Corporate Tax Credits in Florida

Patrick Gibbons

Florida’s very popular Corporate Tax Credit (CTC) program serves more than 20,000 low-income students with $3,950 scholarships that allow each student to attend a private school chosen by his or her parents. The vast majority of those students are minorities.

Corporations make a donation to a non-profit scholarship organization, which in turn awards the scholarships to low-income kids. The State of Florida offers a dollar-for-dollar tax credit for each dollar so donated.

This week a study of the CTC program that the Florida legislature had ordered was released. According to the St. Petersburg Times the study revealed no significant gains for students enrolled in the program. However, Dr. Jay P. Greene of the University of Arkansas noted that the study was descriptive and did not complete a statistical analysis of the available data, making such a conclusion premature.

Dr. Greene, along with the study author, noted that students receiving the CTC scholarships come from schools where students are significantly more disadvantaged than students remaining in Florida’s traditional public schools. As a result, the typical criticism from voucher opponents – that vouchers only benefit advantaged students – falls flat, as the voucher students here are the poorest and lowest achieving students. Unfortunately the study does not prove, one way or the other, the effectiveness of the program.

Dr. Greene believes that more data and a more rigorous research design will provide enough useful information to reach a conclusion on the program, but it is too early to tell. The problem, he notes, “is that the standard for success when it comes to school choice is that it has to produce a quick fix or critics deem it a failure…”

“Quickness” is, of course, is always relative to an observer’s benchmark. But there is much evidence that school choice is an effective means for insuring long-term gains in student achievement.