June 26, 2009

Indiana Senate hopes to bring scholarship tax credit back in budget

By Brigid Curtis Ayer

Veronique Briscoe-Pulliam, who is headed to law school with her husband this fall, is a continuing success story of what educational choice can bring.

A graduate of St. Thomas Aquinas School and Brebeuf Jesuit Preparatory School, both in Indianapolis, and Earlham College in Richmond, Ind., she is a child from a single-parent family.

Veronique was also one of the first recipients of an Educational CHOICE Charitable Trust scholarship in 1991.

Veronique’s mother, who noticed that her then-kindergarten daughter was academically gifted, became frustrated that she was not getting a challenging enough curriculum at the public school she was attending. Unfortunately, she didn’t have the financial resources to get Veronique enrolled in another school.

Veronique’s success story, told by Mary Nuetzman, a program director for CHOICE, would not have been possible without the grants awarded by the Indianapolis scholarship granting organization.

Parents like Veronique’s, who need better educational opportunities for their children, may still be in luck despite the fact that the Indiana House removed the scholarship tax credit from their budget bill, House Bill 1001ss, which they passed on June 19.

Glenn Tebbe, executive director for the Indiana Catholic Conference (ICC), said, “The good news is [that] Sen. Luke Kenley, [R-Noblesville], chairman of the Senate Appropriations Committee, where the bill is headed in the Senate, is supportive of the scholarship tax credit, and the Senate is expected to have the provision put back into the budget bill.”

Over the past several months, the ICC, Indiana Non-Public Education Association (INPEA) and Catholics statewide have urged lawmakers to adopt a scholarship tax credit which would offer a 50 percent tax credit incentive to corporations or individuals for donations made to qualified scholarship granting organizations. These corporations or individuals would then provide grants to qualifying families for school tuition or other school-related costs at the public or private school of the parents’ choice.

The scholarship tax credit was included in Gov. Mitch Daniels’ budget package, but was removed by House Democrats. The House also placed limits on charters schools, which offer parents a choice within the public school system.

“Some lawmakers in the House have concerns that scholarship tax credits, combined with charter schools, would create too much competition for public schools and could cause some harm for certain school districts,” Tebbe said.

“The school scholarship tax credit was an important policy initiative for legislative Republicans during the regular session,” said Jane Jankowski, a staff member in the governor’s office. “In the spirit of cooperation, Gov. Daniels included it in his budget proposal.”

Jankowski said that the scholarship tax credit was important because “it encourages people to help low-income children in poorly performing schools have more education options. The proposal is zero net cost and, given the decline in the state’s revenues, proposals that save money received higher priority than those that spend taxpayer dollars.”

During the regular session, a fiscal report on the scholarship tax credit prepared by the Legislative Services Agency, a non-partisan government entity that supports the Indiana General Assembly, indicated that approximately 1,600 students could receive support from contributions of $10 million, which is the maximum amount of contributions that would be eligible for the tax credit each fiscal year.

A May 2009 study by researcher David Stuit for the Friedman Foundation for Educational Choice found that a scholarship tax credit would result in significant net savings for the state.

For example, the study’s analysis model found that at an average scholarship of $2,500 or less, the state would realize at least $13.4 million in net savings in the first year alone.

Founded in 1991, the Educational CHOICE Charitable Trust in Indianapolis is the only scholarship granting organization in Indiana and was the first in the nation.

In the 2007-08 academic year, more than $828,000 in scholarship grants were awarded to 750 students.

“As far as prospects for passage [of the scholarship tax credit], we’re hopeful it will be part of the final budget,” Jankowski said. “There’s still work to be done before the General Assembly reaches final agreement on a budget.”

After the Senate passes its version of the budget, a conference committee made up of House and Senate members will work to reconcile differences between the House and Senate versions.

“Maintaining the scholarship tax credit in the final budget will be a hard fought battle,” Tebbe said. “We’re hopeful that the Senate’s and governor’s commitment to the scholarship tax credit is strong enough to overcome the objections some House members have with the tax credit.”

The General Assembly is expected to pass a new budget before July 1, when it is scheduled to go into effect.

(Brigid Curtis Ayer is a correspondent for The Criterion. To learn more about the Indiana Catholic Conference, log on to www.indianacc.org.)

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