[Congressional Record Volume 148, Number 61 (Tuesday, May 14, 2002)]
[House]
[Pages H2448-H2453]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         EDUCATION TAX CREDITS

  The SPEAKER pro tempore (Mr. Issa). Under the Speaker's announced 
policy of January 3, 2001, the gentleman from Colorado (Mr. Schaffer) 
is recognized for 60 minutes.
  Mr. SCHAFFER. Mr. Speaker, tonight I want to talk about children and 
the topic of education. I believe it is the most important issue that 
we have to discuss, especially when we look out into the future of 
America and where we are headed.
  My colleagues who preceded me had a very excellent discussion, the 
tenor of which I certainly concur with and agree. And I guess I would 
ask colleagues to consider this same debate or similar debates years 
and years from now, when the children of today are the leaders of 
tomorrow and are debating these important matters of international 
peace and security and all the topics that we deal with here in the 
Congress.
  I would invite my colleagues who may be monitoring today's 
proceedings, if they are interested in engaging in this discussion or 
participating in it, to come join me here on the floor. The topic today 
is, again, education, and particularly with respect to the proposal of 
education tax credits. This is something that our President has 
mentioned frequently. This is a topic that has become well-known in 
several States that have preceded this Congress in exploring the topic 
of education tax credits, and it is an innovative idea and a way to try 
to get new dollars, additional dollars to children for the purposes of 
expanding and broadening their academic horizons.
  I am one who believes here, Mr. Speaker, that if our children really 
are important, and I believe they are, that this Congress ought to be 
prepared to spend whatever it takes to give them the kind of quality 
education that they deserve here in America, an education that is 
second to none. Unfortunately, we do not have that today, yet we spend 
almost every dollar we can dream up here in Washington and take from 
the taxpayers in order to spend on education. We have spent 
considerable amounts of money on the Federal education system, and that 
is magnified even to a far greater degree when we consider the billions 
of dollars, in fact the trillions of dollars that have been poured into 
education around the 50 States and through local school districts.
  At least at the Federal level, for the amount of money that we have 
spent, about $125 billion over the last 10 years to be precise, we 
should have better results, and we should certainly expect those 
results to be far improved over and above the indications of today. Our 
President understands this, and that was the basis of the legislation 
he persuaded this Congress to pass last year. His first major 
legislative initiative was all about education, and this was the core 
of his campaign for office. He proposed doing for the country what he 
managed to accomplish in Texas, and that was to first take into account 
the huge numbers of dollars that have been spent on education and then 
start asking questions, like what do we get for the money.
  The governor of Texas at the time, our current President, was led to 
establish a testing strategy for the State of Texas, and that testing 
strategy has been credited by many with raising the achievement levels 
of the poorest children in that State. The President touted as a 
candidate the successes of Texas throughout the country, and the 
American people seemed to agree with the President. He came to 
Washington and suggested we should do the same thing for the whole 
Nation, and the Congress, by a pretty overwhelming margin, agreed with 
him. Democrats and Republicans joined together to help the President 
pass what turned out to be a higher set of expectations for the Nation, 
a system of national testing.

[[Page H2449]]

