Pair of bills links gifts to school choice tax credits
Legislators introduced companion bills Monday to provide a state business tax credit for contributions to scholarship organizations that help students move from public schools to private schools.
MANCHESTER — Legislators introduced companion bills Monday to provide a state business tax credit for contributions to scholarship organizations that help students move from public schools to private schools.
“Rich people already have school choice. The School Choice Scholarship Act helps bring that choice to all New Hampshire families,” said Charlie Arlinghaus, president of the Josiah Bartlett Center.
The Bartlett Center, which supports HB 1607, sponsored by House Majority Leader D.J. Bettencourt, R-Salem, and SB 372, sponsored by Sen. Jim Forsythe, R-Strafford, released a study of similar programs in states from Pennsylvania to Arizona.
The School Choice Scholarship Act would give New Hampshire businesses credit against the Business Profits Tax for donations to organizations that provide scholarships to school-age children, including those who are home-schooled.
Julianne Cooper, president and dean of Liberty Harbor Academy in Manchester, said businesses are yearning for competent workers and this would give them an opportunity to directly affect the education of future workers.
“I see an enormous amount of flexibility within the system and basically it costs no one anything,” she said.
Sponsors said the bill will be revenue-neutral because each student who leaves the public system to attend an independent school will lower the state’s per-student contribution to local public school education.
According to the Bartlett Center report, states with similar programs have from as few as one scholarship organization — Florida — to as many as 247 — Pennsylvania.
The Berks County Community Foundation is based in Reading, Pa. , which its president Kevin K. Murphy said has the unwanted distinction of being the poorest city in the country. The Berks County Tax Credit Fund, created in 2002, distributed $24,230 for the benefit of 52 students last year.
“Our donations have typically been in the range of $5,000 to $20,000 per company,” Murphy said.
Scholarship funds go directly to the school. In Reading, that meant mostly Catholic schools, including the John Paul II Center for Special Learning for disabled youth, he said.
“To the extent that it opened an alternative, that’s fantastic,” Murphy said. “The Reading School District is a deeply challenged school district.”
New Hampshire Department of Revenue said in a fiscal note it was too early to predict costs of administering the tax credit program.
Revenue Commissioner Kevin A. Clougherty estimated about 64,000 state business tax returns were filed last year; of those about 44,000 had a tax liability they owed the state. About 10,000 to 15,000 businesses had a tax liability of $500 or less, he said.
The Senate Education Committee holds a hearing on SB 372 at 1 p.m. today in Legislative Office Building, Room 103. The House held a hearing Monday afternoon.