{"id":461,"date":"2017-01-26T13:43:25","date_gmt":"2017-01-26T13:43:25","guid":{"rendered":"http:\/\/arknews.org\/?p=461"},"modified":"2017-01-26T17:00:28","modified_gmt":"2017-01-26T17:00:28","slug":"bill-to-establish-education-savings-accounts-draws-skepticism-from-superintendents-governor","status":"publish","type":"post","link":"https:\/\/arknews.org\/index.php\/2017\/01\/26\/bill-to-establish-education-savings-accounts-draws-skepticism-from-superintendents-governor\/","title":{"rendered":"Bill to establish education savings accounts draws skepticism from superintendents, governor"},"content":{"rendered":"
\"\"
CONCERNED: Rep. Bruce Cozart (R-Hot Springs) says he doesn't want to take money away from public schools and put it in private schools.<\/figcaption><\/figure>\n

 <\/p>\n

A bill that would establish education savings accounts in Arkansas is breaking new ground in school choice legislation, according to its sponsor. But critics \u2014 including the state\u2019s influential school superintendent association \u2014 say it could pose major fiscal problems for Arkansas if passed in its current form.<\/p>\n

House Bill 1222<\/a>, filed by Rep. Jim Dotson (R-Bentonville)<\/strong><\/a>, combines two tactics used by lawmakers in other states who favor school choice: the creation of a savings account to be used at a parent\u2019s discretion to fund private school and other education costs, and the use of a tax-credit scholarship in which individuals and corporations can\u00a0donate to a nonprofit organization that provides money to parents seeking a private or home school education for their children.<\/p>\n

\u201cThis is the first time that those two models have been blended into one program,\u201d Dotson said. \u201cWe will be the first in the nation where education savings accounts are funded through a tax credit.\u201d<\/span><\/p>\n

In Arkansas, the largest portion of the cost of a public school student\u2019s education is covered by what\u2019s called \u201cfoundation funding\u201d \u2014 a mixture of state general revenue and local property taxes that the state collects and then remits to local school districts. The legislature has established foundation funding at $6,646 per student. When a student leaves a public school for a private school, the foundation funding does not follow the student. The student\u2019s former public school district does not receive foundation funding for that student the next year. <\/span><\/p>\n

HB 1222 would not directly divert public education funding to private schools, as some voucher programs in other states have done<\/span>. <\/span>Instead, dollars that would have otherwise entered state general revenue in the form of income tax would be diverted to the nonprofits administering the education savings accounts. Those nonprofits would then be able <\/span>to transfer an amount of money equivalent to foundation funding for each academic year into an eligible student\u2019s account.<\/span><\/p>\n

\u201cThere are no state dollars tied to it,\u201d Dotson said. \u201cThere is no actual check written from the state because it\u2019s revenue that was never collected.\u201d<\/span><\/p>\n

But while the state may not pay for the savings accounts directly, the money will be offset by tax credits. Contributors to the nonprofits that administer the savings accounts would receive an income tax credit from the state of Arkansas equal to their donation. The donation would also qualify for a federal income tax deduction.<\/span><\/p>\n

A legislative impact statement<\/a> released by the Department of Finance and Administration found the bill would lead to a $10 million reduction in state general revenue from July 2017 to June 2018. \"For subsequent years the total impact is unknown. The bill provides a growth mechanism that is unclear,\" according to the impact statement.<\/p>\n

Rep. Bruce Cozart (R-Hot Springs)<\/strong><\/a>, who chairs the House Education Committee, said he has concerns about where the money would come from and how much the program could grow each year. \u201cWhen you give tax credits, you lose general income, your general revenue goes down,\u201d Cozart said.<\/span><\/p>\n

\u201cI\u2019m a choice person,\u201d he\u00a0said, \u201cbut I don\u2019t want to take it away from public schools \u2026 and put it in private schools.\u201d<\/span><\/p>\n

Critics of the bill say the education savings accounts are a voucher program. School vouchers use state money to fund scholarships that pay for students to attend private school.<\/span><\/p>\n

