Bill Would Encourage Private Education … With a Catch

The state of North Carolina spends just over $5,600 per year for each student enrolled in public schools. A bill sponsored by House Minority Leader Paul Stam, R-Wake, offers to split that cost with parents who take their children off the public school rolls and educate them elsewhere.

House Bill 355, the Tax Fairness in Education Act, would grant a refundable tax credit of $1,250 per semester for students who had been enrolled in the public school system but are withdrawn in favor of nonpublic alternatives. Stam introduced a similar bill in the last session, but it never made it out of committee.

The idea of public support for nonpublic education in the state goes back at least to 1956, when a voucher program for private schools was established to address concerns over desegregation. No vouchers ever were awarded, and the program was canceled in 1969.

Since then, numerous bills have been filed to encourage the nonpublic education option, both through conventional private schools or homeschooling. These have included a tax deduction for homeschooling families, vouchers for private schools, tax credits for either, and even measures which would increase public school funding in proportion to the number of students who went elsewhere. None of these bills has passed either chamber.

In a March press conference, Stam addressed critics who said the tax credits would use public money to finance private schools, some of them with religious affiliations.
He noted that the widely accepted Smart Start program for preschoolers and the Legislative Tuition Grant for college students support secular and sectarian institutions. Moreover, he said, “according to Fiscal Research, [tax credits] save money, on a recurring basis.”

The fiscal analysis attached to the bill says the measure could save the state as much as $35 million annually, and potentially $25 million more at the district level. North Carolina already avoids over $1 billion in educational expenditures every year due to 169,000 students now being taught at home or in private schools. The present bill has nothing to offer those already outside the public school system.

Dr. Joe Haas, the executive director of the N.C. Christian Schools Association, said it might make sense if the tax credit were extended to all nonpublic students, not just those exiting the public system, “[if] you understand the argument and the fact that parents with children in nonpublic schools are paying twice through their property taxes,” he said.

Stam said the provision which limits the credit to students who were in public schools first was a compromise to assist the bill’s passage; ideally, he said, “I’d take out the sentence about public school.” A similar bill he offered in 2005 did not include this restriction and did not pass.

The unusual 10-page length of the fiscal analysis is due largely to the question of how many additional families will choose nonpublic education if the financial incentive was available. The Fiscal Research Division concluded somewhat vaguely that between 4,800 and 13,100 tax credits would be awarded the first full year. They also estimated private school tuition would average $9,698 per year.

Linda Nelson, the executive director of the N.C. Association of Independent Schools, estimated their member schools’ annual tuition averages close to $10,400, but said while some approach $20,000 per year there were several in the $4,500 range. A large percentage offer significant financial aid already, she said, and a state tax credit would extend the ability of middle class families “who are stretched already” to afford private school.

NCCSA’s Haas said the proposed $2,500 credit would cover most of the average $2,980 tuition reported by their member schools in 2008, but financial considerations may not be foremost in families’ decisions.

“I would hope that parents who enroll in a Christian, religious school are there for that kind of education,” he said.

Maurice Adams is a Raleigh father with a child in a Christian school K-5 program. While their son has done well this year, Maurice and his wife are considering homeschooling partly due to cost; at $450 a month for one child and a younger sister close behind, he said, “it’s already skinny with just the one.” As Haas suggested, though, the decision will not hinge on whether a tax credit is available or not.

“When I look at the mechanisms that affect my family and children and weigh the benefits for their academic and spiritual development, my mind is already made up for nonpublic education,” Adams said.

Some critics have charged that even a limited tax credit will be the start of much larger programs later on. Darrell Allison of Parents for Educational Freedom North Carolina says that concern is misplaced.

“The illustration of the camel’s nose is catchy, but we’re not talking about animals here,” Allison said. “We’re talking about children whose backs are to the wall, and families who are struggling to provide what the Constitution says the state will provide — a quality education for their children.

“We say forget the camels — let’s bring in the sheep, donkeys, and everything else, to make that happen,” he said.

Hal Young is a contributor to Carolina Journal.