The Catholic University of America




Arizona Christian Schools Tuition Organization and Garriott:
Further Reading


Key Points & Facts:

The Cases:
Analysis of the Questions Presented by Professor Destro
Amicus Curiae Brief of
Each amicus is a §501(c)(3), Arizona non?profit corporation that allocates at least 90% of its revenue for educational scholarships or tuition grants.
The Law
  • What is a School Tuition Organization [STO]?
o   STOs are defined in Arizona Statutes §43-1089(H)(3)
o   The Arizona Legislature created STO tax credits to encourage individuals and corporations to invest in private education.
o   STOs are private actors organized to support private education. Other private actors – including parents, schools, and community groups ? are free to create STOs and organize in the same manner.
o   STOs are the only practical way for low income families, neighborhoods, and groups to pool funds that can support scholarships and tuition grants for kids
§   For video interviews of parents, children, and a school administrator:
  • How do STOs work?
o   STOs are free to decide which private schools will advance their goals, and may choose to employ a wide variety of limiting principles for the schools with which they associate and the scholarships they provide. They may not, however, limit their scholarships to one school.
o   Each STO must convince each taxpayer each year to take advantage of the tax credit and to contribute to that particular STO. Taxpayers are free to take advantage of the tax credit by donating to the STO of their choice.
o   Tuition at public and charter schools is free. Nonetheless, children who are educated in the public school system benefit from tax credits because Arizona also allows for a tax credit for contributions made to the public schools’ extracurricular activity funds..
Petitioners’ Arguments:
  • Petitioners are:
  • STOs reflect and effectuate the private choices of parents, schools, and taxpayers, free of any government endorsement of, hostility to, or preference for religiously based education.
  • Taxpayers do not have standing to file an  Establishment Clause case because the Arizona Supreme Court ruled in Kotterman v. Killian, 193 Ariz. 273, 972 P.2d 606 (1999),that:
    • A taxpayer’s final liability is not fixed until all deductions and credits are factored into the return.
    • Funds donated to private organizations under Arizona’s various tax credit programs are not “public funds” because they do not, at any point, pass through the state treasury.
    • No funds actually paid to the state can ever be used to support any private or sectarian school, or any public service company.
Respondents’ Challenge:
  • Respondents are taxpayers who object to the use of tax dollars to support any form of religious education.
  • Respondents do not object to the existence of STOs generally, nor do they object to allowing non?religious STOs to participate, or to STOs that support only schools organized around a particular educational method or the special needs of children.
  • The Respondents’ conceded at oral argument in the Ninth Circuit that their Establishment Clause challenge is solely focused on those STOs that only provide scholarships to students whose parents choose religious schools.
Obama Administration Position: 
  • “Arizona’s decision to voluntarily forego some particular tax collections from individuals who make private and voluntary donations to STOs does not harm respondent [taxpayers.]”
  • Respondents do not have standing to challenge a neutral statute that provides tax credits for contributions made independently by private citizens.
  • The tax credit does not violate the Establishment Clause.
  • (Link to Amicus Brief of United States)
  • Upheld the program on the merits.
  • Did not address the standing issue.
  • Invalidates the program
  • Reasoning:
o   The Respondents have standing to file an “as applied” Establishment Clause case.
o   Respondents abandoned their facial challenge at oral argument in the Ninth Circuit.
o   The Respondents can prevail on an “as applied” Establishment Clause claim:
      • If they can prove that Section 1089 was not really “enacted primarily to provide Arizona students with equal access to a wide range of schooling options,” but rather as a pretense for supporting religious schools.
      • If they can prove that “the choice delegated to taxpayers under Section 1089 channels a disproportionate amount of government aid to sectarian STOs, which in turn limit their scholarships to use at religious schools … a reasonable observer could therefore conclude that the aid reaching religious schools under this program “carries with it the imprimatur of government endorsement.”