Now seeking contributions
Huge tax benefits available to donors to Msgr. Lafferty Tuition Foundation

By RENEE WEBB, Globe editor
September 7, 2006

This past June Governor Tom Vilsack signed the Educational Opportunities Act that provided Catholic schools the opportunity to establish a scholarship tuition organization that provides huge tax advantages to donors.

According to Kevin Vickery, diocesan superintendent of Catholic schools, the diocese established the Monsignor Lafferty Tuition Foundation as a result of the new legislation. This foundation will assist the schools in the diocese in providing financial assistance for those families who are defined as having eligible students by the Iowa code.

This year scholarship tuition organizations in the state are allowed to raise $2.5 million. The diocesan share is $690,609.

"In a nutshell, this is a historic and generous act from the state to help our Catholic schools," noted Steve Elbert, diocesan director of development. "It allows Iowa taxpayers in all brackets who make a gift through the Monsignor Lafferty Tuition Foundation to receive a 65 percent tax credit, and benefit Catholic education in our diocese."

The development director pointed out that depending on a person's state and federal tax situation, nearly 100 percent of their 2006 gift may come back to that taxpayer which they could use as another gift in 2007. Prior to this new act, in a best-case scenario the largest tax benefit would have been about 33 percent. Now, they can receive the 65 percent tax credit and potentially up to another 33 percent deduction.

"It is a remarkable opportunity for our schools, families and donors. Hats off to all government officials who played a part in it," said Elbert.

Vickery mentioned that presently diocesan officials are teaming up with school administrators and development directors to raise the $690,000-plus. Because those who contribute to this foundation will receive such strong tax benefits, the diocese is presently limiting the maximum gift to $1,000 per donor with no limitations as to minimum gifts. He added that the Iowa tax credit is different than a refund. The donor must have an Iowa tax liability to truly benefit from the program.

Each Catholic school will be given the opportunity to raise a specific amount of funds based on student enrollment. For instance, Bishop Garrigan in Algona can raise $53,821 and Sacred Heart Grade School in Spencer can raise $14,323. Seventy-five percent of the money raised by a school will be used to assist students in their school as long as requirements for eligibility are met.

"There is a 25 percent unrestricted fund, so there will be some funds available to use in the neediest places of the diocese," explained the diocesan superintendent.

The diocesan superintendent also noted that the $1,000 cap on individual gifts will be removed after Nov. 1 if the $690,000 has not been raised.

This new scholarship tuition organization, noted Vickery, is fittingly called the Msgr. Lafferty Tuition Foundation in this diocese because the diocesan priest was instrumental in promoting the legislative issues of the Catholic schools.

"It seems so appropriate that this foundation, which is a result of a legislative initiative, should bear his name," said the diocesan superintendent.

Members of the Msgr. Lafferty Tuition Foundation include Bishop R. Walker Nickless, Msgr. Michael Sernett, Ron Olberding of Spencer, Sister Delores Hannon of Fort Dodge, Robin Barber of Spencer, Jim Auen of Carroll, Matt Greteman of Carroll, Gilbert Buscher of Algona, Father Gerald Feierfeil of Sioux City, Father Merlin Schrad of Sioux City, Sherry Nilles of Granville, Gary Tillman of Le Mars, Sue Fitzpatrick of Storm Lake, Kevin Vickery of Sioux City, Sister Ruth Schock of Sioux City and Kris Brown of Sioux City.

After the money has been raised, in January the foundation board will establish an application process. They do know that a third-party provider, Financial Aid Independent Review (FAIR), will be used for the provision of soliciting applications, analysis of financial need and recommendation of financial aid awards for students and families.

"To be an eligible student means that you must be within 300 percent of the Federal Poverty Level," noted Vickery. For a family of six, they would be able to apply for tuition assistance if their family income was below $80,400. "Plus, if this money is used to help the bottom-tier of the economic group, it would free up dollars that we were already spending for financial aid in the locals schools to be used for the middle income families."

These funds will be used to assist students with tuition for the 2007-2008 school year. Next year, the scholarship tuition organizations in the state will be allowed to receive $5 million in tax credit. The diocesan share would be about $1.4 million.

To make a donation, contact your local Catholic school administrator, the school development director or mail your contribution directly to the Msgr. Lafferty Tuition Foundation. See the form below.

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