  I want to start there, because what the President actually proposed 
up front was not only a testing strategy, that was just a portion, and 
in fact a smaller portion of his proposal, but he also proposed greater 
flexibilities for the States, and the most important element, the core 
of the President's proposal, was school choice. Unfortunately, the 
school choice provisions were ripped out of the bill even before it 
came up for its first hearing here on the House side, and the 
flexibility provisions were removed too, by the time the bill got 
through over on the other side of the Capitol, and all the President 
was left with was this the smaller portion of the bill which dealt with 
testing mandates on States.
  In order to get the institutions of the bureaucracy of education to 
go along with the President's idea, even one-third of his idea, we had 
to feed the beast a tremendous amount of cash. We had to give more 
money to the Department of Education and all of the institutions 
associated with it in order to get them to comply or to go along. But 
as I said, if our children are really important, and I believe they 
are, we should be able to be prepared to spend whatever it takes in 
order to improve their education opportunity, and we certainly did that 
in H.R. 1. We expanded the Department dramatically in exchange for the 
new accountability that goes along with it.
  But we have not lost sight of the core element of the President's 
proposal, and that is the school choice element. Tax credits give us an 
opportunity to extend education choice to more and more Americans and 
their children, and do so without threatening the education bureaucracy 
in any way, without threatening all those institutions and lobbyists 
that have built themselves up around the rules and the red tape and the 
spending regiment of the education empire. It does so by bypassing all 
of that, and in fact we are going to continue to feed more money to the 
bureaucracy. That is really not in doubt. And I do not think anybody in 
the bureaucracy needs to be threatened in any way or believe that their 
jobs are somehow going to go away. On the contrary, we are going to 
give them more cash. That is already budgeted and that is going to 
happen.
  But education tax credits allow and inspire new investments in 
education, and that is why they are so exciting and why I hope a lot of 
people are paying attention to the issue because it is a serious one. 
It is one that the President has given his word that he is going to 
help drive through this Congress. It is a topic that has arrived on the 
priority list of the agenda items for our leadership, our Committee on 
Education and the Workforce, and also members of some of the other 
committees, the Committee on Ways and Means in particular, which deals 
with tax policy, and a lot of people around the country are excited.
  They are excited, Mr. Speaker, because they have managed to see how 
tax credits work in a handful of States. There are six States, to be 
exact, that have tax credit legislation on their State law books and 
they are seeing the fruits of that. What I mean is they are realizing 
that by manipulating the Tax Code, taxpayers are eager to contribute 
money to the schools and to do so in a way that provides new kinds of 
education choices to children who have not had choice in the past.
  Education choice is not such an important issue to those who are 
wealthy, because they can afford to buy it. They can afford to forego 
the property taxes, the income taxes, the sales taxes that they are 
paying right now, in generous proportions, I might add, to government-
owned schools, and, instead, pay additional dollars for the tuition 
that it may cost to attend a private institution. So if you have money, 
school choice is really not something that is out of reach. By if you 
are poor in America, you do not have school choice, typically, except 
in a handful of places where these tax credits exist; or in some places 
where vouchers exist, which is something entirely different than what 
is being discussed tonight, still a good idea but different; and in 
places where private individuals have banded together to try to raise 
money to provide scholarships for low-income children.
  That exists in almost every State, these student tuition 
organizations, as they are called. We call them in our legislation 
education investment organizations. They exist in all 50 States today, 
and they exist because of the generosity of many, many Americans who 
want to contribute their earnings and pay back to society in some way 
that offers real hope and opportunity for young children.
  I have some letters from some of the children who have benefited from 
these investment organizations, these scholarship funds, and I will 
read from some of them. They are pretty inspiring and I think speak to 
why we need to be aggressive about achieving this legislation this 
year. But what we are really here to propose and to discuss is the 
legislation that is in the works right now that will be introduced 
within just a couple of weeks that will provide a change in the Tax 
Code to make it easier for Americans to contribute to these scholarship 
funds and to contribute directly to public schools for local 
priorities, for priorities that are established by local school board 
members or established by community leaders through the creation of 
these scholarship funds.

  The tax credits work this way: for every dollar that you would 
contribute to a scholarship organization for poor children, or 
contribute to a public education facility, a local neighborhood school, 
you would receive a 50 percent tax credit from the Federal Government. 
So for every dollar you give to the school, you cut your tax bill in 
half for the equivalent contribution. And there is a cap on that. We 
cannot make this unlimited, of course. We have to deal with some of the 
financial realities of the Congress. So this is a $250 credit that will 
correspond to a $500 donation.
  I have a cousin in Colorado Springs who is a tax preparer, and just a 
couple of days ago she asked me about this proposal. And she asked, 
Will this benefit me? Will I be able to contribute to a school and get 
the credit, since my children are not in the school anymore? This is 
something that appeals to her, and she wanted to know if the credit 
would apply to her. And the answer is yes.
  And I think the question itself is really what is so exciting about 
education tax credits, not only in this proposal but what we have seen 
by way of the record in several States, and that is parents and people 
in communities who are not even parents of children in the affected 
schools are eager and enthusiastic about contributing to an educations 
model in which they fundamentally believe. The notion of school choice 
appeals to millions and millions of Americans. It does not appeal to 
all Americans, but it appeals to most Americans.
  So for those who believe that it makes more sense to continue 
shoveling cash to the government, well that option is available. And in 
fact most Americans will be forced to do that whether they really want 
to or not, as we do today. But it provides a second option for those 
who want to try something different, who want to try to bypass that 
bureaucracy and get dollars directly to children.
  So I am really enthusiastic about the proposal, and as more and more 
people learn about it and hear about it, they are joining up with the 
campaign that we have here in Congress to prepare the bill, to lobby 
our colleagues and persuade them that this is the right thing to do, 
that the experience in the States that have education tax credit 
legislation is an experience worth considering and something worth 
duplicating here in Washington.
  I received a letter from somebody in Fort Collins, Colorado, they did 
not give me permission to use their name so I will not, but in the 
letter he says, one of my constituents says, ``Education tax credits 
have the greatest potential to significantly and instantly affect 
change in our current educational system. As parents know best their 
children's strengths, needs and efficiencies, this tax credit would 
ensure that money spent would be used in the most beneficial and 
targeted way possible. With this legislation, parents would be 
empowered to ensure that their children are equipped with the academic 
and educational tools necessary to improve their quality of education. 
Also, as this tax credit is for all educational expenses, parental 
involvement in their child's education would be fostered and 
encouraged. This bill will ensure that economic considerations will 
never again keep lower-income children from receiving an all-

