The House voted 35-33 for a tax break for those who donate to private and religious school scholarships, saying it will promote school choice for parents who don’t think the public classroom is right for their kids.
The razor-thin decision March 20 sends the bill the Senate. Two lawmakers were absent, Republican Reps. Fred Wood of Burley and Frank Henderson of Post Falls.
The bill would create tax credits worth up to $10 million annually. This provides more choice for parents seeking a public school alternative, proponents said, adding that scholarships would be limited to kids based on their family’s income, to exclude the wealthy. For instance, children from a family of four people that earns $63,900 annually could qualify, according to the bill.
“Everybody talks about choice,” said Rep. Mark Patterson, R-Boise and a parent of children in a private school. “This is a bill that actually creates choice. This gives families that don’t have the means that some of us do to actually send their children to private school.”
Foes said it would siphon more money from Idaho’s general fund — and undermine public schools that are already insufficiently funded. Rep. Janie Ward-Engelking, D-Boise and a former school teacher, said parents who want to send their children to private school should bear the financial responsibility.
“It is their right and their choice, but the state should not subsidize that choice,” she said. “We do not have enough money for public schools right now.”
Others said the bill may violate the Idaho Constitution, at least in spirit.
According to the state’s founding document, “Neither the Legislature nor any county, city, town, township, school district, or other public corporation, shall ever make any appropriation, or pay from any public fund or moneys whatever, anything in aid of any church or sectarian or religious society.”
Proponents said this bill includes an elegant work-around: This is a tax credit, said Rep. Steve Hartgen, R-Twin Falls, not a voucher provided by the state.
“There is no direct transfer of funds,” Hartgen said, pointing out that courts have upheld similar credit programs.
Individuals and businesses who donate money to scholarship granting organizations could reduce their tax liability by up to 50 percent.
Only students who are transferring from a public school or entering kindergarten or first grade would be eligible.
Rep. John Vander Woude, R-Nampa and father of children who went to a private Christian school, projected the program will actually save the state and local districts up to $5.8 million, because reducing public school enrollment would also cut Idaho’s per-student funding obligation.
Foes of the bill said any gains were purely speculative.
“If you make a class go from 34 to 30, I don’t see how you’ve reduced your staff costs, at all,” said House Minority Leader John Rusche, D-Lewiston. “And you certainly haven’t reduced your fixed costs.”
Other opponents had concerns over the simple logistics of the bill. For instance, one company with a tax liability of $20 million could donate $10 million to scholarships, crowding out anybody else who wanted to participate. What’s more, scholarship granting organizations would be required to check with the Idaho State Tax Commission every time somebody wanted to make a donation, to see if there was still room under the $10 million credit cap to benefit.
“This is going to put an incredible burden on our Tax Commission,” said Rep. Lynn Luker, R-Boise. “It’s just very confusing and cumbersome in terms of process. While I understand the idea, I just don’t think this is a very workable solution.”
But proponents said Idaho should follow other states including Arizona that have adopted such tax credit programs, in a bid to expand options for parents.
“If nothing else, this bill is about individual freedom,” said Rep. Lenore Barrett, R-Challis.