OMAHA, Neb. (KMTV) — A petition effort officially kicked off to repeal what was LB 753, now the Opportunity Scholarships Act, which is set to take effect in 2024.
The effort started Tuesday on the steps of the state capitol building.
Supporters call the act school choice. Opponents call it a scheme.
Here’s how the money would flow: The state would certify organizations to collect money and distribute the scholarships. Anyone can donate, including corporations. In its first years, the state has set aside $25 million to reimburse taxpayers for their donations. That would happen through a tax credit. The limit is half of the total tax bill to the state, or $100,000. The $25 million cap could progressively increase as years go on if the credits are nearly entirely claimed.
That's a "far more generous" charitable donation match than anything else in state tax code, says Rebecca Firestone, the director of Nebraska financial think tank Open Sky Policy Institute, who is rallying against the program.
Opponents say the bill essentially gives public funds to private schools that don't face the same requirements as public ones, including on admitting LGBTQ+ students or students that require special education.
Students in families receive first priority for the funds, other than students who received the scholarship the year before and their siblings. Also in that tier are students will an IEP, students experiencing bullying and students in foster care.
The petition effort, in about 90 days, needs 5% of registered Nebraska voters to sign their repeal effort to November 2024 ballots. They could go a step further and put the act on hold if they get 10% of voters to sign. There is also a requirement that necessitates that signatures come from across the state.
Does the bill take funds away from public schools?
Firestone, the director of Nebraska financial think tank Open Sky Policy Institute, argues the bill does divert money from public schools. She says it does that by setting aside $25 million that could have been given to public schools, and by encouraging enrollment away from public schools, less money would be given to districts in the state's aid formula.
"Evidence from other states suggests that the people who benefit financially from this tax credit program tend to be wealthier households and corporations," Firestone said.
The bill's sponsor, Lou Ann Linehan, called it a "lie" to say it diverts money from public schools. She said funding was increased to public schools by $305 million this session.
"If their argument is 'we have to keep these kids because it's more important for the schools to have money than for the kids to go to the school of their choice,' I don't think that's a very good argument," Linehan said.
Do the schools or the family get the money? The money will to the parents of the child seeking a scholarship, not the private schools directly, Linehan said. And while applicants will specify a school they are seeking to attend, they can use the funds to attend any private school, Linehan said.
Linehan said she is not concerned that system would be abused.
"In some states, they have ran into trouble with it when they didn't have tight rules around it," she said. "We have tight rules around it."
Will existing students at private schools be able to benefit from the new program?
Linehan says no unless leaving 8th grade for high school.
Could donors donate to a specific school?
Linehan said they technically could through the scholarship organization, but there's a big catch. She says one scholarship organization must share funding should any of them run out of funds while others have them.
How is the cap enforced?
Linehan said potential donors would be turned away if the tax credit limit is reached.
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