Accountability Act scholarships going mostly to students of color, reports show

Though the Alabama Accountability Act has been around for five years now, little has been known about the students using the tax-credit scholarships other than their family’s income cannot exceed the threshold for a student to be eligible. Until now.

While information on race and ethnicity of scholarship recipients is not required to be publicly reported, the state’s two largest scholarship granting organizations, the Alabama Opportunity Scholarship Fund and Scholarships for Kids, agreed to provide that information to AL.com to analyze who is benefiting from the program and where recipients are zoned to attend public school.

Combined, the two SGOs granted 91 percent or 3,343 of the 3,668 scholarships awarded during the 2017-2018 school year.

According to the information provided, 2,155, or 64 percent of students benefiting from scholarships during the 2017-2018 school year were African-American. Hispanic students were the second largest group of recipients at 19 percent, and white students were the third largest group at 14 percent. All other races accounted for 3 percent of the total.

As for which public school the students are zoned to attend, the information provided for the current school year by the same two SGOs shows recipients are clustered within five of the six largest school districts in the state.

Seventy percent of the two SGOs’ recipients were zoned to attend a public school in Birmingham, Montgomery County, Mobile County, Huntsville, or Jefferson County, a function both of interest in the program and available participating schools.

Originally billed by lawmakers as a way to help students escape “failing” public schools, state lawmakers re-branded the AAA as a school choice program in 2015, more accurately matching how the program is being used. Each year, only about a third of recipients have been zoned to attend a currently-labeled “failing” school, records show.

Of the 3,343 total scholarships awarded so far for the 2018-2019 school year, 1,250 recipients are zoned to attend a “failing” public school. Another 502 recipients are zoned to attend a public school labeled “failing” at some point in the five years prior to the current school year. That leaves 1,591 income-eligible students using scholarships to leave a non-failing public school.

Alabama law requires a school to be labeled “failing” if annual test scores fall in the bottom 6 percent statewide. Currently there are 75 schools on the list. Ten of those schools have been on the list every year since the program began. Zooming out to the district level, of the 3,343 students receiving scholarships this year, 3,006 were zoned to a school district that has had at least one “failing” school over the past six years.

The table below shows which districts scholarship recipients are zoned to attend. If a district had fewer than 10 scholarships students, AL.com substituted a “1″ for the number to protect student privacy.

Originally billed by lawmakers as a way to help students escape “failing” public schools, lawmakers rebranded the AAA as a school choice program in 2015, more closely matching how the program is being used. Each year, only about a third of recipients have been zoned to attend a currently-labeled “failing” school, records show.

Warren Callaway is the Executive Director of Scholarships for Kids, which grants the most scholarships of the state’s six SGOs. He strongly defends the program, saying parents need educational options for their children.

“Across the board,” Callaway said, the reason parents seek out the scholarships “is because the parent thinks the child is not achieving what the child could achieve at school.” About half, he added, say their child is being bullied or is otherwise not thriving. The other half, he said, are not being challenged academically.

Neonta Williams founded Black Alabamians for Education, a nonpartisan advocacy organization working to educate parents about their school choice options.

Williams said the AAA law is working as it was intended, helping students who can’t afford to exercise the school choice that their wealthier counterparts have always been able to access.

Williams works with parents searching to find a better education for their children. Many of the schools children of color are zoned to attend, she said, are chronically underperforming.

In some of Montgomery County’s elementary schools, for example, fewer than 10 percent of third-grade students reached proficiency in reading. Parents don’t always know that information about the school as a whole, she said, but her organization is working to help.

Williams said when public schools have shown an inability to improve student outcomes, all types of school choice can be helpful, including charter schools, virtual schools, magnet schools, blended online learning programs and the tax-credit scholarship program.

“This (scholarship program) is a lifeline,” Williams said. “Where else can they go? More families should know about school choice.”

The way state lawmakers passed the AAA in 2013 left deep scars among those opposed to school choice, who continue to rail against the program.

Supporters of tax credit scholarships are worried that recent resolutions passed by two county boards of education, in Baldwin and Montgomery counties, to repeal the AAA could gain traction and ultimately derail their children’s futures. They are taking action to show their support of the program.

Alabama Opportunity Scholarship Fund Director Lesley Searcy said there are many more children who want a scholarship than her program can fund. Searcy estimates 20,000 children have been placed on waiting lists since 2013.

Searcy’s organization works to document the success students experience to encourage donors so more scholarships can be awarded.

Searcy said parents don’t first search for a private school. “They are looking for any school that would work for their child,” she said, “where the child is happy and can be successful.” Often that ends up being a private school because public schools are reluctant to allow out-of-district transfers. Her organization has placed dozens of students at the Alabama School of Fine Arts and the Alabama School of Mathematics and Science, both of which are statewide public schools.

Searcy said the resolutions passed by two boards of education have parents of scholarship recipients worried. She is helping them to reach out now to lawmakers and other boards of education to show how important the program has been for their children.

The program itself has been through ups and downs, succeeding in a legal battle, though donors were reluctant to contribute during those challenges.

Lawmakers created an incentive for donors by allowing them to take dollar-for-dollar state tax credits for donations made to SGOs, amounting up to 50 percent of their total state income tax liability. While corporations have no limitations on the amount they can donate and claim a credit, individuals are capped at $50,000. SGOs then grant scholarships to eligible low-income students.

Up to $30 million in tax credits are available each year, though the entire amount was reserved by March 1 this year due to a federal tax loophole allowing the donation to be taken both as a state income tax credit and a charitable donation, an amount worth more than the donation itself.

A hearing on IRS regulations to close the loophole is set for November.

Critics of the program say the tax credit program depletes already-scarce resources for public schools by diverting income tax from the Education Trust Fund. From 2013 through 2017, $147 million in donations were made, though less than $100 million in tax credits were actually taken.

Scholarship awards are prioritized for low-income students zoned to “failing” public schools, but if an SGO has scholarship money leftover on July 31, any student meeting the income-eligibility requirement can be given a scholarship.

Williams said she doesn’t like seeing the program used as a political football. “We’re playing politics with something that is so critical to our future,” she said. “But what do you tell a parent who has no other choice?”

She hopes those opposed to allowing low-income families to choose a school for their child will take the time to talk with parents.

Everyone always says they’re “for the children,” Williams said, “so if you’re for the children, then hear from those families. Hear from the students. Hear the differences it has made in their lives.”

About the data

Information on the race and ethnicity of scholarship recipients is from the 2017-2018 school year. School zone data is from the 2018-2019 school year. The information was provided to AL.com by Scholarships for Kids and the Alabama Opportunity Scholarship Fund upon request. Current state law does not require SGOs to report this information publicly.

To see more Alabama education data, visit Trisha Powell Crain’s Tableau page.