As the GRACE Scholars program completed its second year, encouraging signs continue to move the program forward.

In 2008, its first year, GRACE brought in over $86,000 to help with tuition for students who newly entered Catholic schools throughout the state of Georgia.

In 2009, nearly $2.9 million has been directed to the program through more than 1,300 donors, marking a staggering increase from its freshman year.

According to Pat Mannelly, volunteer director of GRACE Scholars, Inc., five area Catholic schools received over $100,000 each and almost every school received between $50,000 and $100,000 as a result of the 2009 gifts. The funds can only be applied toward the cost of school tuition for qualifying students.

GRACE, which stands for Georgia Residents Assisting Children’s Education, is the student scholarship organization that was established by the Archdiocese of Atlanta and the Diocese of Savannah when Georgia recently opened the door for this program.

The program is one of about 20 organizations that distribute scholarships when Georgia taxpayers “redirect” part of their state income tax to the student organizations. The payment is a tax credit against their state tax bill.

Taxpayers or corporations who give to a scholarship organization can get a dollar-for-dollar credit against state income taxes. For example, a married couple donating the $2,500 maximum for couples can lower their state tax bill by $2,500. Individual taxpayers are limited to $1,000, and corporations, up to 75 percent of their state taxes. In other words, you get your entire donation back as a credit when you file your taxes.

“It’s the easiest give in the history of the Catholic Church,” said Mannelly. “The state is giving us a chance to help Catholic education.”

Diane Starkovich, superintendent of Catholic schools for the Archdiocese of Atlanta, who also serves on the board of directors for GRACE Scholars, agrees that the program is helping Catholic education and the local community.

“It is not going to fund or build schools,” said Starkovich. “But it is going to give a child and their family the chance to be in a Catholic school.”

“(GRACE) gives a family hope,” she continued. “It will open doors for students.”

Any Georgia taxpayer may make a donation and qualify for the Georgia Private School Tax Credit, assuming a state cap of $50 million annually hasn’t been met.

Donors pay the money already when they pay their state taxes. The question is whether people want it to go entirely into state coffers or redirect a portion of it to GRACE Scholars. Making that point takes some time, but once the process is clear to people, donors are usually pleasantly surprised.

“How could you not do it since you get it all back?” Mannelly asked.

GRACE leaders are working to get the word out about the program because they believe there is an untapped potential to redirect a portion of state taxes into the program, which can then make Catholic education more affordable for families.

In 2009, the GRACE Scholars program established new policies in hopes of bringing new donors to the program.

One is that scholarship money can be set aside for the student’s whole academic career. The tuition assistance is provided yearly as long as there is still a financial need and the student remains in good academic standing.

Also, scholarships are awarded on financial need only. In the past, students could be ineligible if families earned above a maximum salary level.

Finally, donors can designate contributions to their school of choice. All Catholic schools in Georgia are eligible to receive aid from the GRACE program.

Giving money to GRACE takes four steps, making it important people submit the initial paperwork to the state as early as they can, usually by the end of October. First, a donor must become qualified by the state of Georgia by completing and submitting a Georgia Form IT-QEE-TP1, which can be downloaded at the GRACE Scholars Web site.

The donor will then receive confirmation from the Georgia Department of Revenue, allowing them to donate to GRACE. After the Department of Revenue sends back the approved Georgia Form IT-QEE-TP1 to the donor, they have an open period of 30 days to send a donation to GRACE Scholars, Inc.

GRACE Scholars, Inc. will mail a confirmation form once the forms and donation are received. This form is important to maintain with tax records. All the information and appropriate forms for donating may be found on the program’s Web site.

The tax credit opportunity for 2009 has closed, but it is just beginning for 2010.

“If we can fire up the churches, we could get the number to $10 million,” said Mannelly. “I’m convinced we can triple it this year.”

For more information visit www.gracescholars.org.