New Hampshire Supreme Court Upholds Law Providing Tax Credits for Religious Schools

New Hampshire Supreme Court
The building of the New Hampshire Supreme Court, located in Concord, New Hampshire. |

New Hampshire's Supreme Court upheld the state's tax credit program that allows for funds to go to religious schools.

In an opinion delivered last week, the court unanimously overturned a lower court ruling regarding the tax credit.

The court concluded that the plaintiffs lacked standing on the tax credit, having failed to sufficiently argue that the credit caused them undue injury or harm.

"Because the petitioners fail to identify any personal injury suffered by them as a consequence of the alleged constitutional error, they have failed to establish that they have standing to bring their constitutional claim," read the majority opinion.

"We hold only that the generalized interest in an efficient and lawful government, upon which the petitioners rely, and the amendment to RSA 491:22, which purports to confer standing, are not sufficient to meet the constitutional requirements necessary for standing to exist."

Known as Bill Duncan v. State of New Hampshire, in the opinion the court stressed that taxpayers can have standing when suing the government over a program or policy.

"Our decision in this case does not mean that a taxpayer can never have standing to challenge governmental actions," wrote the court.

"When a taxpayer has a sufficiently personal and concrete interest to confer standing, the taxpayer may seek judicial relief."

In 2012, the New Hampshire legislature overrode a governor's veto to pass a law allowing for an education tax credit whose money would go to private schools.

"Under the education tax credit, companies can give donations for scholarships, and claim 85 percent off their business taxes," reported New Hampshire Public Radio.

"Scholarship organizations use those donations to give money to students who want to change to private school, a different public school, or homeschool."

Republicans and school choice proponents supported the bill while Democrats, including Governor Maggie Hassan, as well as church-state watchdog groups opposed it.

"A tax credit program is New Hampshire's best option for school choice," reasoned the Friedman Foundation for Educational Choice.

"It is well-established within New Hampshire case law that tax exemptions aimed at promoting education for all New Hampshire citizens, but incidentally affecting religious institutions, are constitutionally acceptable."

A lawsuit was filed against the tax credit, with the lead plaintiff Bill Duncan being a member of the State Board of Education. An argument posed by critics was that the tax credit took money away from public schools.

In June of 2013, Judge John M. Lewis of Strafford County declared the law unconstitutional, arguing that the government funds could not go to religious education.

"New Hampshire students and their parents certainly have the right to choose a religious education," wrote Lewis.

"However, the government is under no obligation to fund 'religious' education. Indeed, the government is expressly forbidden from doing so by the very language of the New Hampshire Constitution."

Specifically cited was Article 83 of the state constitution, which reads that "no money raised by taxation shall ever be granted or applied for the use of the schools of institutions of any religious sect or denomination."

In a statement released after the state supreme court decision, lead plaintiff Duncan said that he was "disappointed" in the decision.

"This decision on standing disenfranchises taxpayers, parents and students throughout the state," said Duncan, who noted other ways the tax credit can be challenged.

"There may be other ways to challenge the voucher tax credit program in the future. School districts harmed by the program could bring suit or a future legislature could repeal it."

A bill to repeal the tax credit recently passed the Democrat-controlled House, but remains tabled by the Republican-controlled Senate.

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