$100M private schools bill starts budget season fight

This story has been updated.

(Harrisburg) — Legislation to substantially expand taxpayer support for private and religious schools in Pennsylvania won passage Tuesday in the Republican-controlled Legislature, although Gov. Tom Wolf is signaling that he will block it.

The public dust-up ramps up a fight between supporters of public and private schools in the thick of negotiations between Republican lawmakers and the Democratic governor over a roughly $34 billion budget package.

The bill passed the state Senate on a party-line basis Tuesday, a month after it passed the Republican-controlled House on near-party lines.

Wolf said he would look at the legislation, but not whether he will veto it.

“What I’ve heard doesn’t sound real good,” Wolf told reporters after an unrelated news conference in his Capitol offices.

Republicans, Wolf said, haven’t explained how they would finance the $100 million cost of the bill, and he criticized tax credits programs as lacking control or accountability.

Wolf, who campaigned for office on raising support for public schools, said he is still working to increase aid for a public education system in Pennsylvania he called underfunded.

“It seems to me to be at odds with that need of a government in a democracy like ours to support broad-based, accessible public education,” Wolf said.

The bill is sponsored by House Speaker Mike Turzai, R-Allegheny.
The 18-year-old program to help finance private and religious schools is championed by school privatization advocates, who help find corporate donors to qualify for the tax credits.

The existing $110 million Educational Improvement Tax Credit program effectively lets corporations direct tens of millions in tax dollars to favored private and religious schools. The corporate donations are subsidized by a tax credit of up to 90%, meaning a donation of $100,000 may cost the corporate donor $10,000.

Some donations go directly to private or religious schools for scholarships. Some donations go to middleman organizations that can then withhold up to 20% in administrative costs before distributing the money to private or religious schools.

Families that qualify for a scholarship must report $85,000 or less in annual income.

The average scholarship amount was $1,815 in the 2017-18 fiscal year, according to state figures.

The law does not prohibit public officials from serving on the board of an organization that receives a corporate donation or from being financially rewarded by an organization that receives a corporate donation.

The legislation would nearly double the Educational Improvement Tax Credit to $210 million annually, add automatic 10% increases in years where the tax credit is almost fully subscribed and lift the family income eligibility limit to $95,000. It also would limit administrative cost withholding to 10%.

Senate Majority Leader Jake Corman, R-Centre, said the state’s relatively strong tax collections can finance the cost.

“I can’t think of a better reason to look at some of the revenues we have now and expand options for children to pick the school of their choice,” Corman said during floor debate.

Democrats criticized the legislation as pushing the tax credit program farther away from its original intent to help poor families, and said it now aids families of means.

Sen. Sharif Street, D-Philadelphia, called the bill “irresponsible legislation both morally and fiscally” and said the state should use the money to boost aid to cash-strapped districts where property taxes are high.

An earlier story appears below. 

(Harrisburg) — Legislation to substantially expand taxpayer support by $100 million for private and religious schools is heading to Gov. Tom Wolf’s desk, although he’s signaling that he’ll block it.

The Republican-controlled Senate approved the bill Tuesday on a party-line basis, ramping up a fight between supporters of public and private schools in the thick of budget negotiations.

It’s sponsored by House Speaker Mike Turzai and passed the Republican-controlled House last month on a near-party line basis.

Democratic Gov. Tom Wolf is criticizing it, saying public schools are underfunded and the bill is at odds with the need for accessible public education.

It would nearly double the Educational Improvement Tax Credit to $210 million annually. The program lets corporations direct tens of millions in tax dollars to favored private and religious schools.