UNIVERSAL TUITION TAX CREDIT

Vicki Pate
Nikiski, AK
Jan. 25, 2003

The idea of school choice is straightforward. By allowing parents a range of educational choices and requiring schools to compete with one another for the opportunity of serving their children, we can bring to education the same advances and efficiencies that the free market has brought to so many other endeavors. Those schools that do a good job will thrive. Those that do a poor job will either have to improve, be taken over by their competitors, or closed. As an added benefit, those educators who succeeded in providing a quality product would also reap all the personal, professional, and financial rewards that their important work deserves. Those who failed would be encouraged by the market to find other careers.

Our current system of state-run schools has been around for so long that we no longer are able to distinguish between the fundamental ideals of public education and our current institutions of public schooling. Some people see school choice as a promising reform, but others see it as an attack to the whole idea of public education.

If we are truly committed to the ideals of education, then we should be ready to pursue those goals by the most effective means possible. The goal should be that all children should have equal access to good schools. What constitutes a good method of delivering educational instruction will vary with each student. It is almost impossible to provide a one-school-fits-all model education. Trying to be all things to all people has resulted in the expensive, cumbersome system we now have.

If a school system that is based on parental choice and competition can do a better job of fulfilling both our social goals AND our individual needs, don't we owe it to our children to make that system as widely available as possible?

While Alaska constitutionally mandates funding of public education, Borough government funds a substantial share of the individual student's tuition in those areas of the state with organized local government. Property taxes are the preferred method of revenue collection. I propose allowing the Boroughs to locally adopt a tax credit for education to be taken against the Borough property taxes: dubbed Universal Tuition Tax Credit (UTTC). I have been told that underlying state legislation is required to allow any such tax credits on a local level. I seek your aid in promoting such a bill. To aid this process, more information can be found here. Joining the group is free, and together we can make a difference.

Anyone - individual or business - that pays tuition for a child in an independent school would be able to take a credit against their local property taxes. Education occupies the lion's share of the local budget. The maximum credit should not exceed the percentage currently going to school funding. Parents would be able to keep more of the money they themselves earned, and thus more easily afford tuition payments. Vouchers require a bureaucracy to administer payments. Tax credits require a minimum of paperwork and red tape.

Even families who pay little or no property tax can benefit from such a program. Businesses (who may not want to keep track of individual student's tuition) and other individual taxpayers may make donations to private scholarship funds, and claim a credit against their own taxes. These private scholarship funds would then distribute that money to families, paying some or all of their tuition at the independent schools of their choosing.

Universal Tuition Tax Credit would insure that no taxpayer is forced to subsidize any religious education. All the money is private money - it was never collected in taxes in the first place - so there is no entanglement of church and state. Non-religious businesses and individuals could make donations to strictly secular scholarship funds. Alternately, religious citizens could contribute to scholarship funds that catered to parochial schools.

In any case, there would be no need for extensive government involvement in the operation of either secular or religious private schools, since there would be no direct government funding. Bureaucratic red tape and inertia of large government enterprises are rightly blamed for a great deal of the existing problems with public schools. This would keep private schools independent, efficient and cost-effective.

Early concerns were that educational choice would "skim the cream off " of public schools by removing the brightest students and the most involved parents. Numerous independent studies have been conducted (references on request) to find that freely chosen private schools are better integrated to race and socioeconomic status than public schools. The well to do have always had school choice. They opted to pay for their children's education in addition to the public school system that they funded but did not utilize. Poor people understand that a good education is their ticket out of poverty, and they are eager to escape the public education system, as shown in the voucher program of Milwaukee, Wisconsin and other cities.

As Milton Friedman, Nobel Prize winner in Economics stated, "If you subsidize wheat, you get more wheat. If you subsidize rice, you get more rice. If you subsidize irresponsibility, you get more of that, too." By instituting a method of school choice using tax credits, we can begin to reward parents when they take responsibility for their children's education. Once parents take responsibility for their education, it empowers them to be responsible in other areas also. This would be a great boon to our Alaska.

Last, but certainly not least, our state spends about a Billion dollars yearly for education. A Universal Tuition Tax Credit would not affect the constitutionally mandated school funding. However, if there were substantially fewer students in the public education system, there would be a resultant smaller number of students requiring funding. Additionally, when the public schools compete with private education, a more efficient, leaner public school could emerge. America has long been heralded as the shining star of the free market. It's time we applied the same techniques to education in Alaska.

[An excellent web site with specific information on the Universal Tuition Tax Credit idea is www.mackinac.org. More information on the private scholarship funds mentioned can be found at www.childrenfirstamerica.org. There are quite a few in operation all across the country.]