[Below are three articles, the first a piece of legislation from Arizona, perhaps (??) a breakthrough in freeing up education for the poor and others who want to get free of bondage from govt. mis-education. The other two articles are commentaries.
But any government control of, or taxation for, education is wrong. The question is whether tax credits, like vouchers, can be a half-way step to total separation of school and state. ]
1. Arizona Bill
2. Blue Print - Martin Angell
3. Reform - Elie Pieprz
Arizona HB2074 is an innovative bill which allows private citizens up to a $500.00 tax credit if they decide to donate to a private school scholarship fund. This gives parents more flexibility when choosing educational options for their children. H.B. 2074 Tax credit: school tuition organization
Senate Engrossed House Bill
State of Arizona
House of Representatives
First Regular Session 1997
HOUSE BILL 2074
AN ACT AMENDING SECTION 43-1021, ARIZONA REVISED STATUTES;
AMENDING TITLE 43, CHAPTER 10, ARTICLE 5, ARIZONA REVISED STATUTES, BY ADDING SECTIONS 43-1087 AND 43-1088; RELATING TO INDIVIDUAL INCOME TAXATION.
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 43-1021, Arizona Revised Statutes, is amended to read:
43-1021. Additions to Arizona gross income In computing Arizona adjusted gross income, the following amounts shall be added to Arizona gross income:
(page 1 lines 7 - 24)
(page 2 lines 1 - 44)
(page 3 lines 1- 33)
25. ANY AMOUNT DEDUCTED PURSUANT TO SECTION 170 OF THE INTERNAL REVENUE CODE REPRESENTING CONTRIBUTIONS TO A SCHOOL TUITION ORGANIZATION FOR WHICH A CREDIT IS CLAIMED UNDER SECTION 43-1087 OR 43-1088.
Sec. 2. Title 43, chapter 10, article 5. Arizona Revised
Statutes, is amended by adding section 43-1087, to read:
A. FOR TAXABLE YEARS BEGINNING FROM AND AFTER DECEMBER 31, 1997, A CREDIT IS ALLOWED AGAINST THE TAXES IMPOSED BY THIS TITLE FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAYER DURING THE TAXABLE YEAR TO A SCHOOL TUITION ORGANIZATION, BUT NOT EXCEEDING FIVE HUNDRED DOLLARS IN ANY TAXABLE YEAR. THE FIVE HUNDRED DOLLAR LIMITATION ALSO APPLIES TO TAXPAYERS WHO ELECT TO FILE A JOINT RETURN FOR THE TAXABLE YEAR. A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
B. IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE UNDER THIS TITLE ON THE CLAIMANT'S INCOME, OR IF THERE ARE NO TAXES DUE UNDER THIS TITLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CLAIM NOT USED TO OFFSET THE TAXES UNDER THIS TITLE FORWARD FOR NOT MORE THAN FIVE CONSECUTIVE TAXABLE YEARS' INCOME TAX LIABILITY.
C. THE CREDIT ALLOWED BY THIS SECTION IS IN LIEU OF ANY DEDUCTION PURSUANT TO SECTION 170 OF THE INTERNAL REVENUE CODE AND TAKEN FOR STATE TAX PURPOSES.
D. THE TAX CREDIT IS NOT ALLOWED IF THE TAXPAYER DESIGNATES THE TAXPAYER'S DONATION TO THE SCHOOL TUITION ORGANIZATION FOR THE DIRECT BENEFIT OF ANY DEPENDENT OF THE TAXPAYER.
E. FOR PURPOSES OF THIS SECTION:
1. "QUALIFIED SCHOOL" MEANS A NON-GOVERNMENTAL PRIMARY OR SECONDARY SCHOOL IN THIS STATE THAT DOES NOT DISCRIMINATE ON THE BASIS OF RACE, COLOR, SEX, HANDICAP, FAMILIAL STATUS OR NATIONAL ORIGIN AND THAT SATISFIES THE REQUIREMENTS PRESCRIBED BY LAW FOR PRIVATE SCHOOLS IN THIS STATE ON JANUARY 1, 1997.
2. "SCHOOL TUITION ORGANIZATION" MEANS A CHARITABLE ORGANIZATION IN THIS STATE THAT IS EXEMPT FROM FEDERAL TAXATION UNDER SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE AND THAT ALLOCATES AT LEAST NINETY PERCENT OF ITS ANNUAL REVENUE FOR EDUCATIONAL SCHOLARSHIPS OR TUITION GRANTS TO CHILDREN TO ALLOW THEM TO ATTEND ANY QUALIFIED SCHOOL OF THEIR PARENTS' CHOICE. IN ADDITION, TO QUALIFY AS A SCHOOL TUITION ORGANIZATION THE CHARITABLE ORGANIZATION SHALL PROVIDE EDUCATIONAL SCHOLARSHIPS OR TUITION GRANTS TO STUDENTS WITHOUT LIMITING AVAILABILITY TO ONLY STUDENTS OF ONE SCHOOL.
