Tax credit bill finally advances

After being delayed twice so amendments could be prepared, the private school tax credit bill passed from the House Finance Committee Thursday to an uncertain future.

House Bill 11-1048 would allow credits for both private school tuition and the costs of home schooling, a proposal that’s been made in previous legislative sessions but never passed. Sponsor Rep. Spencer Swalm, R-Centennial, proposed successful amendments designed “to make the bill more palatable in terms of getting votes,” as he put it.

The bill passed on a 7-6 vote, with Republicans supporting and Democrats opposing. Two Republicans, Chair Brian DelGrosso of Loveland and Vice Chair Keith Swerdfeger of Pueblo West, said they think the bill should have a full floor hearing but that they still have personal concerns about it.

Rep. Spencer Swalm, R-Centennial

Swalm’s amendments would require private school students to complete a year in public school and then the next year in private school before becoming eligible for the credit. Home-schooled students would have to attend public school for a year to be eligible.

Those provisions are to prevent current private and home-schooled students from cashing in on the credit. One of the ideals behind the bill is to give an option to parents who may want better schools for their children.

Another key sweetener amendment would give school districts $500 a year for every student they lose to a private school. Asked by a Democratic member why $500, Swalm said, “It was just a number I felt would compensate the districts.”

A key assumption behind the bill is the belief, fashionable in some conservative circles these days, that it will help the state financially. “Rather than costing the state money, these are credits that going to save the state money,” Swalm said. He argues that even though the state will lose some income tax revenue, it will be able to reduce school funding by an even larger amount because enrollments will drop.

The flaw in that argument, committee Democrats said, is that school district costs don’t drop proportionately to enrollment declines.

“The marginal cost of a student leaving the classroom is not necessarily a cost saving,” said Rep. Daniel Kagan, D-Denver, who led Democratic criticism of the bill. The measure is “very apt to hurt the funding of public education.”

Kagan also said he fears tax credits could lure wealthier families from the public schools and “We’ll get to a stage where the public schools are schools for the poor. … They will become the forgotten schools.”

Rep. Cindy Acree, R-Aurora, had a different view, saying “I’m speaking on behalf of the hundreds of families in my district who are struggling to home school their kids,” which she said such families prefer because of “an elitist type of education” in the public schools. “They deserve an opportunity to help ease the stress on their budgets.”

There also were concerns – including on DelGrosso’s part – that the structure of the program might not actually help low- and middle-income families, who don’t pay much in income taxes anyway.

Democratic amendments designed to cushion the state against revenue loss were defeated, and a proposed Democratic amendment to impose CSAP testing and other state requirements on private schools was ruled out of order.

The bill next goes to the House Appropriations Committee, where it may hang around for some time until 2011-12 budget details become clearer. If the bill makes it out of the House, it’s given no chance in the Senate, where majority Democrats are looking for ways to reduce school district budget cuts, not increase them.

The tax credit would be a little less than half the state’s per pupil funding level in a given year, or about $3,150. A similar credit would be available to people who provide scholarships for private school students, and a $1,000 credit would be available for a child who is home schooled. Prorated credits would be available for half-time students.

In other action

• The House accepted and re-passed the amended version of Senate Bill 11-137, the Department of Education bill that’s part of the 2010-11 budget-balancing package. The final version keeps some $754,000 in the Colorado Counselor Corps that’s being used for special grants to some schools. The Joint Budget Committee originally proposed taking the money back.

• The Senate Education Committee voted 8-0 to pass House Bill 11-1089, which would give charter schools the ability to apply for certain kinds of federal and state grants without permission of their authorizing districts. (The state Charter School Institute would handle grant administration for such schools.) The committee approved an amendment that encourages districts and charters to attempt collaboration on grants before a charter acts on its own.

• Senate Education also voted 8-0 in favor of House Bill 11-1053, which encourages school districts to exhaust other alternatives before taking a student to court for truancy. The original version of the bill would have restricted use of court action, something that judges and some school districts didn’t like. The heavy amending to win their support was done in the House.

• The Senate Finance Committee passed Senate Bill 11-069 on a 5-2 vote, which directs the Charter School and Charter Authorizer Standards Review Committee to study the issue of regulating educational management organizations. The bill started with a full-blown regulatory scheme for such outfits but was quickly downsized because of opposition.

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