Just raise the cap

Georgia students attend a school choice rally in Atlanta, January 2014. (AJC/Kent D. Johnson)

Georgia students attend a school choice rally in Atlanta, January 2014. (AJC/Kent D. Johnson)

Get this: There’s a state program that is so successful, lawmakers are thinking about making it worse.

The program is the tuition tax-credit scholarship. Companies and individuals can lower their state income taxes by donating to student scholarship organizations (SSOs), which help families pay for private-school tuition.

These tax credits are capped at $58 million statewide each year. And each year, taxpayers hit this cap earlier and earlier: in 2014, by mid-January. The allotment for 2015 was gone on Jan. 1. That’s right: It lasted all of one day.

Given the program’s popularity, and the fact the average scholarship award is far less than the cost of educating a child in a public school, you might think legislators would simply raise the cap, as they’ve done before.

Instead, there’s an argument over how to expand the program. And however unintentionally, one leading proposal would introduce needless complexity — and politics.

First, here’s some necessary background. In 2014, the credits were claimed so quickly that some previous donors weren’t able to give again. Many of these donors were companies that couldn’t estimate their tax liability so early in the year.

While tax-credit scholarships legally can go to any student regardless of his family’s income, data compiled by the state Revenue Department indicate the lion’s share of the money goes to kids from lower- and middle-income families. The vast majority of corporate donations, however, are made to SSOs that focus only on low-income kids. When those companies weren’t able to give, those kids lost out.

So one proposal is to create a second, similar state program limited to low-income kids. But introducing an income requirement is a bad idea.

That’s not because giving scholarships to poor kids is a bad thing. On the contrary, poor kids need school choice most of all, because they tend to be assigned to our worst public schools. But there is no indication poor kids weren’t getting these scholarships in the past; the problem arose only when the cap was hit so quickly. Raise the cap, solve that problem.

An income test would instead create new problems. It would mean government was favoring one SSO model over others, in a marketplace that’s competitive enough for donors to make those decisions.

An income test also means picking a number, and what qualifies as “poor” or “rich” is highly subjective. Say the threshold was $50,000: Is a family with three kids and annual income of $51,000 really more capable of paying private tuition than a family with two kids and income of $42,000?

Worse, folks who don’t think we ought to have tax-credit scholarships in the first place — including many Democrats — would be all too happy to bid the threshold ever downward.

If simply raising the cap substantially won’t work, a sensible compromise would be to spread out the credits throughout the year, maybe semiannually or even quarterly. That would give potential donors more time to determine their tax liability. To the extent that increased corporate donations, it could increase funds for low-income families without moving Georgia away from choice for all.

RELATED: Data show lower, middle-income families receive most scholarships

Reader Comments 0

105 comments
IReportYouWhine
IReportYouWhine

Your nation's leaders tell you lie after lie after lie because they know what kind of education you got in public school.


You're like "huh?"



EdUktr
EdUktr

A handful of Jay Bookman's liberal trolls seem to have descended upon you today, Kyle. Obviously, the public school education monopoly is a sacred cow to them.

But I'm sure you were already well aware of that.

Finn-McCool
Finn-McCool

Conservatives and their love of tax avoidance scams. A perfect match.

Doom Classical liberal
Doom Classical liberal

Lordy, those evil corporations wanting to help out lower income kids? That's gonna really, really make some progressive heads explode.  

IReportYouWhine
IReportYouWhine

 The average U.S. college freshman reads at a seventh grade level, according to an educational assessment report. 

“We are spending billions of dollars trying to send students to college and maintain them there when, on average, they read at about the grade 6 or 7 level, according to Renaissance Learning’s latest report on what American students in grades 9-12 read, whether assigned or chosen,” said education expert Dr. Sandra Stotsky.


Sounds like we need a bunch more Christian schools.


http://campusreform.org/?ID=6174

Kyle_Wingfield
Kyle_Wingfield moderator

The notion that this is a black-box program and we know nothing about how it works or who benefits from it is simply, plainly false.

Hedley_Lammar
Hedley_Lammar

@Kyle_Wingfield @HeadleyLamar Gaining converts.


That is how Religion works. Its the reason behind Sunday School


You have to get them young. McDonalds doesn't have all those playgrounds at its restaurants for nothing

Wascatlady
Wascatlady

@DontTread @Kyle_Wingfield @HeadleyLamar I have no objection to people donating their money.  But when they donate their money and expect MY money to make up for their "largess", THEN I have a problem.  That money has to be made up somehow!   It is NOT a zero sum game.

