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House of Representatives
Session of 2023 - 2024 Regular Session


Posted: October 10, 2023 03:43 PM
From: Representative Joe Ciresi
To: All House members
Subject: Ensuring our Educational Tax Credit Programs Support Students in Need
Over the past couple of decades, we’ve seen funding for Pennsylvania’s educational tax credit programs increase significantly. But despite over $2 billion in state tax credits being awarded for private and religious school vouchers, the programs are set up in a way that make it difficult to determine their effectiveness and with surprisingly little oversight in how this money is spent.

The Independent Fiscal Office found that statutory limits on the programs’ data that may be collected make it impossible to determine whether state funds are used effectively and the extent to which these tax credits increase educational opportunities. Beyond that, Pennsylvania has a higher scholarship eligibility income limit than any other state, resulting in taxpayers subsidizing private school tuition for many families who could afford it even without the scholarships. Loopholes and the highest administrative expenses cap in the country also divert money that could otherwise go to students from low-income families. We have the opportunity to reform these programs to incorporate accountability and create confidence that the money we’ve authorized for these programs is going to students who need it.

That is why I plan to introduce legislation to reform our educational tax credit programs and ensure this money is serving its intended purpose by:
  • Refocusing the programs on those in need of assistance by lowering the eligibility income limit for EITC and OSTC scholarships – currently the highest in the country – to 200% of the federal poverty line and adjusting definitions of household income to better align with what’s used for other state programs;
  • Freeing up more money for scholarships to students and being fiscally responsible by reducing the cap on administrative expenses for scholarship organizations from 20 percent (also the highest in the country) to 10 percent, and closing loopholes to make sure this money is actually spent on administrating scholarship programs; and
  • Expanding data collection that will allow for the meaningful evaluation of program effectiveness and that scholarships are going to those who need them. 
This legislation implements multiple recommendations of the Independent Fiscal Office intended to improve the ability of these tax credit programs to achieve their goals and purposes. It also aligns program parameters to be more fiscally responsible and similar to the overwhelming majority of other states with similar programs. Please join me in co-sponsoring this legislation to ensure taxpayer money is spent responsibly and going to families who need it. 

Introduced as HB2063