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California bishops pleased with ruling on school tax credits
April 20th, 2011
By Valerie Schmalz

A U.S. Supreme Court ruling in an Arizona case could clear the way for legislation in California that would widen poor families’ school options by upholding the use of tax credits to support scholarships to faith-based and independent private K-12 schools.

The California Catholic Conference praised the 5-4 ruling, handed down April 4, tossing out a challenge to Arizona’s tuition tax credit program. “We are extremely pleased with the court’s ruling,” said Ned Dolejsi, the conference’s executive director.

“Parents have the right to direct their children’s education – meaning that they ought to be able to choose a school that supports their values, meets their child’s academic challenges and needs, and cultivates their child’s natural talents and interests,” Dolejsi said in a written statement. “With this decision, the U.S. Supreme Court has upheld a vital parental right.”

The ruling, written by Justice Anthony Kennedy, held that because the arrangement is for taxpayers to receive tax credits for their donations to tuition scholarship organizations, no actual state spending is involved and that therefore taxpayers in general lack jurisdiction for challenging the program.

The Arizona program grants one-for-one tax credits to school tuition organizations that provide tuition support to students attending K-12 faith-based and independent private schools. Individual taxpayers can send up to $500 a year and couples may send up to $1,000 to a scholarship fund for independent and faith-based schools and receive tax credit that reduces their state tax obligation by the same amount. Arizona law also provides tax credits to support public schools.

In 2009, $52.1 million was paid by Arizona scholarship organizations that offered 27,582 scholarships that averaged nearly $1,900 each, said Raymond Burnell, educational policy specialist for the California Catholic Conference. Arizona individuals may claim up to $200 in tax credits and married couples may claim $400 in tax credits that help public schools. In 2009, that component raised $42.6 million for co-curricular activities in public schools, Burnell said.

Similar programs that allow tax credits for scholarship funds that can be directed to tuition for students in faith-based and independent private schools are in place in a number of states. Pennsylvania also has a tax credit program that helps support children in public schools, Burnell said.

“For our own state, any similar educational tax relief program should be designed to benefit all school children,” Burnell said. Between 85 percent and 90 percent of all Catholic children attend a public school in California, Burnell said. The California bishops are concerned for the welfare of all children attending public, independent and faith-based schools, he said.

The Arizona program was challenged by the American Civil Liberties Union on behalf of the taxpayers of Arizona. The Supreme Court ruled that taxpayers did not have standing. The case was Arizona Christian School Tuition Organization v. Winn et al.

Writing the majority opinion, Kennedy said that the contributions were not a direct state appropriation but “resulted from the decisions of private taxpayers regarding their own funds.”

The ACLU held that the program was a violation of the First Amendment establishment clause separating church and state.

“Today’s decision ignores precedent, defies logic and undermines the role of the courts in preserving the core constitutional principle that government may not subsidize religion,” said Steven R. Shapiro, the ACLU’s legal director, in a press release.

A New York Times editorial April 9 blasted the ruling as “another cynical sleight of hand, which will reduce access to federal courts while advancing endorsement of religion.”

No tuition tax credit legislation has been enacted in California, partly because of strong opposition by teachers’ unions, said Peter Hanley, executive director of The American Center for School Choice and a member of the San Mateo Union High School District Board of Education.

“The Legislature in California has not historically been friendly toward school choice and in fact remains unfriendly to school choice,” he said. “There’s a bill now making its way through the Legislature that would put a cap on charter schools that makes no sense. So if we are still fighting over how many charter schools to have in the state right now, that doesn’t bode well.”

California and the nation need more good schools of all types, Hanley said.

“It should be the public policy of California that families have the primary responsibility for choosing the education for their children,” he said. “We should have the widest possible choices available to families, particularly families in low-income areas that have historically had virtually no choice.”

The state’s fiscal situation puts every issue on the back burner now, Burnell said. But he noted that the Supreme Court decision accepted the argument that an education scholarship program could provide “immediate and permanent cost savings” for overburdened state budgets and that by providing scholarships for students to attend independent and faith-based schools, a scholarship fund program could relieve burdens placed upon public schools.

From April 22, 2011 issue of Catholic San Francisco.



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