Florida Governor Signs School Choice Expansion, Lawsuit Follows

Published May 14, 2014

Gov. Rick Scott signed an expansion of Florida’s tax-credit scholarship program, allowing partial scholarships to private schools for families that earn a little too much money to be eligible for a full scholarship. State teachers unions quickly filed suit against the law, which also creates an education savings account program for special-needs students.

The bill also placed tighter restrictions on scholarship nonprofits.

“Overall it’s a good thing,” said Patrick Gibbons, public affairs manager for Step Up for Students, a nonprofit that administers scholarships. “What’s important here is the program will serve more children and provide those students with larger scholarships.”

Florida’s tax-credit scholarship is not a voucher program, which was ruled unconstitutional in Florida in 2006 except for special-needs students. Instead, the tax-credit scholarship allows corporations to donate to a nonprofit, which then provides scholarships for low-income students to attend private schools. Corporations can take state tax credits for those donations. Scholarships are thus funded through incentivized private donations instead of public money.

The education savings accounts (ESAs) function more like a voucher, but they let parents divvy up their child’s state education money among various opportunities such as classes and therapy, whereas vouchers only purchase tuition from one school. The union lawsuit alleges including both the expansion and ESAs in one bill violates a provision in the state constitution that limits how many topics a given bill can cover. Scholarship nonprofits will administer the education savings accounts.

By law, $358 million can be awarded in scholarships this year. If at least 90 percent of that amount is raised and all available scholarships are given out, the program can grow again next year. It has grown every year since this “escalator” system was created.

More Needy Families Eligible
Under current law, students enter the scholarship program if their families earn up to 185 percent of the federal poverty level. They can continue receiving the scholarship as long as their families are below 230 percent of the federal poverty level.

With the new bill, students will be eligible for new scholarships and renewed scholarships if their family’s income is up to 260 percent of the poverty level. Students from families earning 200 to 260 percent would receive a partial scholarship, ranging from 50 to 88 percent of the full scholarship amount. This would become effective for the 2016-2017 school year.

The federal poverty level is $23,850 for a family of four.

The new bill would allow more children to move into the scholarship program if they have previously attended private schools. Current law allows foster children to participate, but the bill expands eligibility to children placed with grandparents, neighbors, or others who don’t have state foster care licenses. Foster children who are adopted can keep their scholarships.

Scholarship-granting nonprofits will be subject to a second annual audit.

Article reprinted with permission.Image by Kentucky Country Day School.