Pennsylvania's Educational Improvement Tax Credit (EITC) program reached its funding limit this week, highlighting the EITC's popular success. The state will now place companies that applied to the program after the $26.7 million scholarship funding cap was reached on a waiting list.

The program allows companies to provide scholarship money in return for the tax credits so that a growing number of parents can send their children to the schools of their choice. Another $13.3 million of EITC money, which previously also ran out, goes to innovative programs in public schools.

There are 143 scholarship organizations and 193 educational improvement organizations in Pennsylvania. Because of overwhelming demand, the Legislature increased funding for the EITC from $30 million to $40 million and doubled the maximum tax credit from $100,000 to $200,000 in December 2003.

Several environmental groups, including the Pennsylvania Resources Council and the Delaware Valley Earth Force have qualified as educational improvement organizations.

The EITC was signed into law in 2001 by Gov. Ridge. It provides a 75 percent tax credit (and increases to 90 percent for a two-year commitment) to companies contributing to non-profit scholarship or educational improvement organizations.

More than 90 percent of companies that applied this year opted for the two-year commitment.

9/10/2004