[[Page H2450]]

important supplemental education at home. The quality of our children's 
education stands to be greatly enriched by this legislation, just as 
millions of children across the United States would be affected as 
well.''
  Well, that is pretty compelling testimony, again from one of my 
constituents. And I may raise this with him at another time to see if I 
can use his name publicly. I do not have that permission now, as I 
mentioned. But this is the kind of letter that many of us are receiving 
here in Congress, and that is not the only one I have received in my 
office. Again, this debate is taking place in my home State, so people 
are in tune with it there.

                              {time}  2245

  As I mentioned, in some of the States that have passed tax credit 
legislations, and the best examples are Arizona, Pennsylvania, Florida, 
and Minnesota has passed a tax credit bill, too. What they are seeing 
in those States is really dramatic and remarkable. Here is some 
testimony that was delivered in front of one of the committees that 
took place in one of our States in terms of the impact that these 
scholarship funds are having. This is from a student named Sasha. She 
said again in prepared testimony, ``My family applied for a scholarship 
for me to be able to study at the school that I consider a very special 
place.''
  Let me stop there. That really is the key because the definition of 
quality of education today under the bureaucratic model that we have 
established for the country falls into the hands of the bureaucrats who 
run the bureaucracy. Let us say you have a 5-year-old that is going to 
kindergarten, or maybe you have older kids and you move into a new 
neighborhood. You call the school district and say, Johnny is ready to 
go to school, what are my options?
  The first question you will get is what is your address. When you 
deliver your address to the person on the other end of the phone, they 
will say your address corresponds to a particular neighborhood school. 
If they have a lot of money where the school is usually better, or if 
they move into a poorer neighborhood where unfortunately the records 
show and is amply demonstrated, usually means that the school is not a 
good one and not one you probably would choose if you had unlimited 
resources at your disposal.
  With a tax credit, the goal is to move away from trusting somebody 
who does not know the name of your child with placing your child into a 
school that they think makes sense for this child that they do not 
know. Tax credits leave this decision to people who know the child 
better, the parents.
  Sasha wrote, ``My family applied for a scholarship for me to be able 
to study at the school I consider a very special place. It is special 
because it is where I learn the most and where I enjoy learning. It is 
a place where I can dream, and have that feeling that I am going to be 
successful in my life, successful because of what I am learning right 
now. In the past, my mom tried to put me in Catholic schools, but she 
could not afford the tuition for very long. Now I am in my second year 
in the same school because of the scholarships she has secured for my 
sisters and me. I will be very happy if I can stay at my school and 
have the same good friends as long as possible. They are special, 
too.''
  Sasha goes on, ``I think school is important because I have learned a 
lot of stuff that I did not know. I have just learned how to add, 
subtract, multiply and divide fractions. We will be doing geometry 
soon. I know I am learning all of this because algebra is coming. I 
think that might be fun. Going to Blessed Sacrament is important 
because the work is challenging, not easy. The most challenging subject 
is math because of the concept of algebra. At first math was easy, but 
now it is hard. I really try hard to get good grades.'' Sasha goes on 
and describes her experience in the school that she was able to choose 
as a result of her scholarship.
  The reason tax credit legislation is relevant to this student is 
because manipulating the Tax Code to reduce the tax burden on Americans 
who contribute to such scholarship organizations will result in a 
massive cash infusion in America's education system, and it will result 
in the same kinds of positive experiences for more and more children 
across the country, just as the experience occurred to the student I 
just referred to.
  Here is testimony from a teacher. This was given to the Colorado 
State legislature, testimony before that legislative body. This 
teacher's name is Maureen Lord. She is the supervisor for a group 
called Save Our Youth. She told the Colorado State legislature about a 
particular student named Joe Ray. ``Joe Ray was designated learning 
disabled at the local public school. At the end of his fifth grade 
year, he was reading between a second and third grade level, hated 
writing anything. His distraction level was extremely high. To 
complicate things more, he had some fine motor problems. Being an 
elementary educator myself, I knew that Joe Ray would never be at grade 
level if he continued in the public school system where he only 
received an hour of special attention during each school day. His 
future looked dismal for accomplishing the basic skills he needed to go 
on to middle and high school.''
  Let me point out that this experience is not unique throughout the 
country, but it is also not the rule in most public schools. I would 
bet that if Joe Ray lived in a wealthy neighborhood, that Joe Ray would 
receive the kind of attention that he needed; but Joe Ray does not live 
in a wealthy neighborhood, he lives in a poorer neighborhood in 
Colorado. The only school that was available to him was the one that 
the government said was available to him, and it was not a good fit.
  The teacher, pleading on his behalf goes on, ``One day on the radio, 
I heard about a private school that works with kids having problems 
similar to Joe Ray. Unbelievably, they were opening another branch in 
northwest Denver in the fall of 2000, and it would be located 
relatively close to where Joe Ray lived. After visiting the facility 
and meeting with the director, I knew this might be a fit for Joe Ray, 
but there were so many hurdles to overcome. One of the hurdles was the 
tuition. Joe Ray's family was in the lower socio-economic scale and 
anything short of a miracle was needed for him to be able to attend a 
private school. That is just what happened. Joe Ray applied for a 
scholarship, and received a 4-year partial scholarship to this private 
school. With the help from his mentor and his mentor's supervisor, the 
obstacles were falling one by one.
  ``Let me tell you more about the miracles. Joe Ray aced last 
semester's report card. His teacher says he is a wonderful young man to 
work with and eager learner. The multisensory math program is helping 
him to remember his times tables, and his confidence is growing. He now 
frequently looks you in the eye when he talks to you. This is just one 
young boy who is benefiting from the investment that scholarships made 
in his future. I hope this is of some encouragement to you. We at Save 
Our Youth are grateful.''

