LITTLE ROCK — A House committee on Tuesday advanced an amended version of a bill that would allow parents’ income tax payments to be directed into “education savings accounts” managed by nonprofit organizations that could be used to send students to nonpublic schools.
The House Education Committee gave a “do pass” recommendation to the new version of House Bill 1222 by Rep. Jim Dotson, R-Bentonville. The bill, which the panel previously approved in a different form, goes to the House.
The bill would provide a 65 percent tax credit for people and businesses that donate to nonprofit organizations. The donations would fund education savings accounts in amounts equal to per-student state funding for public schools and could be used for students to attend nonpublic schools.
The amendment adopted Tuesday makes the proposed program a pilot program that would sunset after four years. It also would cap total tax credits at $3 million in the second, third and fourth years. No tax credits would be available in the first year.
Dotson said he amended the bill after Gov. Asa Hutchinson told him he had concerns about the potential cost of the program.
As originally filed, the bill had no sunset clause and could provide up to $6.5 million in tax credits if the program generated $10 million in donations in the first year. The bill would have allowed the program to grow by 10 percent each year.