The Three Bees release New Study on Tax Credit Funded ESAs

(Guest Post by Matthew Ladner)

Jason may have not yet developed the shameless self-promotion bug that afflict the rest of us here at JGPB, so I’ll mention for him that he has a new study out along with Jonathan Butcher and Justice Bolick (ah….I just love the sound of that…) on tax-credit ESAs.

The Three Bs make a strong case on the desirability of converting existing tax credit programs over to multiple uses, and also correctly note possible constitutional advantages under some state constitutions for a tax credit approach. The technology for allowing multiple uses for funds looks to be better and cheaper than one might expect (account management/oversight technology is fairly advanced) which may allow for oversight within the admin fees typically allowed by scholarship tax credit programs.

The Three Bs did not directly address the topic of scale. The mighty Florida tax credit program currently looks likely to reach the practical limits of its ability to scholarship children somewhere below 100,000 out of Florida’s 2,500,000 students. This might change if new taxes can be added to credit, but the mechanics of creating a credit against some taxes seems somewhere on the speculative to work-in-progress spectrum at present.

Thus I enthusiastically support conversion of existing tax credit programs to multiple uses, and under some state constitutions, it might be a very good idea to choose this option over a state funded model. Outside of those circumstances, I’d recommend taking your chances with a state funded model if aiming for more than a pilot project.

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