Common EITC and OSTC Misconceptions

“A lie can travel halfway around the world while the truth is still putting on its shoes.” This saying is even more true in the internet age.

Case in point: recent falsehoods being spread by opponents of the Educational Improvement Tax Credit (EITC) and Opportunity Scholarship Tax Credit (OSTC) programs. As the legislature is poised to raise tax credit scholarship caps in the current budget, objections to this proposal simply aren’t holding water.

Myth: EITC and OSTC funds go to unaccountable schools.
Fact: EITC and OSTC are accountable to the highest authority—parents.
Statewide, around 40 percent of students are not proficient in English Language Arts (ELA). That figure climbs to more than 65 percent in Philadelphia and around 80 percent in Harrisburg. A whopping 90 percent of Harrisburg students are not proficient in math.

Tragically, many parents have no alternatives when faced with such dismal statistics—and their children continue to be assigned to these school despite this poor performance. Where’s the accountability?

Programs like EITC and OSTC empower parents to leave if a school isn’t working for their child. That’s real accountability. When they say parents choose unaccountable schools, Governor Wolf and the teachers’ unions are dismissing lower-income parents as incapable of choosing better schools for their children. Parents like Thalia McClenton, who uses tax credit scholarships, prove the naysayers wrong.

Accountability to parents even helps students who remain in district schools by incentivizing failing schools to improve or close.

Myth: We shouldn’t fund EITC and OSTC when public schools are underfunded.
Fact: EITC and OSTC have saved Pennsylvania school districts $4 to $6 billion since 2002.
The average EITC scholarship is $1,800. The average OSTC scholarship is $2,400. Average per pupil spending in PA district schools is $17,600—9th in the nation. This massive savings per student is behind the $4 to $6 billion in savings that a recent EdChoice study revealed.

Anyone who wants more money to be available to public schools should demand raising the caps on EITC and OSTC.

Myth: EITC and OSTC are unconstitutional since they support religious schools.
Fact: Tax credit scholarships are entirely constitutional.
The Pennsylvania Constitution is very precise in its wording: “No money raised for the support of the public schools of the Commonwealth shall be appropriated to or used for the support of any sectarian school.” Because donations flow from businesses directly to scholarship organization, no taxpayer money—and certainly no money raised specifically for public schools—goes to religious schools. Thus, no part of the Pa. Constitution is violated by ETIC or OSTC.

For more information on the constitutionality of tax credit scholarships in PA, visit the Institute for Justice.

Myth: EITC and OSTC take “my” tax dollars and I don't want my taxes going to private schools.
Fact: No tax dollars go to private schools through the EITC or OSTC programs.
Businesses voluntarily donate to scholarship organizations and receive a tax credit in exchange. This is similar to any charitable contribution that receives a tax deduction—the donation results in fewer taxes collected from the donor, not tax dollars going to the organization.

EITC and OSTC have the added benefit of increasing business involvement in the community. When businesses donate to a local school, they often follow that up with future donations of time, talent, and money.

The Bottom Line

The reason many people believe these falsehoods about EITC and OSTC is because opponents keep saying them. But repeating a lie doesn’t make it true.

Since Governor Wolf vetoed HB 800, a bipartisan bill to expand EITC by $100 million and automatically increase it to meet demand, the best avenue lawmakers now have is to include an EITC and OSTC increase in the budget’s education code this week. As my colleague Marc detailed yesterday, a $25 million increase could help 12,500 more students and a $50 million increase could serve 25,000 more students. Best of all would be to match the $100 million laid out in HB 800, which could make a scholarship available to every student was rejected last year.