Growth of Arizona School Tuition Tax Credit Program Exceeds Projections

Posted on April 07, 2004 | Type: Press Release
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PHOENIX-Arizona's landmark School Tuition Tax Credit program helped 19,778 students attend schools of their choice in 2003, according to a report released last week by the Arizona Department of Revenue.

This rate exceeds the growth projections of a December 2003 Goldwater Institute report, which showed how the program helps students like Jose Magana, a senior at St. Paul's Preparatory Academy in Phoenix. Magana stated that without assistance, "there's no chance I'd be [at St. Paul's]." Jose won full scholarships to the honors programs at the University of Arizona and Arizona State University, is interviewing with Harvard University, and was just accepted to Stanford University. For Jose, the tuition tax credit program "opens a door that would otherwise be bolted shut."

Arizona's program gives taxpayers a dollar-for-dollar income tax credit for contributions to organizations that provide scholarships to help students attend private elementary and secondary schools. The Department of Revenue (DOR) finds that from 2002 to 2003, the number of scholarships awarded grew by 21 percent, and taxpayer donations increased by over 11 percent.

Among the Goldwater Institute report's findings:

 ?               School tuition organizations primarily distribute scholarships based on financial need.

?               On average, private schools cost half as much as public schools.

?               Based on the 2002 growth rate, the tuition tax credit program could become a revenue-saver in 2007.

However, the DOR report finds the tuition tax credit program's 2003 growth rate is about double the 2002 rate, suggesting it could help even more students and save the state money sooner than expected.

The Goldwater Institute study The Impact of Tuition Scholarships on Low-Income Families: A Survey of Arizona School Choice Trust Parents is online here. The Arizona Scholarship Tax Credit: Providing Choice for Arizona Taxpayers and Students is available here.

 Contact: Vicki Murray, Education Analyst, (602) 462-5000 x 229,

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