Education , Law & Principles

Ray Carter | October 13, 2023

AG warns Tax Commission on rules for school-choice program

Ray Carter

In a letter to the Oklahoma Tax Commission, Attorney General Gentner Drummond warned the commission that its proposed rules for the Oklahoma Parental Choice Tax Credit Act impose excessive bureaucracy not authorized by the law and fail to make the program user-friendly for parents.

In his Oct. 12 letter, Drumond warned that “several items” in the Tax Commission’s proposed rules “do not appear in HB 1934 and do not appear to be expressly authorized by that Act.”

House Bill 1934, which was signed into law in May, created the Oklahoma Parental Choice Tax Credit Act. The new law provides refundable tax credits of $5,000 to $7,500 per child to cover the cost of private school tuition starting in January 2024.

Families earning below $75,000 qualify for a $7,500 tax credit. Those with incomes of $75,000 to $150,000 get a $7,000 credit, while those with income between $150,000 and $225,000 get a $6,500 credit. Those earning between $225,000 and $250,000 get a $6,000 credit, and families earning more than $250,000 get a $5,000 credit.

Families who choose to homeschool qualify for a tax credit equal to $1,000 per child under the plan.

In 2024, the private-school tax-credit program will be capped at $150 million. In 2025, the cap will increase to $200 million and in 2026 the cap rises to $250 million.

While HB 1934 states that an eligible student must attend a private school “accredited by the State Board of Education or another accrediting association,” Drummond noted the Tax Commission’s proposed rules effectively rewrite that provision so that “another accrediting association” is now defined “an accrediting association approved by the State Board of Education.”

Drummond wrote the law does not grant the State Board of Education that power over private-school accrediting associations.

“If the Legislature had wanted to put our Board of Education in charge of approving other accrediting associations for this Act, then it could have easily done so, much as it did with the Lindsey Nicole Henry Scholarship,” Drummond wrote.

He also warned that the proposed rules create unwarranted and excessive bureaucracy that “could undermine” HB 1934’s goal of giving parents the ability to choose from a wide range of schools.

For example, Drummond noted the proposed rules require private schools to register with the Oklahoma Tax Commission and annually submit reports to the commission.

“This instruction is not found in HB 1934, and it could conceivably place burdens that would cause private schools to avoid participating,” Drummond wrote.

He also noted that the commission’s rules could make the program less accessible to many families.

Drummond noted the Oklahoma Tax Commission’s rule would run the program based on a calendar year rather than the school year.

“This is potentially worrisome, given that it could result in a child having access to the tax credit for half of a school year but not the other half, which could be disruptive,” Drummond wrote.

Other critics have noted that families seeking to place a child in a private school at the start of the next school year in August, rather than changing schools mid-school year in January, won’t be able to complete the school application-and-acceptance process prior to closing of the tax-credit process under the Oklahoma Tax Commission’s proposed rules, which could limit the program’s benefit for lower-income families in particular.

Supporters of school-choice efforts welcomed Drummond’s efforts.

“Attorney General Drummond has demonstrated how the Oklahoma Tax Commission’s proposed rules run contrary to the law that created the school-choice tax-credit program and would undermine the law’s effectiveness,” said Jennifer Carter, Oklahoma senior advisor for American Federation for Children. “The purpose of the Oklahoma Parental Choice Tax Credit Act is to maximize opportunity for parents and children across Oklahoma, and families are grateful for the attorney general’s work on their behalf.”

Drummond’s letter was submitted to the Oklahoma Tax Commission as part of the public-comment period for the agency’s proposed rules for the Oklahoma Parental Choice Tax Credit Act. The public-comment period closed at 4:30 p.m. on Oct. 12.

Under the rulemaking process, the agency can now amend its proposed rules to address concerns raised by the public.

Ray Carter Director, Center for Independent Journalism

Ray Carter

Director, Center for Independent Journalism

Ray Carter is the director of OCPA’s Center for Independent Journalism. He has two decades of experience in journalism and communications. He previously served as senior Capitol reporter for The Journal Record, media director for the Oklahoma House of Representatives, and chief editorial writer at The Oklahoman. As a reporter for The Journal Record, Carter received 12 Carl Rogan Awards in four years—including awards for investigative reporting, general news reporting, feature writing, spot news reporting, business reporting, and sports reporting. While at The Oklahoman, he was the recipient of several awards, including first place in the editorial writing category of the Associated Press/Oklahoma News Executives Carl Rogan Memorial News Excellence Competition for an editorial on the history of racism in the Oklahoma legislature.

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