Private Orgs Take 10% From Private School Tax Credits

by David Safier

Thanks to Slade Mead for catching this item on his blog, The Dry Heat. As an ex-State Senator and a 2006 candidate for State Ed Sup, he knows more about this kind of insider baseball than I ever will.

I’m sure you know you can get an Arizona Tax Credit for giving scholarship money to private schools. But did you know that private organizations get a 10% cut from the tax credits? I didn’t. And did you know a legislator, Steve Yarbrough (R LD-21), runs one of the School Tuition Organizations that skims 10% off the top? According to Slade:

Here is the issue… the state has organizations called School Tuition Organizations that collect tax credit money for private schools. Rather than the schools getting 100% of the money (as do the public schools) these STO’s take a 10% cut. This arrangement runs until June of 2011. Yarbrough runs an STO and is literally making hundreds of thousands of dollars off this cozy arrangement.

Rather than recuse himself from all matters pertaining to STOs, Yarbrough runs the legislation! His bill, HB 2108 has a sunset provision. In conference Yarbrough will attempt to take the sunset provision off.

The 10% rip off is scheduled to end in 2011, but Public Servant Yarbrough wants the gravy train to run on and on and on.