The REACH Foundation released a report that shows the Educational Improvement Tax Credit (EITC) Program saves state money.In the new study, The Fiscal Impact of the Educational Improvement Tax Credit Program, the author, Andrew T. Lefevre – a state expert on school choice – explains how Pennsylvania saved $531.6 million in the 2007-2008 fiscal year, by awarding 44,000 students EITC scholarships to attend the school of their choice. Furthermore, if these children were forced to re-enter the public school system because of a loss of an EITC scholarship, that figure – $531.6 million – would need to be found within the state budget to educate these students.
“In the wake of an economic crisis, Pennsylvania cannot afford to make cuts to the EITC Program. Its innovative approach to education is a win-win for the state, saving the state money and servicing tens of thousands of low- to middle-income families,” says Andrew T. LeFevre, Reach Foundation Executive Director and author of The Fiscal Impact of Educational Improvement Tax Credit Program.
The Educational Improvement Tax Credit (EITC) Program is a corporate tax credit program where businesses can direct up to $300,000 of their tax dollars to 501(c)(3) organizations, such as the Pennsylvania Catholic Conference Scholarship Foundation, set up to distribute scholarships for children wanting to attend K – 12 private school. The business will then receive a 75% tax credit (or a 90% tax credit, if the business gives a commitment of 2 years) based on their tax liability. The state-run EITC Program is currently capped at $75 million.
The EITC Program has been expanded four times since 2001. This program is often hailed by members of the state legislature as one of the most successful examples of a public-private partnership in Pennsylvania.
What is the REACH Foundation? Founded in 1993, the REACH (Road to Educational Achievement through CHoice) Foundation is dedicated to ensuring parental choice in education in Pennsylvania. REACH continually promotes policies that enable statewide parental choice in education, including the well-established and highly successful EITC Program. For more information on the REACH Foundation, visit www.paschoolchoice.org.
