Tuesday, February 09, 2010

LiveWire - Legislator's pivotal vote benefits his own business

By Ronald J. Hansen

A bill to reform and financially benefit the organizations that distribute private-school tax-credit scholarships passed its first legislative hurdle Monday with help from a lawmaker who stands to benefit from the bill.

Rep. Steve Yarbrough, R-Chandler, voted to approve HB 2664 during a meeting of the Ways and Means Committee. The bill, which passed 4-3 on a party-line vote, would raise by 50 percent the amount of the maximum tax credit that Arizonans can take on their state income taxes for donations to private schools. Those donations are collected and distributed by nonprofit school tuition organizations.

Yarbrough is executive director of the Arizona Christian School Tuition Organization, the largest STO in the state. If the bill becomes law and his organization's donations rose by 50 percent from the latest reported totals, the organization would stand to collect an extra $5.8 million beginning in 2011. Of that, he could keep more than $500,000 for administrative overhead, which includes his salary.

By law, STOs are permitted to keep up to 10 percent of donations, though Yarbrough’s has kept about 5 percent, according to an Arizona Republic analysis.

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