Tax credit money enables sports, music and more
Tax credit donations serve an important role in extracurricular activities for schools in the quad-city area. Donations are used for anything from sports to clubs and field trips. Tax credits, according to school officials, are the same for both district and charter school operations.
Individuals who take part in the tax credit program can pay up to $200 a year for an individual and up to $400 for a married couple.
Tax credits have to be made, however, by the end of the calendar year in order to claim the credit when filing taxes, said Mile High Middle School Principal Jim Wells.
Athletics, fine arts, parents and community members can, however, determine where they want the tax credit to go within the purview of "extra-curricular" activities, such as athletics and fine arts.
"They can do yearbook, they can do field trips, junior honor society, student council; there's lot of extra-curricular activities they can earmark money for," Wells said. "As an example, if you're a grandparent of a student in band and you want to support the band program, you can make the donation specific for the band program at whatever school you want."
Tax credits, however, cannot be used for items termed "capital," such as building repairs. Nor can they go directly into the classroom, according to Humboldt Unified School District Finance Director Cynthia Windham.
"It's strictly for extracurricular activity. That's the way it was designed by the state," Windham said. "If tax credits go into the general fund, the expenditures need to be approved by the site council of that particular school, but it has to be under the guidelines of the tax credit, or extra-curricular, account. You can't just pull those dollars out in order to make a repair or pull those dollars out to help supplement a classroom. It has to be extracurricular in nature."
Arizona Speaker of the House Andy Tobin said school tax credits can not be used to support costs incurred during the regular school day, though that rule was relaxed at one point during the recent economic recession.
"A couple of years ago, during the recession, we let schools use 'excess' tax credit monies for the classroom, but that was during reductions," Tobin said. "In the past, (extracurricular) events were often, but not always, paid through M&O budgets."
Tax credit donations, he said, were designed to relieve that pressure from M&O budgets.
Windham called tax credits "extremely important" for her district.
"It allows the district to offer some of the programs we would not necessarily be able to offer if we didn't have the support from the community," Windham said. "As we look at our maintenance and operation dollars to go within the classroom, we know that some of the other extracurricular activities are also equally important to our students."
HUSD generated about $250,000 last year from tax credit support, which includes pay-to-play fees for sports activities as well as community support. In the Chino Valley Unified School District, from July 1 to Oct. 31, the district received more than $29,000 for athletics and other extra-curricular activities. The Prescott Unified School District brought in $1,786,459 in tax credit donations, including pay-to-play fees, for the 2012 school year.
"Pay-to-play fees are assessed at various schools. Parents may pay for participation in various activities and that is included in the totals," Windham said.
As with HUSD, both PUSD and Chino Valley rely heavily on tax credit donations for a variety of programs, including pay-to-play sports activities.
"When fees came about and we started charging students, because we couldn't fund it through the M&O budget, it became huge. High schools rely heavily on it and it supports our middle school programs in terms of helping us pay for coaches, pay for officials, and any kind of equipment needs like uniforms," Wells said.
Those who wish to donate tax credits are encouraged to contact schools within the district to learn more. When writing their tax credit check, be sure to specify where those dollars should go, Wells said.
"They get a receipt they can use for their tax credit when they file their taxes. It's a dollar-for-dollar credit," Wells said. "I encourage folks to do it before the end of the calendar year."
Chino Valley Unified School District Director of Support Services John Scholl said individuals must pay taxes in order to take advantage of the credit.
"If there's somebody, especially like an elderly person, that doesn't have a tax liability to the state and, when they do their taxes and there's a zero at the bottom, they cannot take advantage of the tax credit. I don't want people to give, thinking they're going to get that $200 back if they don't pay taxes in the first place," Scholl said.
Tax credit donations also can be made to a school's extra-curricular general fund, which allows district school officials to determine what program those funds are used in.
"The general fund is the most flexible for the school district and has the potential to reach the most kids," Scholl said.