By BOB GRIFFIN
One of the impacts of the Great Big Beautiful Bill is the ability of low- and middle-income families to be able to afford private school.
The bill allows taxpayers to take a tax credit of $1,700/year and send it to a Scholarship Granting Organization (SGO) to fund private school scholarships, instead of sending that money to the federal government.
The SGO’s would be able to offer scholarships to kids from families that are below 300% of the median family income in each area. That income level in Anchorage would be roughly $290,000/year– but would vary by the local median income, for a statewide average of about $270,000 in income to qualify for a scholarship.
The impact could be huge. If one quarter of the federal taxpayers in Alaska took the $1,700 credit sending that money to an SGO instead of the federal government, that would result in $137 million going to the SGO’s, or enough to fund 19,600 scholarships of $7,000 each. A large portion of the current 5,080 private school students in Alaska would likely be eligible to receive a scholarship. In addition, 15,000 new students would be able to get a scholarship at that level.
If the parents of 15,000 students in traditional public neighborhood schools thought an affordable private school was a better fit for their kids and moved over, it would save $213 million/year in formula funding expense for the state of Alaska. That’s $213 million/year that wouldn’t needed to be diverted away from PFD’s.
This would certainly foster an environment of healthy competition that would provide our public schools a much need spur to innovate and improve parent satisfaction to avoid losing more students and having to manage the fixed cost and infrastructure problems associated with rapidly declining enrollment.
In the end it’s a win-win. Parents have more choices and traditional schools are motivated to innovate and improve the quality of their programs to keep parents interested.
Bob Griffin is on the board of Alaska Policy Forum and served on the Alaska Board of Education and Early Development.