OK. I know I sound like a broken record going on and on about the Alabama Accountability Act and its shortcomings. But when you visit schools across Alabama and time after time see needs unmet, while you know at the same time the accountability act has diverted more than $52 million from the Education Trust Fund, it is hard not to speak out.
In 2013 We listened to all the promises coming from the Statehouse about what wonderful things this legislation would do for struggling schools and their students. But nearly three years later we see that to a large degree, it was all just a figment of someone’s imagination.
The original version of AAA said that scholarship granting organizations could raise up to $25 million annually to award as scholarships. That year seven SGOs collected $24.7 million. The lion’s share ($17.8 million) went to the Alabama Opportunity Scholarship Fund that was supposedly established by former governor Bob Riley (though info at the Secretary of State’s office says the organizer was actually John Kirtley of Tampa).
Twenty-five donors gave the $17.8 million. Info from Kirtley’s Florida-based Step Up for Students SGO says $14 million came from just two donors. Next in line was Scholarships for Kids, Inc. in Birmingham with $6.3 million from 753 donors.
The other five raised a total of $616,142.
(Donors get a dollar for dollar credit against their Alabama tax liability. All income tax collected goes to the Education Trust Fund. So a $1 million donation diverts $1 million from education.)
The money raised by SGOs in 2013 was spent on 5,690 scholarships in 2014. But here is when things begin to go hay wire. The law says that every student receiving a scholarship is eligible to continue getting on until they graduate high school or reach 19 years of age. Simply put, the SGO must raise as much one year as they did the year before to just tread water with scholarship numbers.
Apparently the Alabama Opportunity Scholarship Fund did not get the memo because instead of raising $17.8 million in 2014 as they did in 2013, they only collected $652,390. This drastic decrease was blamed on the fact that a Montgomery circuit court ruled AAA unconstitutional in May 2014. (This ruling was overturned by the Supreme Count earlier this year.)
As I testified at hearings on an amendment to AAA before both House and Senate committees, if court action prevented AOSF from raising money. why didn’t it have the same impact on all SGOs. The truth is, while donations to AOSF screeched to a virtual halt in 2014, Scholarships for Kids, Inc. increased their donations from $6.3 million in 2013 to $12.1 million in 2014–a jump of 91 percent.
But as is often the case in committee hearings, facts don’t really count.
So the legislature amended the 2013 bill by increasing the annual cap on donations from $25 million to $30 million and by allowing donations be made and counted retroactively to 2014 since only 53 percent of the $25 million cap was raised. The law was also changed to allow the individual donation limit be increased from $7,500 to $50,000.
That brings us to right now, the middle of November 2015 with about 45 days left for SGOs to raise money. So what about making donations retroactive to last year the legislature said we needed? Records from the Alabama Department of Revenue show that of the $11.5 million that could have been raised and counted against 2014, only $2.6 million came in.
And what about that $30 million the legislature said we needed in 2015. Only $14 million has come in so far, though granted, many such tax breaks show up very late in the year.
Two things are now clear. 1) the legislature’s crystal ball continues to not work and 2) in spite of the wholesale lack of enthusiasm for the accountability act we were promised, we do know we have diverted $52 million in the last three years from potentially helping public schools.