Espinoza v. Montana Department of RevenueAnnotate this Case
The Supreme Court reversed the district court’s order granting summary judgment in favor of Plaintiffs, holding that the Tax Credit Program, which provides a taxpayer a dollar-for-dollar tax credit based on the taxpayer’s donation to a Student Scholarship Organization (SSO), violates Mont. Const. art. X, 6.
SSOs fund tuition scholarships for students who attend private schools meeting the definition of Qualified Education Provider (QEP). Pursuant to its authority to implement the Tax Credit Program, Mont. Code Ann. 15-30-3111, the Montana Department of Revenue implemented Admin. R. M. 42.4.802 (Rule 1), which excluded religiously-affiliated private schools from qualifying as QEPs. Plaintiffs, parents whose children attended a religious-affiliated private school, challenged Rule 1. The district court granted summary judgment for Plaintiffs. The Supreme Court affirmed, holding that the Tax Credit Program violates Article X, Section 6’s prohibition on aid to sectarian schools and that the Department exceeded the scope of its rulemaking authority when it enacted Rule 1.