Taxes, Religion, And Education: How Much Are We Willing to Pay for Choice?
In 1976, my first-grade public school teacher in Kansas led our class in the Pledge of Allegiance each morning. She followed it with a recitation of The Lord’s Prayer. (I didn’t know the words and mumbled along as best I could.)
In 1983, I shared that experience with my eighth-grade social studies teacher in Wisconsin. He thought if parents wanted their children to pray in school they should send them to religious school and pay their tuition. Taxes, he explained, paid for public education.
Times are changing. In the courts and legislatures, advocates are pressing to require state and local governments to pay for religious schools, either directly or through generous tax credits. But are residents prepared for one possible consequence: Less money available for public schools?
A little history: The Blaine Amendment
Back in 1875, Rep. James G. Blaine (R-ME), the Republican leader in the US House, sought to expand the First Amendment. It would have said;
“No state shall make any law respecting an establishment of religion or prohibiting the free exercise thereof; and no money raised by taxation in any state for the support of public schools, or derived from any public fund therefor, nor any public lands devoted thereto, shall ever be under the control of any religious sect, nor shall any money so raised or lands so devoted be divided between religious sects or denominations.”
Blaine’s amendment to bar any tax dollars from being spent on religious schools passed in the House but narrowly failed in the Senate. However, Congress passed a law requiring new states to add Blaine-like amendments to their constitutions. Today, 37 states have this constitutional ban—but not Maine, which became a state in 1820.
Carson v. Makin: Vouchers for religious secondary education
On June 21, the US Supreme Court ruled in Carson v. Makin that if Maine provides vouchers for any private schools, it must do so for religious schools as well.
Because Maine is so rural, 15 percent of its towns do not have public secondary schools. To accommodate their students, Maine offers vouchers to families who enroll their children in nearby private schools. But students at religious schools were not eligible. Two families sued, arguing that Maine discriminated against them because of their religion. The majority of the High Court agreed.
According to Maine’s attorney general, these religious schools still need to abide by the same anti-discrimination law that other participating private schools follow. But that would pose yet another obstacle for religious schools, says Carroll Conley, executive director of the Christian Civic League of Maine. In that case, he predicts still more litigation.
Vermont, also a rural state lacking a Blaine Amendment, has a similar voucher program. But its constitution states that Vermonters cannot be forced to “support” (with say, tax dollars) a religion that is “contrary to the dictates of conscience.”
Peter Teachout of Vermont Law School says the state could seek to require participating schools to comply with state and federal anti-discrimination policies. Whether proponents of public funding of religious education in Vermont, like those in Maine, see this as an obstacle remains to be seen.
Hile v. Michigan: 529 savings plans for religious K-12 school tuition
In my home state of Michigan, conservative advocates are trying multiple approaches.
Michigan’s restrictive Blaine-like constitutional provision bars tax dollars from funding any private education, whether religious or secular. It reads:
“No payment, credit, tax benefit, exemption or deductions, tuition voucher, subsidy, grant or loan of public monies or property shall be provided, directly or indirectly, to support the attendance of any student or the employment of any person at any such nonpublic school or at any location or institution where instruction is offered in whole or in part to such nonpublic school students.”
The Mackinac Center Legal Foundation represents families who want to use their tax-advantaged 529 education savings accounts to help pay for K-12 private school tuition, including in religious schools. That is allowed under the federal Tax Cuts and Jobs Act but barred by Michigan’s constitution. These families argue Michigan’s 529 program discriminates against religion. Their case is now in federal court.
Let Michigan Kids Learn group: Scholarship tax credits for religious education
At the same time, a pro-school choice group backed by former US Education Secretary Betsy DeVos is taking a slightly different tack. It wants Michigan to allow individuals and businesses to claim a tax credit for up to the full amount of their contributions to private school scholarship funds. The tax credits would be available for religious school tuition but capped at a total of $500 million annually.
The group failed to get a voter initiative on the November ballot but now wants Republicans in the state legislature take up the measure in the fall. If it passes, Michigan would have one of the largest tax credit scholarship programs in the US, second only to Florida’s $874 million program. To date, 17 states have scholarship tax credit programs.
Where do these developments leave taxpayers?
Regardless of what people think about the separation of church and state or the importance of religious choice in public education, their tax dollars may soon fund religious education throughout the country.
Many states are unlikely to raise tax rates to pay for additional education spending, so there may be fewer tax dollars available for traditional public education. Or, new spending on religious education might crowd out other state and local spending.
Taxpayers should pay attention. Choices in education come at a cost. If taxpayers are not willing to cover it, there will be winners and losers—not all of them students.
The Tax Hound, publishing once a month, helps make sense of tax policy for those outside the tax world by connecting tax issues to everyday concerns. Have a question or an idea? Send Renu an email.