Kyle_Wingfield
Kyle_Wingfield moderator

There's more detail in this self-reported information about Georgia GOAL, the largest SSO which has collected about one-third of all donations since the program began: http://www.goalscholarship.org/docLib/20150102_GOALResults12302014.pdf

Highlights: About 80% of the scholarship money went to kids whose families' AGI was $36K or less.

Another of the largest, Arete, only gives to kids whose families fall below certain income thresholds: http://www.aretescholars.org/parents/

Hedley_Lammar
Hedley_Lammar

@Kyle_Wingfield Seems there is some data


My apologies.  Frankly I think this is worse because the data shows much of the money going to those that don't need it.

Kyle_Wingfield
Kyle_Wingfield moderator

@HeadleyLamar "Frankly I think this is worse because the data shows much of the money going to those that don't need it."

Not necessarily. The fourth quartile started that year at about $62K. If you have three kids (about average for families in that quartile, according to the data in the furthest-right column), that's not really "rich."

Kyle_Wingfield
Kyle_Wingfield moderator

@Captain-Obvious @HeadleyLamar To be clear, that 80% figure is just for one SSO (Georgia GOAL). Statewide, the figures are broken down only by quartile, but that's enough to tell us about half the scholarships went to people with AGI less than $30,000, and more than three-quarters of it went to people with AGI less than $62K. And again, with those $62K-plus earners having an average of 3 kids in their families, that's not a whole lot of money, either.

RafeHollister
RafeHollister

Shocked I tell you, but Bookman actually had some common sense reforms and accountability measures that need to be implemented before this program is expanded.  


Yes, we need to help poor and middle class students escape the failing public schools and this is one of many small steps we can make in that direction, but you can't demand accountability and fiscal responsibility in other government programs, and just dismiss it in this one. 

Kyle_Wingfield
Kyle_Wingfield moderator

@RafeHollister The only dismissing going on here is the people who are dismissing the accountability features the program already has. Could there be more? Yes. But I find it incredible that folks are hammering at this program while accepting -- much less suggesting -- nothing in the way of consequences for public schools that spend far more money with, generally speaking, dreadful results.

Hedley_Lammar
Hedley_Lammar

@RafeHollister Even worse, we lack even basic demographic information about who’s getting the subsidy — how many are needy, and how many are middle- and upper-class families who would send their kids to private school anyway? We don’t know because we’re not allowed to know; state law forbids collection of that data.


http://jaybookman.blog.ajc.com/2015/01/07/ga-s-private-school-scholarship-program-is-a-mess/


Exactly right.


And the fact some of these schools clearly are promoting one Religion over another is HUGE problem for me.

RafeHollister
RafeHollister

@Kyle_Wingfield @RafeHollister Not disputing that we need "way" more accountability for our public schools, especially on the financial side of the ledger, but some of these accountability things Bookman points out should be added before we expand the program.  In fact, I'm not sure how people voted the program in, without some of this, like some requirement for the receiving schools to provide some information on test scores and graduation rates and who is/was receiving these scholarships.

Kyle_Wingfield
Kyle_Wingfield moderator

@HeadleyLamar "Not much info there at all"

Oh, just that "basic demographic data" y'all have been pining for. And it's there for previous years, too.

Kyle_Wingfield
Kyle_Wingfield moderator

@HeadleyLamar I see no difference whatsoever. I certainly didn't intend for there to be one. Other than the fact it should be "the data" or "those data," not "that data."

Kyle_Wingfield
Kyle_Wingfield moderator

@HeadleyLamar "Even worse, we lack even basic demographic information about who’s getting the subsidy — how many are needy, and how many are middle- and upper-class families ..."

That's all there. And the law lays out requirements for students regarding whether they previously attended public schools or not.

IReportYouWhine
IReportYouWhine

Our education system is ranked 27th in the world, we look up to nations such as Yugoslavia. We've poured money into education like there is no tomorrow, in infrastructure, teacher pay, in curriculum, it hasn't helped in the least bit. If anything, the increased expenditures have made it worse. As a nation, how can anyone defend the status quo? There is a major malfunction in the public education system and it apparently isn't going to fix itself.


Is this about you or is it about the welfare of our children and this nation's future?

