Study Shows Alabama Accountability Act Saves Taxpayers Millions

MONTGOGMERY (Feb. 15, 2017) – The Alabama Federation for Children, the state’s voice for educational choice, released a study that shows the scholarship tax credit program set up by the Alabama Accountability Act saved the state of Alabama $29.9 million over the course of 2014 and 2015.

The study was conducted by an independent research organization affiliated with Auburn University of Montgomery.

“This study confirms what we have known to be true for a long time,” said Chad Mathis, State Chairman for the Alabama Federation for Children. “The tax credit scholarship program has not only changed the lives of thousands of Alabama students, but it is also saving taxpayers tens of millions of dollars.”

The study showed that over the course of 2014 and 2015, 9,902 students received a scholarship with 76% of those students having attended a public school in the previous year. Net savings were calculated by subtracting the public funds the state would have spent on behalf of those scholarship recipients who would have attended public schools from the taxes the state did not collect because of tax credits claimed through the scholarship program.

“Over the past three and a half years, we have listened to countless opponents opine about how the scholarship program has cost the state tens of millions of dollars,” continued Mathis. “This study not only proves those opinions to be false, but it shows the opposite is actually true. I am sure opponents will continue to disparage the program and what it is doing for children all over this state, but they are going to have to find a new argument.”

Alabama Legislature passed the Alabama Accountability Act during the 2013 Regular Legislative Session, creating the state’s first educational choice programs.

Other key takeaways from the study include:

  • Every year that the $30 million cap is reached, the state realizes a net savings of $16.1 million.
  • If the statutory cap was raised to $50 million, net savings would increase to $29.1 million per year.

To read the full study, click here.