Bill Duncan, House Ways and Means, 1/23/12

posted Jan 25, 2012, 2:07 AM by Bill Duncan   [ updated Jan 25, 2012, 10:55 AM ]

Testimony on HB 1607 establishing an education tax credit program

before the

Ways and Means Committee

of the

New Hampshire House

January 23, 2012


Bill Duncan


Thank you, Mr. Chairman, for the opportunity to speak on HB 1607.  I will speak in opposition to the bill.

I’m Bill Duncan, from New Castle.  I’m a retired software entrepreneur.  My children are in their 30’s now but they’ve been home schooled, public schooled and private schooled.  We’ve done it all.

I’m here today, though, as a taxpayer concerned about HB 1607 because under this bill as currently drafted we could be spending over $100 million in 5 years on private, religious and home school vouchers or scholarships. 

Over the weekend I read that HB 1607 may be amended to include the same state adequacy grant recovery provision that is part of SB 372.  That’s clearly necessary because the savings the Fiscal Note says would accrue to the state would not actually happen.  The transition funding continued in the stabilization grant provision of HB 337 means that that savings would not have materialized. 

I also read that Senator Forsythe said that the bills will be amended to “ensure aid is targeted to needy students.”  I assume that means students qualified for the free and reduced lunch program.  Depending on what the amendment actually says, that could be an improvement. 

But no matter what the students’ incomes are, the whole idea of using public funds to induce families to take their children out of the public schools and put them in private, mostly religious, schools just doesn’t make sense.  Voucher/ETC programs fit where schools are failing. Our schools are not failing.  Especially in this era of deep cuts it is hard to see why the state would now spend tens of millions of dollars – wherever it comes from – doing this.

I do understand the “choice” rationale.  “Give parents school choice.  Don’t make them hostage to the monopoly government-run schools.” 

You say it right up front in the bill, that the purpose is to:

“Allow maximum freedom to parents and independent schools to respond to and, without governmental control, provide for the educational needs of children…”

So you want to use government money for parents to escape government control.  I do get that that’s the purpose of this bill.  But I do not believe that dismantling our public school system to replace it with private and home schools is a legitimate public purpose for state money.

Exhibit A to my testimony is a flow chart showing how the program works:

The bottom is the current system.  State Aid, State Wide Education Property Tax funds and local property tax funds go to each school district.


The top part shows how the Education Tax Credit would work in year 1:


1.       First, the state makes up to $15 million in tax credits available in the first year.

  1. Then, businesses give up to $20 million to new Scholarship Organizations.
  2. The Scholarship Organizations split the money between private and public school students.
  3. Then the state takes back an average of $4,112 per public school scholarship student to off-set the tax credits to business. 


These numbers could change with amendments to the bill, but the basics do not change.  This is a pretty involved process to siphon public money into private schools.

Exhibit B is a financial projection I’ve done based on the bill as currently written.  This is just using the figures straight out of the bill.  It’s hard to see, even aside from administration costs, how the program could ever be revenue neutral.   

So HB 1607 would cost a lot.   And there are no real benefits?

Most recipients will probably be students would could have gone to a private without the scholarship.  For low income people, a $2,500 scholarship would not help that much toward most private school tuitions.

According to the minutes of the SB 67 committee:

       The average cost of a private education in NH

      Religious Elementary $5,228

      Secular Elementary $15,745

      Religious Secondary $7,664

      Secular Secondary $24,711

      Boarding $47,092


If you target only a portion of the scholarships, the rest would go to students who do not need them.  The way the bill reads now, most will already going to private schools!

And there is no accountability for the academic performance of private schools getting all that new money.  Advocates say those schools will be better, but how would we know?  The bill requires no testing.  And the program does not offer the choice of going to an out-of-district public school, where we could monitor the academic performance.

One of the leading national organizations advocating for "school choice" says this about accountability:

"The Alliance for School Choice and our affiliate, the American Federation for Children, support strong, commonsense accountability provisions for private school choice programs to ensure the highest level of program quality and sustainability. To achieve this goal, we support public policies that allow for significant transparency to parents, policymakers, taxpayers, and independent evaluators in order to show the effectiveness of these programs. Responsible accountability standards demonstrate both a serious commitment to transparency while ensuring that participating schools maintain their autonomy.


"We believe the school choice movement should encourage states to create new legislation and improve existing legislation so that there is significant transparency to all parties to show the effectiveness of these programs and the schools that participate in them. We also believe that academic information, including both snapshots of academic achievement and some measure of student gains, should be provided to parents and the public, both for voucher programs and tax credit scholarship programs."

As currently written, this is a large program.  It could be giving $36 million to 17,000 students every year by the 5th year.  

But even on a smaller scale, it would have a large negative impact on our schools, taking money and students out of the schools that are already suffering declining enrollment just from basic demographic changes.  Even Cornerstone Research said on NPR last week how damaging it would be to take children out of the public schools under these conditions. 

The message to public schools would be that their Legislature has given up on them and walked away.  And they’re actually doing a great job!

It is clear what a bad deal this is for the state and the taxpayers. 

I ask you to oppose HB 1607.

I am happy to answer any questions you might have.