisions for voucher programs that provide publicly funded scholarships to allow parents to send their children to private schools. Such a bill recently passed in the House of Representatives. A measure approved by the House Appropriations Committee’s subcommittee on the District of Columbia would strip the NEA of its local tax exemption and create a new $7 million federally financed voucher program that would pay families up to $3,200 a year if they send their children to private school. The legislative report accompanying the District of Columbia appropriations bill says specifically that money generated by the new tax on the NEA would be used to help pay for charter schools.

Although the NEA is not opposed to the District of Columbia using some of the tax revenue for charter schools, the union is opposed to specifically earmarking its funds only for that purpose.

Only two years ago, the NEA lobbied against a legislative proposal that would have revoked its tax exemption. The measure failed 213-210 in the House. Last year, the NEA paid the District of Columbia government $100,000 in an arrangement called “payment in lieu of taxes.”

The NEA announcement drew faint praise from conservative members of Congress. “It’s a good thing when folks decide to pay their taxes,” said Rep. Randy “Duke” Cunningham of California, one of the Republicans who drafted the House language that would revoke the tax exemption.

But it failed to quell the skepticism of some of the NEA’s frequent critics. “There are a number of things they get out of this by paying something they should have been paying anyway,” said Paul Steidler of the Alexis de Toqueville Institution, a conservative think tank in Arlington, Virginia. “It does give the NEA a lot of leverage and even enhances their credibility in opposing the scholarships and in torpedoing the money allocated for charter schools.”

--Jeff Archer

A version of this article appeared in the November 01, 1997 edition of Teacher as NEA To Give Up Tax Break


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