House moves ahead on tuition savings

A proposal that would allow Arkansans to use their 529 college saving plans to pay for tuition at public, private and religious kindergarten-12th grade schools narrowly advanced in the state House on Tuesday — though lawmakers will need more votes to give the measure final approval in the lower chamber.

Democrats are in near total opposition to the proposal, which would adopt in Arkansas changes made to federal law last year by the Republican-controlled Congress to the college saving plans.

The investment plans, which are administered by the state treasurers’s office, allow taxpayers to deduct up to $5,000 in contributions from their taxes and then make taxfree withdrawals to pay for college tuition or other higher education expenses.

An amendment to the treasurer’s office budget, proposed by Sen. Jason Rapert, R-Bigelow, would allow withdrawals from the plans to be used for tuition and expenses at elementary and high schools, both public and private.

Legislative researchers have estimated that the new language, which was added to House Bill 1122 by a House vote Tuesday, would cost the state around $5.2 million each year in lost revenue if each family with children in private schools took full advantage of the proposed tax deductions.

It will take 75 votes in House to pass the amended appropriation bill when it is considered later this week. The vote to add the amendment to the bill on Tuesday passed 55-25, with nine lawmakers

Democrats have 24 members in the House, meaning Republicans cannot afford to lose more than one vote to pass the appropriation.

voting present.

Democrats have 24 members in the House, meaning Republicans cannot afford to lose more than one vote to pass the appropriation.

“It’s the special language. We have no trouble with the treasurer’s budget,” said House Minority Leader David Whitaker, D-Fayetteville. “It’s a transfer of public money into private institutions; we’re against that.”

In response to critics of the plan, Rapert has said, “This is not a voucher issue.” Republicans are in favor of school choice and of allowing parents to use their tax deductions for whichever school they chose to send their children to, Rapert said.

But Whitaker said he also believes the Department of Finance and Administration underestimated the cost because it only accounted for children in private school, when the proposed change also would apply to the much larger number of children enrolled in public schools.

Rapert said he disagreed with Whitaker’s assessment and accused Democrats of misrepresenting the impact of his proposal.