Sec. 3. Title 43, chapter 10, article 5, Arizona Revised Statutes, is amended by adding section 43-1088, to read: 43-1088. Tax credit: public school fees; definition
A. FOR TAXABLE YEARS BEGINNING FROM AND AFTER DECEMBER 31, 1997, A CREDIT IS ALLOWED AGAINST THE TAXES IMPOSED BY THIS TITLE FOR THE AMOUNT OF ANY FEES PAID BY A TAXPAYER DURING THE TAXABLE YEAR TO A PUBLIC SCHOOL LOCATED IN THIS STATE FOR THE SUPPORT OF EXTRA CURRICULAR ACTIVITIES OF THE PUBLIC SCHOOL, BUT NOT EXCEEDING TWO HUNDRED DOLLARS.
B. THE TWO HUNDRED DOLLAR LIMITATION ALSO APPLIES TO TAXPAYERS WHO ELECT TO FILE A JOINT RETURN FOR THE TAXABLE YEAR. A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
C. THE CREDIT ALLOWED BY THIS SECTION IS IN LIEU OF ANY DEDUCTION PURSUANT TO SECTION 170 OF THE INTERNAL REVENUE CODE AND TAKEN FOR STATE TAX PURPOSES.
D. IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DIE UNDER THIS TITLE ON THE CLAIMANT'S INCOME, OR IT THERE ARE NOT TAXES DUE UNDER THIS TITLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CLAIM NOT USED TO OFFSET THE TAXES UNDER THIS TITLE FORWARD FOR NOT MORE THAN FIVE CONSECUTIVE TAXABLE YEARS' INCOME TAX LIABILITY.
E. FOR PURPOSES OF THIS SECTION, "EXTRA CURRICULAR ACTIVITIES" MEANS SCHOOL SPONSORED ACTIVITIES THAT REQUIRE ENROLLED STUDENTS TO PAY A FEE IN ORDER TO PARTICIPATE INCLUDING FEES FOR:
1. BAND UNIFORMS.
2. EQUIPMENT OR UNIFORMS FOR VARSITY ATHLETIC ACTIVITIES.
3. SCIENTIFIC LABORATORY MATERIALS.
Sec. 4. Department of revenue: report of fiscal impact the director of the department of revenue shall submit a report to the governor, the president of the senate and the speaker of the house of representatives regarding the fiscal impact of the tax credit provided for donations to school tuition organizations on July 1, 1999.
Fife Symington, Governor 7 April 1997 Monday, 10:48 am
A BLUEPRINT FOR ALL 50 STATES
-Here's the best structure for school choice and the "biggest legislative threat" to the NEA/AFT-
School choice is a major interest to most Americans, and education is a top issue of concern among voters. According to the August 27th Gallup poll, 52% of public school parents would place their kids in private schools if they had the financial ability to do so. In addition, 72% of black families support school choice, and they want educational options rich families like the Clintons and the Gores make for their own kids.
There are several plans for school choice mostly along the lines of government-funded vouchers and tax-credits. However, the best idea is one I learned about from a unique source while attending the China - U.S. Conference on Education in Beijing last July. I learned about this bill from the National Education Association--the past NEA president, the Arizona teachers' union and their legal counsel. The bill I am referring to is the Arizona Private Scholarship Tax-Credit, signed into law last June. Few people know about it, but it is exciting! It is a brilliant approach to educational reform, yet so simple! It unites all school choice activists, including those who have fears about "vouchers" as well as many public school advocates.
Recently, the Arizona teachers' union filed a lawsuit against this law in the Arizona Supreme Court, and the case was argued on December 16th. The prospect for a victory for school choice is positive, and it might even go to the U.S. Supreme Court. They allege it violates separation of church and state, but this law isn't government assistance at all; it is completely voluntary and privately funded. In the NEA's words, this law is their "greatest threat" because it will expand to other states and eventually the whole nation.
Here's the way the law works. It provides up to a $500 personal income tax-credit to any Arizona taxpayer for donations to Arizona-based private scholarship organizations which then disburse the funds in the form of scholarships to low income students to attend the school of their parents' choice. The beauty of this is that it completely avoids the concerns many have with government-funded vouchers and the implied "strings attached". Today there are approximately 40 private scholarship organizations across the country, so the infrastructure is present to pursue this on a national level. In addition, the bill provides a $200 tax-credit to taxpayers for voluntary contributions to any Arizona public school. For this reason, the teachers actually rallied in favor of the bill against their own union! This funding mechanism increases public schools accountability and communication with taxpayers. Thus, public schools will rely less on state and federal funding, and more on their communities, which will reward schools that perform.
