'Tax-Credit Scholarships' Just New Name for Vouchers

Nothing involving vouchers, school choice and ALEC-drafted legislation is going to turn out well for students or our nation's education system. North Carolina is one of several states wrestling with legislation that would create a backdoor for corporations to fund scholarships (read: vouchers) through handpicked nonprofits. In North Carolina, the corporations could then receive tax credits to divert up to $40 million of their state taxes. In other words, these tax-credit scholarships, or "neovouchers" as University of Colorado professor Kevin Welner calls them, use public money to help corporations fund their pet school choice project.

As Welner explains in a column, there's crucial difference between conventional vouchers and these tax-credit scholarship programs, which are based on a model drafted by the American Legislative Exchange Council:

"With conventional vouchers, the state effectively bundles tax revenue and distributes it as vouchers. With neovouchers... the taxpayer and the nonprofits play that role, while the state backfills the funding, reimbursing the taxpayer.

Yet after all these machinations, the end result is almost unchanged. The state’s final budget still reflects the loss of tax revenue, and the voucher remains in place. The main practical difference is that neovoucher plans place parents at the mercy of taxpayers’ choices since those donors decide which organizations to fund. And since wealthier residents tend to be the ones who owe substantial state taxes, the decision-making authority is effectively transferred from low-income parents to high-income taxpayers."

Click here to read a recent piece for the Institute for Southern Studies detailing the forces behind the tax-credit scholarship legislation in North Carolina, where big money from pro-education choice organizations is pushing the political agendas of wealthy individuals and corporations. And click here to read an article from the New York Times details similar developments in Georgia.

Click here to read Welner's full column.

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