Arizona to Aid Special-Needs and Foster Children

Published September 1, 2009

The passage of a new law in late May and the strengthening of another in mid-July mean the end of a rollercoaster ride for hundreds of disabled and displaced children in Arizona.

This March the Arizona Supreme Court ruled the state’s two voucher programs, used by 473 foster and special-needs children statewide to attend private schools, was unconstitutional. The legislature responded by passing a bill creating a corporate tax credit scholarship program those children can use instead.

“We were devastated when they pulled the financing,” said Jeanne Zimmer, a Scottsdale resident whose 13-year-old granddaughter used a voucher. “We’re a retired couple, so the scholarship made it possible for Anne Marie to go from a public middle school over to Gateway School last year.”

Gateway Academy is a K-12 private day school in Scottsdale for highly functioning autistic children.

Very Special Session

By calling a special session to enact the new tax credit law, Gov. Jan Brewer (R), who signed the bill May 29, ensured families that qualified for the credits would have them in time to enroll children in their chosen schools this fall.

In addition, on July 13 she signed House Bill 2288, eliminating the “sunset” provision on the state’s three-year-old Corporate School Tuition Organization Tax Credit, which allows 2,000 low-income children to attend private schools. It also allows insurance companies, which pay premium taxes instead of corporate taxes, to participate in the tax credit program for the first time.

In addition to ensuring the program will continue beyond 2011, legislation raises the funding cap—$14.4 million during the 2008-09 school year—20 percent per year “into perpetuity,” said Andrew Campanella, director of communications for the Washington, DC-based Alliance for School Choice.

Brewer also approved HB 2287, which allows individuals to contribute up to $500 annually to School Tuition Organizations through weekly or monthly paycheck contributions instead of being required to pay it in one lump sum.

Bipartisan Kudos for Governor

Zimmer, a Democrat, attended the signing ceremony and said she was “horrified” that her own party “dropped the ball 100 percent.” Former governor Janet Napolitano (D) opposed the previous voucher program.

“Give [Brewer] kudos for picking up that ball where the Supreme Court dropped it and stepped all over it,” said Gateway Academy CEO Robin Sweet of changing the voucher program to a tax credit program.

“It definitely helps these families that have kids who are disabled and displaced,” agreed ChamBria Henderson, executive director of the Arizona Scholarship Fund in Mesa, who works with seven schools catering to special-needs students. “These kids have been on such a rollercoaster ride. To have had the rug pulled out from under them, then put back, then pulled out again, was terrible.”

Cap Retained

While the bill passed during this year’s special session will certainly help the 473 children the Arizona Supreme Court decision left twisting in the wind, it did not increase the $5 million cap on the program.

Arizona has 120,000 special-needs students and a higher cost of meeting their needs through smaller classes and more thoroughly trained teachers. “$5 million isn’t going to go very far,” Henderson said.

“Really [$5 million] is $30,000 for only 167 students,” Sweet agreed.

Money Saved

The individual tax credit program has been in effect since 1998. Since that time, the program has saved the state’s taxpayers $18 million in educational costs, said Charlotte Beecher, executive director of the Institute for Better Education, one of the state’s 501c(3) tax credit-distributing organizations.

Other than the restriction that funds raised by corporate contributions be directed only to students whose families qualify for the free- and reduced-price lunch program, Arizona allows the state’s nearly 50 scholarship-granting organizations much flexibility in dispersing the funds, said Tim Keller, an attorney for the Institute for Justice, who has defended Arizona’s school choice programs in court.

“That’s the real strength of this policy,” Keller said. “It allows the individual organizations to raise the funds and tailor their scholarships to the communities they serve.”

For example, scholarship-granting organizations run by Catholics employ stricter income-eligibility requirements than required by state law. Others restrict scholarships to students who reside in the same geographic area, Keller said.

Reports indicate the Arizona Christian School Tuition Organization raised more than $11 million in donations during 2007, the most recent figures available.

‘Sensible Answer’

Leaders of the state’s tax credit-distributing organizations say Arizona will lead the way when it comes to school choice.

“We just feel very strongly that school choice is the sensible answer to America’s concern about education excellence—from a financial standpoint, from parents having decisions about where their children attend school, and the communities themselves,” Beecher said.

Jim Waters ([email protected]) is director of policy and communications at the Bluegrass Institute for Public Policy Solutions in Bowling Green, Kentucky.

For more information …

Text of HB 2001:

Text of HB 2287:

Text of HB 2288:

“Arizona Supreme Court Delivers Stunning Blow to School Choice,” by Ben DeGrow, School Reform News, May 2009: