Dec. 15, 2021

By Rep. Steve Mentzer (R-Lititz)
A new report shows that tax credit programs supporting school choice opportunities is more effective at economic development than through traditional state grant and loan programs.

Last week, the state Independent Fiscal Office (IFO) reported that Pennsylvania used or awarded $623 million in tax credits aimed at promoting economic development, an increase of $71 million from the previous year.

By contrast, Pennsylvania spent $389 million in that year on state grants or appropriations for economic development projects. That’s a decrease of nearly $27 million from the previous year.

Among all of these programs, the Educational Improvement Tax Credit (EITC) and related Educational Opportunity Scholarship Tax Credit (OSTC) are the largest state economic development incentives of 46 programs listed in the IFO report.

I have seen firsthand how much these programs do to rescue promising students from failing schools and afford gifted students opportunities that they otherwise would not have had access to. These programs also help with overcrowding in some areas as all students are no longer “forced” into the same school.

That is why I have consistently supported the EITC and OSTC. In 2017, by a 147-39 bi-partisan vote, I joined my colleagues in voting to increase funding for the Educational Improvement Tax Credit (EITC) program by $50 million for a total of $175 million.

In the 2021-22 budget, I voted to increase the EITC by $40 million. The EITC and OSTC programs have helped more than 14,000 families choose what is best for their children and ensure students of all backgrounds are afforded the opportunity of a quality education and are not trapped in a failing or underperforming school.

The Education Improvement Tax Credit and Opportunity Scholarship Tax Credit programs are managed by the state Department of Economic Development. The School Choice program allows businesses to obtain tax credits in exchange for donating money to students who leave low-achieving schools in the commonwealth.

Those scholarship funds are given to qualified students to attend a school of their choice outside of the school district where they reside.

A low-achieving school is defined as a public elementary or secondary school ranked in the bottom 15 percent of its designation based on combined math and reading scores on the Pennsylvania System of School Assessment.

The Opportunity Scholarship program is geared toward children residing in attendance areas of low-achieving schools. Not only is it working for our students, it is also working to create jobs and encourage businesses to locate in Pennsylvania. That is effective public policy.