Private Schools Hope Pa. Tax-credit Program Will Grow Larger

Mary Niederberger
Pittsburgh Post-Gazette

After a slow start, money is starting to come in to a tax-credit scholarship program aimed at providing scholarships for students who live within the attendance areas of the state’s lowest-performing schools to transfer to other higher performing schools.

Ronald Bowes, assistant superintendent for policy and development for the Catholic Diocese of Pittsburgh, said the diocese has raised about $500,000 for scholarships through the Opportunity Scholarship Tax Credit program and hopes to double that number by July 1, after which it will determine the number and amounts of scholarships it will be able to award for the 2013-14 school year.

“It’s still been quite a struggle. I’m nowhere near where I’d like to be, but if I could get it up closer to $1 million by July then I could feel like it’s been mildly successful,” Mr. Bowes said.

The OSTC, approved by the Legislature last year, provides tax credits of up to $50 million to eligible businesses who contribute to scholarship organizations on the state’s approved list.

Statewide, about $15.5 million of the possible $50 million in tax credits for Opportunity scholarships has been claimed, according to the Department of Community and Economic Development, which administers the program. The deadline for business to take advantage of the program for the current year is June 30.

The Pittsburgh Diocese operates a scholarship organization to raise the tax scholarship money for its schools. It is one of 17 approved scholarship organizations in Allegheny County, but will likely be the largest fundraiser under the program given its track record with the Educational Improvement Tax Credit program, which has allowed private schools to raise general scholarship money through business tax credits since 2001.

The diocese has raised between $3 million and $4 million annually through the EITC program and eventually hopes to do the same with the Opportunity Scholarship program, Mr. Bowes said.

In January, when the diocese had collected just $120,000 in OSTC money, Mr. Bowes and others had complained that the state’s complicated application process for businesses to participation in the Opportunity Scholarship program was making it difficult to solicit donations. But the process has been streamlined and the application is no longer an obstacle, he said.

Now the biggest hurdle appears to be finding new companies to contribute to the Opportunity fund, in addition to those already solicited for the original EITC program.

“People don’t understand the program, but it took the EITC program several years before it took off,” said Bob Phelps, executive director of the Pittsburgh Urban Christian School in Wilkinsburg. The school was able to raise $43,000 in Opportunity Scholarship money this year, which allowed 20 additional students to attend, bringing the school’s enrollment to 130.

“We would like to double in size, and we have a waiting list of people for the scholarships,” Mr. Phelps said.

Otto Banks, executive director of the Reach Foundation, a statewide organization that promotes school choice, said some firms pay enough in taxes that they can contribute to both the EITC and OSTC. “Many of these companies have additional tax burdens and they can contribute to the OSTC as well,” Mr. Banks said. “We really need to reach out to accountants and accounting firms and trade groups so everyone understands.”

Students who live within the attendance boundaries of a low-achieving school as determined by the state education department are eligible to receive an Opportunity scholarship if their household’s annual income by July 1 is not greater than $75,000, plus $15,000 for each dependent member of the household. The maximum scholarship award is $8,500 for a regular education student and $15,000 for a special education student.

There are 43 Allegheny County schools on the state’s list of lowest-achieving 15 percent of schools released in January. Among them are elementary, middle and high schools in both Sto-Rox and Clairton school districts, the education center for the K-6 Duquesne City School District, and 21 buildings in the Pittsburgh Public Schools. Other local districts with schools on the list include McKeesport Area, Penn Hills, Steel Valley, Wilkinsburg and Woodland Hills.

To view the list of low-achieving schools, visit the Department of Education’s website at and click on the Opportunity Scholarship Tax Credit program icon.

There are 94 Allegheny County schools on the state’s list of schools that have signed up to receive Opportunity Scholarship students. Though the program is designed for both private and public schools to accept Opportunity Scholarship students, all 94 schools in the county are private, with more than half of them Catholic.

Of the $500,000 raised so far by the diocese, some large amounts are designated for specific schools. For instance, Serra Catholic raised $95,000; St. Joseph High School in Natrona, $75,000; Oakland Catholic, $55,000; and Central Catholic, $27,500.

Students who are interested in applying for an Opportunity Scholarship should contact one of the approved scholarship organizations on the state’s list. The list is available on the Department of Community and Economic Development’s website,