A controversial proposal to give state tax credits to companies that make donations for private school scholarships is gaining momentum in Maryland, drawing support from top Democratic leaders to the consternation of the state teachers’ union.
One bill that would create an education tax credit received preliminary approval in the state Senate on Tuesday. A slightly different version of the measure is expected to advance in a House committee, possibly before the end of the week.
Maryland House Speaker Michael E. Busch (D-Anne Arundel) said Tuesday that he is softening on the idea of giving tax credits to companies that make donations to help pay for private school scholarships, clearing the way for the bill to be heard on the House floor this session.
Busch, who has been a fierce opponent of education tax credits, said there is a growing sentiment among many Democratic lawmakers from Baltimore City and parts of Prince George’s County — urban areas with some of the state’s lowest-performing schools — that students need more educational options.
He said a bill, known as Broadening Options and Opportunity for Students and Teachers and introduced by Del. Keith E. Haynes (D-Baltimore City), addresses those requests.
“Many legislators come to me and have suggested that they would like to see some kind of legislation put forward,” Busch said. “It’s a fair gesture that we take a look at it . . . to lay out parameters and guidelines” for how they think the money should be distributed.
Under the bill, the state Department of Commerce would receive donations from companies that would be placed into a fund. The businesses would get a tax credit of 70 percent of the donation. The money in the fund would be used to provide scholarships to students who are eligible for free and reduced-price meals. At least 5 percent of the student population would have to be disadvantaged in order for a schools to be eligible.
The Senate version of the bill, known as the Maryland Education Tax Credit, would give a 60 percent tax credit for donations from companies to a so-called student assistance organization that provides private-school scholarships. The bill has been introduced for the past 10 years and won the support of then-Gov. Martin O’Malley (D). It advanced in the Senate in the past, but not in the House.
Gov. Larry Hogan (R), who took office last year, sponsored tax-credit legislation then and again this year. In 2015, he blamed Busch for not allowing the measure to move out of committee.
“I think there has to be some kind of response,” Busch said Tuesday. “Maybe it doesn’t pass. I’m not guaranteeing that it does. But certainly, it is in a better posture and there is more comfort level here than it’s had in the past.”
The bill could become one of the few issues on which Busch, Hogan and Senate President Thomas V. Mike Miller Jr. (D-Calvert) come to an agreement.
Doug Mayer, a spokesman for Hogan, said they are pleased that Senate moved its bill, which is similar to Hogan’s proposal.
“We want to see the latitude and the ability of businesses to make donations to public and nonpublic schools,” he said. “We’ll have to see what happens in the House.”
In the Senate, several Democratic lawmakers tried nearly a dozen times to amend the bill. The amendments included requiring an audit of the program, placing a sunset provision on the tax credit, and ensuring that 45 percent of the students attending the school are eligible for free and reduced-price meals. None of the amendments succeeded.
Maryland would join 16 other states across the country that offer education tax credit programs. Most of them have Republican-controlled legislatures, including Virginia, Georgia, Florida and Alabama.
Sean Johnson, assistant executive director with the Maryland State Education Association, called the two bills “slightly different versions of the same bad idea,” and said the union is lobbying hard against them.
“I’m fairly certain if one of these tax credits passes, it will be the first time a Democratic supermajority state advances a proposal like this,” Johnson said.
He said the programs, which would be allotted $15 million under the Maryland Education Tax Credit and $50 million under the BOOST program for disadvantaged students, would divert money away from public schools and other state needs.
Both House and Senate bills have provisions allowing businesses to receive a tax credit if they donate to innovative programs at public schools.
Also on Tuesday, the Senate gave an initial nod to a bill requiring local school districts to notify parents of county, state and federal assessments that students take in class, including posting information on their websites about when students are tested, why they are tested and how long the tests will take. The legislation is in response to criticism by parents, teachers and students about excessive testing.
The Senate also gave preliminary approval to a bill that would allow voters to determine whether they should decide who should fill the seats of the attorney general and comptroller if a vacancy occurs during a term. Under current law, the governor appoints a replacement.