Advancing school choice: scholarship tax credits

Friday, 27 January 2017

After listening to the cheers and excitement of hundreds of school children, parents, and teachers at the annual School Choice Rally held at the State Capitol Jan. 19, the Revenue Committee of the State Legislature heard testimony from a number of proponents advocating the advance of LB295 which would allow for the Opportunity Scholarships Act.

The Opportunity Scholarships Act—introduced by Sen. Jim Smith of Papillion—provides privately-funded scholarships for low-to-middle-income students to attend the private school of their choice. These scholarships are funded by private donations to qualified nonprofit scholarship granting organizations (SGOs). In return, those who provide private donations could receive a tax credit (as opposed to a tax deduction) on their state income tax bill for a percent of their donation.

While this idea is novel for Nebraska, similar laws already exist in 17 other states—including a few of our neighbors (Kansas, Iowa, and South Dakota). Like these other states, our State Legislature has the opportunity to advance heroic legislation that 1) protects true parental choice and 2) provides a tremendous state savings.

Protecting Parental Choice. The Catechism of the Catholic Church puts it beautifully: “As those first responsible for the education of their children, parents have the right to choose a school for them which corresponds to their own convictions. This right is fundamental…. Public authorities have the duty of guaranteeing this parental right and of ensuring the concrete conditions for its exercise.”

The Opportunity Scholarships Act provides a state policy that helps parents—especially those most in financial need—fulfill their duty in choosing the education that is most fitting for their children. Oftentimes, schools and parents in such circumstances are placed in a predicament of finding adequate financial resources to give their child an opportunity at private education. However, LB295 remedies this predicament by establishing a financial resource that could be essential to students and parents in fulfilling their dreams. 

State Savings. Importantly, LB295 is able to achieve opportunity for low-to-middle-income students without taking away any funding from public schools. Ultimately, the program relies on the financial charity of private donors.

In the 17 states that currently have scholarship tax credit programs, it is estimated that these states have saved somewhere between $1.7 and $3.4 billion to date. Our neighbors in Iowa have saved at least $280 million since the enactment of their scholarship tax credit program in 2006.

State savings occurs by the number of scholarships that are provided to students who transfer from public to non-public schools or who otherwise would be in a public school but for an Opportunity Scholarship. This creates a direct savings to the state because such students will not receive state aid when attending a non-public school, since a student’s state aid for education is only available to them while in public school. This leads to significant reductions in expenses for local schools and provides them more funds to spend per student.

The Time Is Now. Nebraska is in a unique position this year to advance the Opportunity Scholarships Act out of the Revenue Committee and be heard by the full body of the State Legislature. Now is your chance to help make this happen with a phone call or e-mail to your State Senator and the members of the Revenue Committee. Look up their information at Ask them to support and advance LB295.

For more information about this legislation and the many other issues important to us as Catholics, visit and “Join CANN (Catholic Advocacy Network of Nebraska)” for our regular action alerts and information updates. 

Keep this important piece of education legislation in your prayers—LB295 would certainly be the answer to the prayers of thousands of families across Nebraska seeking a private education.