Last week, our mom/mother-in-law called and asked us “What do you know about House Bill 1222?” To be honest, at that point, we didn’t know much. It had just been filed (along with 99 different shell bills about retirement taxes and funds). Brittany knew the short title dealt with “Parental Empowerment”, but other than that we were still shuffling through the recent Senate bills.
Just to clarify, we don’t normally have family phone calls to discuss legislation. Emails, maybe, but never dedicated conference calls. Naturally, we were curious.
Brittany pulled up the bill through the Arkansas Legislature website and we downloaded the 17-page monstrosity and read through it.
HB 1222 was filed on January 18th by Representative Jim Dotson, a Republican from Bentonville. HB 1222 would establish an “education savings account” of sorts in Arkansas. This account would be used at a parent’s discretion to fund private school, tutoring, and other education costs. The account would be joined by a tax incentivized scholarship which corporations and individuals can donate to a nonprofit organization that provides money to parents to opt into private or home school education.
What makes HB 1222 interesting in that regard is that these two systems have been advocated in other states, but have not been blended in this manner before. But what is interesting is not always what is best.
Currently, the largest portion of the cost of public school education is covered by a mixture of general state revenue and local property taxes (think millage taxes). The Arkansas Legislature established the funds needed for one public school student at $6,646. Why is this number important to know? Because when a student leaves a public school to opt into private or home schools, the money does not go with the student, nor does the former public school still receive that money. It goes back into general revenue and is allocated elsewhere. This would be why most smaller school districts worry about retention rates- the school can’t even function without a certain number of students to ensure funding.
So how will HB 1222 affect that system? It will not directly divert public education funds to private schools; rather, money that would have gone into the general revenue as an income tax will now be channeled to nonprofits administering the education savings account. Those nonprofits would in turn channel money equivalent to the cost per student for public education (remember, $6,646 a student) into the student’s “savings account.” We mentioned that the donations would be incentivized- the donations would qualify for a federal income tax deduction and the donors would also receive an income tax credit from the state that would match their donation.
When legislation such as this is filed, the Arkansas Department of Finance and Administration conducts a legislative impact report- in general terms, they look at revenue impacts, taxpayer impacts, the resources required to implement the legislation, as well as other related points. The DFA, as of the January 25th version of HB 1222, released an impact report that found HB 1222 would lead to a $10 million reduction in general revenue from July 2017 to July 2018. The impact report went on to state that the total impact is unknown as the bill “provided a growth mechanism that is unclear.”
Throughout the introductions on floor and committee, the sponsors and co-sponsors have been careful to not call it a voucher bill, but rather a “savings account” bill. For those who are not well acquainted with a voucher system, vouchers use state money to fund scholarships that pay for student to opt over to private schools. This bill instead incentivizes money to be redirected from general revenue, funneled to nonprofits, parsed out in scholarships that are transferred to accounts for students to attend private schools. While you mull over how similar or dissimilar those systems sound, we will sound off on our thoughts below.
B: I’m interested to see what Luke has to say as we both have different schooling experiences. I attended public school K-12, with the exception of 6th grade. After some harrowing bullying experiences, my grandparents and mom home schooled me so I could focus on my studies sans broken bones.
After reading over HB 1222, I find myself agreeing with Sen. Joyce Elliot, who called it a “voucher bill that’s thinly disguised as a savings account.” And while voucher systems should not be unilaterally denounced, I will say that HB 1222 should be. There is a $10 million cap on the program in the first year. After the first year, there is no cap and the language in the bill says that all students on the waiting list must be funded, which means if this program is enacted it could expand rapidly. All this means is that there could be a small financial benefit to the state in the first year (if most of the students are drawn from the present public school system), but after the first year, due to the lack of cap, the impact stands to be largely negative on the general revenue, and in turn, the state budget.
I understand the desire to allow parents to have more involvement with their child’s education. It is something my parents exercised when I was homeschooled. However, we also need to take a moment to look at the bill as written.
I read some commentary rather recently from a representative from my hometown keep stressing “education savings account” and the separation of the account from general revenue, which the Governor himself say can’t be separated due to the impact on general revenue. And while I do not agree with Governor Hutchinson on many policies, it seems we both can see the proposed flow of cash as it ebbs away from our public school system.
L: Yes well, despite my bourgeois upbringing, I generally have negative feelings toward laws that strive to undermine public education. Systems like these assume a convenient private school is located nearby for each and every family, and generally only give the appearance of desegregating the rich and white from People of Color and the working class. Given that the average private high school tuition in the state is $5,798, it might appear that the $6,646 amount would guarantee access for all students equally.
It can be difficult to assess just how far the money stretches in different parts of the state, in large part because there doesn’t seem to be any tuition database for the entire state. The numbers that I could find for Little Rock, range in price from between $4,000 to nearly $10,000 for different schools, severely limiting the choices for lower income individuals, even with the extra money.
But this disregards the fact that a great many private schools are, above all, religious. Despite the memes I see, not all Americans are Christian. Yet the private schools available in the state are almost uniformly so. Having attended an Episcopal school that minimized religious influence and encouraged reading the Bible beside Greek myths as literary texts, I can’t speak to what a school that places a high importance on providing “the best Christian education” would be like.
My final criticism is that the law is confusing at best. Individual parents have to apply for an education savings account with a certified nonprofit and then the nonprofit has to make contributions to the account. As Brittany notes, this drains state revenues. But it also places the burden for finding such an organization on parents who will likely be working anyway, assuming the legislation actually helps its target audience.
So now that we have had our chance to dissect and discuss, please feel free to follow up with us for any comments, concerns, or questions! We look forward to taking on a new bill next week; until then, keep up the calls to representatives and government officials and let your voices be heard.
-Brit and Luke