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My Turn: ‘Monitor,’ judge wrongly argue your money is the government’s money

At what point does the money in your private bank account become the government’s money?

In an unprecedented decision last month, a Strafford County judge ruled that parents participating in New Hampshire’s nascent scholarship tax credit program could not choose to send their children to religious schools. The program grants tax credits to corporations worth 85 percent of their eligible donations to nonprofit scholarship organizations that fund low- and middle-income students attending the schools of their choice.

Judge John Lewis ruled that scholarship recipients could still attend secular private schools, out-of-district public schools, and home schools.

However, he forbade the use of scholarships at religious schools as a violation the state Constitution’s historically anti-Catholic “Blaine Amendment” provision, which states that “no money raised by taxation shall ever be granted or applied for use of the schools of institutions of any religious sect or denomination.”

The judge’s decision contradicts the understanding of every high court to address this question thus far. In 2011, the U.S. Supreme Court held that when “taxpayers choose to contribute to (scholarship organizations),  they spend their own money, not money the state has  collected from . . . other taxpayers.”

But rather than adhere to this precedent, Lewis relied on the dissenting opinion in that case, as well as the dissenting opinion in an Arizona Supreme Court decision, to blur the distinction between tax credits and government spending. But as the Supreme Court explained, the logical flaw in this argument is that it “assumes that income should be treated as if it  were government property even if it has not come into the tax collector’s hands. Private bank accounts cannot be equated with the . . . state treasury.”

What about property tax exemption?

On Sunday, a Monitor editorial denounced the U.S. Supreme Court’s view as a “fiction,” a “subterfuge,” and a “cheap trick.” But if the government already owns money that it chooses not to collect, as the Monitor and Lewis believe, then every religious school and house of worship is already directly “funded” by “public money” because they qualify for the longstanding state property tax exemption.

Moreover, this would be a direct “subsidy” to religious institutions, unlike the scholarship tax credit program, which “subsidizes” parents who may or may not choose a religious school. In reality, both the property tax exemption and the scholarship tax credit program are constitutional because tax credits, exemptions and deductions are not public money in any historically accepted sense of the term, and these programs are neutral with respect to religion. It is absurd to believe, as Lewis and the Monitor apparently do, that these programs can only be constitutional if they are actively hostile to religion instead.

1955 precedent

But even under the illogical view that tax credits constitute “public money,” the scholarship tax credit program should still be constitutional based on New Hampshire precedent, though it is limited and nonbinding.

A 1955 Opinion of the Court declared that a voucher program for nursing school would be constitutional even if the public funds were used at a religious school because it was indirect (i.e. – the money went to the students, not the schools) and incidental (i.e. – if the money went to a religious school, it was because the recipient chose that school).

The New Hampshire Supreme Court declared that “members of the public are not prohibited from receiving public benefits because of their religious beliefs or because they happen  to be attending a parochial school.”

While a subsequent nonbinding opinion declared that a $50 property tax credit for private school tuition would be unconstitutional, the logic of that opinion contradicted the court’s previous position and it was never fully implemented. New Hampshire continued to grant property tax exemptions to religious schools and even used tax dollars to fund students attending religiously-affiliated colleges.

The scholarship tax credit program is intended to expand educational options for those who need it most. Wealthy families already have school choice. They can afford to live in a district with a high-performing public school or pay for private school. Often, the only choice low-income families have is their assigned district school.

The judge’s decision, in violation of precedent and logic, unnecessarily and unconstitutionally limits the educational choices that the scholarship tax credit program would make available to them. Let us hope that the New Hampshire Supreme Court has better judgment.

(Jason Bedrick, a former New Hampshire state representative, is a policy analyst at the Cato Institute’s Center for Educational Freedom.)

Legacy Comments6

This is a well-written and argued piece. However, I support the Court's opinion, and disagree with this critique of the decision. There is a difference between the property tax exemption that churches receive and this 'scholarship' program. Historically, churches and other non-profits have had a broad purpose related to the public good--charitable works, maintaining community ties, etc. Hence one justification for the exemption. But the scholarship program was deliberately designed as an ideological end-around to this tradition. Rather than promote the 'public good' this program was designed to fragment and undermine those notions, in seeking tax payer support of ideals that are often contrary to and openly hostile to notions of the 'public good'. Seeking tax-payer support for these beliefs--and tax credits are tax payer support no matter how parsed-- is hypocritical. There are limits to the extent a pluralistic society should underwrite support for those who would prefer theocracy or some other form of government to our democratic ideals.

So, I agree with you on this one. I don't think that taxpayer monies should go towards any private school, religious or otherwise. If you want to send your child to a private school, that is your prerogative but don't expect a "rebate" because you want to accessorize. However, I do sympathize with the folks who want to send their children elsewhere and this is another topic but our system is broken, driven by political agenda and ideology and is not preparing our students for higher education effectively. Tax payers should not support any beliefs, religious or otherwise. I think having children read: "Heather has two mommies" or preaching political agenda and indoctrinating children must stop as well. We barely teach the three "r's" and the basics, instead focusing on far too many social agenda issues. But money for religious schools or private schools in any shape or form........NO!

If memory serves, this makes two areas of agreement. I think we agreed that 911 "Truthers" are all wet, as well.

I guess they real answer is to remove all "donations" from tax exemption status. Each person owes whatever their due money is and anything one donates to anything is just that, a "donation". An interesting lawsuit would be, if I donate money to my church and then write off the donation against my tax bill, am I funding the church with tax money. That essential is what is happening here, tax money goes to the school or in my case directly to the church. A further test may be the whole "property tax exemption" for churches and religious schools. Can “not” paying taxes but receiving tax supported service (fire, police ….) be considered state tax supported. My opinion is that the Constitution says a separation between church and state, but that is only in so far as telling people what to believe or how to believe. Nowhere does it say the state cannot charge the church (or a religious school) for a service supplied. I’m pretty sure they pay for sewage service, so why not fire and police coverage like everyone else?

So, if education is a right along the lines of speech, the government has no business being involved in it in the first place. Yet those seeking a “free” education for everyone do not seek a government-free education, they seek a government monopoly of it. Since education is a human right, the involvement of government can, logically, only serve to infringe upon that right. But that’s not what these people are really about."

There may be logic in your post, but your premises are false. The federal government historically serves as the guarantor of those rights you speak of. States have in the past often shown themselves to freely violate many of the freedoms enumerated in the Constitution and the Bill of Rights. You mis-label as 'government monopoly' the free and universal access to education, paid for by everyone. There are reasonable limits placed upon free speech; there are reasonable parameters to public education. Democratic government both protects those rights and sets limits on them in practice. A 'government-free' education is a libertarian pipe dream that ends in preaching Social Darwinism and justifies the doctrine of might making right. That's why so many libertarians are gun fetishists.

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