Contentious Education Tax Credit Bill Headed to Senate

Mar 20, 2012

Correction: an earlier version of the story stated the tax credits would initially be capped at $3.4 million. 

The New Hampshire Senate is set to vote tomorrow on a controversial bill that would create a tax credit for businesses that donate to private school scholarship organizations. The bill’s supporters are confident that it will pass.

The bill has been scaled back from its original form. Initially it capped business tax credits for donations to private school scholarship funds at $15 million; now the cap is $6.8 million, though it would increase by 25% each year that the cap is reached.

Republican Senator Jim Forsythe, the bill’s sponsor, disagrees with democrats who say the plan is unconstitutional because it could allow money that would otherwise be collected as taxes to go to religious schools. He says he’s sure the plan the votes to get it through the senate.

"If we’re going to start saying that this is unconstitutional, then we’d have to prohibit donations to the Salvation Army, and to your church and so forth." Forsythe says, "So this is on very sound footing."

Critics of the bill equate it to a backdoor attempt to create a voucher program, and say it will have dire consequences on local school budgets and property tax rates.