  Joe Ray also testified before the Colorado legislature. He said, ``I 
am really glad I do not have to go to my old school anymore. There were 
always people selling drugs there. I was afraid to go to school because 
I didn't want to get beat up any more at my old school. They gave me 
the answers to the CSAP test,'' which is the State standardized test. 
That is pretty common. I hear that not only in Colorado but in several 
States.
  ``They were not very helpful to me with math, reading and writing. I 
did not like my old school at all. I like my new school because they 
help me better. They teach me in a way that is right for me. The 
teacher is nice to me, and there are so many other school kids. I also 
like that I do not have to switch classes. I like Dove Christian 
Academy so much I want to come back again. The new school I go to does 
help me a lot more. Dove Christian Academy does different things to 
help me learn. I read a lot better now, and I think my math and writing 
are better, too. I really thank ACE and the money they have given me. I 
am so glad I was able to come to the school and learn. Now I have a 
chance to get a good education and maybe even go to college. I never 
would have thought of that before if it weren't for ACE.''
  Pretty powerful testimony in one State that has an experience with 
education tax credits. We can do this for the whole country. We have a 
chance

[[Page H2451]]

to accomplish this in all 50 States and amplify the good record that is 
taking place in a handful of other States across the country.
  This is a topic that is not one that belongs to Democrats or 
Republicans, conservatives or liberals. I happen to be a Republican, 
but this is a proposal that has been advanced by Democrats and State 
legislators around the country. It is supported by Democrats here. It 
is one that has been proposed in my State in the Colorado State senate, 
and a liberal one at that, and at the same time was being carried in 
the State House of Representatives by a very conservative Republican.
  It has the ability to bring people together of different political 
persuasions because at its focus is America's school children. I have 
to confess when it comes to the education debate in Washington, too 
often children are the last individuals considered. We talk about them 
a lot, there is no doubt about that. We get nice pictures of them up 
here and try to suggest to the country and the world that the children 
are at the center of the debate, and I think they are in our hearts. We 
care about the kids, there is no doubt about that. But by the time the 
bills make it to the floor of this House and over to the other side of 
the Capitol, the lobbyists take over, and they watch every line item in 
these bills and make sure that their organizations and their members 
are not affected by the ideas that we advance to try to help children. 
The children are at a disadvantage because they do not have lobbyists 
here. Their parents vote for us as Congressmen and Senators, and 
sometimes Members get replaced when they do not fight hard enough. That 
does happen from time to time. The lobbyists watch much closer here. 
They fight hard to maintain and preserve the bureaucracy and the unions 
that go along with America's education system.
  When you cross these powerful groups, the consequences are sometimes 
very, very dangerous because they have millions of dollars to spend 
against you. They have big political campaign war chests that they use 
to try to persuade people that if you do not persuade your constituents 
back home if you are not fighting hard enough for the bureaucracy, for 
the institution or the union, that that means you do not care about 
children and you should be replaced. They have a far more successful 
ratio of replacing Congressmen who do not stand up for the bureaucracy 
than the children do and their parents when children fail to be the 
objective of education debates.
  Here is why this is true. This chart on my right explains how money 
gets down to a child. At the top is a hard-working taxpayer who pays 
his cash, a portion of his earnings through taxes. It is not voluntary; 
it is confiscated from his paycheck. Those dollars are confiscated by 
the Treasury Department. His employer is forced to send a portion of 
his paycheck to Washington, D.C. to the Treasury Department. The 
Treasury Department takes account of all of these dollars, tracks how 
these dollars are coming in, so that politicians, me and my colleagues 
in Congress, we make decisions on how to spend these dollars. We spend 
a pretty sizable portion on the United States Department of Education. 
They occupy some large buildings. We allocate a big chunk to the 
Department, and it goes to those buildings two blocks away. Once it 
