Supreme Court to hear education tax credit case

PHOENIX, Ariz. - The U.S. Supreme Court will decide the future of an Arizona program allowing tax credits for private and parochial school scholarships, the Arizona Daily Star reported.

Since 1997, Arizonians have been allowed a credit against their income taxes for donations to organizations that provide private and parochial K-12 school scholarships, according to the Daily Star.

A federal appeals court ruled in 2009 that the program was unconstitutional, saying it resulted in the government supporting and providing favorable financial treatment to religious schools, the Daily Star reported. The 9th Circuit Court found it objectionable that some of the organizations only grant scholarships to families if they agree to send their children to a religious school, according to the Daily Star.

The program's supporters argued that many entities offer scholarships only to specific schools and that in this case taxpayers, not government, direct the money to the chosen organization, he Daily Star reported.

The Supreme Court is expected to hear arguments in early November.

The Daily Star reported that in 2008, the latest tax year for which numbers were available, the state's residents donated

$55.2 million to scholarship organizations, while corporations donated an additional $10.8 million under a similar tax credit program.

The Arizona Daily Star, "Private-school money to get high court look," May 25, 2010

Mackinac Center for Public Policy, "Education Reform in a Fiscal Crisis," March 19, 2010