Pa’s public schools need our help. Gov. Tom Wolf was right to veto private school tax credit bill | Opinion

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By Susan Spicka

It’s budget season in Harrisburg. At a time of year when we should be talking about funding to meet public schools’ needs, instead we’ve been hearing more about massive giveaways of taxpayer dollars to well-off families who send their children to private schools.

The Pennsylvania House and Senate passed legislation sponsored by House Speaker Mike Turzai, R-Allegheny, allowing for a massive expansion, from $110 million to $210 million, of the Educational Improvement Tax Credit. The two-decade-old program provides tax credits to businesses and other organizations that fund scholarship aid for religious and private schools.

Who gets Pennsylvania’s educational tax credits, and who gets money? Search the EITC data yourself.

A built-in,10 percent annual increase in EITC funding in Turzai’s bill would have brought the total annual funding for the EITC program to an eye-popping $544 million in just 10 years.

Gov. Tom Wolf vetoed the legislation, and he was correct to do this.

The EITC program, and its partner, the Opportunity Scholarship Tax Credit (OSTC) program, are intentionally designed to provide taxpayer-funded private/religious school tuition vouchers to well-off families that are already comfortably paying their children’s private school tuition.

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HB 800 proposed to raise income eligibility for EITC private school tuition vouchers. Under current law, a family of four with an annual income of about $116,000 is eligible for tuition vouchers. HB 800 raised this to over $125,000, or twice the state’s average income for a family of four.  

A Keystone Research Center report, Still No Accountability for Taxpayer-Funded Vouchers for Private and Religious School Tuition, demonstrates the EITC/OSTC programs already subsidize attendance at elite, expensive private schools, many of whose students come from the most affluent Pennsylvania families.

In 2014-2015, just 23 of Pennsylvania’s most exclusive—and most expensive (average annual tuition $32,000)—private schools concentrated in and around Philadelphia and Allegheny Counties received $11.2 million in EITC/OSTC funding, more than 9% of the total during that year.

Making matters worse, there is no public auditing process to ensure that EITC/OSTC income limits are enforced.

 There is also no policing of side deals, through which families make contributions to EITC/OSTC in exchange for reduced tuition for their own children.

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And how do we know that increased taxpayer funds don’t just hold down regular tuition paid by the richest PA families? We don’t—that makes EITC/OSTC another public subsidy for the 1 percent.

Because Pennsylvania law explicitly prohibits the collection of data that would provide demographic information about students who receive vouchers, it is impossible to know who benefits from these vouchers.

In addition, the EITC/OSTC programs divert tax dollars into private organizations that have no public budgets, no public check registers, no public meetings, no Sunshine laws, and no right-to-know laws. As a result, there is virtually no public scrutiny or accountability for how this money is spent.

In Pennsylvania, EITC/OSTC scholarship organizations can keep 20 percent of the funding they receive to provide tuition payment vouchers to students. Comparable programs in Florida only direct 3% of the funds to those intermediary organizations.

In Arizona, which allows scholarship organizations to keep 10 percent of the funding, extraordinary examples of personal enrichment have been documented, including by a legislative leader who draws $125,000 annually as executive director of a scholarship organization and owns businesses that were paid over two-thirds of a million dollars by that same scholarship organization in 2014.

Does that happen in Pennsylvania? We don’t know.

Funding for K-12 private school vouchers via the EITC/OSTC programs has increased almost six-fold from $35.7 million in 2010-2011 to $210 million in 2018-2019.

This increase has not been accompanied by corresponding increases in financial or academic transparency and accountability for these programs.

Instead, Pennsylvania taxpayers know virtually nothing about how more than $1 billion in diverted tax dollars have been spent on K-12 private/religious school scholarships since 2001. They also know nothing about the academic outcomes of students who have received these vouchers.

Another expansion of EITC/OSTC tax credits for private school tuition vouchers for well-off families is unconscionable in a state that underfunds public schools so much that rich districts with their own resources have a third more funding per student than poor districts.

It is a further departure from the basic principles of equal educational opportunity and quality public education for all—and a further consolidation of “separate but unequal” schooling using taxpayer dollars.

Susan Spicka is the executive director of the advocacy group Education Voters of Pennsylvania. She writes from Shippensburg, Pa. 

1 COMMENT

  1. EITC oft times serves as a subsidy for nonpublic schools for children already enrolled there (not necessarily needy students wanting to leave public schools for privates). For example, a private school will advertise ‘financial aid available’ to try and attract students (and retain those already enrolled) with EITC-funded scholarships. Many of these families are middle-class earning over $100,000 who could afford tuition if they prioritized it over other discretionary spending. But the private school needs to fill seats and uses EITC-funded scholarships as an enrollment tool to do so. Point: not all EITC scholarships go to needy students.

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