ETC Repeal Hearing Update – Part 1

Today the House Ways and Means Committee held a public hearing on HB 632, a bill that would repeal the Education Tax Credit scholarship program. Over 400 low-income children utilize the program this school year.

The committee room was at maximum capacity with people standing along the walls and in the hallway. It was wonderful to see so many smiling faces and bright yellow School Choice scarves!

We live blogged the hearing on our Facebook page; you can catch up on what was said here. Make sure you select “all comments” so you see the full report instead of what Facebook deems “most relevant.” Although Chairman Susan Almy claimed to be surprised at the great attendance and therefore didn’t reserve a larger room or allow more time for the hearing, it does not seem plausible given that the committee received well over 200 emails opposed to the repeal bill.

SUMMARY

Very few people, only the bill sponsors and one retired public-school teacher from Concord, spoke in favor of the repeal bill. They were poorly informed about how the ETC is funded, its accountability requirements, and constitutionality.

The prime sponsor, Representative Joelle Martin, said that private donations through the Education Tax Credit are “state-bound” money, and this was echoed by other sponsors and supporters. Based on the context of their comments, our best guess is that they believe earnings and income belong to the state even before taxes are paid and in the state treasury. They also repeatedly said that scholarship organizations “filter” money from businesses, making it sound almost like money-laundering. In fact, businesses may make donations to approved scholarship organizations using the Education Tax Credit program and receive roughly 85% of a credit against their Business Enterprise Tax or Business Profit Tax. Individuals may make donations and receive a credit against their state Interest and Dividends Tax as well as a deduction against their federal income taxes. There are five other tax credit programs in NH including the Coos County Job Creation Tax Credit and Economic Revitalization Zone Tax Credit. There are no bills to repeal any of the other tax credit programs, just the Education Tax Credit which is the only one in the state that supports low-income children who want an educational opportunity beyond their local public schools. Families – not the scholarship organizations – select where the funds are directed, which may be used for out-of-district public schools, private school tuition, or approved home education expenses. Some bill supporters claimed that these private donations raise their local property taxes, but that is inaccurate. Local property taxes allocated for education remain within the district and do not follow children for parent-placements in schools of choice — all local dollars stay with the district. In fact, if the 413 students currently utilizing the ETC scholarship had to return to their local schools, it would cost districts more money as the average cost per pupil is $15,865.26. The private scholarships, averaging $2,762 per child, is a win-win for communities as districts would otherwise have to spend a great deal to incorporate these students back into their schools.

Opponents to the ETC also claimed that the scholarship organizations, of which there are two in the state – the Children’s Scholarship Fund NH and the Giving and Going Alliance – are not transparent about the distribution and use of the funds. They ignore that the scholarship organizations must file annual reports to the Department of Revenue plus they voluntarily submit to independent audits. The information is available here.  They must fully account for every dollar that is donated and how scholarships are used. They also survey families each year, asking if they are satisfied with the program and over 90% say that are happy with it.

The constitutionality of the Education Tax Credit program was also questioned by opponents. They seemed dismissive of the fact that families, not the scholarship organizations or the state, direct the scholarships, but this is a critical distinction. Other states with ETC programs and Blaine Amendments have faced challenges on these grounds. The Blaine Amendment is a bigoted clause found in the constitutions of several states and has origins against Catholic schools. Today it is facing more legal challenges, arguing that government must be neutral relative to religion, neither being for nor against any religion or its practice. It is discriminatory to eliminate religious organizations from participation in school choice programs for the sole reason that they are non-secular institutions.

There was broad misunderstanding of how a child can qualify for the ETC scholarship. Per statute, eligibility is based on two factors: 1) the family’s annual income cannot exceed 300% of the federal poverty limit, which is $75,300 for a family of four; and 2) that the child is “switching” out of their local public school for an out-of-district public school, private school, or home ed program or as of 2018, be entering an alternative learning environment as a Kindergartner or 1st grader. Over 60% of scholarship children qualify for the Free and Reduced Lunch program, meaning the family earns less than $46,400 for a family of four. Poverty is a major contributor to a range of long-term academic problems. According to The Condition of Education (2018) by the National Center for Education Statistics (NCES), living in poverty has a great impact for the duration of a child’s academic years, from kindergarten through high school. The report says, “…and living in poverty are associated with poor educational outcomes, including low achievement scores, having to repeat a grade, and dropping out of high school.” The ETC scholarship is the only one of its kind in NH that supports our most at-risk children.

