STO scholarships; means testing
If passed, HB 2295 would have significant implications on the operational framework of school tuition organizations in Arizona. The legislation includes provisions for maintaining a public registry of certified organizations and mandates annual reporting and accountability measures, including financial audits for organizations receiving over $1 million in contributions. This would enhance transparency and ensure compliance with the law. The requirement for means testing may also impact the number of students eligible for scholarships, potentially reducing access for those who do not meet the income thresholds. Proponents argue that these changes would enhance fairness and ensure that funds are appropriately directed to low-income families.
House Bill 2295, introduced by Representative Cano, seeks to amend Arizona Revised Statutes sections concerning school tuition organization scholarships. The bill outlines the certification requirements for non-profit organizations to operate as school tuition organizations (STOs), emphasizing the allocation of revenues from contributions to educational scholarships. Specifically, it mandates that at least ninety percent of annual revenues must be used for scholarships or tuition grants. Additionally, the bill stresses that a significant portion of these funds must go to students from families with incomes at or below 185% of the federal poverty line, establishing a means-testing approach to ensure that assistance is targeted towards those in need.
However, the bill has garnered mixed reactions. Supporters claim that the modifications will prevent misuse of funds and ensure scholarships reach those who need them most. Conversely, critics have raised concerns about the restrictive measures on scholarship distribution. They argue that means testing could create barriers for some families who may not qualify despite low to moderate incomes. Furthermore, by limiting the grants to a narrower income range, there is a fear that it might discourage contributions to school tuition organizations, potentially complicating funding for various educational initiatives. Overall, HB 2295 aims to create a more structured and accountable framework for educational funding through school tuition organizations.