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Opinion

Opinion | If Businesses Want to Give Money to Private Schools, Nothing is Stopping Them

Credit: iStock

by Hugh Jackson, Nevada Current

Nevada has a private school pseudo-voucher program called Opportunity Scholarships. Technically, public money isn’t sent directly to private schools or their parents. That would be unconstitutional in Nevada. So the Republican workaround to that, devised a few years ago when a Republican was governor, gives tax credits to businesses who donate to one of a half-dozen organizations who in turn are authorized to dole out the private school tuition money – money that otherwise would be collected as public tax revenue.

The total amount of tax credits that can be claimed each year is capped at approximately $6.66 million. No doubt that amount was selected for what seemed a perfectly rational explanation that has nothing whatsoever to do with the mark of the beast.

But the office of His Excellency the Honorable Gov. Joe Lombardo envisions eliminating the current devilish cap on tax credits, replacing the $6.66 million with … $500 million.

It can be harder in Nevada to fund a program with business tax credits than in other states, because compared to other states, Nevada businesses don’t pay very much taxes. Businesses can currently claim pseudo-voucher scholarship tax credits against the modified business tax, which is sort of a payroll tax. Revenue raised from that tax is forecast to total $866.5 million this fiscal year.

Squeezing $500 million out of that would entail nudging just about every one of the larger modified business tax payers in the state to take the credits, and hope they all got around to applying for them. That might be dicey.

So Lombardo’s office is looking elsewhere, by also proposing to let the insurance and resort industries take credits against, respectively, the insurance premium tax (projected revenues of roughly $600 million a year over the next two years) and the gaming tax (about $900 million a year over the next two years).

The legislation Lombardo’s office has drafted to do this – yes, there’s a bill for that – doesn’t envision reaching $500 million for several years. Specifically, it scraps the current $6.6 million cap on the total amount of tax credits the state will bestow, and replaces it with amounts equal to annually escalating percentages of “all money deposited for credit to the State Education Fund,” capping out to the equivalent of 5% of the fund in 2031. 

According to the state treasurer’s office, the State Education Fund is a combination of multiple funds, and pretty fluid – it changes a lot as money comes in and money goes out. As of last week, the balance of the fund was just a little shy of $2 billion. For 5% of the fund to equal Lombardo’s pseudo-voucher funding goal – $500 million – the state education fund would have to total $10 billion by 2031. 

Maybe it will. Maybe it won’t. It doesn’t matter. Because although Nevada’s often timid elected Democrats can be painfully agreeable to the right’s talking points, even they are not going to let all this nonsense get that far.

Did someone say accountability?

Nevada is not Florida or some other severely red state led by a culture warring charlatan hellbent on replacing public schools with churchy ones to comport with whatever a loud part of the Republican base thinks the founders intended when the skies opened up and Jesus came down and delivered unto them the Constitution.

Not being one of those states, Nevada has the luxury of basing policy on reason. And evidence.

Despite the hype and the marketing and flashy support from a well-funded school “choice” movement and politicians who love it, the evidence on diverting public money to private schools is a mixed bag at best and has failed to deliver as promised, producing positive if slight results in some areas (exerting competitive force for public schools to improve) but negative results in others (lower test scores, especially in math). 

There is even less evidence of positive results from pseudo-vouchers funded by tax credits of the sort being championed by the Nevada governor’s office. That may be because, as researchers note, those programs are generally “subject to fewer regulatory burdens and accountability pressures than those in voucher programs.”

All of that would be worth debating, except the school “choice” debate is daft.

For all the Sturm und Drang over education, and all the time and attention education gets from the public and the media, the single largest hindrance to educational performance remains the same that studies have found time and again for decades, and it’s not what happens in schools. It’s the instability of the student’s household, which almost always hinges on money.

A favorite argument made by supporters of “school choice” is that poverty is not an excuse for poor educational performance. And they’re not wrong. Poverty isn’t an excuse, it’s a cause.

And a favorite sound bite uttered by everyone in our education debates emphasizes a need for “accountability.”

But while a segment of the population routinely launches rote charges that public education has “failed,” so there needs to be accountability, the economy has been failing working families for decades.

Who do we hold accountable for that?

Unpopular opinion: Whether it’s Republicans clamoring for “school choice” or Democrats vowing that they’re “for” public education, the emphasis from both on education as society’s savior is not going to produce a solution to Nevada’s underlying problems. It’s a distraction from them.

Meanwhile, if businesses and industries want to give money to private schools, nothing is stopping them. But they can still pay their taxes while they’re at it to fund the public schools that will be attended by the overwhelming majority of their workforce of the future — even if the state does end up blowing a half-billion on a voucher scheme to please a select few.

This article was originally published by Nevada Current and is republished here under the Creative Commons license.