gets there, it is distributed and redistributed and transferred to 
States, all 50 States and territories and districts, the District of 
Columbia as well. At the State level the politicians there, the State 
legislators, they divvy up the dollars that come from the Federal 
Government as well as State and local dollars. They redistribute the 
funds to the State Department of Education and that whole bureaucracy.

                              {time}  2300

  The State Department of Education gives those dollars to the school 
districts in all 50 States. In Colorado there are 176 school districts. 
The school districts, of course, they are run by politicians, elected 
school board members, and they meet with all the interest groups that 
they have to deal with and they decide how to spend these dollars and 
apportion them for the various schools within a school district. Once 
the principals and the teachers and everybody at the school level have 
decided how to prioritize those funds, then these dollars finally get 
to the child way down here. By the time the taxpayer's dollar goes 
through this whole vortex of bureaucracy and politicians, the 
proportion of money that actually makes it to the child is very, very 
small. In fact, it has been estimated that somewhere around 30 to 40 
percent of the tax dollar taken from the hardworking American for the 
purpose of education ever makes it down to the child.
  That explains the politics of education in America, which has as much 
to do with the necessity of education tax credits as the positive 
outcome of tax credits themselves.
  I have tried, as many of my colleagues have, Mr. Speaker, to try to 
change this system from within. I came here to Washington because I 
have got five kids of my own. I kind of feel that my children have kind 
of the dead hand of government laying over their shoulder as they try 
to progress in the public schools back home in Colorado. And so I 
wanted to come here and try to fix some of this nonsense. I spent 9 
years as a State Senator trying to fix it from here down. We made some 
success, but this bureaucracy is large. Every one of these 
organizations has lobbyists and they have interest groups. The 
employees of the State Departments of Education and the U.S. Department 
of Education, they organize. The teachers in all of these districts, 
the National Education Association, the American Federation of 
Teachers, these are two teachers unions that are frankly the largest 
political influence in America and they are all a part of this process. 
So when we come to Washington and suggest changing and improving or 
amending in any way the flow of dollars through this process, you get a 
big political fight on your hands. It is a fight worth engaging, do not 
get me wrong. I enjoy doing it. It is the right fight. My kids matter 
enough that I am willing to take it on and suffer whatever political 
consequences might occur. But sometimes we win. Sometimes we lose. 
Usually we lose. Anybody who wants to change this system usually loses, 
because the relationship between these agencies matters more to 
politicians in Washington and politicians in the States and ultimately 
to school board members than the child does down here in the bottom. I 
hate to admit that, but that is absolutely the truth. I would defy 
anyone to try to deny that and would welcome a vigorous debate on that 
point.
  Again, I am willing to admit we all talk about the kid down here, but 
when the debate takes place on the House floor it is all the people who 
run these agencies that count the most, unfortunately. They are the 
ones who are heard the loudest. Their voices tend to drown out the 
child down here at the bottom and they drown out the expectations of 
the taxpayer, too.
  Rather than try to tamper with all this in a tax credit bill or an 
education proposal, keep in mind that trying to improve this system is 
an ongoing function of the Education Committee and we are working on 
that, but that really is a separate debate than the proposal that we 
are rallying around now. Because rather than amend this or change it or 
do anything to this, we are going to leave it alone and try to bypass 
this process with new money, not the old money. We are going to 
continue to feed cash to this system in America. It is already budgeted 
this year. Mark my words, when the appropriation bill passes, we are 
going to grow the size of this bureaucracy because it does not matter 
who is in charge, it does not matter whether Republicans are in charge 
or Democrats are in charge, we are going to grow the size of this 
bureaucracy. That is the track record. That is the way it is. We have 
got to accept that. I finally have. But I am trying to find a way to 
get this guy's dollar to that child and tax credits is a way to 
accomplish that.

