Tax Reform Would Harm Cristo Rey Students
The House of Representatives’ newly proposed tax reform would greatly impair the Cristo Rey Network’s ability to provide educational opportunities to low-income students. The Washington Examiner’s Todd Shepherd–the Independence Institute’s former investigative reporter–describes the negative implications of the proposed tax reform in his piece House tax reform could cripple innovative education model aimed at low-income families.
My good friend, and senior fellow at the Independence Institute, Ross Izard, wrote a private school profile called Building Hope: A Profile of Arrupe Jesuit High School that exemplifies the local impact of the Cristo Rey Network here in Colorado.
Cristo Ray’s consortium of high schools emphasizes the combination of “four years of rigorous college preparatory academics with four years of professional work experience.” The network is Catholic, but open to all students. Its primary concern is helping low-income students reach success, despite religious affiliation.
The network is incredibly successful–it has graduated over 13,000 students, 90 percent of which enroll in college. That’s an enrollment rate 29 percent above the national average for low-income students and 4 percent above the national average for high-income students.
The average Cristo Rey household earns around $37,000 annually, but the network’s 32 schools are exclusively private, college-prep institutions. To pay for their education, students participate in the Corporate Work Study Program, in which they work at local businesses that in exchange pay for the majority of their tuition.
As of now, the tuition students earn through the work study program is untaxed–it goes straight from the business to the school with no obstructions.
With the introduction of the House’s new tax reform, this would no longer be the case. The tuition students earn from their work study program would no longer be exempt from taxation. This would also mean that when it came time to apply to college the Cristo Rey students’ work study would be counted as income. Consequently, the financial aid they receive for college would be diminished.
This negative externality of the proposed tax reform is an unnecessary obstacle forced upon students working for a brighter future–though I believe many legislators are blissfully unaware that it is being included in the reform. Hopefully by the time I go to high school, my brightest friends will get the best opportunity to maximize their potential, despite their income. I wonder how that would be possible without the full support of groups such as the Cristo Rey Network?