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HB 370 repealing the voucher program

Docket

AN ACT repealing the education tax credit program.

SPONSORS: Rep. Gile, Merr 27; Rep. Porter, Hills 1; Rep. Frazer, Merr 13; Rep. Gorman, Hills 31; Rep. Gargasz, Hills 27; Rep. Vaillancourt, Hills 15; Rep. P. Sullivan, Hills 10; Sen. Kelly, Dist 10

COMMITTEE: Ways and Means

ANALYSIS:  repeals the education tax credit program.


2 Comments

  1. Steve Holmes says:

    First of all, I am certain it is not a state or government voucher program. Voucher programs, by definition get funding from the Government general fund and the government determines everything including the amount of the voucher and who is eligible for them and then they issue the vouchers based on that criteria. Tax credit programs like the one you are concerned about, here in NH get funding directly from businesses. Non-profit Scholarship Organizations like Network for Educational Opportunity determine the eligibility of each applicant and they issue scholarships based on the families income. The law requires an average scholarship of $ 2500 per student. One of the important criteria for this program is that it is only available to people who make less than 300% of the poverty threshold. So this is only to assist the poorer of our state to have an opportunity to make a choice concerning the education of their children. Those who make more than that threshold can receive no scholarship from this program.

    Next, this is not public money. The US Supreme Court in 2011 ruled in a tax credit case that the plaintiffs, who brought suit based on their belief that this is public money, had no standing to sue because the money never touched the Government coffers. That is true in this case as well. It’s similar to the money that you save when you make a contribution to a charity and then get a tax reduction on your income tax. No money actually comes to you from the government for that contribution and likewise no money goes to the recipients of this scholarship directly from the government.

    As far as the financial impact to the state is concerned, consider that last year about 3000 students left the public schools in NH for a variety of reasons. For example, some moved out of state, some transferred to private schools, some decided to home school etc. When those students left their respective public schools the state stopped paying adequacy to the districts where those children attended school. This actually saves the state money regardless of why or how the student leaves the public school.

    That brings me to the financial impact on the district. Even if a student leaves a public school, as long as his or her family lives in that district their school tax continues to go to the public school. According to the DoE figures, the average cost to educate a student in NH is $14,000. The lost adequacy from the State when a student leaves the public school is about $4,100. That means the district is still receiving about $10,000 per student even though the student is no longer there.

    Another important consideration is that this business-funded Scholarship Program is not an unlimited program. Out of 200,000 students in the state a maximum of approximately 1400 students would be able to take advantage of this program. Currently 290 students have applied for the scholarship, and the scholarship does not totally fund their education. The families will still have to pay the difference, and remember that the families that qualify must make less than 300% of the poverty limits. Without making quite a financial sacrifice I doubt that many of those families who are eligible will be able to afford the private tuition, so the overall impact statewide is minimal at best.

    • Bill Duncan says:

      You’ve defined vouchers pretty narrowly, Steve, but I’d say that even by your definition the New Hampshire program qualifies. The funding comes straight from the general fund (as my numbers show: http://wp.me/p2OKqy-nP) and the 13 page bill passed last year determines every programmatic aspect of the program. The fact that the selection of the students is sub-contracted to a non-profit is a detail in this context. Most of state government business is done by this kind of contracting. And the result is a voucher result – public money sending children to private, religious and home schools. It’s a tax credit funded voucher if there ever was one.

      I get the point about courts deciding the technical question that the money never became “public.” But it’s hard to believe that you, as a legislator, would not consider this dollar-for-dollar subsidy of the business donation to be a raid on the general fund. You could spend the whole general fund that way, giving tax credits rather than going through the step of collecting the money and spending it. This is a tax expenditure, just as real as if the State had written the check.

      The small impact on the school districts and the targeting to poor people are temporary features, easily changed by future Legislatures. Already, the program is set to go off like a slow release bomb and would grow to $30 million and 13,000 children per year in 10 years. Your former speaker, Bill O’Brien, has already told NHPR that he wants to eliminate the targeting to poor people and expand the program more quickly.

      The voucher program is not about poor people but about privatization of public education.

      I appreciate you’re engagement on the issue, Steve,

      Bill

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