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Education Group Sues To Block New Tax-Credit Scholarship Program

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Lawyers with Council For Better Education say a new tax-credit scholarship program, created by the passage of HB 563 earlier this year, is not legal under the state’s constitution.

The pro-public education nonprofit, along with a group of parents and two Kentucky school districts, are suing to block the state from starting the program, which would use tax credits to fund a private school scholarship program. 

“The [Kentucky] Supreme Court has emphatically and repeatedly held that the Constitution’s education and public funds provisions forbid the Commonwealth from funding private schools,” the lawsuit, filed late Monday in Franklin County Circuit Court, reads.

Individuals and corporations can donate to the Education Opportunity Account Program and get a tax credit of up to 97% in return. Middle and low-income families can then apply to receive scholarships to cover educational expenses like textbooks or tutoring. In the state’s most populous counties, families can also use the scholarships to pay for private school tuition.

At least 17 other states have some version of this program. Supporters say they help open up private education to families who couldn’t normally afford it. But plaintiffs say the programs divert funding from cash-strapped public schools to “unaccountable” private schools.

Gov. Andy Beshear vetoed the bill that created the Education Opportunity Account Program, butRepublican lawmakers overrode that veto.

The plaintiffs are particularly concerned about a statute in the law that prevents the state from requiring private schools to alter their “creed, practices, admissions policy, or curriculum.” This prohibition, they say, opens the door to potential discrimination.

In the complaint, plaintiff Katherine Walker-Payne, a parent in Jefferson County, “objects to HB 563, because, as an LGBTQ family, she believes that public funds should be used to support the public schools that her children attend, rather than private schools that may discriminate against her family.”

In addition to Council for Better Education and Walker-Payne, Frankfort Independent Schools, Warren County Schools and two other families are plaintiffs in the case.

They’ve asked the court for a permanent injunction blocking the tax-credit scholarship program from going into effect June 28.

A spokesperson from Attorney General Daniel Cameron said his office is “in the process of reviewing the complaint.” 

Council For Better Education is the same nonprofit that won the landmark Rose v. Council For Better Education case in 1989. That held that the General Assembly is responsible for adequately funding public education throughout the state. 

The group lost a different case that challenged the adequacy of the state’s education funding in 2007, when they argued low scores on state tests showed schools were not sufficiently funded. The court ruled the plaintiffs did not have enough evidence.

The Associated Press reports the Institute for Justice plans to intervene in the case on behalf of the state. The Institute for Justice litigated the landmark Espinoza v. Montana Department of Revenue case in 2019, which determined that Montana could not prevent voucher dollars from going to private religious schools.

Jess Clark is LPMs Education and Learning Reporter. Email Jess at jclark@lpm.org.

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