Kentucky State Capitol

Kentucky State Capitol

SHELBYVILLE, Ky. (WDRB) — School superintendents throughout Kentucky sent lawmakers a singular message Monday: Do not pass legislation authorizing scholarship tax credits in the waning days of this year’s session.

The Kentucky Association of School Superintendents scheduled five news conferences throughout the state in opposition to House Bill 205, which would allow donors to recoup most of their donations to groups that award private-school scholarships.

The bill, sponsored by House Majority Floor Leader John "Bam" Carney and scheduled for a discussion-only hearing Tuesday in the House Appropriations and Revenue Committee, would cap the tax credits at $25 million in fiscal year 2020 and automatically increase that limit by 25 percent each year if at least 90 percent of the previous year’s cap is spent. Donors would receive at least 95 percent of their donations up to $1 million in tax credits.

Ten area superintendents gathered at the Ohio Valley Educational Cooperative’s offices in Shelbyville on Monday and detailed their misgivings with HB 205.

Their push against HB 205 comes amid renewed optimism for supporters of scholarship tax credits after House Speaker David Osborne signed on as a co-sponsor and the legislation got its first reading in the House on Friday and second reading on Monday. Jefferson County Public Schools Superintendent Marty Pollio said most, if not all, superintendents in Kentucky oppose the measure.

“This might manifest itself more in Jefferson County and in some other districts, I think every single superintendent will be impacted,” Pollio said, noting some school districts struggle to make payroll at times. “We are in a state where that’s a reality in public education, and we have to make sure that we give what our kids, our teachers, our students need at all times."

But Carney, R-Campbellsville, issued an ominous warning for superintendents who oppose HB 205.

“I’d say superintendents will be lucky to get anything else this session,” Carney said. He specifically mentioned Senate Bill 8, which would alter the teacher tribunal process, as a measure that could be jeopardized by superintendents’ opposition to HB 205.

“If they want to just always be against everything that doesn’t go their way instead of coming and talking to folks and try to work things out, then why would we continue to make efforts to try and pass legislation that they want?” Carney continued. “They didn’t come to the table to support pension reform, so at some point they need to work with us or there’ll be some consequences.”

With two readings, the bill will be ready for vote on the House floor if it passes the budget committee.

During Monday's news conference, Shelby County Public Schools Superintendent James Neihof said HB 205, if passed, could financially strain school districts, which receive state funding on a per-pupil basis, that have already seen funding slashed for things like professional development for teachers and instructional resources for classrooms.

While enrollment may decline in the future if HB 205 passed, Neihof says that’s not necessarily true for expenses like payroll and utility bills.

“It’s not a fair analysis to say that when a student leaves, all of our costs leave,” he said.

Beyond that, school districts will also be asked to shoulder some of the expenses related to a comprehensive school safety bill and the General Assembly’s top priority, Senate Bill 1.

Some speakers noted that lawmakers did not include any funding for SB 1. Instead, legislators will wait until next year’s budget-writing session to determine how much the state will pay for school security initiatives.

Pollio specifically mentioned the bill’s call for school districts to hire enough counselors, as funds become available, to provide one for every 250 students instead of one for every 1,000 students currently. Counselors in many districts must handle between 400 and 500 students each, he said.

“We are talking about a significant increase in counseling services, rightfully so for our students,” Pollio said. “But we also have to have the funding and the mechanism to do that.”

EdChoice Kentucky President Charles Leis, however, contends that the money in question is small compared to broader education spending in the state and is worth the cost of trying to help kids who struggle in public schools. The scholarships would be available for kids in families whose annual income isn’t more than 200 percent of the federal limit to qualify for free or reduced-priced lunches.

HB 205 is “relatively fiscally neutral” at the state level, and while districts would lose some of their state funding if the legislation becomes law, their local and federal revenue sources would remain, he said. Leis estimated that if HB 205 becomes law, it would affect less than 1 percent of public school enrollment.

“If we lose a child and that child does not get a satisfactory education, it’ll continue the cycle of poverty,” Leis said. “You can’t break that cycle. Education is so critical to the individual.”

Neihof also questioned the constitutionality of scholarship tax credits, as have others who point to Kentucky’s constitutional ban on tax dollars aiding or funding religious schools.

Anna Baumann, senior policy analyst for the Kentucky Center for Economic Policy, said if HB 205 became law, it would be ripe for a legal challenge.

A similar law in Montana, which provided tax credits of $150 for scholarship donations, was struck down by that state’s Supreme Court in December. The high court ruled 5-2 that such tax credits provided indirect aid to church-affiliated schools, according to a report by the Associated Press. 

“It’s pretty safe to assume that there would be challenges,” Baumann said.

Andrew Vandiver, associate director of the Catholic Conference of Kentucky and a board member with EdChoice Kentucky, said it would be “unfortunate” if HB 205 became law and ultimately wound up in court.

However, he said he was confident that HB 205 would survive a legal challenge. He predicted that the Montana case would be overturned by the U.S. Supreme Court based on its prior rulings.

“We’re actually very confident that if opponents want to challenge this program and take away scholarships from the kids that we’ll prevail in court,” Vandiver said.

Osborne, R-Prospect, said there's some belief that HB 205 does not need a supermajority of 60 votes to pass the House. There's also court precedence that indicates "maybe we do," he said.

"I think it's a calculated decision on whether or not we would want to send it out of here with less than 60 votes," Osborne said.

Asked whether there are 60 votes for HB 205 in the House, Osborne said he didn't know.

Carney didn’t rule out adding scholarship tax credits to a concurrence bill in the closing days of this year’s session if HB 205 stalled. If it fails to become law this session, he said he would push the measure again during next year’s session.

“It will be moving forward sometime in the near future,” he said.

But don’t count anything out until the gavel falls for the final time in this year’s General Assembly.

“I’d say anything’s possible before sine die,” Carney said, referencing final adjournment at the conclusion of legislative sessions.

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