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    Home Opinion Education tax credits unaccountable
    Education tax credits unaccountable
    Opinion, Сolumns
    July 24, 2022

    Education tax credits unaccountable

    Whether Pennsylvania should provide tax credits to help fund scholarships for private schools is a debatable policy question. Whether the state should collect information on the program’s performance should not be open to debate.

    But incredibly, the nonpartisan Independent Fiscal Office reported in January that a thorough program review was impossible due to a lack of information. Even more incredible is that the state law that created the tax credit severely restricts data that state agencies may collect.

    That did not stop state lawmakers this year from including an additional $115 million in tax credits for the program in the state budget, plus $10 million for the related opportunity scholarship tax credit.

    The Ridge administration created the EITC program in 2001. Teachers unions accurately complained that it was a “back-door school choice voucher program,” but they dropped their opposition when Ridge cut them in on a plan to vastly increase public pensions.

    Under the program, companies receive a state tax credit of up to 90% for their contributions to nonprofit organizations, which distribute the money as scholarships for students to attend, mostly, private schools. Total EITC tax credits were capped at $30 million in the first year. With the new increases, the EITC tax credit cap is $340 million and the opportunity scholarship cap is $65 million.

    The law allows the state to collect only aggregate information on the programs. So the administration has reported that nonprofit scholarship organizations funded by the tax credits received 164,500 applications and awarded 68,400 scholarships for the 2019-2020 school year, the most recent with complete data.

    That does not begin to answer crucial policy questions.

    Of the 19 states with similar programs, Pennsylvania’s income limit is the highest. A family of four with an annual household income of up to $130,710 is eligible. Although a supposed goal of the enterprise is to enable lower-income students to attend private schools, there is no data on how many scholarship students already attended private schools.

    Several bills have been introduced to require the state to collect data on students and their families and the students’ educational outcomes.

    Accountability should be a nonpartisan objective. The bills easily should pass.

    — The Citizens’ Voice, Wilkes-Barre via TNS

    Tags:

    data economics eitc income politics private school program revenue school student tax credit

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