I’m tired of writing about the Alabama Accountability Act. You’re probably tired of reading about it.
Issues surrounding the law keep changing, though, and legislative actions this week likely will decide whether it remains on the books. Whether to salvage their political stature or because they finally read the law, lawmakers who voted for it suddenly are expressing concerns.
The basic problem with the Accountability Act is that nobody knows what it means. The rush to pass it without input or debate resulted in a strikingly ambiguous law. It is objectively poor legislation not because it undermines public education, but because it is unclear on issues that have the greatest impact on the Education Trust Fund budget.
Let’s start with a basic question: Does the law provide tax credits for students assigned to failing public schools but already enrolled in private schools?
The ideological debate on this question is significant, as by definition these students already have “school choice.”
The budgetary implications are huge. About 10,600 private-school students are assigned to failing schools. Unless the families fill out their tax forms wearing blindfolds, 100 percent of them will claim the tax credit. The exact amount of the credit is unclear, but it’s about $4,000 per student. If they are entitled to the credit, the Education Trust Fund — which finances all public pre-K, K-12 and post-secondary schools — will lose $42 million.
One would think legislators would not have voted on a bill that was ambiguous on such a costly issue. They did. Despite their rhetoric of fiscal responsibility, not a single senator in the Republican supermajority voted against the bill. Only three Republican House members voted against it, none of them from this area.
Immediately after the law passed, legislators who spoke publicly about the law — including its sponsor and the Senate Pro Tem — said students already enrolled in private schools would receive the tax credits.
That did not sit well with some voters. It also created a $42 million hurdle in crafting the education budget.
The next thing we heard — from numerous legislators — was that the state Revenue Department had interpreted the law as not authorizing tax credits for those already enrolled in private schools. With remarkable speed and little inquiry, legislators and the media (me included) accepted this as fact. The estimated cost of the law dropped by $42 million.
So I was surprised Wednesday when the Revenue Department contacted me.
“Over the past few weeks, we have been questioned specifically as to what the department’s position is, in regard to whether the tax credit applies to families that are already in private schools,” a spokesperson said by e-mail. “We have consistently responded that the department is reviewing the legislation, and no final determinations have been made at this point. While we can’t stop speculation on actions any state agency may take, the department’s position remains the same.”
Were the legislators making it up? Were Revenue Department officials talking to lawmakers unofficially? More ominous, is the Revenue Department under pressure to change its interpretation?
The uncertainty comes from the law’s sloppy drafting.
The Accountability Act states that students “assigned or enrolled” in a failing school are entitled to tax credits. Students are entitled to the credits if they either “spent the prior year in attendance at a failing school” or if they are “assigned to a failing school for the next school year,” an either/or standard that seems to contemplate tax-credit eligibility for students already in private schools.
On the other hand, the law requires the Department of Revenue to issue credits that “reimburse the parent for costs associated with transferring the student from a failing school” to a private school, which arguably limits tax credits to those previously enrolled in a failing public school.
The Revenue Department’s interpretation — which it says it will not issue until it receives guidance from the Legislature — will be important, but not conclusive. If it determines those already in private schools do not get the credits, a lawsuit by parents could result in a different court ruling.
Not only is it mystifying that fiscally responsible lawmakers could vote for a law with a $42 million question mark, it is hard to imagine how they can pass a budget without an answer. The education budget is currently stalled due to debate over a teacher raise with a $30 million price tag. But neither legislators nor the state Department of Education have any idea on a $42 million item in the Accountability Act.
The preliminary House version of the education budget estimated the total cost of the Accountability Act as about $35 million. The cost of the tax credits for those already enrolled in private schools alone blows past this estimate, depending on the Revenue Department or court interpretation.
The $35 million estimate is even more dubious given the $25 million private-school scholarship program included in the law, a program funded entirely with tax dollars currently allocated to public schools.
The scholarships are not limited to families with low incomes. The private organizations that grant the scholarships must calculate the percentage of families in the county who are at or below an income that is two times the poverty level. (Calculating that percentage may be a challenge, as a Census Bureau spokesman said Friday the agency does not compile such data.) They must award the same amount of scholarship money to students from families below that income level as to families above it.
An extremely rough estimate — based on income brackets tracked by the Census Bureau — suggests about one-third of Alabama families have incomes that are below an amount that is double the poverty level. If this is accurate, then about two-thirds of the tax-funded scholarships would go to students with higher incomes.
Indeed, 25 percent of the scholarships — $6.3 million — can go to students who already are enrolled in a private school.
There is plenty of room to debate the wisdom of the Accountability Act’s apparent goals, but those debates need not be resolved in recognizing it is a bad law. It is so poorly drafted that no one knows how much it will cost, who it will help or whether it will provide any benefit to students in failing schools.
Alabama’s “fiscally responsible” Legislature should be embarrassed.
The Alabama Accountability Act should be repealed.