The following parental choice in education legislation is under consideration during the 2015-16 Legislative Session in Minnesota:
1. K-12 Education Expense Credit and Deduction
The current proposal expands the income limits, indexes for inflation, and allows for private school tuition as an allowable expense for the tax credit. The proposal will serve nearly 95,000 Minnesota families, with the average family qualifying for the $1,500 tax credit.
Bill numbers: In the House, HF 798 (Knoblach) was included in the House tax bill, which is HF 848 (Davids). The Senate companion to HF 798 is SF 1224 (Chamberlain).
Status of Bill: Governor Dayton proposed a modest expansion of the K-12 Education Tax Expense in his budget recommendations released in February 2015. HF 798 was included in the House Tax bill (HF 848. House Republicans offered the individual tax credit proposal as part of a Special Session package to resolve the state’s economic disparities. The tax credit portion of the proposal was increased from $1,500 to $3,500. However, Gov. Dayton and the Legislature did not come to an agreement on the terms of a Special Session. The proposal will be part of legislative leadership negotiations with Gov. Dayton during the regular legislative session starting in March 2016, as the legislation is currently included in the House Omnibus Tax bill passed in 2015. Minnesota Management & Budget released the state’s latest budget forecast in February 2016. The updated figures show a $900 million surplus, $306 million less than the projections made last November. Revenues are down $427 million, but spending was also $109 million less than predicted. Given this change, the Minnesota Legislature will have less money for tax relief and new government spending.
Bipartisan support: Yes. Governor Dayton proposed expanding the K-12 education expense and House Republicans expanded the proposal and included it in the omnibus tax bill
Cost: $23.6 million per year
2. Equity and Opportunity Scholarship Act (known as K12 Scholarship Tax Credit)
This bill would allow individuals and corporates to receive a tax credit for donating to charitable entities (called Student Tuition Organizations or STOs), who in turn award K-12 scholarships to children from income-qualifying families. Corporations and individuals would be eligible to receive 80% credit on annual state income tax liability. The current bill caps the appropriation at $40 million per year.
Bill numbers: HF 1369 (Kresha) and SF 1396 (Senjem) awaits action in both legislative bodies.
Status of Bill: The bill is authored by Rep. Ron Kresha (R) in the House and Sen. Dave Senjem (R) in the Senate. Sen. Terri Bonoff (DFL-Minnetonka) is a co-author of the bill. The House Republicans on the Education Committee plan to move the bill forward and include pre-kindergarten in the proposal by amending HF 1369 into HF 1368, which will be heard in the House in late March 2016.
Bipartisan support: Yes
Cost: $40 million per year
3. Education Savings Accounts (ESAs) for Special Education Students
This bill gives parents of special education students access to the current K-12 per-student education funding formula to use the funding for tuition and other educational needs. The bill allows the resident school district to retain up to 20% of the per-student amount and the parent may access up to 80% of the allocation for educational expenses, including private school tuition.
Bill numbers: HF 1529 (Fenton) and SF 1313 (Hann).
Status of bill: HF 1529 passed the Education Innovation Committee and Government Operations Committee in 2015. The bill will heard in the House Education Finance Committee and moved to the House Floor in late March 2016. SF 1313 awaits action in the Senate.
Bipartisan support: Not at this time
Cost: Funding is currently allocated within the K-12 per-student education funding formula.