Final exam: On last day of session, school tax credit act still hotly debated
by Tim Lockette
May 19, 2013 | 6750 views |  0 comments | 110 110 recommendations | email to a friend | print
If a piece of legislation could live backward in time, it would look a lot like the Alabama Accountability Act.

There was little debate on the bill — which offers a $3,500 tax credit to parents of kids zoned for failing schools — before legislators passed it into law Feb. 28. In fact, most lawmakers hadn't heard of the tax credits a day before.

But since the bill was passed into law, debate in Montgomery has focused on little else. And that debate is likely to come to a head Monday, the last day of the legislative session, as lawmakers weigh in on a second bill that could determine the shape of the tax credit program once and for all.

"So much for ‘dead week,’" said Sally Howell, director of the Alabama Association of School Boards. Her organization used the week before the end of the session, typically a cooling-down period when lawmakers don't meet, to make calls to school board members across the state and ask them to lobby for changes to the Accountability Act.

Howell's biggest challenge right now is simply explaining what's being voted on Monday. The act and its proposed changes have gone through a number of twists and turns since the Legislature last met — making it difficult to explain just what Monday's vote would mean.

Already law

The Accountability Act itself is already state law. The bill creates a tax credit, which state officials say would amount to about $3,500 per year, for parents of students in "failing" schools who want to move their children to either private schools or non-failing public schools.

The bill also sets up a state scholarship program that would give people or corporations a tax credit for donations made to a nonprofit scholarship foundation. Those scholarships would go to students in failing schools, to help them pay for tuition or school supplies. There's no limit on the amount of money that can go into the scholarship program — but the state will hand out only $25 million total in tax credits to those who give money to the scholarship program.

Critics said the law was too vague about its definitions of "failing" schools, that it would take money from the state's education budget (which is largely funded by income tax) and that public schools weren't ready to handle the transfer students it would generate.

The criticisms sent Marsh back to the drawing board. He sponsored HB658, a bill that would rewrite some sections of the Accountability Act. That bill passed both houses earlier this month.

But Gov. Robert Bentley has yet to sign it. Bentley returned the bill to the Legislature on Wednesday, asking that they add wording that would delay the implementation of the tax credits for two years.

Bentley's main reason for the change: money. The state is still trying to pay back more than $400 million it borrowed from its own Education Rainy Day Fund years ago. By law, that money has to be paid back by October 2015. Bentley wanted to pay back $100 million in 2014 — but with the cost of the Accountability Act estimated at somewhere between $30 million and $70 million, the 2014 budget now includes only $40 million for that payback.

"It's an issue of making sure we have as many resources as possible," said Jeremy King, Bentley's spokesman.

If Bentley's proposal passes…

Bentley has said he won't sign the changes to the Accountability Act without the two-year moratorium.

If the house votes to accept Bentley's suggestion (officially a vote to "concur"), the two-year delay would go into effect, along with all the other changes suggested for the Accountability Act.

Chief among those is a new definition of failing schools. There's still no official list of schools that would be deemed "failing" under the Accountability Act, but the bill now before lawmakers would declare a school failing if it falls into the bottom 6 percent in academic performance in three of the last six years.

The bill leaves it up to the Alabama Department of Education to come up with a way to define failing schools. (State school officials prefer the term "priority schools.") There's no official list of those schools yet. But school officials say it’s likely no more than 75 of the state's 1,500 schools would wind up on the failing schools list. That's compared to an estimated 135 under the current Accountability Act. That could significantly cut into the act's long-term cost.

The bill now before the Legislature also includes wording that would allow schools to reject students who hope to transfer out of failing schools under the bill.

That wording would satisfy the demands of school administrators who said they don’t have room to accept more students — but it could dramatically cut the number of students who actually get the tax credit.

A two-year delay on the tax credit would enable the state to pay back more of its debt to the Rainy Day Fund, but it's not clear by how much. Supporters of the two-year delay say it's best to pay the Rainy Day debt down as much as possible this year.

"The tax credit puts us in a terrible situation in the 2015 budget," said Eric Mackey, director of School Superintendents of Alabama.

State school officials say a two-year delay would help them prepare for the impact of the Accountability Act. Before the Accountability Act was passed, the state was already seeking a way out of the No Child Left Behind Act — and shifting away from the Alabama Reading and Math Test Plus. That's the test now used to judge school performance.

State Education Department spokeswoman Malissa Valdes-Hubert said the state is switching to the ACT Aspire, a test designed by the same company that produces the ACT college entrance exam.

"What we're finding is that the ARMT-Plus doesn't grow them into the ability to take the ACT," Valdes-Hubert said.

School officials plan to use the ACT — and a sister test designed to judge whether non-college-bound kids are ready for the workforce — in a new accountability system focused on readiness for college and careers. A two-year delay, she said, would give the system more time to make that transition.

... and if Bentley's proposal is rejected

Accepting Bentley's two-year proposal isn't the Legislature's only option. They can vote to override the governor on the changes, which would put the HB658 changes in place without the two year delay.

That’s what Sen. Del Marsh, R-Anniston, wants to do. In a statement released Thursday, Marsh said he'd ask legislators to override the governor. Kids in failing schools, Marsh said, can’t wait another two years.

If Marsh can't get the votes to override, he said, he'll leave the bill in the basket in the Senate. If HB658 never comes to a vote, the Feb. 28 version of the Accountability Act will be remain law.

“Since the Accountability Act is already law, both of these options ensure that parents of children stuck in failing schools have school choice now, not in two years, and finally have the opportunity for a better education," Marsh's statement read.

That means one out of every 10 schools in the state could wind up on the "failing" list. The Accountability Act, as now worded, contains four definitions of "failing" schools — the clearest of which would give the "failing" label to the bottom 10 percent of state schools. That determination could be made based on just one year of testing data.

Anniston High School has a chance of being on the failing list no matter which bill becomes law. But the chance is greater under the 10 percent approach.

The ARMT, the state's basic standardized test, isn't given in high school. Valdes-Hubert says the state's ranking of high schools will likely be based on each high school's graduation exam scores and its graduation rate.

According to the most recent list of graduation rates, Anniston City Schools — where Anniston High is the only high school — has a graduation rate of 58 percent, well below the state average of 72 percent.

It’s not clear whether schools would be able to reject transfer students under the original Accountability Act. Lack of clarity in the bill’s wording was one reason lawmakers sought changes to the bill. If HB658 fails, the question of accepting transfer students will likely remain open.

Chance of passage

Mackey, the head of the school superintendents’ association, said many lawmakers in the Republican supermajority seemed open to the governor’s changes.

"The only districts I've heard news from are Republican, but they seem to be leaning in favor of the governor's proposal," Mackey said.

Mackey made those comments before Marsh declared that he wouldn't support the governor's changes. Even if the governor's proposal passed the House — where budget hawks in both parties might be willing to support it — Marsh likely has enough power in the Senate to make sure the governor's proposal never gets a hearing.

But if Monday produces a sudden reversal, it wouldn't be the first in the conflict engendered by the Accountability Act. That has some lawmakers, such as Rep. Barbara Boyd, D-Anniston, unwilling to make predictions.

"This Legislature is unpredictable," Boyd said.

Capitol & statewide correspondent: 256-294-4193. On Twitter @TLockette_Star.
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