Early next year, the Georgia Supreme Court will hear arguments in Gaddy v. Georgia, the lawsuit over the state’s K-12 tax credit scholarship program.

The Fulton County Superior Court dismissed the lawsuit brought by Raymond Gaddy, a taxpayer who argued the $58 million program was unconstitutional. He then appealed. The state constitution prohibits the use of tax dollars to fund “any church, sect, cult, or religious denomination.” He argues that the scholarship program is unconstitutional because it gives money to private schools with religious affiliations.

It works like this: taxpayers pledge money — up to $1,000 for an individual, $2,500 per married couple and many thousands of dollars for certain business entities — to specific private schools and get a tax credit from the state for the same amount. The money goes through non-profit organizations that assign it to private schools as scholarships.

Georgia limits the tax credits to $58 million a year, and in recent years, the $58 million in donations to the program has been taken on the first day of availability.

Proponents cite that as evidence of the program's popularity, but efforts to expand it have met with resistance from lawmakers. One key member of the General Assembly said during Georgia's last legislative session that it's inaccurate to describe something as a "donation" when the money is recouped in a tax rebate. Critics have complained about the level of transparency with the program. Recipients are not identified and there is little information about them.

The state Supreme Court has scheduled oral arguments in Gaddy's appeal Jan. 23. A group that supports the tax credit program filed a brief Thursday against the lawsuit, arguing that the state's constitutional prohibition on taxes and religion is "a discriminatory constitutional provision that would itself create additional constitutional problems."

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