BY BILL DUNCAN
This article originally appeared in the New Hampshire Business Review
Supreme Court ruling means the tax credit program may continue for the moment, leaving the state with a fiscal liability of uncertain size for a program with no legitimate public purpose
Before the misunderstanding spreads too far, it is important to point out what the recent New Hampshire Supreme Court decision actually said about the constitutionality of the voucher tax credit law: Nothing.
The voucher tax credit program, passed by the 2012 O’Brien Legislature over the veto of Gov. John Lynch, provides up to $6 million per year in business donations for tuition vouchers averaging $2,500 each to enable New Hampshire students to leave public schools and attend private schools or, with smaller subsidies, home schools. Virtually all contributions a business makes can be offset by the tax benefits it receives.
In its 15-page decision, the court said nothing about the merits of the case itself. It said nothing about the constitutionality of funding New Hampshire religious schools through the side door, disguised as a tax credit.
The question is still out there waiting to be decided.
What the court did unanimously agree on is that the 2012 New Hampshire statute allowing any taxpayer to challenge unlawful governmental conduct is unconstitutional. The court said that, we, the plaintiffs, had not been personally harmed by the tax credit and therefore could not challenge it.
The court’s decision means that the voucher tax credit program may continue for the moment, leaving the state with a fiscal liability of uncertain size for a program with no legitimate public purpose.
Importantly, the Legislature does not have a reliable way to budget for this program.
The current budget provided very little for the program because there has been so little donor interest in using the tax credits. (No surprise — there was no apparent business support when the legislation was being considered.)
What about the next budget? Should the Legislature set aside the full $5.1 million the law authorizes to fund the tax credits in each of the next two years? Or the $50,000 in tax credits claimed by the program this year? Or something in between? Whatever the Legislature does set aside is not available to fund anything else.
The problem is that the cost of the program is not under the Legislature’s control. I hear legislators and reporters say, “The voucher program is small — why even worry about it?” That’s true. It is minuscule today. But the Legislature has written New Hampshire private schools a blank check for up to $5.1 million this year, possibly more in the future. Any time groups of schools want to get together and create scholarship organizations to provide their donors a tax break, that blank check is waiting for them.
The question isn’t really whether the program is so small as to be harmless. The policy question is still whether a state with so little revenue should pay for private, religious and home schools that are not accountable to the citizens of the state for their educational results.
Voucher proponents make the heartstrings argument that their goal is to help poor families. This is a requirement the House sponsor of the bill accepted under protest while emailing a supporter that his real goal was to pay as little as possible to “entice that student out of the Govt [SIC] school” and get “as many students as possible out of the ‘system.’”
I think the citizens of New Hampshire have a much different vision. I think we are committed to doing everything we can to educate those New Hampshire children who arrive at our schools with the fewest advantages. I know our public schools are.
But it’s a big job. Over 45,000 of our students are in low income families who might qualify for free or reduced cost lunches this year. Paying private schools to take a few of these children is not a serious policy response to their needs.
But imagine if the $10.2 million potentially going to vouchers in the next two years went to pilot efforts to provide high quality pre-K and other programs that would prepare all children to do well in school.
That would be a starting point to demonstrate what we could really do to provide the best education for New Hampshire children.