Bill > S934

Introduced Session

This bill directs the Director of the Division of Taxation to establish a five-year pilot program to provide tax credits to corporations which contribute funding to nonprofit organizations that provide scholarships to help low-income children attending persistently underperforming schools pay tuition at out-of-district public schools or in-district or out-of-district nonpublic schools located in the State. The bill defines a persistently underperforming school as one in which, for the past two school years: more than 50% of the schools students did not pass the language arts and mathematics subject areas of the State assessments; or more than 75% of the students did not pass either the language arts or mathematics subject areas. A child is considered low-income if the child lives in a household in which the income does not exceed 250% of the federal poverty level. Under the pilot program a tax credit will be equal to 100% of the contribution a corporation makes to a qualified scholarship organization. While there is no limit on the amount that can be contributed for credit, a corporation may not apply the credits to reduce its tax liability to an amount less than the statutory minimum provided in subsection (e) of section 5 of P.L.1945, c.162; and the total tax credit of all participating corporations is capped at $24,000,000 the first State fiscal year, $48,000,000 the second State fiscal year, $72,000,000 the third State fiscal year, $96,000,000 the fourth State fiscal year, and $120,000,000 the fifth State fiscal year. If the sum of the amount of tax credits authorized in a State fiscal year exceeds the aggregate annual limits, tax credits will be allowed in the order that contributions are made until the limit is reached. The bill establishes the Opportunity Scholarship Fund to be credited with contributions made by taxpayers to nonprofit scholarship organizations. The bill directs the Opportunity Scholarship Fund Board to select one scholarship organization in each of the counties in which a persistently underperforming school is located to administer the scholarship funds, or the board may select a scholarship organization to administer the funds in more than one county. The board, in consultation with the State Treasurer, is to distribute the funds to the selected scholarship organizations. The scholarship organizations selected under the bill must require that an eligible school which admits a child receiving a scholarship under the pilot program: (1) accept the scholarship as payment in full for the childs tuition and other costs of attendance; (2) in the event that more children apply for admission to that school under the pilot program than there are openings, that students will be selected through a lottery; (3) ensure that a child enrolled in an eligible school who received a scholarship under the program in the prior school year receives a scholarship in each school year of enrollment under the program provided that the child remains eligible; and (4) in the case of an eligible school that is a nonpublic school, that the school administer an annual test to scholarship students that is aligned to the core curriculum content standards. The scholarship organization selected in each county will manage the scholarship application process; review and verify the residence of scholarship applicants; compile an inventory of vacancies in eligible schools; conduct necessary student selection lotteries; monitor the enrollment of scholarship students in eligible schools; and prepare an annual report to be submitted to the State Treasurer that provides information on the program for the prior school year. The bill directs the board to commission an independent study on the implementation of the pilot program by an individual or entity with expertise in the field of urban education. The study will consider issues such as the academic achievement of scholarship recipients, the impact of the pilot program on achieving savings for State taxpayers, the impact of the pilot program on student enrollment patterns, and parental satisfaction with the program. On or before January 1 of the fifth school year of the pilot program, the board is directed to submit a report to the Governor and the Legislature on the implementation and results of the pilot program. The report will include a recommendation on whether the program should be reauthorized on a permanent basis.

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Tom Kean (R)*,  Raymond Lesniak (D)*, 

Withdrawn from Consideration (on 02/08/2010)