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Private school tax credit killed

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Ritter signs PERA bill

A bill that would have allowed lower-income families to receive $1,000 annual tax credits for children enrolled in private schools was killed Tuesday by the House Finance Committee.

House Bill 10-1296, sponsored by Rep. Spencer Swalm, R-Centennial, was one of two Republican school tax credit bills introduced this session. The other, House Bill 10-1295, will be heard in the finance committee Wednesday.

Defeat of such a bill was pretty much a foregone conclusion, given Democratic control of the legislature and that fact that school districts are facing budget cuts.

The bill failed to advance on a 5-6 party-line vote and then was postponed indefinitely by majority Democrats.

“I appreciate your effort,” Rep. John Kefalas, D-Fort Collins, said to Swalm. But, “I can’t support this bill … I have this fundamental value that public monies should support public institutions. I want to be very careful about undermining efforts to improve our public school system.”

Rep. Cheri Gerou, R-Evergreen, said she was interested in a measure that helped children, not the “system.”

Swalm’s original version of the bill would have covered any families who moved children from public to private schools. But, he offered an amendment Tuesday that restricted it to lower-income families. For the first year eligible family income had to be at or below 175 percent of federal poverty level. In subsequent years the ceiling would have been set at 220 percent.

A legislative staff fiscal note estimated that through a phase-in period to 2023, the bill would cost the state $9.7 million in lost revenue because about 9,600 kids would use the program. But, the state would have saved an estimated $26.5 million in school aid. (School districts would have received $1,000 per student who went to a private school.)

Swalm acknowledged that while the state might save money, the bill would affect school district finances. The legislative staff analysis cryptically noted that, “School district expenditures will decrease as a result of reduced enrollment.”

Norton Rainey, executive director of the Alliance for Choice in Education, a private school scholarship program, private school principal Jacquelyn Graham and parent Teresa Gonzales testified for the bill. Colorado Education Association lobbyist Karen Wick testified against it.

The bill being considered Wednesday, HB 10-1295, takes a broader approach.

It would allow annual credits of $500 for part-time and $1,000 for full-time home schooled students, and private school students would be eligible for a credit equal to half of average state per-pupil aid to schools.

People who provided scholarships for private school students also would be eligible for tax credits.

The legislative fiscal analysis estimates a loss of $407 million in state revenue by 2023 but $430 million of savings in state school aid. Again, the analysis says only, “School district expenditures and FTE will decrease as a result of reduced enrollment.”

The bill has 25 Republican cosponsors, but it’s not going anywhere.

PERA changes now law

Gov. Bill Ritter Tuesday signed Senate Bill 10-001, the complex plan designed to return the Public Employees’ Retirement Association to solvency over the next 30 years.

The new law contains a complex set of changes, including increased employer contributions, diversion to the pension fund of money that otherwise might have gone to employee salaries and changes in various benefit and eligibility calculations. (There are no changes that significantly affect teacher retirement eligibility. Education employees are the biggest segment of PERA membership.)

Financially, the biggest piece of the plan is cutting annual retiree benefit increases from the current 3.5 percent to 2 percent a year, something that has angered many individual retirees despite support for the bill by employee groups. Ritter didn’t mention the cut in the upbeat news release about the bill’s signing.

Use the Education Bill Tracker for links to bill texts and status information.

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