There’s a first for everything, including state supreme court decisions striking down well-established scholarship tax credit programs.

Last week, the Montana Supreme Court issued a sweeping ruling against the state’s scholarship tax credit program in Espinoza v. Montana Department of Revenue. (You can read ACE’s press release about the ruling here.)

The Espinoza ruling breaks with logic applied in previous U.S. Supreme Court precedent, as well as with state supreme court rulings in Arizona, Alabama, Florida, Georgia, Illinois, and New Hampshire. It marks the first time in American history that a state supreme court has struck down a scholarship tax credit program.

There is an awful lot about this ruling that should make choice advocates and legal scholars frown, but it’s not all bad. Here’s a rundown of the positives and negatives of the Espinoza decision.

The Bad

• It breaks with widely accepted legal logic to argue that tax-incentivized private donations to private nonprofits somehow constitute taxpayer money.
• It strikes down the entire scholarship program, even for students who have chosen to take their scholarships to secular schools.
• Despite attempts at rationalization, it comes down on the side of Montana’s state constitutional Blaine Amendment. Found in 38 state constitutions, Blaine Amendments are deeply rooted in a history of discrimination against religious minorities and immigrants.
• It makes no effort to accommodate current scholarship students under the tax credit program, who stand to lose their funding as early as this school year.

The Good

• Ironically, the program’s restrictive design softens this ruling’s impact. With donors only able to receive a tiny $150 tax credit per year, the program was only able to scholarship a small number of students. Hopefully, this will mean that any scholarship students who lose their funding as a result of the ruling will still have access to other scholarship assistance.
• ACE Scholarships does not participate in the credit program, which means that Montana’s nearly 1,000 ACE scholars will not be affected.
• As it is written, this decision provides a clear path to a U.S. Supreme Court appeal—an appeal that could finally finish what the high court started in Missouri and Colorado by addressing the constitutionality of Blaine Amendments themselves. A ruling against these relics of a darker time would unshackle hundreds of thousands of children across America.

The Institute for Justice, which has represented plaintiff families in support of the tax credit program since the beginning, has already declared its intention to appeal the decision to the U.S. Supreme Court “immediately.” It is not clear how long that process will take, particularly because the high court accepts only a small percentage of the requests it receives. But the conversation is most certainly coming. In fact, it’s already underway.

As several Montana private school leaders argued in an op-ed earlier this year, the true strength of Montana’s private school community comes from its diversity. If the state wants to support a great education for all students, the best thing it can do is allow parents to choose the educational environments their children need. Here’s hoping SCOTUS will instruct state leaders to do exactly that by reversing this decision.