By Dr. Jerry Burkett
Senator Dan Patrick (R-Houston) really wants to see a voucher program in Texas. Patrick recently filed two new voucher bills in Texas’ lawmakers continuing quest to saddle Texas with an ill-conceived voucher scheme. Senate Bill 1410 and SB23 co-sponsored by Senator Ken Paxton (R-McKinney) seek to create a voucher program offering private school vouchers for at-risk students, with a priority for kids in low-rated schools. Two other voucher bills have followed Patrick’s, Senator Donna Campbell (R-New Braunfels) filed SB 1575 (also co-sponsored by Paxton) and House Bill 3497 was filed by Representative Scott Turner (R-Frisco).
The legislators who have filed these bills were very careful not to refer to them as “voucher” programs. Instead they have adopted the more fiscally friendly term “tax payer saving grants” or “equal opportunity scholarship” programs. However, despite the politically correct language used to describe these so-called “reform” measures, “tax payers” (you and me) save nothing and these “scholarships” are not designed for poor families. Patrick proposes that the family income cutoff to qualify for the voucher will be about $71,000 for a family of three, which is twice the federal free and reduced lunch program limit.
In previewing his voucher scheme late last year, Patrick touted his plan as a way to save Texas money by reducing the amount of general revenue expenditures into public education by reducing enrollment – those schools that are still reeling from $5.4 billion in budget cuts from last session. Patrick has maintained that the plan does not pull money from public schools, yet his bill offers participating companies a credit toward their business franchise tax. The franchise tax is the under-performing education funding source that has created much of the revenue shortfall for public education. In fact, businesses could take up to 15 percent of what they’d pay in franchise taxes, and donate it to the new scholarship fund instead. So not only does this boondoggle shift student funding from public schools to private interests, it further depletes the franchise tax revenue that was originally proposed to replace the hole left in the education budget from the 2006 structural tax deficit. To claim this scheme does not impact public schools financially is an exercise in delusion.
Despite little evidence of success (see the lackluster performance of long-running voucher programs in Cleveland and Milwaukee), there are pushes for similar voucher schemes nationwide – Indiana’s voucher program was just upheld as constitutional while Louisiana’s program was recently declared unconstitutional There are pushes to expand the program in Florida and Tennessee. Efforts recently passed in Arizona and Alabama. Vouchers are the holy grail of those seeking to privatize public education. Pro-corporation lobbying groups such as the American Legislative Exchange Council (ALEC) even provide model legislation to privatization-friendly lawmakers to further their causes to privatize public education through vouchers, charter schools, and efforts to generally undermine the public education system. With profiteering lobbyists driving the voucher discussion, we’ll continue to see it around the nation. So, what exactly does a voucher scheme entail:
What is a Tax-Credit Scholarship?
The term “tax-credit scholarship” or “taxpayer scholarship” is not new term in the realm of school finance. The “tax credit” is issued to companies, business, or private entities in exchange for financing private education for students. Instead of paying your tax dollars directly to the general revenue, you pay part of the tuition for a student to attend private school in exchange for having your tax liability reduced. The first “tax credit scholarship” was established in Arizona in 1997 and similar programs have been expanded into Georgia, Virginia, and Florida.
As of September 2012, 14 tuition tax credit programs exist in 11 states (NCSL). In 2008, Georgia’s tax credit plan was challenged in a report by the Southern Education Foundation claiming a lack of transparency and the use of accounting gimmicks. In 2011, Arizona’s program was challenged and upheld in the U.S. Supreme Court.
“Supporters of tuition tax credits say they save the state money because annual tuition at a private school is typically less than the per-pupil cost at public schools. This is shown through a nonpartisan analysis of the Florida Tax Credit Scholarship Program. It reported for every $1 spent on the tax credit program, Florida taxpayers saved an estimated $1.49”.
However, despite the reported taxpayer savings both the report on the Florida program and the 2008 analysis of the Georgia program agree that saving is based significantly on student participation in the program that must balance with the proposed tax credit cap that is placed on the program.
Opponents of tax-credit or taxpayer scholarships have described the plans as complicated school voucher plans since the purpose of the scholarship is to pay for tuition and fees to private schools through manipulation or diversion of tax revenue dollars. Supporters maintain that these programs allow for more students to participate, save the state money, and are an alternative to traditional school voucher programs.
Brief History of School Vouchers
A school voucher program is an arrangement whereby public funds are made available to qualified parents to cover some or all of the expenses associated with enrolling their child in a participating private school of their choosing. School voucher programs have been introduced by legislatures since 1869. Vermont was the first state to implement a voucher program issuing a “town tuitioning” program that was designed to allow students in rural areas, without access to a public school, the opportunity to attend a nearby private school. Few voucher programs came into existence after 1869 in the United States but gained popularity in the 1990’s when 3 voucher programs were established in Wisconsin, Ohio, and Florida.
The programs established in the 1990 have had similar aspects seeking to provide school choice alternatives for low-income students using a publicly funded voucher. However, the constitutionality of the voucher program in Ohio was challenged in the landmark U.S. Supreme Court case Zelman v. Simmons-Harris. The voucher program enacted in the Cleveland school district gave qualified families the option of sending their children to a participating public school, a private sectarian school, or a private non-sectarian school. As a result of the program, in the 1999-2000 school year, 96 percent of the students receiving vouchers were enrolled in religiously affiliated schools. The US Supreme Court upheld the Ohio voucher law establishing that the program does not violate the Establishment Clause.
