Testimony in Opposition To SB 265 Building Opportunities for All Students and Teachers
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| Betty Weller, MSTA vice president, testimony on SB265/HB973 |
Senate Budget and Taxation Committee
February 21, 2007
Betty Weller, MSTA Vice President
Representing the members of the Maryland State Teachers Association, I wish to express our opposition to SB 265 that allows tuition tax credits for contributions to eligible organizations and programs. By any other name it is a voucher program. The primary reason for our opposition is that it diverts tax dollars away from public schools and public programs.
Although all schools would have the opportunity to access the fund established with these contributions, the research shows that the schools in less wealthy neighborhoods are not likely to receive the grants that schools in more affluent neighborhoods receive. A study of the Arizona tuition tax credit program showed that the program, which cost the state over $55 million over a three year period, that the money has gone largely to subsidize families in both private and public schools. Additionally the study by Arizona State University showed that 76 cents of every tax credit dollar went to families whose children were already attending private schools.
Moreover, a study by the “Arizona Republic” in 2000 showed that one school (Naduburg ES) in one of the wealthier districts collected $333 per student, while another school (Glendale ES) located in a predominantly poorer section collected only $4 per student. The study did find exceptions. It found that some schools in low income areas benefited by nearby retirement communities, but overall the study concluded that schools in wealthier communities benefited disproportionately under the tuition tax credit program.
In Pennsylvania tax credit vouchers became law in 2001. By mid-2002 1,347 businesses had claimed tax credits for a cost to the state of $27.7 million. In the first year the corporate tax credits of $18.28 million provided vouchers for 10,000 private school students.
A study by the “Morning Call”, an independent newspaper in Allentown, Pennsylvania, in its August 4, 2002 edition, concluded that ‘middle and upper income families are receiving the lion's share of tax credit dollars through private school tuition assistance.'
In Illinois, where the law includes many pre-requisites before individual taxpayers can qualify for a tax credit, the tax credit program holds little benefit for public school parents. In that state taxpayers can deduct 25% of educational expenses they incur over and above $250, up to a maximum of $500. To claim a $100 credit parents would have to spend $650 on qualified educational expenses. Few public school parents spend that amount on such qualifying expenses.
The Illinois law significantly redirects state tax dollars to subsidize private schooling for more affluent taxpayers. Note below the charts from Illinois.
The research on tuition tax credits in the four states where the program exists is extensive and conclusive. Tuition tax credit programs primarily benefit middle and upper income families often with students already enrolled in private schools, are very costly to the state, and do little to improve public schools.
As Trent Franks, the Arizona legislator who sponsored the law and is now a member of Congress, stated when referring to his state's tuition tax credit law: "Why do we need vouchers at this point?"
We urge an unfavorable report.
