Letter to the Senate Finance Committee on Tax Extenders
August 02, 2012
On behalf of the more than three million members of the National Education Association, we would like to express our support for the bipartisan tax extender package scheduled for possible mark-up in the Finance Committee this week. We are particularly pleased that the proposed package extends the educator tax deduction and Qualified Zone Academy Bond program. We are disappointed however, that it does not extend the expiring American Opportunity Tax Credit.
NEA strongly supports an extension of the educator tax deduction. Studies show that educators are spending more of their own funds each year to supply their classrooms and purchase essential items. According to a 2010 report by Office Max, seven in ten teachers report their schools are not able to provide them with all the necessary tools to teach their students effectively, and 79 percent of educators say their classrooms currently lack important classroom supplies, paper products, and arts and crafts materials. Everyday classroom supplies such as pencils and pens (78%), prizes and incentives (72%), and arts and crafts supplies (72%) top the list of purchases teachers make using their own cash. 1
Many educators are finding the need to buy supplies for their students has increased in these difficult economic times, as funding cuts lead to shortages in essential materials and more students come to school without basic learning tools. A large majority of educators also spend an average of $15 a month out of their own pockets to feed students. (Status of the American Public School Teacher 2005—2006, March 2010.)2 The need for these expenditures is not surprising. According to First Focus:
- 2.7 million more children lived with an unemployed parent during a typical month in 2011, compared to 2007 (an increase of 71%), bringing the 2011 total to 6.5 million children;
- 3 million (47% of those living with an unemployed parent) lived, during a typical 2011 month, with a parent unemployed six months or longer;
- 8 million more additional children relied upon SNAP for food in 2011, compared to 2007, bringing the total number of children receiving SNAP to 21 million (one in four);
- 16 million children (more than one in five) currently live in poverty3
- One in three working families today find that employment does not guarantee a decent living standard. Forty percent of all children — 30 million kids — grow up in such households.4
The educator tax deduction is a bipartisan recognition of educators’ financial sacrifices as well as of the needs of students who lack even the basic necessities for success in school. Extending it will make a real difference for many educators, who often must sacrifice other personal needs in order to pay for classroom supplies and instructional materials.
NEA also supports extending the Qualified Zone Academy Bond (QZAB) Program. On average, the buildings that house our public schools are more than 40 years old.5 The American Society of Civil Engineers gives the condition of our schools a grade of “D” and attributes the failure to upgrade them to “problems in the financial sector and declining revenues for states and local governments.”6 According to Fix America’s Schools Today, a project of the Economic Policy Institute and the 21st Century School Fund, schools need an estimated $500 billion in repairs and upgrades.
The QZAB program has proven to be an efficient and cost-effective way to help disadvantaged communities address pressing renovation and repair needs. QZABs assist school districts in rural and urban communities by providing a financing mechanism to renovate buildings and invest in equipment and technology. Investors receive a federal tax credit equal to the amount of interest payable on the bonds, thereby relieving local taxpayers and municipalities of the interest burden. A school that is awarded a QZAB may use the funds to renovate and repair buildings; invest in equipment and up-to-date technology; develop challenging curricula; or train quality teachers.
We are disappointed that the proposed package does not expand the expiring American Opportunity Tax Credit. Having more college educated workers in the American workforce is crucial to growing our economy. In order to compete in the 21st century global economy, we need to give all Americans the opportunity to pursue a college degree. Tax credits like the American Opportunity Tax Credit are critical to increasing access to and affordability of higher education, particularly for lower income students. The AOTC does not expire until the end of 2012. Therefore, we hope Congress will take action before the end of the year to extend this important credit.
Thank you for your consideration of our views on these important issues.
Director, Center for Advocacy
Director of Government Relations
1OfficeMax Teacher Survey, May 2010, http://multivu.prnewswire.com/mnr/officemax/43900/
3The Recession’s Ongoing Impact on America’s Children: Indicators of Children’s Economic Well-Being Through 2011, Julia Isaacs, Brookings Institution, December 2011.
4Living on the Edge: America's Low-Earning Families, Sophia Parker, The Resolution Foundation, September 2011.
5National Center for Education Statistics
6Report Card for America’s Infrastructure, 2009