Two New York legislators have introduced a bill that can help all New York students, whether they attend public or nonpublic schools. With the Educational Tax Incentives Act, Senator Serphin Maltese of Queens and Assemblyman Dov Hikind of Brooklyn attempt to go one better than Governor Spitzer, who did not succeed in passing his tuition tax deduction proposal, which would have benefited nonpublic school students.

This measure, which they have jointly promoted for several years, would allow principals as well as school boards to solicit donations from individuals and corporations. Because of its potential to help all New York State, a total of 41 legislators, Democrats and Republicans representing city districts as well as suburban and rural regions, have signed on as co-sponsors to the 2007 version. While the legislation would allow some help for nonpublic school children, public education would be its primary beneficiary.

Donors to schools could claim a credit on their state income tax returns. This credit would be for 50% of the donation, with a $140 cap for personal tax returns and a $4,000 cap for taxpayers who file a corporate franchise tax return, as well as for those who have S corporations, limited liability partnerships, and other such business arrangements.

The significance of these donations is that all the money thus raised would come without an increase in the school tax rate. These dollar amounts were calculated to bring the first-year cost of the bill within the $25 million figure proposed by Governor Spitzer for helping parents of nonpublic school students.

Since the credit is for only half of the amount donated, this measure has the potential to raise $50 million to support education. Based on the experience of Arizona, where a similar law has been in effect for several years and about 80% of first-year donations went to public education, analysts have projected that in New York about $40 million would go to support public schools in the first year. In other words, public education would gain $15 million more than the state would lose. New York’s public schools would benefit even more in subsequent years, as the amounts donated are expected to increase.

The educational tax incentives bill addresses two critical areas overlooked in the governor’s proposal for a tuition tax deduction. By allowing school boards and principals to solicit tax-advantaged donations, the measure would foster the creation of non-tax-generated revenue streams for public education. This would relieve New York’s taxpayers of some of the burden of maintaining the public school system, while encouraging school administrators to make their schools attractive places for prospective donors.

The Maltese-Hikind bill also would benefit the local education funds, which have been set up in some communities to raise money and support for their public schools. It would allow supporters of public education to choose where to send their donation: to the local education funds, to school districts, or directly to individual schools they want to help. There are also provisions to help low-wealth school districts and to reimburse school personnel for out-of-pocket expenses for classroom supplies.

The legislation also includes reporting provisions. This way, the public could know where their donations have gone, and school leaders could be held accountable, as rightly demanded by Governor Spitzer. If school authorities do not spend the money wisely, donors could decide to contribute elsewhere. The second area overlooked in Mr. Spitzer’s proposal is that of help for parents who find themselves at the lower end of the economic ladder. The governor’s tuition tax deduction would have helped only those who send their children to schools where tuition is charged and who itemize deductions on their federal and state tax returns. Since most low-income families fare better by claiming the standard deduction, the people who might need help the most would not get it under Governor Spitzer’s proposal.

The tax incentive plan encourages donors to support scholarship funds. These funds, helping students in religious as well as secular schools, would assist families who otherwise might not be able to afford an alternative to public school. Mr. Spitzer is right in wanting to help New York’s students and their families. But because the Maltese-Hikind Educational Tax Incentives Act can help students in public and nonpublic schools, as well as New York’s taxpayers, it is a better idea.

Now in committees in both houses, it deserves to be voted out soon.

Mr. Mulhearn is president of United New Yorkers for Choice in Education, based in Hempstead, and may be reached at unyce@earthlink.net.