Since the Zelman decision, there has been a rise in the number of school voucher programs enacted through legislation throughout the United States. Six states including Washington, D.C. established voucher programs each seeking to serve low-socioeconomic, disabled, or foster students from 2002-2007 (Wolf, 418). In Utah, a voucher plan was passed by the state legislature but later struck down by voters. Indiana and Louisiana have most recently passed voucher legislation seeking to provide students with universal access to school vouchers (citations).
Researcher Patrick Wolf examined the voucher issue stating that when voucher programs are enacted, the students who apply for and use vouchers tend to be educationally disadvantaged because of the logic of parental choice. Previous research has established that private schooling tends to have larger positive achievement effects on disadvantaged students than on advantaged students which may have led to the initial push from state legislations to enact programs for economically disadvantaged and foster students.
Do Taxpayer Scholarship Programs Save Money?
Senator Patrick’s “tax-credit scholarship” program is supposedly designed to give at-risk or low-income students first access to the voucher instead of allowing all students access to the scholarship as was proposed in Georgia. Research has not been conducted on universal voucher access programs to determine if these programs save tax money.
However, despite the lack of scholarly research, various aspects of taxpayer scholarship programs have been examined and evidence has been presented that should be taken in consideration for future legislation that is in development for these types of grants.
The most significant report on taxpayer grants was written by the Southern Education Foundation, which found a variety of flaws in Georgia’s plan. Through analysis of a variety of state and local data, the SEF found that the state of Georgia actually diverted more taxpayer dollars to the program than originally intended. Scholarships in 2009 cost the state government $11,803 per student and the state government incurred an additional cost of $7,510 in financing a partial scholarship in a private school above and beyond what it would have paid in 2009 for the education of the same student in a public school.
The report also cited an August 2009 article from the Atlanta Journal‐Constitution that reported that parents and students attending private schools were showing up at public schools “to fill out paperwork to enroll their kids in public schools solely to qualify” for the tax‐funded scholarships—“with no intention of actually attending classes in the public school.” Largely, parents who are accepting the scholarship dollars are from households with children (between the ages of six and 16) and had essentially twice the median income of those households where children attended public schools in 2007.
Testifying in support of taxpayer scholarships for Texas in 2011, both the Heritage Institute and the Texas Public Policy Foundation released reports stating that Texas would save $2 billion for the 2012-13 biennium or $3,429 dollars per participating student. To support the potential for student participation in the Texas program, the Texas Public Policy Foundation and the Heritage Institute both cite data from a voucher program enacted in Milwaukee, Wisconsin. The TPPF used student enrollment data from Milwaukee to project Texas taxpayer savings at $2.3 billion.
Steve West, writing for the Texas Association of School Business Officials, stated that the data from the Heartland Institute was flawed as it consisted of all school district spending per student part of which includes “funds that are prohibited or are not available for use for general maintenance and operations spending.” When recalculated to include eligible funds, the potential savings is reduced to $1 billion.
The National Education Association points out that moving students from public to private schools harms school districts because they cannot reduce their fixed facilities and transportation costs in proportion to the number of students who leave (citation).
Do Taxpayer Scholarships Improve Student Learning?
Supporters for taxpayer scholarships often point, specifically, to data collected by Harvard University researchers on the Milwaukee and Cleveland voucher programs. Although there was a jump in the testing performance for voucher students, when these students were compared to non-voucher students, there was not difference in their scores.
Other research studies conducted on the Milwaukee program have found no significant voucher impacts on test scores until students had used them for at least three years, generated math gains of 1.5 to 2.3 percentiles per year but no statistically significant reading gains, and a one-year snapshot of the 2006-07 school year, students’ state test scores were about the same on average in Milwaukee regardless of whether they used vouchers or attended public schools.
Who can receive a voucher?
The provisions of Texas’ current voucher bills state that any private school that is a member of Texas Private School Accreditation Commission (TEPSAC) is eligible for the program. When people think of private schools, many think of the large, expensive and established schools like Ursuline, The Hockaday School, or Fort Worth Country Day; however these schools are just three of 1,187 schools listed with TEPSAC. Many of the schools listed with TEPSAC are smaller private schools that are managed by churches or daycare providers like Primrose Academy, KidsRKids, or franchise schools like The Goddard School. If these schools can provide evidence (to whom has not yet been established) that they give a nationally norm-referenced assessment to students (basically any test that provides a percentile rank for a child) they are eligible for the scholarship dollars.
Clearly, more research is necessary to determine the fiscal and academic effectiveness of universal school voucher programs like the tax-credit scholarship plan suggested by Patrick. It is clear that in the development of a program, it must include a variety of elements that other states have either included or lack in their current programs.
In addition, consideration of such a program should not occur until the state of Texas has resolved pending law suits related to school funding adequacy and equity and has increased current per students funding allotments for public schools. According to the National Education Association, Texas ranks 49th in per student funding at $8,400 per student which is a figure that is nearly $3000 below the national average. It is negligent of the state of Texas, when determined to be inadequately funding education in violation of the state constitution, to chase such a boondoggle. Texas needs to fund its constitutional obligations to a system of free public schools before falling down the school voucher rabbit hole.