Private Schools Using Tax Dollars to Fund Scholarships Intended for Low Income Student to Offset Tuition Costs of High Income Students

But The Schools Are Sponsored by Religious Organization, So By Definition What They Are Doing is Not Wrong

Thanks to Jared Bernstein’s excellent Forum on Economics we are directed to a New York Times story that exposes how private, mostly religious affiliated schools are distorting a program designed to help poor student attend private schools.  Basically the deal is this.

States have enacted programs that provide for tax credits for individuals and/or corporations to donate money for a scholarship for children of low income families attending public schools to attend private schools.  Even though much of the scholarship money and diversion of public funds goes to schools that actively promote a religion, the Supreme Court has blessed this practice.

It turns out that in some, but not all instances both the schools and the parents have devised ways to divert the money so that the parents of children already in these private schools receive the benefit, even though that was not the intention or the desire of the program.  Georgia, with it strong base of religious voters is one of the prime perpetrators of the misuse of the program.

The program would be supported by donations to nonprofit scholarship groups, and Georgians who contributed would receive dollar-for-dollar tax credits, up to $2,500 a couple. The intent was that money otherwise due to the Georgia treasury — about $50 million a year — would be used instead to help needy students escape struggling public schools.

That was the idea, at least. But parents meeting at Gwinnett Christian Academy got a completely different story last year.

“A very small percentage of that money will be set aside for a needs-based scholarship fund,” Wyatt Bozeman, an administrator at the school near Atlanta, said during an informational session. “The rest of the money will be channeled to the family that raised it.”

And it is not just parents and students who were not intended as beneficiaries of the program that are benefiting.  Organizations have sprung up which take large sums of money just to administer the program.

A cottage industry of these groups has sprung up, in some cases collecting hundreds of thousands of dollars in administrative fees, according to tax filings. The groups often work in concert with private schools like Gwinnett Christian Academy to solicit donations and determine who will get the scholarships — in effect limiting school choice for the students themselves. In most states, students who withdraw from the schools cannot take the scholarship money with them.

What is going on of course is that supporters of using tax dollars to support religious education have found a clever way to exploit a program aimed at helping low income families and use the money for promoting religion.

Most of the private schools are religious. Nearly a quarter of the participating schools in Georgia require families to make a profession of religious faith, according to their Web sites. Many of those schools adhere to a fundamentalist brand of Christianity. A commonly used sixth-grade science text retells the creation story contained in Genesis, omitting any other explanation. An economics book used in some high schools holds that the Antichrist — a world ruler predicted in the New Testament — will one day control what is bought and sold.

And regardless of what the Supreme Court has said in his support of using tax dollars to support religion, this is clearly diverting public tax dollars to preach.

Surprisingly, Florida is a state where strict controls may have prevented much of the abuse.

In Florida, where the scholarships are strictly controlled to make sure they go to poor families, only corporations are eligible for the tax credits, eliminating the chance of parents donating for their own benefit. Also, all scholarships are handled by one nonprofit organization, and its fees are limited to 3 percent of donations. Florida also permits the scholarships to move with the students if they elect to change schools.

Far from being ashamed at ripping off the system, those doing it in the name of ‘religion’ are proud of what they are doing.  One part of the scam is for a parent with a child already in private school to ‘enroll’ the child in public school with no intention of actually sending the child to public school, but technically qualifying for the program.

The idea, based on a technical interpretation of the word “enroll,” was promoted by State Representative David Casas, a Republican and co-sponsor of the scholarship legislation in Georgia. In meetings with parents, he had explained that the bill’s wording was intentional — using the word “enrolled” rather than “attending” — to enable the scholarships’ use by students already in private schools.

Parents questioned the idea. “Aren’t people going to say that’s a scam?” asked one father during a presentation by Mr. Casas that was posted on YouTube. “ ‘You’ve been going here for nine years. Now you’re enrolling in public school? You’re enrolled in two schools?’ ”

Mr. Casas, the president of a seminary, assured him it was not a scam. “Feel fine about it,” Mr. Casas said.

As noted, Mr. Casas is head of a seminary and probably considers himself a very righteous person.  The rest of us think that if there is some truth to the story that the “anti-Christ will someday control what is bought and sold’ as cited above from an Econ textbook, then maybe what it was talking about was Mr. Casas.  Isn’t diverting money from low income families that was designed to give their kids a better education and using it for middle and high income families to support their kids who are already in private schools something an “anti-Christ’ might do?  Really, it’s probably right there in the “Handbook for the anti-Christ”.