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Montana Lawmakers Advance Bill To Raise Private School Tax Credit

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Republicans in the Montana House of Representatives have advanced a bill to increase the tax credit residents can claim for donations that help pay student tuition at private schools. The proposal follows a U.S. Supreme Court decision ruling that Montana can’t exclude religious schools from the tax credit program.

House Bill 279 would increase the maximum allowable state income-tax credit for donations to "student scholarship organizations" from $150 per person to $200,000. 

Rep. Seth Berglee, a Republcan from Joliet, is sponsoring the bill. 

"I think it gives a actual equity in education to kids that might not be able to afford to go to one of these schools," Berglee said.

The original tax credit program passed the Legislature in 2015. Private religious schools were exempted from benefiting after the Montana Department of Revenue determined it would violate the state’s Constitution, which bars public dollars from going to religious institutions. 

The Montana Supreme court eventually struck down the entire program saying it violated the state’s constitution. 

However, last summer, the U.S. Supreme Court upheld the tax credit program as valid and said religious schools could not be left out. 

Democratic Rep. Mark Thane spoke against the new proposal to extend the program, saying he’s concerned the bill has few stipulations for private schools that would benefit from the tax credit. 

"Under the definition of qualified educational provider, there is no requirement for those education providers to serve students with disabling conditions, and I think that's a tremendous oversight."

According to the most recent legislative fiscal analysis of the bill, it could result in a roughly $6 million loss in state revenue over the next two years and $10 million the biennium after. 

Republican Gov. Greg Gianforte has not said whether he supports the bill. He has expressed support for school choice programs in the past and his foundation donated money to Petra Academy, a private religious school in Bozeman.

The bill will need to clear one more vote in the House before advancing.

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