DILLON & HITCHCOCK: Opt In Or Lose Big, Arizona
By Kimmie Dillon & Sarah Hitchcock |
Arizona is known as the national gold standard for education opportunity. With a decades long history of tax credit scholarships supporting families and the nation’s first education savings account (ESA) program, Arizona paved the way for other states to make bold education reforms. Senate Bill 1142, now on the governor’s desk, is the next iteration of such reforms.
Arizona faces a choice: opt in to the federal education freedom tax credit (EFTC)—or lose big. Created by the Working Families Tax Cut Act, taxpayers can claim up to $1,700 in dollar-for-dollar federal tax credits for contributions to nonprofit Scholarship Granting Organizations, referred to as school tuition organizations (STOs) in Arizona. From there, STOs provide scholarships for numerous educational resources—including tuition, tutoring, and special education services—all designed to prioritize students.
And at what cost to state budgets? Absolutely none.
Simply put, these private donations will have a tremendous impact for Arizona families. If Arizona rejects this opportunity, 177,000 scholarships may be lost over the next three years alone. That’s 177,000 kids who won’t receive the educational support they need. Access to the EFTC ensures that Arizona parents can continue tailoring education to the unique needs of each child.
Importantly, Arizona taxpayers can donate to STOs regardless of their state’s opt in status. But states that decline to participate will effectively require residents to send donations across state-lines, instead of using funds to educate children in their home state.
Arizona is positioned to immediately and uniquely benefit from the EFTC because of its mature network of STOs. These non-profits are well-established—ready to immediately process charitable donations without the ramp up period that may hinder less-prepared states. Where other states may spend the early years building up organizational capacity of the nonprofit sector, Arizona can spend them distributing scholarships.
EFTC scholarships will be another avenue to fund the freedom for families who seek educational instruction alternatives. Denying families this simple yet effective tool will only hinder their ability to do what they need to for their child’s success. Research shows that choice benefits not only participating families, but traditional public school systems, too. A peer-reviewed study examined all 50 states and Washington, D.C., measuring access to private, charter, homeschool, and public school options. The findings were clear: states with higher levels of educational freedom consistently demonstrated higher student achievement.
One of the biggest reasons families chose to privately educate their children is that they desire instruction aligned with their values; one school cannot meet the needs of all students. By providing an array of opportunities, families are free to choose what’s best for their child. Arizona now has an opportunity to provide an additional $983 million in funding over the next three years.
Momentum is growing across the country with nearly 30 states opting in to the credit. A bipartisan coalition of governors and state legislators have embraced educational freedom, and now our state can supercharge education freedom for students and families.
Opt in or lose big, Arizona.
Kimmie Dillon serves as executive director of the America First Policy Institute’s Arizona state chapter. Sarah Hitchcock serves as director of the Education Freedom campaign at the America First Policy Institute.