Tuna Meowt
Tuna Meowt

@IReportYouWhine It's funny how cons have shrieked FOR YEARS that throwing more money at public schools isn't the answer to a failing system.


So what's their solution today?  THROW MOAR MUNNEEZ at their favored solution.


Hedley_Lammar
Hedley_Lammar

@IReportYouWhine Our education system is ranked 27th in the world


Healthcare system pre Obamacare ranked even worse. 


Its about not giving tax dollars to private schools that don't need them anyway. Especially to teach Christianity. 

Kyle_Wingfield
Kyle_Wingfield moderator

@Tuna Meowt @IReportYouWhine Yes, the $58 million for the tax-credit scholarship program is just so comparable to the $7 BILLION-plus we spend on public schools. And that's just state money, which represents a little less than half of the total.

IReportYouWhine
IReportYouWhine

@Tuna Meowt @IReportYouWhine The whole entire idea of this program is to provide help paying for costs that have already been established and increase access for those who could not otherwise afford it.

Hedley_Lammar
Hedley_Lammar

@IReportYouWhine @HeadleyLamar  Tell that to the Tens of millions who now have access to healthcare.


I'm sure they will agree they are worse off.


Healthcare costs are rising at the slowest rate in half a century. 

IReportYouWhine
IReportYouWhine

@HeadleyLamar @IReportYouWhine Patricia Wanderlich got insurance through the Affordable Care Act this year, and with good reason: She suffered a brain hemorrhage in 2011, spending weeks in a hospital intensive care unit, and has a second, smaller aneurysm that needs monitoring.

But her new plan has a $6,000 annual deductible, meaning that Ms. Wanderlich, who works part time at a landscaping company outside Chicago, has to pay for most of her medical services up to that amount. She is skipping this year’s brain scan and hoping for the best.

“To spend thousands of dollars just making sure it hasn’t grown?” said Ms. Wanderlich, 61. “I don’t have that money.”

http://www.nytimes.com/2014/10/18/us/unable-to-meet-the-deductible-or-the-doctor.html

CommonSenseisntCommon
CommonSenseisntCommon

My stance on this remains the same. If you want your kids to go to a private school pay for it without the tax breaks.


My parents did it in the 60s with only a single low-middle income without incentives from the state.


Now the wealthy and middle class Republicans HAVE TO HAVE tax breaks to give that same education to their children. Put on your big girl panties cons.

Kyle_Wingfield
Kyle_Wingfield moderator

@CommonSenseisntCommon "If you want your kids to go to a private school pay for it without the tax breaks."

People sending their kids to private schools with this money aren't getting a tax break. The donors are. And the law states very clearly that mixing the two is illegal.

CommonSenseisntCommon
CommonSenseisntCommon

@Kyle_Wingfield 

So your neighbor pays for your kids and you pay for his or your company does.

Not much difference.

The point is the parents need to pay for their children to go to private school themselves without ANYONE getting a tax break.

Don't Tread
Don't Tread

@CommonSenseisntCommon @Kyle_Wingfield Parents should get vouchers so the tax money follows the child, regardless of what school the child goes to.  It's time to end the liberal near-monopoly on the schools.  (Of course, you liberals are all in favor of keeping your monopoly.)

DawgDadII
DawgDadII

@CommonSenseisntCommon @Kyle_Wingfield  The company I worked for reimbursed at various times all or part of my tuition (tuition reimbursement), for which (at the time) they got at least partial tax credit as a business expense. Knowingly or not, you are also arguing against these programs, which benefit many.

Visual_Cortex
Visual_Cortex

It's a vehicle to help parents with means keep their kids out of public schools.

Couldn't think of a better summation of my case-against, Mangler. So long as I have to hear that "resources are scarce" (wasn't that the claim just... yesterday, Kyle?) here in Georgia, this kind of subsidy seems all the more indefensible.

Kyle_Wingfield
Kyle_Wingfield moderator

@stands_for_decibels The average scholarship is about the same as the state's contribution to a child's public-schools education. So:

1) The additional cost to the state, if any, is minimal.

2) The local system is no worse off than if said student moved to the next county or out of state.

Visual_Cortex
Visual_Cortex

@Kyle_Wingfield @stands_for_decibels

If it is truly a financial wash (and I see no reason to distrust you here) then I will acknowledge my objection reaches out my serious concerns that this wash is short-term, that by chipping away at the kind of large public school systems I expect a civilized society to manage, we create more long term problems for the state (and possibly the nation at large.)