  Here is how the tax credit model works. The hardworking taxpayer 
donates directly to the needs of a child. Again, they do this through a 
change in the Tax Code, not a change in the education bureaucracy. 
Because the Tax Code allows this taxpayer to make a donation based on 
what strikes him or her as a good idea, a local priority, an urgent 
need, and to donate to that cause rather than continue to shovel cash 
through that other system I just described, the bureaucratic model that 
is Washington, D.C.'s education system. When explained to Americans

[[Page H2452]]

across the country, this is what Americans prefer. Taxpayers like this 
guy have expressed to me, just as my cousin did last week, that even 
though she does not have children who are in schools anymore, she would 
love to have the advantage of a tax credit so that she could contribute 
to the education cause in her neighborhood, for somebody else's child, 
for a poor child whose future will not be so bright unless we are 
willing to put the cash forward to provide a little freedom for the 
child, a little liberty that wealthy parents can afford. It is not just 
the individuals who can contribute. Our tax credit proposal also 
entails corporate contributions, because we have heard from businesses 
around the country as well that if given the chance they would prefer 
to invest in an academic program in their neighborhood that is designed 
by a school board member perhaps or maybe by a superintendent or maybe 
by a church or a synagogue or maybe by a nonprofit organization, they 
would rather invest in something they believe in locally than continue 
to send exorbitant amounts of money here and have it filtered through 
this process that I described.
  And they like the idea that tax credits allows us to begin to measure 
the fairness in education by the relationship between individuals 
rather than the relationship between these political entities. And like 
it or not, that is how we measure education fairness in America today. 
Schools keep track of how much each school receives. School districts 
keep track of how much school districts receive. They compare 
themselves to each other. Every State has got a lobbyist in Washington, 
by the way. Not the elected officials. I mean, they hire lobbyists to 
come here. Every State has lobbyists back here. The lobbyist's job is 
to make sure that Colorado, in the example of my State, is receiving 
generally the same amounts of money that Kansas is or Wyoming or any of 
our neighboring States. You have got this 50 times over as these 
lobbyists are measuring education fairness by the relationship between 
their political jurisdiction in their States. And then, of course, up 
here at the Federal level, agencies and departments, they just do not 
like to lose money. If a program received a billion dollars last year, 
the people who run that program want to make sure they receive at least 
a billion dollars next year, too. And if they have fewer students that 
they serve, that does not matter. If they do not serve students well, 
that does not matter. They just want the same amount of money or more, 
because that is how they get the plaques on their wall suggesting that 
they are good bureaucrats, good managers. These people work hard, they 
care, they have been trained well to operate within the system. In fact 
they have got their own language. If you ever sit in the meetings that 
I get to sit in on, you will learn about this whole new language that 
exists in the education bureaucracy. They have got all these agencies 
and programs that are called by their initials, these terms that relate 
to my kids that we do not use at home but if you want to be involved in 
discussions about this, you have got to learn another language that is 
kind of irrelevant and makes no sense to the taxpayer up here at the 
top or the child down there at the bottom. Once again, that is fine for 
all the people who work in this system, but fairness in education 
should not be measured by the relationship between programs or States 
or school districts or individual schools. Fairness should be measured 
by the relationship between children down here at the bottom. That is 
what the tax credit proposal really allows us to begin to do.
  We get to start thinking about some of these students that are 
referred to in this testimony I read. We even had some of these 
students who came to Washington here and testified in front of the 
Education Committee. When you hear from the children who speak in terms 
of their future and their hope and learning about algebra and getting 
back to grade level and going to college, students who have been 
written off in the past, when you hear these kinds of stories, you 
begin to care about the kids again. You do not care so much about the 
comfort of the bureaucracy anymore. We will acknowledge that the 
bureaucracy is a big organization. They have got lots of lobbyists. 
They have got a lot of political firepower. We are going to leave them 
alone. We are going to find a new way to change the Tax Code and help 
children achieve their academic dreams.