Last year, the Arizona School Choice Trust (ASCT), a private scholarship organization, assisted about 110 low-income kids with scholarships to attend private schools-donors received tax deductions. But this next year, as a result of the private scholarship tax-credit law, the state of Arizona projects that the ASCT will provide scholarships in excess of $50 million. That could provide for as many as 20,000 kids going to the school of their parents' choice the first year alone (1998)! This is revolutionary with the possibility of reducing the monopoly power of public education and restoring educational choices to parents, as well as providing all children with the opportunity to receive a quality, Christian education without government strings. The Arizona proponents of the law will increase the $500 tax-credit as the benefits are realized.
This bill is an excellent opportunity for all states with or without an income tax (it could apply to a corporate franchise tax, for example). We need to get the bill introduced into all 50 states and the U.S. House and Senate. It is more powerful than the Coverdell bill, which doesn't help low income kids; and it will help more kids than the Armey D.C. Scholarship bill and the J. C. Watts voucher plan, while avoiding the concerns of government strings. It is even better than the Ron Paul education tax-credit bill, which I urged him to write (I didn't know about the Arizona bill at that time).
The bill will unite many diverse groups-Republicans, Democrats, blacks, whites, rich, poor, and even private and public school teachers. It might even amass the veto-proof majority we seek on the national level. At the very least, it will show who the real heroes of education are, and it will expose the agenda of those anti-family extremists whose educational agenda is to enslave the children of poor, minority families and keep them shackled in the back of the educational bus. And that is something that strikes fear in the souls of educational monopolists during an election year.
Martin Angell is director of Every Church A School Foundation based in Dallas.
By Elie Pieprz
Investor's Business Daily, May 13, 1997
Washington may have its so-called ''education president,'' but if you want to see real hope for schools, you'll have to look a couple of thousand miles to the west.
Last month, Arizona Gov. Fife Symington signed a bill passed by the Republican-led Legislature that ushers this country into a new chapter in the fight for school choice. The new law allows Arizona's taxpayers to take a $ 500 credit from their income taxes if they contribute to scholarship funds for private schools. The contribution would not go for a specific child's tuition but would make private schools more affordable to all parents.
Tax credits for public purposes are nothing new, but Arizona is breaking ground by using them to build up the private school system. And its program, which avoids some of the tough political and constitutional issues of direct voucher plans, should encourage other states to follow.
Most Americans recognize that our educational system is not adequately preparing our children for their future. Recent U.S. Education Department studies indicate that the average elementary school student is reading below the ''proficient'' level. And of the 1990 class of public high school freshmen, fewer than 70% graduated in 1994.
Since high schools are not doing their jobs, the two primary college entrance exams had to be altered in order to boost scores. Statistic after statistic shows that the current school system doesn't serve the nation's children well.
A recent NBC News/Wall Street Journal poll indicates that the American people have lost faith in the public school system and now favor new options.
By a huge majority - 94% - they want significant change in our public education system. Three-quarters believe that fixing the problems of our schools is not a responsibility of the federal government. Nearly as many - 69% - want parents to have more control over all aspects of education.
The taxpayers have spent plenty of money to improve the public schools, with poor results. Nowhere is this truer than in Arizona. By any measure, the public school system there is an expensive failure.
Its spending has increased 164.4% (in real dollars) since 1970 and now consumes over 60% of the state's $ 5.1 billion budget. It has the third- highest ratio of pupils per teacher at 21.1 (as of 1994), and its high school dropout rate, now at 36.4%, has been increasing at the third-fastest rate in the country.
At the same time, every Arizonan has been paying 8% of his or her per-capita income of $ 23,709 toward public education. It costs taxpayers $ 6,100 annually, with fixed costs included, to pay for the education of one public school student. But at long last, the new Arizona law will give parents the power they demand and deserve.
The tax credit means more Arizonans will be able to opt out of the public system, saving the taxpayer about $ 3,000 for each student that leaves.
A study by the Arizona Department of Education in early April concluded that the law will likely result in the transfer of $ 50 million from the state treasury to private school scholarship funds. That would allow 100,000 taxpayers to use their tax obligation to support real education - not a government bureaucracy. One such fund is the Arizona School Trust Fund, which has been sending children to private schools for years.
Studies have shown that parental involvement in the educational process is the clearest path to success. The ASTF fosters that idea by paying for only half of the tuition for a private school student, thereby having parents make their own financial commitment to their child's education. ASTF recognizes that the way to improve our students is not through fine- tuning a bureaucratic system, but through engaging parents.
If the American system of education is really focused on the welfare of our children, private schooling must play a larger role. Arizona's school superintendent, Lisa Graham Keegan, in arguing for increased capital funding for schools, says, ''Put simply, the money should follow the student.'' It is just that simple.
Educrats must remember that the money is for the student, not the system.
Elie Pieprz is state projects coordinator for Americans for Tax Reform.
Go to: => TOP Page, => EDUCATION Library; => ROAD MAP