Editorial: End the cap on private school scholarships

Posted 9/21/22

In many cases where demand exceeds supply, forces realign and come into balance. Unless something like the Rhode Island General Assembly stands in the way.

Through a little-known program created …

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Editorial: End the cap on private school scholarships

Posted

In many cases where demand exceeds supply, forces realign and come into balance. Unless something like the Rhode Island General Assembly stands in the way.

Through a little-known program created 15 years ago, Rhode Island corporations, both large and small, can channel would-be tax dollars into private school scholarships for families in need. In simple terms, the businesses make philanthropic donations to the financial aid programs of local private schools, and they receive most of that value back in tax credits with the state. So instead of paying $100,000 in tax to the state, a business might send $100,000 to private school scholarships and receive a $90,000 credit toward its state taxes. The $100,000 is distributed by the schools to students from families living within 250% of the federal poverty line.

The Rhode Island Scholarship Tax Credit program is detailed in a story inside this week’s “Guide to Private Education,” with a description of the lottery-like atmosphere that occurs every July in a nondescript conference room at One Capitol Hill, Providence. There, a handful of private school admissions and development directors gather with a few state officials and watch as numbers are pulled from a bin, bingo-style. Each number represents a business whose donation has been accepted. Each called number triggers joy or anxiety for the anxious schools.

The lottery — state officials prefer to call it a “drawing” — is necessary because there is a cap on the total tax credits available each year. The maximum is $1.5 million. Once that level of donations has been reached, the program is closed.

This past July, 59 businesses submitted applications to participate in the program. Only 16 were accepted. The potential scholarship fund was nearly $3 million, but the state shut the door at half that amount.

Considering the vastness of its $13.6 billion annual budget, the state could survive the loss of .01% of its revenue — especially when that money is going to a worthy cause.

Detractors criticize the program for indirectly taking money away from public schools. However, it is clear that public schools cannot meet the needs of all students. In fact, if thousands of private school students suddenly flooded back into public school settings, the system would collapse. In addition, many private schools can successfully teach students in ways the public schools cannot. And the scholarships are not going to the wealthy and elite; they are going to families who could not afford a private school tuition on their own. They can open doors for families living in the chronically failing Providence School District.

Last year, 496 students received scholarships through the program. By doubling the tax credit cap to $3 million, the General Assembly could double the impact. The demand is there. The state should loosen the supply.

2022 by East Bay Media Group

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Scott Pickering

Scott Pickering has been on the East Bay Media Group team for more than two decades, since starting as a reporter for the Sakonnet Times. He's been editor of most of the papers, was Managing Editor of all the papers for many years, and became General Manager in 2012. Today he can be found posting to EastBayRI.com, steering news coverage, writing editorials, talking to readers, working with the sales team, collaborating on design, or helping do whatever it takes to get the papers out the door. Reach him at spickering@eastbaymediagroup.com.