Dozens of children attended the hearing today and many were obviously attending as part of a school group. Unfortunately, the Chairman did not begin calling members of the public until 90 minutes into the hearing, and even with the extended time, many left prior to having the opportunity to speak.

Fortunately, some students and families were able to stay and shared heart-felt personal stories about what the ETC program means to them.

  • One immigrant teen said he faced bullying in his local public school because of the color of his skin and that his English skills were not fluent. He was also denied an opportunity to play on the school baseball team by the coach for these reasons. Now he is in a school where he is happy and accepted for who he is.
  • One high-school student spoke about the rampant drug use at her local public school and feeling unsafe there. She is now at a private school where she is safe, thriving academically, and already making progress towards a future in nursing.
  • Another student spoke about being under-challenged academically at her local school. She is now attending a private high school and doing very well, already receiving letters from colleges despite being a sophomore.
  • A single-mom spoke about her challenges getting her 10 children into an educational environment that would support them. They faced bullying at the local public school from other students because they wore cross necklaces or clothing with religious themes. She said the private school where they attend made a miracle happen for her family by connecting them to the ETC scholarships. Her children are now successful academically and accepted “holistically.”
  • A father spoke about the challenges his family faced to give their three sons the right educational fit. Their oldest was enrolled in the local public school, but was under-challenged and bored. The ETC scholarships and generous support from the schools enable the family to enroll the boys in schools that provide greater opportunities for their academic interests and abilities. Their oldest is a student at Stanford’s Online High School.

PART 2 – To Be Announced

The Chairman indicated that she will reconvene the public hearing the first full week of March, likely that Tuesday 3/5 or Wednesday 3/6. Stay tuned on our Facebook page and website to make sure you hear when it is scheduled. So many people were unable to testify today — we hope you can come back for part 2! We will create another Facebook event and post on our website once the hearing date and time are announced.

TAKE ACTION

Until the House Ways and Means Committee votes on the bill, we can still make efforts to share information about the ETC program and personal stories with them. It is important to continue reaching out to them, and thinking ahead, to your state representatives who will also vote on the bill.

CALL: Phone calls can be especially effective, particularly if you share what educational opportunities mean to you and your family. Mention if you are a constituent. Here is the committee members’ contact information.

EMAIL: This can be effective and is one of the easiest ways to communicate with the committee. You may use this easy tool to send an email to the committee and your state reps, urging them to reject the ETC repeal bill. The message can be customized for even greater impact. Please share the link with your friends and family, too.

You can also send your testimony to the committee; be sure to ask that it is included in the permanent record for the bill. You can also send a copy to us at info@schoolchoicenh.org if you would like us to consider publishing it.

A brief group email takes only moments. Their emails are below for an easy copy/paste.

[table id=26 /]

 

susan.almy@comcast.net
Richard.Ames@leg.state.nh.us
dennis.malloy@leg.state.nh.us
David.Karrick@leg.state.nh.us
Thomas.Southworth@leg.state.nh.us
Tom.Schamberg@leg.state.nh.us
edith.tucker@leg.state.nh.us
Lisa.Bunker@leg.state.nh.us
Jennie.Gomarlo@leg.state.nh.us
Willis.Griffith@leg.state.nh.us
Tom.Loughman@leg.state.nh.us
Jerry.Stringham@leg.state.nh.us
norman.major@leg.state.nh.us
repulery@comcast.net
patrick.abrami@leg.state.nh.us
Charles.Burns@leg.state.nh.us
Fred.Doucette@leg.state.nh.us
jess.edwards@leg.state.nh.us
Alan.Bershtein@leg.state.nh.us
susan.almy@comcast.net
Richard.Ames@leg.state.nh.us