This week could determine whether Accountability Act tax credits reach rich or poor Alabamians
by Tim Lockette
tlockette@annistonstar.com
May 04, 2013 | 6769 views |  0 comments | 14 14 recommendations | email to a friend | print
MONTGOMERY — When the Alabama Accountability Act became law nearly two months ago, Donoho School president Jan Hurd saw it as something that could open up school choice to all.

Two months later, Hurd isn't quite as hopeful. Hurd expects the law to bring a handful of students — if any at all — to Donoho, a private college-prep school in Anniston. The Accountability Act’s $3,500 tax credit is less than half the school's approximately $8,000 annual tuition, and Hurd says the school won't accept the scholarships designed to give the poorest students an additional boost.

“We, being an independent school, do not want to accept any scholarship funding that would be a threat to our independence,” Hurd said.

Two months after the Accountability Act was passed, Hurd and other school administrators are still applying a lot of guesswork to their predictions about how the new law will play out. The law was designed to give students in "failing" public schools a tax credit — about $3,500 under its current formula — to attend another school, either public or private. But just who will qualify for the credit is still very much an open question. Also at issue: Will parents in poverty be able to afford private school tuition even with the credit — and will the schools even accept them?

Those questions could get some answers this week, as the Alabama Senate takes up a bill that could rewrite some of the Accountability Act's wording. The status of that act could determine whether the act becomes a handout for the affluent or a hand up for the poor.

East side, west side

"The bill, as it was explained to me, was a bill to help poor children get out of failing schools," said Sen. Arthur Orr, R-Decatur, a supporter of the original Accountability Act.

Orr said that when the new bill comes before the Senate next week, he hopes to add means-testing — essentially, setting an income cap to make sure the tax credit goes only to poor and middle-income families.

He didn't specify how high the cap might be, but Orr’s comments reflect a growing concern among legislators that the tax credit might put money primarily into the pockets of people who can already afford a private school education.

Numbers from the 2010 Census show how that could happen in Anniston. In the city's most affluent neighborhoods — largely white east-side communities where median incomes range from $36,000 to $56,000 — half of all school-age children were in private school in 2010. In majority-black west side neighborhoods, median incomes range from $11,000 to $26,000. Fewer than 1 percent of kids in those neighborhoods were in private school in 2010.

The city’s board of education operates five elementary schools, spread across town. But once they hit middle school age, all the city's students are zoned for Anniston Middle and Anniston High. If either school landed on the "failing" list, families in the higher-income neighborhoods could still qualify for the tax credit.

A key question remains unanswered for both parents and state budget writers: Will the tax credit apply to students already in private schools — or only to students in public schools who are looking to transfer?

The Accountability Act leaves that decision up to the state's Department of Revenue. The department has yet to render a decision.

"The Department of Revenue is reviewing the matter, and no final determinations have been made at this point," Carla Snellgrove, the department's spokeswoman, wrote in an email to The Star.

Sen. Del Marsh, R-Anniston, has said he doesn't believe the act, as currently worded, would grant the tax credit to kids already in private school — but he’d like it to. He told The Star last week that securing the tax credit for current private school students was the change he'd most like to see in the law.

The power to reject

There are also questions about whether poor students in failing schools would really be able to transfer out of their those schools.

The Accountability Act tax credit is refundable, which means parents will get the $3,500 even if they didn't pay that much in income tax. But many private schools, such as Donoho, charge more than that.

The authors of the Accountability Act seem to have foreseen a gap between the tax credit and tuition. The law set up a separate tax credit to allow people and corporations to give to a scholarship fund that would grant scholarships of up to $2,500 to families who need more than the $3,500. Other states have set up similar funds, run through nonprofit organizations, to avoid the legal entanglements that come with receiving state money.

But it's not enough to convince Alabama's private school administrators that they can take the money and keep their independence. Hurd of Donoho is also president of the Alabama Association of Independent Schools, and her organization is advising headmasters not to accept the scholarships.

Bob Philips, headmaster of Faith Christian School in Anniston, said he hadn't discussed the issue with his board of directors, but expected they'd choose not to accept the scholarships.

"When you accept money from the government, there's always strings attached," he said.

The Accountability Act would also allow students to transfer to non-failing public schools, even those out-of-district — but it's not clear that all students would be able to do that. Many Alabama cities, including Anniston, are under desegregation-era court orders that ban students from attending any school other than the one they're zoned for.

And schools may soon get the right to turn those transfer students away. A bill that would allow either public or private schools to reject Accountability Act transfer students passed the Alabama House of Representatives last week. So far, it’s the only change to the Accountability Act that has survived a vote in the Legislature.

When the bill was in the House, Rep. Barbara Boyd, D-Anniston, tried to add an amendment that would prevent schools from turning students down on the basis of race, religion, national origin or sexual orientation. The amendment never came to a vote.

"What the Accountability Act is going to do is re-segregate the schools," Boyd said.

Boyd said she has not yet found someone to introduce her proposal in the Senate, but it's likely that senators will fight out the possible changes to the Accountability Act as the House bill moves to the Senate this week.

Senators have little time to make those changes. Tuesday is the 28th day of the Legislature's 30-day session.

Capitol & statewide correspondent: 256-294-4193. On Twitter @TLockette_Star.
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