Wednesday, April 22, 2009

9th Circuit Says Arizona Scholarship Tax Credits Likely Violate Establishment Clause

In Winn v. Arizona Christian School Tuition Organization, (9th Cir., April 21, 2009), the U.S. 9th Circuit Court of Appeals reversed an Arizona federal district court's dismissal of a lawsuit challenging Arizona's scholarship tax credit program. The Court of Appeals held that plaintiffs have taxpayer standing. It went on to conclude that plaintiffs' allegations state a claim that Arizona's program as applied violates the Establishment Clause. Arizona grants a tax credit of up to $500 to individuals who contribute funds to nonprofit "school tuition organizations." STO's in turn award private school scholarships to children. In practice, 85% of contributed funds are available only for scholarships to religious schools.

The court wrote at length distinguishing Arizona's plan from the school voucher program upheld by the U.S. Supreme Court in the Zelman case. Here, while taxpayers have a choice of which STO's they will support, parents' choices are constrained by taxpayers' decisions of which STO's to fund. The state has delegated discretion to taxpayers that is used to create incentives for parents to send their children to religious schools. (See prior related posting.) Phoenix's East Valley Tribune reports on the decision.