Arizona School‐​Choice Plan Provides Model

This article appeared on USATO​DAY​.com on August 22, 2001.
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Tinika Malone is a 31‐​year‐​old single mother with four beautiful daughters. Unbeknown to her, she’s also on the front lines of a national debate over the future of public education.

Two years ago, Malone had little control over her girls’ education. She wasn’t happy with her local public school, Larry C. Kennedy Elementary in Phoenix. But Malone and her girls had no practical options. At the time, she had only a temporary job, and her modest salary wasn’t enough to relocate or pay private‐​school tuition on top of such necessities as food and rent.

All of that changed when a friend gave her an application for the Arizona School Choice Trust. Malone applied and received private scholarships that allowed her to send her children to a school of her choice. Her girls are now thriving at a local private school.

Malone’s story may represent the future of school choice. The role of tuition vouchers is in doubt. Major voucher initiatives were defeated last fall in Michigan and California, and a modest voucher component was cut from President Bush’s education package. The tax credit in Arizona that helped Malone may now be the best hope for families seeking parental school choice.

The program lets taxpayers donate up to $500 to non‐​profit‐​scholarship groups and at tax time receive the money back, dollar for dollar. The scholarship organizations pool the donations and award them to needy students. Arizona’s scholarship credit has raised more than $32 million and funded more than 19,000 scholarships since its 1997 inception.

Under the law, each organization sets the size of the scholarship and eligibility standards; generally, organizations base scholarships on financial need. Some provide scholarships for use at schools affiliated with particular religions or instructional methods, such as the Jewish Community Day School Scholarship Fund and the Foundation for Montessori Scholarships. Others, such as Arizona School Choice Trust, give scholarships for use at any school in the state.

That diversity highlights an important benefit of the tax credit. Unlike vouchers, which rightly or wrongly are seen by critics as using public funds to support private religious schools, the tax credit is immune to such charges. Donations are private and voluntary, similar to the federal deduction for charitable giving to such groups as the Ronald McDonald House or a local parish.

The tax credit is also good for taxpayers. When a student uses a scholarship to transfer from public to private school, the money that would have been spent on that student’s public education is freed up. Those resources can then be reinvested in public education, for instance, or returned to taxpayers as tax cuts. Moreover, student transfers reduce class sizes and lessen the burden on crowded public schools. The savings from transfers have already offset the credit’s cost, and projections show the credit should save Arizona’s taxpayers millions more over time.

But Malone will tell you the real effect of the program: “It has changed my girls tremendously. Kiara had earned an F in spelling in her public school, and by the end of the first year at the academy, she got an A. Not only have her grades improved but her whole attitude is different.”

Because the scholarships cover only part of tuition, Malone still makes a financial sacrifice for private school, paying $150 per month to cover the remainder of the tuition. But she thinks it’s worth it.

Other kids are worth it, too. School‐​choice supporters should renew their efforts to put choice back in the forefront of the education debate by highlighting the success of Arizona’s education tax credit.

Carrie Lips

Carrie Lips, a former policy analyst at the Cato Institute, holds a master’s degree in public policy from the John F. Kennedy School of Government at Harvard University.