The debate over the constitutionality of a new private school scholarship law will hinge in large measure on a 19th-century constitutional amendment intended to discriminate against Catholics, legal experts say.
A new law went into effect this year allowing businesses to receive a substantial tax credit from the state for making contributions to scholarship organizations that help children who want to change public school districts, attend private school or be home-schooled. Participating businesses can receive an 85 percent education tax credit from the state against their business profits and/or business enterprise tax, as well as a federal tax deduction.
The Network for Educational Opportunity is the first organization to begin seeking donations from businesses. Tax credits are awarded to businesses on a first-come, first-served basis, and the law features a $3.4 million cap in this first year of the program.
The Network for Educational Opportunity is a Connecticut organization that has served as a platform for Alan Schaeffer, also affiliated with Alliance for the Separation of School and State. Mr. Schaeffer set up a New Hampshire presence and appeared to provide day-to-day support to Sen. Jim Forsythe in developing the NH voucher bill. He said that he would establish a “scholarship organization” to receive and distribute scholarship contributions if the bill if it passed, which he did.
The Americans United for Separation of Church and State, New Hampshire Civil Liberties Union and the American Civil Liberties Union filed a lawsuit against the state in Strafford County Superior Court in Dover on behalf of eight plaintiffs, seeking to block the law because, they claim, it would divert taxpayer money to religious schools in violation of the constitution.
“The New Hampshire Constitution is very clear. It says that a taxpayer of New Hampshire should not be required to pay for religious instruction,” Bill Duncan, a New Castle resident and one of the plaintiffs on the case, said recently.
While the N.H. attorney general’s office will be defending the state in court, the nonprofit Institute for Justice, a civil liberties law firm headquartered in Arlington, Va., is seeking to become an intervener in the lawsuit, said Dick Komer, a senior litigator with the agency.
“We think that NEO and the parents have a right to participate (in the lawsuit), so we will intervene and become parties in the case,” he said. “We fully expect that the judge will grant it.”
It’s not clear that they will be able to do this.
Komer said a key factor in the case is the Blaine Amendment to the N.H. Constitution, passed in 1877. The amendment states “no money raised by taxation shall ever be granted or applied for the use of the schools or institutions of any religious sect or denomination.”
James Blaine, an influential Republican from Maine who nearly became president in 1884, promoted the bill in an effort to gain Protestant votes. New Hampshire had strong Protestant roots and Catholics wanted equal funding for their own schools because Protestant public schools were “hostile” toward the Catholic interest, Komer said.
“(The amendment) was in fact added to the New Hampshire Constitution in a blatantly discriminatory act against the Catholic religious minority,” he said. “(These are) old provisions that were designed to discriminate against Catholics and their schools, and are now being used to discriminate against religion in general and religious schools.”
Marcus Hurn, the longest-serving professor at the University of New Hampshire School of Law in Concord, gave a similar assessment of the Blaine Amendment, which never had the two-thirds support it needed to pass Congress and become federal law.
“It was pretty clearly motivated at the time by bigotry against Catholics,” he said. “It’s part of the constitution. The motives were pretty vile, but the amendment itself just says the state can’t support religious schools.”
That is one reason Hurn believes the new scholarship law is unconstitutional. He said advocates for the law would either need to have the Blaine Amendment declared unconstitutional at the federal level or have it repealed. Repeal would require a three-fifths vote of both the N.H. House and Senate and a two-thirds vote of qualified voters participating in an election.
“We’ve got a real constitution. It’s hard to change,” Hurn said.
Komer said he disagrees with that interpretation of the Blaine Amendment, and that he does not believe its existence makes the scholarship law unconstitutional.
“They think the state cannot do anything that could conceivably help people making religious choices,” he said. “The money’s not being given to a religious school as defined by the New Hampshire Constitution. … The donations from corporations are going from a private party, the corporation, to a private party, NEO, to a private party, the parents.”
Komer also disputed the notion that the scholarships are a use of tax dollars, because the tax credits to businesses prevent the money from ever entering the treasury.
“This isn’t money raised by taxation,” he said. “Money raised by taxation is money that goes into the treasury in Concord and then is distributed by the executive branch,” he said. “This is money that never goes to the treasury because it’s a program that operates via tax credits.”
This is the argument that voucher proponents always make, as if there is no clear, direct tax expenditure funding the contributions made by businesses. Other courts have supported that fiction but the NH Supreme Court has not. The NH complaint cites opinions in which our Court has recognized that giving a tax credit is essentially equivalent to spending tax dollars.
Hurn said the New Hampshire Constitution is “very distinctively different” from other states, and that its equal taxation clause means all taxpayers need to be taxed equally. The only exceptions, such as elderly exemptions, are for functions that the state could, in theory, subsidize on its own, he said. Religious functions are not among them.
“If the Supreme Court sticks with the traditional case law, it would be (unconstitutional) because it’s a prohibited tax expenditure and makes business taxes unequal based on decisions of individual taxpayers,” he said.
This is very similar to the reasoning that has prevailed, so far, in a challenge to Louisiana’s voucher program.
Hurn said he has no strong opinion about private schools and vouchers, but he does have “almost fanatical opinions about the purity of New Hampshire’s constitutional law.”
Komer’s agency has won similar cases it has litigated in other states. He said the Institute for Justice is a public interest firm with an area of focus in school choice issues.
“The whole purpose of these school choice programs is to provide the same (opportunities) to low-income (families) that everyone else has,” he said. “They have the right now to use private schools, including religious ones. They just can’t afford it and this makes it more affordable. In that sense, it really does provide them with additional economic opportunity.”
Although Mr. Komer asserts that the voucher program is for low income people, the bill’s sponsors targeted the vouchers to families with incomes under 300% of poverty ($68,000 for a family of four) only after being forced to during the legislative negotiations. And Rep. Bill O’Brien has introduced a bill this year to eliminate even this modest level of targeting.