CONCORD, New Hampshire — The state Supreme Court has left intact a New Hampshire law that creates a business education tax credit to fund scholarships to private schools.
In its unanimous ruling Thursday, the justices vacated a lower court ruling that deemed unconstitutional part of the law making religious school students eligible for scholarships.
The program was passed in 2012 by Republican lawmakers who overrode a veto by then-Gov. John Lynch, a Democrat.
Gov. Maggie Hassan, also a Democrat, made repeal of the law a priority, but Republicans blocked repeal efforts. She expressed her disappointment in Thursday's ruling.
"The voucher tax credit is bad public policy for public education in New Hampshire and our taxpayers, diverting millions of dollars in taxpayer money with no accountability or oversight to religious and private schools."
Opponents of the law argued it violates the separation of church and state provision of New Hampshire's constitution and will hurt public schools. Supporters said it promotes educational freedom and choice for low income families.
In January 2013, nine New Hampshire parents, taxpayers and a business challenged the program. Their case was waged by the New Hampshire Civil Liberties Union, Americans United for Separation of Church and State and a dozen other opponents of the tax credit program. In June 2013, a Strafford County Superior Court judge deemed unconstitutional the portion of the law that makes religious school students eligible for the scholarships.
The justices Thursday vacated the lower court ruling, saying the challengers had suffered no injury and therefore had no right to sue. They declared unconstitutional a 2012 amendment to state law that permits taxpayers to sue even if they can't show their rights were violated.
Proponents of the law called the ruling a victory for parental choice and liberty. Opponents of the tax credit say the ruling dilutes government accountability.
"We are delighted that the Supreme Court recognized that the trial court erred in allowing this case to proceed in the absence of any personal harm suffered by the plaintiffs from the alleged unconstitutionally of the program," said Senior Attorney Dick Komer, who represented two families seeking scholarships and the Network for Educational Opportunity (NEO), the state's only operational scholarship-granting organization. "
Gilles Bissonnette, lead lawyer for the New Hampshire Civil Liberties Union, said the ruling "will have a significant impact on government accountability."
"In striking down taxpayer standing, the New Hampshire Supreme Court has made it far more difficult for the people of this state to constrain the actions of government bodies when those actions violate sacred constitutional rights."
The justices' position on standing eliminated their need to rule on the constitutionality of the law.
In arguing in support of the law before a packed courtroom in April, Senior Assistant Attorney General Richard Head told the justices that the businesses donate to an independent scholarship organization. In return, they get a credit on their business profits and enterprise taxes amounting to 85 percent of their donations.
Kate Baker runs that independent scholarship fund — the Network for Educational Opportunity. She said in April that 91 percent of the 103 scholarships awarded last year went to children who qualify for free and reduced lunch programs. None of the $128,000 in scholarships was given to students attending religious schools because of the lower court ruling, she said.
Republican Rep. William O'Brien, who championed the education tax credit in his former role as House Speaker, applauded the ruling and the choice it gives parents to send their children to religious or secular schools.
"It will be up to them and not up to vested education industry interests trying to corral all students into failed government schools," O'Brien said.
Scott McGilvray, president of the New Hampshire chapter of the National Education Association, said lawmakers should "protect and improve, not denigrate and defund" the state's public education system.