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Wolf says he’ll veto $100 million increase to EITC program

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Author: Justin Sweitzer/Wednesday, June 12, 2019

Just one day after the Pennsylvania Senate voted to send a bill expanding the Educational Improvement Tax Credit program to his desk, Gov. Tom Wolf has said he will veto the legislation.

House Bill 800, sponsored by House Speaker Mike Turzai (R-Allegheny), would increase the cap on contributions to the state’s EITC program, which allows businesses to receive tax credits for donating to scholarship organizations that provide private school scholarships to Pennsylvania students.

Turzai’s bill would increase the EITC program by $100 million, while also implementing an escalator clause that would increase the cap by 10 percent every year, as long as 90 percent of tax credits are claimed in the prior year.

Speaking to reporters in Philadelphia on Wednesday, Wolf said he will not sign the bill, characterizing the bill an unfunded increase in expenditures.

“I’m going to veto that,” Wolf said. “I’ve seen enough to know that this is not something that I think is good for Pennsylvania.”

“It’s a $100 million increase in expenditures — a 40 percent increase in one line and then it has a 10 percent increase in the out years with no way to pay for it,” he continued. “I don’t understand that.”

The EITC program was established in 2001 to spur private investment into scholarship organizations that benefit private school students in Pennsylvania. Under current law, businesses may receive a tax credit of up to 75 percent of their contribution, or 90 percent if they pledge to contribute for two straight taxable years.

Turzai’s bill would expand the current state cap of $110 million worth of tax credits to business who make contributions to scholarship organizations to $210 million per year.

The Speaker of the House told The PLS Reporter Wednesday that even if his bill would be signed by Wolf, the EITC program would make up for less than one percent of what both the state and local governments spend on public education in Pennsylvania.

“We’re going to be increasing spending on K-12 here in just the next two weeks to record levels for public education,” Turzai said. “The EITC scholarship tax credits under House Bill 800 amount to a total of $210 million. That is just over half of a percent — 0.5 percent — of the entire amount we spend on public education in the Commonwealth of Pennsylvania between state and local taxes.”

Turzai said the EITC program helps students attend the best schools for them.

“Why not allow students to be able to go to a place that’s them? Whether it’s a rural Christian school, a Catholic school, whether it’s a non-denominational school, a Jewish school in Squirrel Hill or Philadelphia — the values for individuals matter.”

Wolf has approved increases for the program in the past, but said Wednesday that increased funding for private schools diverts attention from the needs that the state’s public schools face.

“It distracts from what we ought to be focusing on — that is educating every child through our public school system,” Wolf said.