Progress continues on fundraising efforts for Msgr. Lafferty Tuition
By RENEE WEBB, Globe editor
Nov. 9, 2006
Two months after fundraising efforts began for the Msgr. Lafferty Tuition
Foundation, about $307,000 has been raised.
This tuition foundation was established as a result of legislation signed
last June by Iowa Governor Tom Vilsack. That legislation called the Educational
Opportunities Act allows Catholic schools to establish a scholarship tuition
organization that provides huge tax advantages to donors. In the Diocese of
Sioux City the scholarship tuition organization was named the Msgr. Lafferty
Tuition organizations in the state this year are allowed to raise $2.5
million. The diocesan share is $692,607.
According to Diane Donnelly of the diocesan finance department, this
legislation allows Iowa residents with an Iowa tax liability to receive a 65
percent tax credit. Nonresidents and part-year residents may also qualify for
the tax credit but possibly at a lower percentage.
Steve Elbert, diocesan development director, noted that those people who have
a tax liability on the federal level, depending on their situation, more than
likely will be able to take a charitable deduction on their federal taxes as
well. Based on $1,000 they would see a $650 state tax credit and anywhere from
$100 to $350 federal itemized deduction. In most cases, the donor cost of a
$1,000 gift would be $100 or less.
"Basically you are trading dollars," said Elbert, who added that
this is such a great tax benefit that some people are wondering if it is too
good to be true. "As always, we encourage donors to seek the counsel of
their professional financial advisor."
Because there were such unprecedented tax benefits, the diocese opted to
initially limit the gifts to a maximum of $1,000 per individual. The concept was
to spread the tax savings benefits to many people. That cap was lifted on Nov.
1. Now people can make gifts of any size and receive the 65 percent tax credit
until the $692,607 has been raised. Since the beginning of the month, there have
been a few larger gifts of $5,000, $10,000 and $20,000.
Donnelly stressed the importance of acting on this gifting opportunity as
soon as possible.
"After we reach the allocation, we can continue to accept contributions
but cannot issue tax credits for contributions exceeding the diocesan
percentage. The tax credits will be issued on a first come basis," noted
Donnelly, who added that so far 289 individuals have made contributions to the
Each Catholic school in the diocese has been given the opportunity to raise a
specific amount of funds based on their school enrollment. Money that is
designated for their school will be used for tuition assistance at their school
as long as they have eligible students.
"Some schools in the diocese have been very successful with the
scholarship tuition organization," noted Elbert.
As of Nov. 6, five schools or local school systems have either met or are
close to reaching their goal - Bishop Garrigan Schools in Algona, Sacred Heart
in Boone, Emmetsburg Catholic, Sacred Heart in Spencer and St. Mary's in Storm
"We are pleased with the response," noted Elbert. "There are
several other schools that are right at or close to the 50 percent mark."
He stressed the fact that he would love to see people take advantage of this
gifting opportunity "because right now the Iowa taxpayer who has a tax
liability either has the choice of sending their money to Des Moines for Iowa
taxes or diverting those monies to go to Catholic schools in the Diocese of
Dawn Prosser, development director at St. Mary's Schools in Storm Lake, said
this effort was successful in her school for two reasons.
"First, our needs for tuition assistance have grown exponentially since
I came here in 1995. More and more families are needing help to provide Catholic
education. We've had people come forward to help other families," she
For three years now the school has put forth an effort to raise tuition
assistance funds and she sees the Msgr. Lafferty Tuition Foundation as one more
way to do so.
"The second reason for our success in meeting the goal is the generous
offer of the tax credit from the Iowa Department of Revenue. I have seen gifts
from people who would have given anyway, but it's really nice to be able to give
them an extra tax credit as well as their standard federal deduction," said
Prosser. "It's another thank you to people for their generosity."
Along with some who have given in the past, the school picked up some new
donors thanks to this unique giving opportunity.
The people in Storm Lake recognized the value of this program, which can
assist families who need tuition assistance and help themselves through huge tax
benefits. She noted that many of the donors used terms such as "no brainer,"
"why wouldn't I do this," "it's such a good deal" and
"it's really going to help the school."
Prosser called it a win-win situation for the donors and the school.
Given that there are such strong tax benefits, Diane Elbert, development
director for Bishop Garrigan Schools pointed out that some people think it's too
good to be true.
"We tried to communicate it to as many people as we could because it is
a benefit that everyone should have the opportunity to take advantage of,"
Once people were informed, they saw the value in it.
"It is very complicated to explain, though, so anyone who has heard a
little bit about it needs to contact the development directors to get a more
in-depth explanation," said Diane Elbert. "It's a matter of education
The school held informational sessions to inform tax preparers and financial
planners. They in turn educated their clients and from their potential donors
spoke with the development office at Garrigan.
She extended gratitude to those who participated and encouraged other
interested persons to contact the development office for more information.
After Dec. 1, the school designation limits for particular schools will be
lifted. If some schools have not raised their designation, other schools may
raise additional funds for their own school use as long as they have eligible
students to receive the tuition assistance.
"It is important for those schools who have not yet met their quota to
encourage their local donors or alums who are spread out across Iowa to
contribute because otherwise their credits may be used by other schools,"
explained Elbert. At this time, schools have less than three weeks.
In addition to the designated funds, 25 percent of the total fund will remain
undesignated so that the Msgr. Lafferty Tuition Foundation will be able to
assist those schools with the greatest needs.
People who have ties to Catholic schools are encouraged to take advantage of
this tremendous gifting opportunity. Elbert mentioned that he would love to see
individuals in non-school parishes who had in the past been touched by Catholic
education take advantage of the tax benefits.
"My hope is that we as a diocese and Iowa - all scholarship tuition
organizations get behind this program because it is something that we want to
continue," he said.
According to Kevin Vickery, superintendent of Catholic schools, after Jan. 1
a formal certificate will be mailed to donors to satisfy the requirements set
forth by the state of Iowa pertaining to gifts to the Msgr. Lafferty Tuition
He reminded donors, "Your gift and the tax advantages you may reap,
offer you an opportunity to share again. For some, it may be a chance to 'give
it twice.' We humbly ask you to consider this in your regular parish, school,
diocesan and other giving charities."
In relation to monies raised by the Msgr. Lafferty Tuition Foundation,
tuition assistance will be awarded to eligible students for the 2007-2008 school
year. Donnelly mentioned that the legislation has identified requirements of
eligible students. An eligible student is a member of a household whose total
annual income during the calendar year before the student receives a tuition
grant does not exceed an amount equal to three times the most recently published
federal poverty guidelines.
For more information call Kevin Vickery at (712) 255-7933 or e-mail him at
email@example.com. People may obtain a gift form at the diocese's Web site: