The Arizona Tuition Tax Credit has been the subject at this blog on a couple of occasions. In its early form it drew the incredulous attention of scholars who questioned both its legality and its fairness (See Welner & Moses in References).
In 1998, the law allowed tax payers to direct up to $200 of their state income tax indebtedness to a public school to be used for extra-curricular activities. (The $200 extra-curricular thing was really just a sop to opponents of the main section of the bill, which now allows a $2,000 tax credit contribution to a private and/or religious school for tuition.) Glen Wilson calculated that in the first year of the program approximately $6 Million were contributed to a total of about 900 public schools. The per student donation was $8.80--nothing much to get excited about. But the program has grown amazingly large. Modifications of the law have raised the contribution limit to $400 for a couple filing their tax return jointly and permitted the money to be spent on character education programs.
Tens of millions of dollars of state tax indebtedness are now directed to public schools in Arizona. As one might expect, the money is hardly distributed equitably. Let’s take a look at a half-dozen schools in a single school district (Scottsdale Unified School District) that differ greatly in the socio-economic level of their attendance areas, and, as a result, differ greatly in how they are benefiting from the tax credit program. In the table below, four K-5 elementary schools and two 9-12 secondary schools are shown along with their enrollments, total contributions, per pupil contribution and typical housing prices of their attendance areas.
|Tonalea (K-5)||$15,150||550||$28||$25,000 to $200,000|
|Tavan (K-5)||$23,800||770||$31||$200,000 to $300,000|
|Hopi (K-5)||$70,300||770||$91||$1,000,000 to $2,000,000|
|Kiva (K-5)||$87,350||770||$113||$500,000 to $5,000,000|
|Coronado (9-12)||$121,500||1,300||$93||$100,000 to $200,000|
|Chaparral (9-12)||$404,950||1,900||$213||$500,000 to $5,000,000|
Tonalea and Tovan draw students from lower middle-class attendance areas and collect roughly $30 per student, while Hopi and Kiva are collecting 3 and 4 times that much. The former state superintendent of schools sent her children to Kiva, where one took a trip to Catalina Island on tax credit funds in the earliest days of the program. At the secondary school level the inequity is huge—more than a $100 per student difference in contributions. Coronado is a low-income high school receiving less than $100 per pupil under the tax credit program while Chaparral enjoys contributions topping $200 per student.
And so once again our legislators and their constituents have brought the Matthew Principle to the service of their children and their neighborhoods. “For unto every one that hath shall be given, and he shall have abundance: but from him that hath not shall be taken away even that which he hath .” (Matthew 25:29)
Moses, Michele S. (2000) Arizona Education Tax Credit and Hidden Considerations of Justice. Education Policy Analysis Archives, 8(37). Retrieved March 19, 2012 from http://epaa.asu.edu/ojs/article/view/428/551.
Welner, Kevin G. Taxing the Establishment Clause: The Revolutionary Decision of the Arizona Supreme Court in Kotterman v. Killian. Education Policy Analysis Archives, 8(36). Retrieved March 19, 2012 from http://epaa.asu.edu/ojs/article/view/427/550.
Wilson, Glen Y. (2000) Effects on Funding Equity of the Arizona Tax Credit Law. Education Policy Analysis Archives, 8(38). Retrieved March 19, 2012 from http://epaa.asu.edu/ojs/article/view/429/552.
Gene V Glass
University of Colorado Boulder
Arizona State University