Arizona’s Corporate Tuition Tax Credit Is Constitutional

J. Justin Wilson
J. Justin Wilson · October 28, 2009

Arlington—Late yesterday, the Arizona Supreme Court declined to review the Arizona Court of Appeals’ March 2009 decision in Green v. Garriott upholding Arizona’s Corporate Tuition Tax Credit Program,  thus ending a legal challenge to the program that funds scholarships for low- and middle-income children who transfer from public to private schools.

“Today’s decision brings an end to this frivolous legal challenge to Arizona’s Corporate Tuition Tax Credit Program,”  declared Tim Keller, executive director of the Institute for Justice’s Arizona Chapter.  “The nearly three thousand parents and children relying on this scholarship program may now breathe a sigh of relief being fully reassured that their tax-credit-funded scholarships are constitutional.”

Originally filed in September 2006 by the Civil Liberties Union of Arizona and the Arizona School Boards Association, Green v. Garriott was an attempt by school choice opponents to overrule Kotterman v. Killian, the Arizona Supreme Court’s landmark 1999 decision upholding Arizona’s innovative Individual Tax Credit Program from attacks under both the Arizona and federal constitutions.  The Institute for Justice intervened in the lawsuit on behalf of the Arizona School Choice Trust, a nonprofit School Tuition Organization that receives corporate contributions to fund private school scholarships, and parents who desperately wanted to transfer their children from public to private school but lacked the financial means.

The suit was originally dismissed by the Maricopa County Superior Court in March of 2007 because controlling legal precedents from both the Arizona and U.S. Supreme Courts made it clear that the program passed constitutional muster.  The Court of Appeals agreed that the program was perfectly consistent with both federal and state constitutions because it is neutral with regard to religion and is governed entirely by private choices.  Moreover, the Court of Appeals noted that the program is funded by private charitable donations from corporations rather than by money appropriated by the legislature.

“School choice programs like Arizona’s Corporate Tuition Tax Credit help fulfill the promise of an equal opportunity for every child to receive a good education,” Keller continued.  “There is nobody better suited to determine the educational needs of a child than that child’s parent or guardian.”

The Institute for Justice is also defending Arizona’s Individual Scholarship Tax Credit Program from legal attack in federal court in a case titled Winn v. Garriott.  While Winn was originally dismissed as meritless, a three-judge panel of the Ninth U.S. Circuit Court of Appeals reinstated that case earlier this year.  The Institute’s request that the entire Ninth Circuit rehear the case was denied last week over the dissent of eight circuit judges who said the panel decision could not be squared with U.S. Supreme Court precedent.  The Institute intends to ask the U.S. Supreme Court to reverse the appellate court and reinstate the trial court’s dismissal.