                              {time}  2310

  This chart is one that refers to just one scholarship organization 
that exists today, and this is the kind of scholarship organization 
that a tax credit would utilize in order to reach children. It is a 
rather large one, it is called the Children's Scholarship Fund. I 
pulled this off of the Children's Scholarship Fund's website. This 
shows the concentration of applications that this scholarship 
organization received from throughout the country. The blue areas are 
places in America where children apply to receive scholarships from one 
nonprofit organization in order to attend schools that the children and 
their parents wanted their children to attend. This is broken down 
based on concentration of students. I will not go through the whole 
chart here, but the light blue is anywhere where you have from 1 to 99 
applicants in a State; the red dots, these large cities, Detroit, 
Chicago, New Orleans, we can see Atlanta, New York, and so on, 
Washington, D.C., Los Angeles, these are places where anywhere between 
10,000 and 80,000 people who are interested in scholarships might live. 
Now, these are where the applications came from, and there is a pretty 
broad level of interest from throughout the country.
  Unfortunately, the Children's Scholarship Fund, again, a private 
organization, not a government institution; it gives scholarships out 
based on how many people want to contribute to the scholarship fund out 
of their own free will as a donation; they do not have unlimited 
resources. They cannot give scholarships to all of these kids who want 
academic freedom, who want a little liberty in their lives, who want to 
be treated as well as wealthy children are who can choose the kind of 
school they want to attend. So all of these applicants applied, but 
only a fraction of them actually walked away with a scholarship and 
ended up with some of the success stories that I read about a little 
earlier.
  The second chart shows us the distribution of recipients, and it is 
broken down by counties. We can see that the scholarship fund, this 
particular organization, the Children's Scholarship Fund does a great 
job. They reach thousands of children around America, but there is a 
lot that are just overlooked by this one organization.
  What a tax credit will allow is for every taxpayer in America to 
contribute to an organization like the Children's Scholarship Fund. 
This would be one of their options. As I say, this is a large one that 
has kind of a national emphasis, but every one of our States, Mr. 
Speaker, has an organization similar to this one in it, at least one. 
The State of Arizona has about 70 of them.
  The reason Arizona, if I can use Arizona as an example, the reason 
Arizona has so many scholarship organizations in it is because Arizona 
as a State passed education tax credit legislation 3 years ago. As time 
goes on, more and more people are deciding to send their State tax 
dollars to these scholarship organizations to help children. The impact 
that it is having on Arizona's children, especially the poor, is rather 
remarkable. In fact, it has been studied pretty extensively.
  I just happen to have the analysis of the Arizona tax credit plan, 
the Arizona scholarship plan. This is a report that was written by 2 
researchers, Carrie Lips and Jennifer Jacoby. In fact, Carrie Lips now 
works here for the House of Representatives and the Republican Policy 
Committee. What this report shows is really remarkable. It shows that 
between 1998 and 2000, the tax credit in Arizona generated 32 million 
new dollars and funded almost 19,000 scholarships through more than 30 
scholarship organizations. Now, that is $32 million in the education 
system of Arizona that was not there before. It is $32 million that did 
not come from Arizona's public education system, but new dollars that 
came out of the pockets of Arizonans on a voluntary basis, because the 
Tax Code in Arizona makes it easier for people to invest in the number 
1, most important industry in America, which is education. They believe 
that in Arizona. Mr. Speaker, 19,000 scholarships in just 3 years. 
People care about this. They have made a huge difference in the lives 
of students there.

