Business tax credit for education idles

Deduction of 75% stalls in same panel where it has previously died twice

April 09, 2010|By Arthur Hirsch | Baltimore Sun reporter

Supporters of a business tax deduction to help private and public schools that has failed in past legislative sessions hoped this year would be different. Plans by the Archdiocese of Baltimore to close 13 schools brought attention to the bill, Gov. Martin O'Malley wrote a letter endorsing it and, for the first time, Archbishop Edwin F. O'Brien made the trip to Annapolis to lobby for passage.

But with only days left in the session, the legislation has again stalled in the House committee where it has died twice before.

"Nothing's happened; it's just sitting there," said Del. Ronald George, an Anne Arundel County Republican, supporter of the bill and member of the House Ways and Means Committee, which has held hearings on the measure.

As in sessions past, the Senate approved the measure this year, but it has not come to a vote in the House committee. Committee members differed on the chances that anything could happen between now and the close of the 2010 General Assembly session Monday.

Among the least optimistic is George, who said he's been experiencing déjà vu.

"I'm getting the feeling they're going to let it sit," he said. "This is how it happened last year."

Del. Jolene Ivey, a Prince George's Democrat who is listed as a co-sponsor but said she couldn't vote in favor without amendments, sounded more optimistic.

"It seems like we're going to find a way to make something work," said Ivey, one of six members of the Ways and Means education subcommittee, to which the Senate measure moved after a hearing April 1.

"We've had some informal conversations with the subcommittee," Ivey said, including talk of amendments. But the panel has held no formal work sessions or considered changes.

Amendments were offered in the Senate, where the bill passed, 30-17, but all were rejected. As it stands, the measure known as Building Opportunities for All Students and Teachers in Maryland calls for a 75 percent state income tax credit for business contributions to education. Specifically, the credit targets contributions that go to nonprofits to help students and schools, both public and private, including Catholic schools. These would include scholarships, after-school activities and extra arts and science programs.

The legislation includes a $200,000 cap on the amount to which a business could apply the credit, regardless of how much it contributes. The total annual ceiling on the credit fund would be $50 million, but the governor could decide how much to allocate in a given year.

Ivey and other committee members say the panel will not approve the measure unless the 75 percent credit is cut. She said the state's 21 existing business tax credits range between 5 percent and 60 percent.

In what seemed an understatement, Del. John A. Olszewski Jr. said that "as introduced, I see [the bill] having some difficulty getting through the committee."

The Baltimore County Democrat, a member of the education subcommittee, said lawmakers had questions about who would be eligible for the nonprofits' aid, and whether private schools would agree not to deny admission on the basis of sexual orientation.

This point came up in sharp questions by committee members to O'Brien in his appearance last month. He declined to support an anti-discrimination amendment. The Catholic Church teaches that homosexual acts are sinful.

He told the panel that rising costs and falling enrollment are forcing the archdiocese to close 13 of its 64 schools at the end of the academic year. He said the tax credit would not save the schools, but it would help.

The bill is opposed by teachers unions, the American Civil Liberties Union and the Maryland Association of Boards of Education, in part because they say it would divert public money to private schools. Supporters say that's a misrepresentation, as public school allocations are based largely on formulas set by law.

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