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Tax Credits for Scholarship Funding Organizations
Enacted 2001, Began Operation 2002

FAST FACTS
  • 23,400 scholarships in 2008-09
  • Scholarships worth up to $3,950
  • 1,048 private schools participating
Florida provides a tax credit on corporate income taxes (the only type of income taxes the state collects) for donations to Scholarship Funding Organizations (SFOs), privately run non-profit organizations that support private-school scholarships. SFOs provide scholarships worth up to $3,950 for low-income students. They also may provide students with funds for transportation to another public school. Businesses get a dollar-for-dollar tax credit for contributions up to 75 percent of their total tax owed. The overall size of the program is capped at $88 million.

PROGRAM DETAILS
Scholarship or Voucher Value: SFOs provide scholarships worth up to $3,950, though they may not exceed the actual private-school costs. At least 75 percent of the scholarship must be used for tuition, with the rest going for textbooks and transportation. Transportation grants are worth up to $500.
Student or School Participation: In 2007-08, three Scholarship Funding Organizations provided scholarships to 19,416 students at 906 private schools.
Student Eligibility: Students who qualify for free and reduced-price lunch (185 percent of the federal poverty level) and who are either enrolled in public school or are about to enter kindergarten or first grade are eligible to receive scholarships. A family of four must earn $37,553 or less to qualify in 2006. If students’ household income rises, they may stay in the program up through 200 percent of the poverty level. Students who previously participated in Florida’s A+ Opportunity Scholarships are also eligible. Participating private schools are required to accept scholarship students, but if they have more applicants than open seats they are not required to admit students at random.
Legal Status of Program: No legal challenges have been filed against the program.
Regulations on the Program: SFOs are required to be non-profit organizations incorporated in Florida. They must disburse 100 percent of their income from tax-credit donations as scholarships in the same year in which it is received (administrative costs must be paid separately) and be audited annually by an outside accountant. They may not use a donor’s money to support that donor’s child. Participating private schools must complete a five-page notarized questionnaire covering issues such as the number of teachers and food safety inspections. They must also administer a norm-referenced test to participating students.
Research on Program:
01/01/03 Grading Vouchers: Ranking America’s School Choice Programs
02/05/08 Grading School Choice: Evaluating School Choice Programs by the Friedman Gold Standard
08/06/09 An Empirical Evaluation of the Florida Tax Credit Scholarship Program
09/02/09 Florida’s Lessons for Indiana K-12 Reform
10/01/05 Using School Choice: Analyzing How Parents Access Educational Freedom
View All Research
News on Program:
09/10/09 Go for whole package of school reform, not pieces
09/02/09 Florida’s Lessons for Indiana K-12 Reform
08/11/09 A credit-worthy educational effort
08/06/09 Dramatically higher parental satisfaction found in Florida tax credit scholarship program
View All News
Governing Statutes: 2001 Florida Statutes, Title XIV, Chapter 220.187
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