I think you skipped a step in your explanation. The qualifying charitable organizations should be organizations that are already getting state funding. Like schools. Arizona has some that aren’t currently funded by the state (like private schools, whose funding I personally strongly oppose, and would hate to see California include them in qualifying organizations). But most of the organizations are things the state is either already funding or reasonably could fund. I do not know whether the state reduces funding based on the amount of direct contributions, but there are some credits that are limited in total dollar amount.
