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Lessons for Rhode Island During National School Choice Week

January 22, 2018

by Jonathan Butcher
January 22, 2018

How can we give every child the chance to succeed? Millions of families across the U.S. will be asking just this question this week during National School Choice Week, the annual celebration of opportunities in education around the country.

Families in Rhode Island can be even more specific: How can a state law enacted a dozen years ago to help low-income students find quality private schools help more children? Churches and private school leaders in and around Providence are hosting events this week to answer this question.

Rhode Island has allowed businesses to make charitable contributions to nonprofit scholarship organizations since 2006. Businesses receive a tax credit worth a portion of their contribution. The scholarship organizations use the funds to award K-12 private school scholarships to low-income students. Nearly 20 states, including Arizona and Florida, have similar laws.

Today, Rhode Island’s law is more than a decade old, and scholarship organizations award some 400 scholarships each year. But with public school enrollment topping 130,000 students, the scholarship organizations are reaching less than 1 percent of the state’s public school students.

In Arizona, and Florida, closer to 5 percent of students are using tax credit scholarships (as a percent of the total public school enrollment, the figures are nearly 7 percent and 4 percent, respectively)—giving Rhode Island something to aspire to. The percentage may sound small, but in Arizona, this means scholarship organizations award approximately 70,000 scholarships annually. More than 100,000 Florida students use a tax credit scholarship.

Here are three ways Rhode Island can change state policy in an effort to give more children the chance to find an excellent education:

    1. Eligibility: Rhode Island’s scholarships are only available to students from families at or below 250 percent of the federal poverty line. Just as every child can attend their assigned public school, so every child should be allowed to apply for a K-12 private school scholarship through the state’s tax credit option. Research from other areas of the country demonstrate that children from all walks of life can benefit from additional education options.
      To offset the cost of additional private school scholarships, lawmakers could require students from families that meet certain income-based criteria switch from public school to private school in order to participate. Currently, Rhode Island tax credit scholarship students do not have to switch from public school to use a scholarship. But by requiring at least some students to attend a public school before using a scholarship, lawmakers can offset the new scholarships.
    1. Tax credit. In Arizona and Florida, the states with the largest number of tax credit scholarships awarded annually, donors receive a dollar-for-dollar credit on their taxes for their charitable contributions to scholarship organizations. This gives donors more incentive to make contributions. In Rhode Island, businesses receive a credit worth 75 percent of their contribution if they donate for one year and worth 90 percent of their contribution if they commit to a two-year donation.
  1. Multiple uses. Today, students can learn anytime, anywhere, using in-person and virtual materials, along with any number of resources available online. Students should be allowed to use tax credit scholarships for more than just private school tuition. Personal tutors are valuable to children that need to catch up to their peers; education therapies are essential to children with special needs; and online classes are useful for students that want to learn material not available in their local school.
    Arizona’s education savings accounts and New Hampshire’s tax credit scholarships give students the ability to use an account-style learning option or tax credit scholarship for more than just private school tuition. Today, account-style learning options are available in six states (New Hampshire’s tax credit scholarships bring the count to seven). Families can hire personal tutors for their children, save money from year to year, or even save for college—in addition to paying private school tuition in many cases. Rhode Island lawmakers should consider giving the state’s scholarships similar flexibility.

Rhode Island policymakers should look to successful policies in other states as they consider how to help more students pursue the American Dream. The state’s private school scholarships are a great start, but policymakers should build on the existing policy to help more children succeed.

Jonathan Butcher is a Senior Fellow at the Goldwater Institute.

 

 

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