On April 27, the Missouri House of Representatives passed a bill that would establish the Missouri Empowerment Scholarship Accounts Program, which would provide children with special needs and disabilities with an education savings account (ESA) that could be used to help pay for tuition at a private school that may better suit their individual needs. The bill still awaits a full vote in the state’s Senate.
This ESA program would be funded in a way that is similar to how tax-credit scholarship programs are funded. Individuals and businesses would receive a tax credit equal to 100 percent of the amount of their contribution, so long as the claimed tax credit does not “exceed the amount of the taxpayer’s state tax liability for the year which the credit is claimed.” These contributions and ESA accounts they fund would be handled by state-sanctioned “educational assistance organizations.” The state would cap the maximum amount of contributions to the program at $25 million per year.
Qualifying students eligible for an ESA would receive an amount equal to 90 percent of their local school district’s average per-pupil expenditures during the previous school year. The ESA could be renewed annually by a student’s parents until the student graduates high school. Funds still remaining at the end of a school year could be rolled over to the next school year, including for use paying for “qualified” postsecondary education once the child graduates high school.
Only 38 percent of Missouri 4th graders and 31 percent of 8th graders tested “proficient” in math on the 2015 National Association of Education Progress (NAEP) test, also known as the Nation’s Report Card. Only 36 percent of 4th and 8th graders tested proficient in reading. These results show Missouri’s public school system is failing to educate roughly six out of 10 4th grade and 8th grade students to a proficient level in reading and mathematics.
Missouri’s sub-standard performance on NAEP underscores the desperate need for the state to expand school choice opportunities far beyond what is currently available. Too many public schools in Missouri are failing to adequately prepare students for productive lives. Parents should be allowed to choose the schools their children attend and should not be penalized financially if that choice is a private religious or secular school.
“ESAs are about empowering parents and improving the range of educational options for children,” Renee Porter, executive director of Choice Matters, told The Heartland Institute’s School Reform News. “All children are different and learn differently. Some children have disabilities that require special attention. Other children are so advanced that their time in the classroom isn’t really benefitting them. It’s unrealistic, and quite frankly unfair, to expect every public school to provide for the exact needs of every student. That’s why it’s important to give parents options like charter schools, private schools, and virtual schools.”
Not only are education choice options good policy, they are also broadly popular. Polling conducted in Missouri by the Friedman Foundation for Educational Choice in February and March 2014 shows 60 percent of registered voters support the creation of an ESA program, 64 percent were in favor of charter schools, 62 percent were supportive of voucher programs, and 59 percent said they support the creation of a universal tax-credit scholarship program.
While providing ESAs for students with special needs would be a great step forward for Missouri, the passage of a universal ESA bill would be ideal and go a long way toward remedying Missouri’s dismal record of failing to educate its children. The goal should be to allow every parent to choose, require every school to compete, and give every child an opportunity to attend a quality school.
The following documents provide more information on education savings accounts, tax credit scholarship programs, and educational choice.
Ten Principles of School Choice
Since the U.S. Supreme Court ruled in 2002 school vouchers are constitutional, grassroots activists around the country have been organizing to support passage of school choice programs. Legislatures passed statewide programs in Colorado and Florida, and other states are expected to follow their lead. At least 35 cities have privately funded voucher programs. This booklet from The Heartland Institute provides policymakers and civic and business leaders a highly condensed and easy-to-read guide to the debate. It presents the 10 most important principles of the school choice movement, explaining each principle in plain and precise language. It also contains an extensive bibliography for further research, including many links to documents available on the Internet and a directory of the websites of national organizations that support school choice.
The ABCs of School Choice – 2016 Edition
The ABCs of School Choice, produced by the Friedman Foundation for Educational Choice, is a comprehensive, data-rich guide to every private school choice program in America. This annually updated publication may not reflect developments past January 25, 2016.
The Fiscal Effects of School Choice Programs on Public School Districts
This report by Benjamin Scafidi is the first-ever study of public school districts’ fixed costs in every state and the District of Columbia. Scafidi concludes approximately 36 percent of school district spending cannot be quickly reduced when students leave a school to enroll elsewhere. Scafidi finds the remaining 64 percent, or approximately $8,000 per student on average nationally, are variable costs that change directly with student enrollment. This means a school choice program attaching less than $8,000 to each child who leaves a public school for a private school leaves the district with more money to spend on each remaining child. Scafidi says in the long run, all local district spending is variable, meaning all funds could be attached to individual children over time without creating fiscal disasters for government schools.
How School Choice Programs Can Save Money
This Heritage Foundation study of the fiscal impact of voucher programs notes Washington, DC vouchers cost only 60 percent of what the city spends per pupil in government schools. The study estimates if the states with the top eight education expenditures per pupil adopted voucher programs similar to the one in Washington, DC, they could save a combined $2.6 billion per year.
How School Choice Can Create Jobs
Examining five South Carolina counties, Sven R. Larson found school choice programs were associated with gains of up to 25 percent in youth self-employment. Larson writes, “School Choice raises academic achievement and reduces the problems and costs associated with high school dropouts. But it also has a decisively positive impact on youth entrepreneurship and could provide a critical boost for the economies of poor, rural counties.”
Taking Credit for Education: How to Fund Education Savings Accounts Through Tax Credits
This paper from the Cato Institute explains how legislators can design an education savings account (ESA) program that is privately funded through tax-credit-eligible contributions from taxpayers, which is similar to models used in many tax-credit scholarship programs around the country. Tax-credit-funded ESAs would empower families with more educational options while enhancing accountability and refraining from coercing anyone into supporting ideas they oppose. Because they are funded through voluntary contributions rather than public funds, tax-credit scholarships have a perfect record of constitutionality at the U.S. Supreme Court and at every state supreme court that has considered the issue. In states that have adopted a Blaine amendment, tax-credit ESAs could be a lifeline to families in need.
The Legal Landscape of Parental-Choice Policy
The U.S. Supreme Court decision Zelman v. Simmons-Harris cleared away the most significant obstacle to the expansion of private school choice programs by ruling the First Amendment’s Establishment Clause does not preclude faith-based schools from participating in private school choice programs. Other important legal questions fall into four categories: the scope of students’ right to an education and parents’ right to choose their children’s schools; state-constitutional obstacles to private school choice; the effect of laws governing racial integration and the inclusion of disabled students; and the religious-liberty implications of faith-based schools participating in such programs. This report from the American Enterprise Institute notes the lack of clarity on these questions poses challenges, but the report says they also create opportunities for proponents of private school choice to scale existing programs and expand program options.
A Win-Win Solution: The Empirical Evidence on School Vouchers
Greg Forster of the Friedman Foundation for Educational Choice collected the results of all available empirical studies that use the best available scientific methods to measure how school choice vouchers affect academic outcomes for participants and all available studies on how vouchers affect outcomes in public schools. Contrary to the widespread claim vouchers do not benefit participants and that they hurt public schools, the empirical evidence consistently shows vouchers improve outcomes for participants and those who remain in public schools.
Nothing in this Research & Commentary is intended to influence the passage of legislation, and it does not necessarily represent the views of The Heartland Institute. For further information on this subject, visit School Reform News at https://heartland.org/publications-resources/newsletters/school-reform-news, The Heartland Institute’s website at http://heartland.org, and PolicyBot, Heartland’s free online research database, at www.policybot.org.
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