MONTGOMERY — While thousands of students are receiving scholarships funded by tax-deductible donations to attend private schools under the Alabama Accountability Act, 140 parents received a tax credit in 2015 for moving their children out of a failing public school.
The number of tax credits has increased from 94 in 2013, the first year of the act, and 125 in 2014. The total value of tax credits rose from $169,373 in 2013 to $380,851 last year, according to the Alabama Department of Revenue.
The Alabama Accountability Act was passed in 2013, and supporters said it would help low-income students get out of low-performing public schools. It provides a tax credit to help students transfer from failing schools, as determined by the legislation. There is also a $30 million per-year scholarship fund, but students don’t have to be from failing schools to receive that money. Opponents of the act have said it is diverting money from the state’s education budget and is not truly helping the students in the state’s worst-performing schools.
Businesses and individuals who donate to the scholarship fund receive income tax credits. In 2015, 833 individuals claimed the tax credit for a total of $4.9 million, according to Revenue.
As for the corporate contribution tax credit, four worth about $33,000 had been claimed as of last week, but a Revenue Department spokesperson said that number is likely to increase. About 1,200 corporations donated about $25.8 million to the organizations that handed out the scholarships in 2015, according to the Revenue Department.
Donors can use the tax credit for up to 50 percent of their total tax liability in a given year and carry forward the unused credits for up to three years.
In 2014, credits worth $5.1 million were claimed; in 2013 it was $19.5 million.
A recent report by the Institute for Social Science Research at the University of Alabama said about 4,115 low-income students received scholarships in the 2014-15 school year. About 32 percent were zoned to attend a failing public school, though that doesn’t mean they were enrolled in one.
Budget group to meet
The new Joint Legislative Task Force on Budget Reform will meet for the first time Wednesday at the Statehouse. It was created in the recent special session of the Legislature to study existing budget practices and suggesting possible changes, such as unearmarking state revenue and ending some tax credits and deductions.
The 14-member panel includes Sen. Bill Holtzclaw, R-Madison, and Rep. Anthony Daniels, R-Huntsville.
The group will report findings and recommendations to the Legislature early next near. Lawmakers have had three budget-focused special sessions in the last two years, and the state’s General Fund struggles aren’t expected to improve in 2017.