Tax credits that perform

PEOPLE often wish government operated more like a business, saying investments should generate returns exceeding costs. A recent report shows the Oklahoma Equal Opportunity Education Scholarship Act fits the bill. It is saving state dollars and providing children greater educational opportunity. The scholarship tax credit program, established in 2011, provides income tax credits to businesses and individuals who donate to groups giving private school scholarships to students. The credits can offset much, but not all, of the cost of a donation. Jacob Dearmon and Russell Evans, professors at the Meinders School of Business at Oklahoma City University, analyzed the program and compared the “tradeoff of foregone tax revenue and foregone per pupil expenditures.” Their latest report, which updates an August 2017 study, concluded that Oklahoma government saved $1.39 for every dollar in tax credits issued in the 20172018 school year. After accounting for all local, state and federal dollars expended on public schools, the report found $2.91 in school spending is saved for every dollar issued in tax credits. And because state funding for schools was increased dramatically for

After accounting for all local, state and federal dollars expended on public schools, the report found $2.91 in school spending is saved for every dollar issued in tax credits.

the current school year, the report notes savings from the scholarship tax credit have increased as well. Savings occur even if one-fourth of scholarship recipients would have still gone to private school without the program. The report found “under every reasonably construed scenario the program performs better than break-even.” Under the program, scholarship recipients must be from families with no more than 300 percent of the income required to quality for free-and-reduced lunches, have a learning disability, or live in a school district designated “in need of improvement” by the State Department of Education. But the website of the Opportunity Scholarship Fund notes the law urges that roughly 62 percent of scholarships go to students from families with even lower income — 185 percent of the federal poverty level or less. The three main scholarship-granting organizations using the tax credit program provide scholarships averaging between $579 and $3,008 per student. Critics may scoff that those amounts won't cover the cost of private tuition, and question how low-income families can take advantage. But the reality is the program now includes thousands of students, most of whom are from families of modest means. Dearmon and Evans write, “The success of the program in offering a meaningful education choice to scholarship recipients combined with the fiscal performance of the programs suggests room for program growth in Oklahoma.” When former Sen. Mike Mazzei, R-Tulsa, left the Legislature in 2016, he helped launch a think tank, The Oklahoma Opportunity Project. Mazzei, who now serves as Gov. Kevin Stitt's secretary of budget, spent most of his final years in the Senate seeking to raise taxes by eliminating tax breaks. Thus, it's notable the Oklahoma Opportunity Project called for expanding the Education Scholarship Tax Credit program. For those who want programs to produce societal and financial benefit exceeding taxpayer costs, Dearmon and Evans' report shows citizens need look no further than the Equal Opportunity Education Scholarship Act.