Federal Judiciary

A no-decision in tuition tax credit case?

By Akin Gump Supreme Court Practice Group

A group of Arizona taxpayers, in a new filing in the Supreme Court, has suggested that the Justices consider avoiding a ruling in a major case on tuition tax credits for parents of parochial school students, at least until the impact of a new Arizona state law has been assessed, first by lower courts. The Court in May granted review of two cases; that was before it was told about new legislation in the state.  The supporters of the tax credit program presumably will get a chance to respond before the Court takes any action on the new development.

The Court has not yet scheduled oral argument in the consolidated cases (Arizona Christian School Tuition Organization v. Winn, 09-987, and Garriott v. Winn, 09-991).  These are appeals by state officials (in 09-991) and by a private tuition scholarship program in the state, seeking to scuttle the constitutional challenge to the program, first enacted in 1997.  (Briefing on the merits has not yet been completed.  All of the filings so far in the case are available on ScotusWiki, at this link.)

Under the Arizona program, individual taxpayers in the state get a dollar-for-dollar tax credit when they make contributions to private, non-profit groups known as “school tuition organizations.”   Such an organization provides funds to cover scholarships or grants to students enrolled in private schools, up through high school.  Contributions to such organizations have risen into the tens of millions of dollars.

The new brief, filed in the Supreme Court on Tuesday, is by the taxpayers who have challenged the program as a violation of the Constitution’s Establishment Clause, on the theory that the largest tuition organizations in the state had restricted their scholarships or grants to students attending specified parochial schools only.   Supporters of the program, the challengers’ new filing said, “have maintained, throughout this litigation, that Arizona’s tax-credit program is a program of private charity that need not comply with the Establishment Clause.  Arizona’s new legislation demonstrates conclusively that the program is not a program of private charity, but rather a governmental spending program that uses [school tuition organizations] as the state’s surrogates to distribute government tax revenues for the government;s educational purposes.”

The brief noted that the supporters had mentioned the new law in footnotes in their briefs on the merits and had argued that they were not relevant to this case.  But, the brief of the challengers argued, the changes bear directly on the issues in the case.   Neither lower court in ruling in the case had a chance to assess the impact of the new legislative changes, the brief said.

After cataloging the changes, the brief suggested that the Court might wish to consider sending the case back to lower courts “for further proceedings that would take account of the extensive statutory changes” after the lower courts had ruled.

Full post as published by SCOTUSBLOG on August 20, 2010 (boomark / email).