Supreme Court upholds Arizona’s tax break for private education

WASHINGTON – The Supreme Court’s conservative majority opened the door for new state support for religious schools, ruling that special tax credits that pay for children to go to church schools cannot be challenged by dissenting taxpayers.

The 5-4 decision is a major win for those who support the school choice movement and aid to parochial schools, and a potentially far-reaching loss for defenders of the separation of church and state.

The ruling effectively upholds Arizona’s dollar-for-dollar tax credit, up to $500 per person or $1,000 for a couple, for those who donate to organizations that in turn pay tuition for students attending private and parochial schools.

The court’s ruling put an implicit stamp of approval on similar laws in at least six others states that offer tax credits for those who support religious schools. And it is likely to encourage other states to do the same, since tax credits are more politically acceptable than public aid to religious schools.

Justice Elena Kagan, in her first written dissent, spoke for the court’s liberal bloc in saying the ruling “offers a road map – more truly, a one-step instruction” for those who seek public money to aid religion. Use tax credits, not cash grants, she advised.

The ruling goes further than ever before in shielding public subsidies for religion from a legal challenge. The First Amendment bars the government from promoting “an establishment of religion.” And since the 1960s, the high court has invoked the First Amendment to strike down a series of state laws that send public money to parochial schools.

In all those decisions, taxpayers had sued in federal court, arguing the subsidy for religion violated the First Amendment. The Arizona case began the same way when several taxpayers sued to challenge the state’s tax credits. They pointed out that some tuition support groups gave money only to children who attended certain church schools. And their ads told taxpayers they could support a child in a religious school, and “it won’t cost you a dime.”

The U.S. 9th Circuit Court of Appeals ruled this scheme an unconstitutional subsidy for teaching religion, but in Monday’s decision, Justice Anthony M. Kennedy threw out the entire lawsuit, holding the objecting taxpayers had no standing to sue.

“When Arizona taxpayers choose to contribute (to a school tuition group), they spend their own money,” he said, not the state’s money. Therefore, others have no right to object, he said. Chief Justice John G. Roberts Jr. and Justices Antonin Scalia, Clarence Thomas and Samuel A. Alito Jr. agreed in the case of Arizona Christian School Tuition Organization v. Winn.

“That is absurd to say it is their money. It is tax money they owe to the state,” replied Paul Bender, the Phoenix lawyer for the objecting taxpayers. “If you give the money to a church school, you get a 100 percent tax credit. If you can’t object to that, what’s left?”

He and other advocates were surprised in November when the Obama administration’s acting Solicitor General Neal Katyal urged the court to throw out the suit brought by the Arizona taxpayers.

Some school choice advocates said the decision will encourage other states to look to tax credits.

Nine years ago, the high court upheld the use of state tuition vouchers in Ohio that allowed poor children in Cleveland to enroll in a private or parochial school. Despite this legal breakthrough, however, few states followed Ohio’s lead. Supporters of public education fought hard against such public aid for parochial schools.

By contrast, tax credits have been seen as more acceptable. “This has quietly become the option of choice” for those who favor state aid for religious schools, said Notre Dame law professor Richard Garnett, counsel for the American Center for School Choice. “And this decision is likely to encourage the shift” in favor of tax credits for religious schools, he said.

Attorneys general from 13 states had urged the court to approve the use of “tax incentives” to “increase access to private schools.” They cited laws in Florida, Georgia, Indiana, Iowa, Pennsylvania and Rhode Island that allow tax credits for support of private schools.