[[Page H2453]]

  I have heard similar stories around the country in some of these 
other States that have embarked on tax credit legislation at the State 
level, in Pennsylvania and Florida, just to name a few. More than 80 
percent of those scholarships in Arizona were rewarded to recipients 
who were selected on the basis of financial need. Every scholarship 
representative reported financial need is considered in the allocation 
process. What I mean by that is every one of the organizations, I think 
there are 70 organizations now in 2002 that distribute these funds, 
they all report that financial need is a consideration of allocation of 
spending. The taxpayers win in the end. They save money. First of all, 
the public school system has a little bit of a cushion associated with 
this. The students who go to nongovernment-owned schools as a result of 
the Arizona plan actually save money for the government-owned 
institutions, and it is just staggering. In the year 2000, in Arizona, 
37,000 citizens voluntarily contributed to scholarship programs like 
the one I described, and again, this is just one State, one State's 
example, one State's experience, one more reason why education tax 
credits need to be considered here in Washington; one more example why 
our President has committed to lend his support and the power and might 
of the President's office to get a tax credit proposal through this 
Congress.
  Mr. Speaker, it is not just politicians and children and the donors 
who recognize this. The media does too. Again, I mentioned the debate 
that is taking place in Colorado right now over tax credits. Here are 
very liberal newspapers who almost always oppose school choice 
proposals, either at the State or Federal level, but a tax credit plan 
seems to have some appeal, even among these liberal organizations. The 
Denver Post says in its editorial, ``tuition tax credit laudable.'' 
They talk about how a neighborhood, in Denver, ``a neighborhood rich in 
diversity with new immigrants, the home to many monolingual Spanish 
speaking children and parents who need special education services.'' It 
goes on and on about the children in these neighborhoods and how they 
will benefit from education tax credits, a proposal that is similar to 
the one in Arizona, Florida, Pennsylvania, and Illinois, and it talks 
about how Colorado's proposal, if it were to pass, would have an even 
more positive impact there.
  Here is one from the Fort Collins Coloradan, and this is probably one 
of the most liberal newspapers in the entire State of Colorado; in 
fact, probably in the country, and they agree. ``Tax credit for low-
income programs are needed.'' Helping children value education and stay 
in school, and they talk about how Hispanic organizations and Hispanic 
leaders, minority leaders are rallying around this education proposal, 
but there is a lone opponents. It says, ``nor do we agree with Ron 
Brady, President of the CEA,'' which is the Colorado Education 
Association, that is the local regiment of the NEA, the National 
Education Association, and it is the largest political lobbying, 
political special interest group in America, and very powerful. They 
have a good record of crushing bills that help poor children like this. 
So that is the fight that is taking place in Colorado. Hopefully, 
hopefully, the poor children will win and the tax credit bill will 
pass.
  Then, here is the article from the Coloradan. ``Bill-boosting 
education organizations draws debate. Hispanics praise it, but school 
officials call it detrimental.''
  That is the debate I would anticipate here in Washington as well. We 
do have support from our Department of Education and our leadership 
there. We have support from our own President; we have lots of support 
here in the Congress. But once again, the many, many thousands of 
employees who work in these various political entities and 
organizations, they are the ones who oppose these efforts to reach out 
to poor children in the States; they are the ones who have expressed 
the greatest amount of resistance here in Washington. It is the right 
fight, though, for children.
  For those of us who came here to Washington to try to beat this 
bureaucracy, to try to shape it into something that benefits kids in 
the end, it is another good fight. I think the strategy of this makes a 
lot of sense, because we are not going to touch any of this. We are 
going to leave the bureaucracy in place. We are going to bypass it 
through the Tax Code and allow the hard-working taxpayers to contribute 
to the academic dreams of America's schoolchildren.

                              {time}  2320

  It is a good plan.
  Just as I close, in terms of strategy for those of our colleagues who 
are interested in the legislation and have their staff members 
investigating it, we have had all the meetings with the Committee on 
Education and the Workforce, with the Committee on Ways and Means and 
we are trying to get as many considerations taken into account as we 
get the final drafts passed. We intend to get a draft that will move 
through committee rather quickly. We have a commitment from our 
leadership to accomplish that in June and bring a bill to this floor. 
We are working with our friends in the Senate as well, and we have some 
cause for optimism on the Senate side. It is, again, because of the 
track record of the States that we have seen and the enthusiasm of so 
many outside groups and organizations that care about education that 
this is really a high point that warrants real excitement. Children are 
going to win. Taxpayers are going to win. The country is going to win, 
and those are the kind of victories we all need to celebrate and get 
behind.
  Mr. Speaker, I thank you for the recognition this evening.

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