Lawmaker benefits from tax credits he helped design - Tucson News Now

Lawmaker benefits from tax credits he helped design

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Arizona state Sen. Steven Yarbrough is widely popular among advocates of school choice for his support for and sponsorship of laws that benefit the state's tuition tax credit program. (Source: CBS 5 News) Arizona state Sen. Steven Yarbrough is widely popular among advocates of school choice for his support for and sponsorship of laws that benefit the state's tuition tax credit program. (Source: CBS 5 News)
PHOENIX (CBS5) -

Arizona state Sen. Steven Yarbrough is widely popular among advocates of school choice for his support for and sponsorship of laws that benefit the state's tuition tax credit program.

But a CBS 5 investigation found Yarbrough's own finances are tied to the program and have benefited from the laws he has helped to pass.

"It seems like a conflict of interest to me," said Jenifer Darland, a mother of school-aged children and an advocate for public education.

She said she was shocked when she learned Yarbrough, a Chandler Republican, is the executive director of the state's second-largest tuition tax-credit organization, Arizona Christian School Tuition Organization, or ACSTO.

STOs, as they are known, receive donations from Arizona taxpayers and turn those funds into scholarships for students to attend private school. The donors are reimbursed dollar-for-dollar by the state, up to $1,000 for a married couple.

The STOs are allowed to spend up to 10 percent of the donations they receive on administrative expenses, thanks to laws Yarbrough and others have sponsored. In Yarbrough's case, that has added up to hundreds of thousands of dollars over the years.

"We are paying his mortgage. We are paying his rent," Darland said.

An examination of the most recent tax return for ACSTO shows Yarbrough receives a salary of $96,000 per year. ACSTO also paid for his car. It paid $426,000 to a company called HY processing, which Yarbrough serves as part owner. The organization also paid $127,000 in leasehold improvements and $50,000 rent to the landlord. Yarbrough owns the building.

"I don't think it looks good on Steve and I don't think it looks good on the Legislature," said former Senate Minority Leader David Schapira.

He put together a bi-partisan task force with the goal of closing the loopholes that allow the administrators of the STOs to double- and triple-dip when billing for expenses.

"Unfortunately, the recommendations that we made, which came out in bill form, which I sponsored, they didn't pass. They didn't even get a hearing," Schapira said.

CBS 5 Investigates reached out to Yarbrough via email to ask for an on-camera interview. The senator replied that he would answer questions in writing, but only after we identified his critics and cited specific legislation that he sponsored.

Here is the email chain to and from Yarbrough, including his answers to questions about his involvement in the school tuition organization.

Copyright 2014 CBS 5 (KPHO Broadcasting Corporation). All rights reserved.

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