This follows a separate lawsuit brought by the ACLU in September against the state’s business donation tax credit, which allows businesses to donate money to organizations that provide scholarships to low‐income children. The outcome of these two cases will reveal the future of school choice policy. Although the two voucher programs might fall in battle, education tax credits are likely to survive and continue to advance school choice.
Arizona is the center of school choice politics, with one of the strongest charter school laws, both personal and business tax credits, and two voucher programs – by far the largest range of effective school choice programs in the country. Arizona has also pushed the three choice programs under attack through a democratic Governor, Janet Napolitano. Opponents of school choice have chosen to attack their biggest and fastest‐growing threat, trying to stop the snowball from rolling on in Arizona. And since the legal issues at play are largely the same across much of the country, one can say that as goes Arizona, so goes the country.
This is the first time that the education establishment has dared to turn its fire on school choice programs that help disabled and foster‐care children. That they have chosen to unleash the hounds on the most sympathetic beneficiaries of school choice is a sign of panic. School choice opponents have kept their hands off similar programs in the past, fearing backlash for throwing disabled children out of their schools. But although the sympathy factor seems to have made the difference in some past battles, such as the Ohio Supreme court decision upholding vouchers in 1999, both lawsuits will turn on the same few fine points of law.
Education tax credits are much better positioned to withstand the suit. In Kotterman vs. Killian (1999), the Arizona Supreme Court upheld personal donation tax credits in a 3–2 ruling, based primarily upon the fact that tax credits are not “public funds” and therefore cannot violate constitutional restrictions on the use of government funds. On this point, they are joined by every other state court that has ruled on the issue. Although the current Arizona court sits different justices, it is unlikely that they will overturn such a strong and recent precedent. Tim Keller, executive director of the Arizona chapter of the Institute for Justice, a civil liberties law firm, and an attorney defending the choice programs, says that a “decision overturning Kotterman would be shocking.”
The Kotterman decision provides hope for the voucher programs as well. Although there is no dispute that education vouchers constitute “public funds,” the funds are given to parents, not to schools. The Kotterman opinion ruled that the intervening step of parental choice among both religious and secular options means the funds benefit the children, not a religious school they may happen to choose. The U.S. Supreme Court found the voucher program in Ohio constitutional on similar grounds, as did the Wisconsin Supreme Court.
Although the voucher program has more hurdles to clear, all three programs should be upheld as constitutional. Anything less would be an ideological misreading of the law. The forces of educational stagnation will fail in their attack on school choice in Arizona, and this will be the beginning of their end.