Amended Opportunity Scholarship program heads to House floor in wake of Supreme Court support for choice programs

Another major Republican education policy agenda item, the Opportunity Scholarship program, is advancing through the Oklahoma state Legislature. On Wednesday (April 6), the House Appropriations and Budget Committee approved an amended version of the bill, on an 11-3 vote. The measure advanced even as the U.S. Supreme Court affirmed the legality of a school choice program. 

 The “opportunity” proposal cleared the state Senate 30-14 last month. If this revised version clears the state House it will return to the Senate for further deliberations. 

 House sponsor of the bill, state Rep. Lee Denney of Cushing, told CapitolBeatOK she is “very hopeful” the measure will pass the House this coming week, then go back to the full Senate for ultimate enactment.
 Revisions were made to finance grants for new programs in rural public schools. Intact provisions in the bill empower parents of children in failing public schools to access the education provider of their choice through scholarship-granting organizations financed by private individuals and corporations. Contributors could gain a 50% credit on state income tax credits. Total value of the tax credit program is capped at $5 million.

 Denney, a Republican, said she was gratified the measure gained bi-partisan support in subcommittee, but was disappointed the final “A&B” vote went along straight partisan lines. She said she is working for more Democratic support when the bill is considered in the full House. 

 Sen. Dan Newberry of Tulsa, who has worked on the measure the past two years, told CapitolBeatOK he believed the House Committee changes were “very positive and helpful. They are certainly acceptable amendments.” He said in an interview on Friday (April 8) that he shared Rep. Denney’s optimism about eventual approval of the measure and its advance to Governor Mary Fallin’s desk for her signature. 

 During last month’s consideration of S.B. 969, state Sen. Jim Wilson of Tahlequah asserted in questions and in final debate the measure was “a voucher system.” Newberry quarreled with that, saying it is a scholarship program allowing individuals and businesses to support a program to create scholarship funds to give children attending schools that are failing an option to access better schools, including private institutions.

 Wilson contended the fund would divert money from the general revenue fund, and said the scholarships were not true philanthropy. Newberrry disagreed, saying his bill was intended to encourage individuals who create opportunity for children who would not otherwise have it to access better schooling.

 In closing debate in that first go-round, Wilson said the bill was “really just a bad precedent. This is just a voucher program.” He encouraged a no vote.

 Sen. Newberry countered those assertions and said the measure would give hope to children presently attending schools that are not succeeding.

 Deemed the “Oklahoma Equal Opportunity Education Scholarship Act,” S.B. 969 would allow individuals or companies to receive a tax credit when contributing to a scholarship-granting organization. Limited to a 50% credit annually, amounts would be for contributions up to $1,000 per individual or $2,000 for married couples who file jointly. Corporate filers would receive a 50% credit up to $100,000.

 Scholarships could be used to cover tuition at accredited private schools, and costs of fees and transportation. Scholarships-granting organizations would be required to spend at least 90% of receipts on scholarships. The total scholarship pool would be limited to $5 million a year, with some of that now, as a result of the House committee changes, reserved for use in rural public schools. 

 Children allowed to access scholarships will come from families with less than 300 percent of the requirement for the free and reduced lunch program; and/or any child in a district that has been identified as needing improvement under No Child Left Behind. Scholarships could be for amounts up to $5,000 or 80% of the per-pupil expenditure in the public school district where a student resides, whichever total is greater.

 Like other advocates of parental choice in education, Newberry is celebrating the U.S. Supreme Court’s approval of the Arizona Tax Credit program, a close (if not perfect) fit with the Newberry-Denney legislation. 

 Newberry told CapitolBeatOK the U.S. High Court’s analysis of constitutional and policy issues was “very compelling.” In terms of his own proposal, he summarized the decision this way: “The justices said this was not a violation, and further that such policies are a good idea.”
 Robert Enlow, president and CEO of the Foundation for Educational Choice, based in Indianapolis, Indiana, commented this week, “The Arizona Tax Credit Program — like tax credit programs in many states — gives individuals the right to contribute their own money to scholarship organizations that offer kids school choice.”

 In a 5-4 decision, as Enlow summarized, “The Supreme Court … clearly said that individuals should have the right to contribute to any tax-free scholarship program just as they would contribute to the Red Cross, a homeless shelter or any other charity.”

 The court’s decision came in the case of ACSTO vs. Winn. Some analysts have asserted the case was primarily rooted in “standing” to sue. However, in conjunction with precedents, the case has broader implications. 

 In distilled form, the court’s analysis is that a tax credit for educational scholarships cannot be considered government spending. At one point the majority opinion argued that private bank accounts should not be equated with the state treasury.

 In the court’s analysis, when a parent/child receives a scholarship/funding from a scholarship granting organization, the only portion of state involvement is the tax credit itself.

 As one knowledgeable analyst told CapitolBeatOK after reading the decision, the court opinion is best understood this way: “A parent’s choice of the private school or educational option for the child has NO state involvement whatsoever. The state may fund the education of a child and if it does so — by tuition support, scholarship, or voucher — the extent of the state’s involvement ends at the point when the parent/child receives the funding.  After that point, the choice of which school to attend is a private choice.”