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Msgr. Lafferty Tuition Foundation
Diocesan educators, ICC director keep eye on tax credit legislation

By RENEE WEBB, Globe editor
(Email Renee)

While a new bill has yet to be introduced concerning Iowa’s school tuition organizations (STOs), diocesan school officials are keeping a watchful eye on any developments as cuts in the program have been recommended to the state’s governor.

According to Tom Chapman, executive director of the Iowa Catholic Conference, Governor Chet Culver’s Tax Credit Review Committee recommended that the Educational Opportunities Act’s credits be reduced from $7.5 million to $5 million. That review committee also recommended that the tax credit percentage be cut from 65 to 40 percent of donation.

“Right now, if I give $1,000 to this scholarship fund, I get a $650 (state) tax credit, but they are proposing that if I give $1,000 I would now receive just a $400 tax credit,” he explained.

For four years now the Educational Opportunities Act of 2006 has enabled taxpayers who have an Iowa tax liability to receive a 65 percent tax credit on contributions made to STOs. In the Diocese of Sioux City, that fund is called the Msgr. Lafferty Tuition Foundation.

“There is not a bill yet, but there will be one later in the session,” said Chapman. “Frankly, we don’t know exactly what will be in the bill. We only know the recommendation that came from the governor’s Tax Credit Review Committee. The actual bill may look different. Maybe they will leave it alone or maybe it will be worse.”

Dan Ryan, diocesan superintendent of Catholic schools, said a reduction in dollars available for tuition assistance would have a negative impact on families sending their children to Catholic schools.

“Families need to be able to rely upon a steady amount of financial assistance so that they can anticipate year to year what the potential financial aid is,” he said. “(A reduction in STO dollars) would push local schools to come up with more financial assistance. It also might lead to possibly some students leaving Catholic schools.”

Ron Olberding, principal at Sacred Heart Grade School in Spencer and Pocahontas Catholic, said nearly one-third of the students at each of his schools receive tuition assistance through the Msgr. Lafferty Tuition Foundation.

Choice in education
“It helps ensure that students who want to receive a Catholic education, can,” he said. “We don’t want to be a school just for the wealthy. Thanks to STOs like Msgr. Lafferty, more parents have a choice as to where they send their children to school. When parents have a choice, it makes all of the schools better.”

In the Diocese of Sioux City, Ryan pointed out that about 2,100 students received tuition grants this year alone thanks to the Msgr. Lafferty Foundation. Despite the fact that more than $1.8 million was distributed, he is aware there were unmet needs.

“We are advising against a change (with the tax credit program) because frankly, it will cost the state money if they do this,” Chapman said. “Over 9,500 kids receive grants through school tuition organizations statewide. If you do the math, if even just five percent of these students go from private schools to public schools because they have a smaller grant or because they lose a grant totally – it will end up costing the state more money.”

Currently, the state cost per pupil is $5,768 for a public education. If five percent of grant recipients throughout the state of Iowa go back to public schools, the cost to the state would be over $2.7 million.

“The private schools are saving taxpayers millions of dollars,” Olberding noted. “If you attend a public school, tax dollars pay for the education. When you go to a private school it is the parents and churches that pay for the education.”

He did mention that some tax dollars benefit the private school students for textbooks (a maximum of $20 per student), transportation and special education needs but these dollars are minimal compared to the overall cost of an education.

Education
Because they are uncertain as to what the new bill will look like, Chapman said right now the ICC is trying to education people so that if or when the time comes, they can get the word out quickly about contacting their legislators.

Ryan pointed out that he and many of the administrators from diocesan schools have met with state representatives and senators in the schools.

“We want them to know what we are doing in our local schools and how that is positively impacting the local communities in the state of Iowa,” he said. “We are also participating in some of the legislative breakfasts that ICC and Iowa Ace are holding in the coming weeks.”

Chapman has also been meeting with legislators at the state capitol.

With this being a shortened legislative session that is expected to wrap up by the end of March, a bill is expected to be presented by early March.

“It’s important that people stay abreast of this situation,” Ryan said. “We can’t take anything for granted. We want to continue to help people understand that we are an important partner in education in Iowa. We educate over 6,000 students in this diocese. We are also an important economic factor, in that we employ a great number of people in this part of Iowa.”

Reductions in enrollments, he noted, has potential to impact jobs.

“They need to consider the whole piece; Catholic schools are a benefit in many economic ways as well and a user of services,” he said.

Stay informed through ICC
Stay abreast of legislation related to the Iowa tax credit through the Iowa Catholic Conference’s. Sign up for the ICC’s legislative network at www. iowacatholicconference.org.