School Choice & Charters

New Reports Debate Ariz. Tuition Tax Credits

By Darcia Harris Bowman — September 26, 2001 3 min read
  • Save to favorites
  • Print

Two Washington groups on opposite sides of the battle over public financing for private schooling released dueling reports last week on Arizona’s 4-year-old tuition-tax-credit program.

The Cato Institute, a Washington-based free-market think tank, praised the program for “giving parents choices” about where to send their children to school and saving taxpayer dollars at the same time. On the other end of the political spectrum, the People for the American Way Foundation, a liberal watchdog organization, also in Washington, called the initiative “a model to avoid” that is “seriously undermining public education.”

“The Arizona Scholarship Tax Credit: Giving Parents Choices, Saving Taxpayers Money” is available from the Cato Institute.

“A Model to Avoid: Arizona’s Tuition-Tax-Credit Law” is available from The People for the American Way Foundation.

The arguments may sound familiar to those who have followed the debate over private school vouchers. But with that concept mired in legal and political fights at the federal level, tax credits may be the next flash point.

“Voucher proponents have made it clear themselves that this is the next battlefield [because] vouchers have not done well in the polls, and they have not done well in the courts,” said Dwight R. Holmes, the education policy manger for the People for the American Way Foundation and an author of the group’s report on the Arizona tax credit. “Our case is, this is public money, and any time the state gives a tax credit, they are, in fact, reallocating public money—money that could have gone to help schools in high-poverty areas.”

Supporters of school choice acknowledge that they see some attractive qualities in Arizona’s program that are missing from the voucher idea.

“I think that for people who are concerned that vouchers might one day lead to more government intrusion into private schools, the tax credit really is a great way to help kids without increasing the potential for government regulation,” said Carrie Lips, the author of the Cato Institute report.

Help for the Poor?

Arizona policymakers created the $500 tax credit in 1997 for contributions to organizations that give students scholarships to attend private and religious-based elementary and secondary schools.

The policy immediately faced legal challenges, and teachers’ unions and other opponents urged the U.S. Supreme Court to review the Arizona Supreme Court’s ruling that the program did not violate federal or state constitutional prohibitions against government aid to religion. The high court declined to take up the appeal. (“High Court Leaves Tuition-Tax-Credit Ruling in Place,” Oct. 13, 1999.)

From 1998 to 2000, Arizona’s tax credit generated roughly $32 million for more than 30 scholarship organizations, according to state data. That money, in turn, subsidized 19,000 scholarships.

The Cato Institute contends the scholarships are “overwhelmingly” directed to the poor. At the same time, however, the group’s report acknowledges that scholarship organizations may have different definitions of low-income families, and it concedes there is no breakdown of scholarship recipients’ income.

Critics like the People for the American Way Foundation charge that children of middle- and upper-class families—not the poor—benefit most under the Arizona tax-credit program. The law does not specify that scholarships be based on need, and many of the awards are too small to help impoverished families afford the tuition at most private schools, Mr. Holmes argued.

Moreover, the tuition organizations “say the first priority on their list is kids already in private schools,” he contended. “The fact that they’re already in a private school leads to the conclusion that their families can afford the tuition.”

Supporters are hoping the program’s reach will broaden in time to include more needy public school students. Cato estimates that by 2015, the scholarship credit will be raising $58 million a year in Arizona, underwriting at least 35,000 scholarships annually, and helping a minimum of 11,000 public school students attend private or religious institutions.

In the meantime, Ms. Lips said, the program is still doing well. “I think a lot of people hope this eventually helps people who don’t have the finances to send their children to private schools, but I certainly don’t think it’s a failure to give people already paying for public schools with their taxes a little help paying for private schooling for their own children.”

Events

Ed-Tech Policy Webinar Artificial Intelligence in Practice: Building a Roadmap for AI Use in Schools
AI in education: game-changer or classroom chaos? Join our webinar & learn how to navigate this evolving tech responsibly.
Education Webinar Developing and Executing Impactful Research Campaigns to Fuel Your Ed Marketing Strategy 
Develop impactful research campaigns to fuel your marketing. Join the EdWeek Research Center for a webinar with actionable take-aways for companies who sell to K-12 districts.
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Privacy & Security Webinar
Navigating Cybersecurity: Securing District Documents and Data
Learn how K-12 districts are addressing the challenges of maintaining a secure tech environment, managing documents and data, automating critical processes, and doing it all with limited resources.
Content provided by Softdocs

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

School Choice & Charters Q&A How the Charter School Movement Is Changing: A Top Charter Advocate Looks Back and Ahead
Nina Rees, president and CEO of the National Alliance for Public Charter Schools, plans to step down as leader of the group at the end of the year.
6 min read
Nina Rees, CEO of the National Public Charter School Association.
Nina Rees, president and CEO of the National Alliance for Public Charter Schools, emphasizes that she has "always thought of [charter schools] as laboratories of innovation with the hopes of replicating those innovations in district-run schools."
Courtesy of McLendon Photography
School Choice & Charters Lead NAEP Official Faces Scrutiny Over Improper Spending Alleged at N.C. Charter School
Peggy Carr, the National Center for Education Statistics' head, is vice chair of the school's board and part-owner of school properties.
7 min read
Peggy Carr, Commissioner of the National Center for Education, speaks during an interview with The Associated Press about the National Assessment of Education Process on Oct. 21, 2022, in Washington.
Peggy Carr, commissioner of the National Center for Education Statistics, speaks during an interview with The Associated Press about the National Assessment of Education Process on Oct. 21, 2022, in Washington. Carr is facing scrutiny over allegations of improper spending by a North Carolina charter for which she serves as vice chair and landlord.
Alex Brandon/AP
School Choice & Charters 3 Decades In, Charter Schools Continue to Face Legal Challenges
Debates are raging in Kentucky and Montana over whether charter schools violate state constitutions.
6 min read
Illustration of a school building with a Venn diagram superimposed
iStock/Getty
School Choice & Charters More Young Kids Opted for Private School After COVID Hit
Newly released federal data shed light on where some students who left public schools during the pandemic ended up.
3 min read
A teacher with group of students standing in private school campus courtyard and talking
E+