\u201cIt\u2019s a voucher bill that\u2019s thinly disguised as a savings account,\u201d said Sen. Joyce Elliott (D-Little Rock)<\/strong><\/a>, who vice-chairs the Senate Education Committee. \u201cYou can call it whatever you want, but if the effect is we\u2019re taking money out of the public school coffers to be used for private reasons, then you know it is a voucher.\u201d<\/span><\/p>\n

Parents could use the money in the education savings account to fund tuition at a private school as well as for other education expenses, including uniforms, books, tutoring services, transportation, examination fees and even college, since unused money\u00a0in a savings account would carry over to the next year.<\/span><\/p>\n

There\u2019s a $10 million cap on the program in the first year, which means, if it is fully funded by contributors\u2019 donations, about 1,500 students selected by a lottery could participate in 2017. The lottery is weighted for students who receive free or reduced-price meals under the National School Lunch Act.<\/span><\/p>\n

\u201cIt\u2019s absolutely not a voucher program,\u201d said Sen. Bart Hester (R-Cave Springs)<\/strong><\/a>, a co-sponsor of the bill. \u201cIt\u2019s not taking one dollar away from public schools.\u201d<\/span><\/p>\n

Supporters point to a working paper<\/a> recently released by the Department of Education Reform<\/strong> at the University of Arkansas that found the bill could result in a small financial benefit to the state overall in its first year. That would be the case only if a majority of education savings account students are drawn from the existing public school population. Otherwise, the paper projected the program would\u00a0have a negative impact on state revenue. In addition, the paper only looks at the first year of the program, when there is a $10 million cap on tax credits.<\/span><\/p>\n

The program has the potential to expand dramatically in the second year because there is no financial cap set after the first year and because the bill says all students on the waiting list must be funded, in addition to the students who received accounts in the first year.<\/span><\/p>\n

Currently, about 30,000 students attend private school in Arkansas. Richard Abernathy, <\/strong>executive director of the Arkansas Association of Educational Administrators, which represents school superintendents, said he worries that all of those students will apply for education savings accounts and those who aren\u2019t funded this year will be added to a waiting list to be funded next year.<\/span><\/p>\n

\u201cThe second year, all bets are off. The state will be losing money, period,\u201d Abernathy said. \u201cI would just about bet everything that 30,000 kids will be applying for that because they already attend private schools. Why wouldn\u2019t they apply for that?\u201d<\/span><\/p>\n

Governor Hutchinson<\/strong> also expressed concerns about the bill. \u201cI\u2019ve always been in support of parents and students having choice in education,\u201d Hutchinson said in a statement. \u201cAs for this particular <\/span>piece of legislation, I am concerned that the use of tax credits will have a significant, negative impact on the budget.\u201d\u00a0<\/span><\/p>\n

\u201cIt\u2019s still a great bill,\u201d Dotson said,\u00a0<\/span>\u201cThe program is supposed to be designed to grow slowly over time.\u201d Dotson said in other states with similar programs, there has been only a little growth in the first year or two. \u201cThe vast majority of people stay in their public schools.\u201d<\/span><\/p>\n

Benji Hardy contributed to this report.<\/i><\/b><\/p>\n","protected":false},"excerpt":{"rendered":"

A bill that would establish education savings accounts in Arkansas is breaking new ground in school choice legislation, according to its sponsor. But critics \u2014 including the state\u2019s influential school superintendent association \u2014 say it could pose major fiscal problems for Arkansas if passed in its current form.<\/p>\n","protected":false},"author":4,"featured_media":467,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[22],"tags":[],"class_list":["post-461","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-arkansas-general-assembly"],"yoast_head":"\nBill to establish education savings accounts draws skepticism from superintendents, governor - Arkansas Nonprofit News Network<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/arknews.org\/index.php\/2017\/01\/26\/bill-to-establish-education-savings-accounts-draws-skepticism-from-superintendents-governor\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bill to establish education savings accounts draws skepticism from superintendents, governor - Arkansas Nonprofit News Network\" \/>\n<meta property=\"og:description\" content=\"A bill that would establish education savings accounts in Arkansas is breaking new ground in school choice legislation, according to its sponsor. 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