February 22 2010

Distinction with a Difference: Tax-Credit Scholarships are Not Vouchers

Vicki E. Alger

The Tampa Tribune is right to encourage the expansion of Florida's Step Up for Students scholarship program. This program, however, is a tax-credit scholarship program, not a voucher program. Here's how they differ-and why that difference matters.

Elementary and secondary school voucher programs, like Pell Grants or the G.I Bill for college students, use public dollars to fund scholarships that parents can use to send their children to schools, public or private, that they think are best. Though similar in effect to voucher programs, tax-credit scholarship programs differ in an important way: they are funded with private dollars.

This distinction remains a bone of contention with educational opportunity opponents-even though that bone was buried more than a decade ago when the courts upheld the constitutionality of the country's first tax-credit scholarship program adopted in Arizona back in 1997.

Arizona's program provides tax credits up to $500 for individual taxpayers (and now up to $1,000 for married couples filing jointly) who contribute to non-profit scholarship-granting organizations so elementary and secondary students can attend private schools.

Within mere weeks of the program's passage in 1997, the state's largest teachers union, the Arizona Education Association, along with People for the American Way, Americans United for Separation of Church and State, and others, challenged the state's tax-credit scholarship program under the First Amendment's Establishment Clause and the Arizona Constitution's religion clauses, also known as Blaine Amendments. 

The case, Kotterman v. Killian, ultimately went to the state Supreme Court, which upheld the tax-credit scholarship program in 1999. Chief Justice at the time Thomas A. Zlaket not only said that Arizona's Blaine amendments are "a clear manifestation of religious bigotry," he explained that the purpose of the tax-credit scholarship program is to "encourage the development of educational settings that would invigorate learning, improve academic achievement, and provide additional choices to parents and children."

Thus, such programs do not aid religion. Furthermore, the primary beneficiaries of tax-credit scholarship programs are not private schools but "parents who might otherwise be deprived of an opportunity to make meaningful decisions about their children's educations, and the students themselves." (See p. 3)

Similar rulings were reached in cases involving voucher programs in Wisconsin (Jackson v. Benson, p. 5) and Ohio (Zelman v. Simmons-Harris). Since voucher programs don't violate separation of religion and state provisions, educational choice opponents changed their tactics in Florida (Holmes v. Bush) by challenging voucher programs on the grounds that they do not provide a uniform system of education.

If tax-credit scholarship programs were indeed voucher programs, they could also be challenged on similar non-uniformity grounds-but they are not. As former Chief Justice Zlaket explained in Kotterman v. Killian, tax-credit scholarship programs do not trigger state constitutional provisions because "no money ever enters the state's control. . . Thus, under any common understanding of the words, we are not here dealing with ‘public money.'"(See p. 4)

Tax-credit scholarship programs like Florida's Step Up for Students program that use private funds therefore do not have the constitutional and regulatory entanglements of voucher programs, which are publicly funded through government appropriations. All students should have equal access to good schools, whether they use vouchers or tax-credit scholarships. Practically speaking, the distinction between publicly-funded and privately-funded scholarship programs matters because opponents will grasp at any constitutional provision they can to stop educational choice.

"We will attack on any grounds," as Robert Chanin, former general counsel to the National Education Association, the country's largest teachers union, put it. (See p. 3, note 6). "Our objective is not to establish lofty principles of constitutional law or to advance the state of constitutional jurisprudence . . .We will continue to challenge voucher and other choice programs under state constitutions on whatever grounds are available to us from lofty principles to church, state separation to Mickey Mouse issues such as the single subject rule."

Florida is a national model in expanding educational opportunity, improving student test scores, and closing achievement gaps. Other states are striving to emulate the success of the Sunshine State. For the sake of continued reformer efforts in Florida as well as those across the country, it is important for supporters of educational opportunity to define the terms of the debate-otherwise opponents will.

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