the school voucher audit: do publicly funded private school choice programs save money?

THE SCHOOL VOUCHER AUDITDo Publicly Funded Private School ChoicePrograms Save Money?

breaking down

@edchoice

School choice advocates have always used the savings potential of vouchers as a positive selling point.

@edchoice

Since the creation of the first voucher program in 1990, six studies have examined the fiscal impact of school choice on taxpayers.

@edchoice

All six show school choice saves money for taxpayers. None found a negative impact.

@edchoice

But still, that wealth of evidence hasn’t stopped school choice opponents from claiming otherwise.

@edchoice

“MYTH: Vouchers save taxpayers money”-Education Voters of Pennsylvania

“Vouchers do not save taxpayer money”-Americans United for Separation

of Church and State

“Myth 1: Vouchers save money”-National Education Association

@edchoice

So what is getting lost in translation?

@edchoice

Our Director of Fiscal Policy and Analysis...

• Former Controller/Chief Financial Officer for the City of Indianapolis

• Two-time Fantasy Football Champion

• Elton John Enthusiast

• Roger Federer Fan

• Dad of sixth-grader Elly

JEFF SPALDING

@edchoice

...not only examined the fiscal impact of voucher programs...

1990

2001

1995

2006

1992

2003

1997

2008

1991

2002

1996

2007

1993

2004

1998

2009

1994

2005

1999

2000

2010

Milwaukee Parental Choice Program | Wisconsin

Cleveland Scholarship Program | Ohio

John M. McKay Scholarships for Students with Disabilities Program | Florida

Autism Scholarship Program | Ohio

Carson Smith Special Needs Scholarship Program | Utah

Georgia Special Needs Scholarship Program | Georgia

Opportunity Scholarship Program | Florida

Opportunity Scholarship Program | Washington, D.C.

Educational Choice Scholarship Program | Ohio

Student Scholarships for Educational Excellence Program | Louisiana

@edchoice

...he also walks through how he made each calculation for full transparency.

@edchoice

To make sense of a calculation,first you’ve got to understand

what you’re calculating.

@edchoice

After all, the numbers alone don’t indicate whether an outcome is good or bad.

10 4 6

@edchoice

Opponents claim, simplistically, that school choice drains money from the public school system.

I do not support vouchers. And the reason I don’t is because I don’t think we can afford to siphon dollars away from our underfunded public schools.”-HILLARY CLINTON

“

@edchoice

@edchoice

@edchoice

That rhetoric obscures an important fact: A public school is also relieved ofthe cost burden for any student

switching to private school.

$ • speech therapy

• remedial reading specialist

• all other standard instructional costs

+

@edchoice

By not acknowledging such variable cost savings, opponents implicitly argue thatall public school costs are “fixed.”

@edchoice

By that logic: If costs don’t go down when a public school’s enrollment declines...

@edchoice

...costs wouldn’t go up when a public school’s enrollment grows.

Enrollment

Dolla

rs

Revenue

Cost

@edchoice

One could argue school choice opponents basically say the relationship between funding and costs for instructing students looks like this:

Enrollment

Dolla

rs

Revenue

Cost

@edchoice

In actuality, the relationship between funding and costs looks more like this.

Enrollment

Dolla

rs

Revenue

Cost

@edchoice

For a voucher program to result in savings, this must be true:

Per-Student Cost Burden Removed

from Public School

Net SavingsPer Student

Cost ofVoucher

@edchoice

To determine whether that is the case for a voucher program, use this equation:

Public School Cost Per Studentx

Number of Voucher Students( )Voucher Amount

xNumber of Voucher Students( )

TOTAL NET SAVINGS

@edchoice

We did the math.

@edchoice

By taking their educational needs to independent schools, voucher students removed a cost burden of $4.5 billion from public schools.

$4.5 billion ? ?

@edchoice

From 1990 to 2011, students received$2.8 billion in voucher funds to attend independent schools of their choice.

$4.5 billion $2.8 billion ?

@edchoice

You read that right.

@edchoice

Voucher programs saved $1.7 billion.

$4.5 billion $1.7 billion$2.8 billion

@edchoice

What happened to those savings?

@edchoice

Those funds are most commonly captured by either the public school districts or the state treasury, which can use them to:

1. invest in public schools,

2. invest in other priorities such as law enforcement or healthcare,

3. lower total state spending,

4. build reserves, and/or

5. lower taxes

@edchoice

In fairness, however, some kids who use vouchers are not diverted from public schools. That is, they maybe could have attended private school without a voucher.

@edchoice

But if a family’s financial hardship and inability to get a voucher were to cause parents to withdraw from private schools...

@edchoice

...already cash-strapped public schools would be hit with the financial responsibility of adding those kids to classrooms and funding their education.

@edchoice

With that in mind, wonder how muchmore voucher programs could be saving?

@edchoice

If vouchers would have been available to keep private school enrollment steady from 1985 to

2010, our country could have saved

$111 billion.

@edchoice

What has the U.S. education system accomplished instead?Ad

ditio

nal C

ost o

f Tot

al U

.S. E

nrol

lmen

t Shi

ft to

Pub

lic S

choo

lsPrivate School Share of K-12 Enrollm

ent

13%

12%

11%

10%

$16B

$14B

$12B

$10B

$8B

$6B

$4B

$2B

0

Private School Enrollment Share

$222 billion cumulative additional cost for public schools, over 25 years, because of erosion in the private school enrollment share

2009

-10

2005

-06

2001

-02

1997

-98

1993

-94

1989

-90

1985

-86

2007

-08

2003

-04

1999

-00

1995

-96

1991

-92

1987

-88

School Year

@edchoice

If these numbers piqued your interest, check out individual program breakdowns

and more in the full report atedchoice.org/SchoolVoucherAudit