A state budget bill currently making its way through the North Carolina Senate would provide funding for a limited education savings account (ESA) program. The Personal Education Savings Accounts Program (PESA) would be available to students with disabilities, children in foster care, and to children who have a parent who is on active duty in the military. If passed, the program would begin in the 2018–19 fiscal year.
Under the program, ESAs could be used to pay for tuition and fees at private and parochial schools, as well as textbooks, tutoring services, educational therapies, and transportation costs. Additionally, the ESAs could be used to cover the fees required to take national standardized achievement tests, such as the SAT and ACT. The maximum scholarship amount for an eligible student would be $9,000, and all leftover funds could be rolled over for use in the following school year. However, the program is only budgeted for a $1 million appropriation, which means only 111 students could be funded if each is given the maximum scholarship allotment.
Only 44 percent of North Carolina 4th graders and 33 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 38 percent of 4th graders and 30 percent of and 8th graders tested proficient in reading. These results show North Carolina’s public school system is failing to educate roughly 6 out of 10 of their 4th grade and 8th grade students to a proficient level in reading and mathematics.
North Carolina’s troubling 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 North Carolina 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.
In May 2016, EdChoice released a report in which it examines 100 empirical studies of school choice programs. Eighteen of these studies used random assignment to measure outcomes, referred to in academia as the “gold standard.” The overwhelming majority of the available empirical evidence shows education choice offers families equal access to high-quality schools that meet their widely diverse needs and desires, and, according to the research, it does so at a lower cost. EdChoice also found education choice also benefits public school students.
“The results are not difficult to explain,” the study says. “School choice improves academic outcomes for participants and public schools by allowing students to find the schools that best match their needs and by introducing healthy competition that keeps schools mission-focused. It saves money by eliminating administrative bloat and rewarding good stewardship of resources [and it] breaks down the barriers of residential segregation, drawing students together from diverse communities.”
North Carolina already has two small voucher programs, the Opportunity Scholarships program and the Special Education Scholarship Grants for Children with Disabilities, so establishing this small ESA program would not be out of step for the Tar Heel State and would give more North Carolina families a greater opportunity to meet each child’s unique education needs. When parents are given the opportunity to choose, every school must compete and improve, which gives more children the opportunity to attend a quality school.
The following documents provide more information about education savings accounts and education choice.
A Win-Win Solution: The Empirical Evidence on School Choice (Fourth Edition)
This paper by the Friedman Foundation for Educational Choice details how a vast body of research shows educational choice programs improve academic outcomes for students and schools, saves taxpayers money, reduces segregation in schools, and improves students’ civic values. This edition brings together a total of 100 empirical studies examining these essential questions in one comprehensive report.
2016/17 School Choice Report Card
This report card published by the American Federation for Children scores 27 active non-special-needs voucher, scholarship tax-credit, and education savings account programs against ideal standards for program quality. The report is an excellent tool policymakers and researchers can use to help improve education programs and maximize student participation.
Research & Commentary: Indiana School Choice Parental Satisfaction Should Lead to More School Choice
In this Research & Commentary, Heartland Policy Analyst Tim Benson examines an expanded, follow-up study to a 2014 report by EdChoice that examines why Indiana parents choose to take advantage of the state’s Choice Scholarship Program voucher and use it to send their children to private schools.
Competition: For the Children
This study from the Texas Public Policy Foundation claims universal school choice results in higher test scores for students remaining in traditional public schools and improved high school graduation rates.
Recalibrating Accountability: Education Savings Accounts as Vehicles of Choice and Innovation
This Special Report from The Heritage Foundation and the Texas Public Policy Foundation explores how education savings accounts expand educational opportunities and hold education providers directly accountable to parents. The report also identifies several common types of regulations that can undermine the effectiveness of the program and how they can be avoided.
The Fiscal Effects of School Choice Programs on Public School Districts
In the first-ever study of public school districts’ fixed costs in every state and Washington, DC, Benjamin Scafidi concludes approximately 36 percent of school district spending cannot be quickly reduced when students leave. The remaining 64 percent, or approximately $8,000 per student on average, are variable costs, changing 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 actually leaves the district with more money to spend on each remaining child. In the long run, Scafidi notes, all local district spending is variable, meaning all funds could be attached to individual children over time without creating fiscal problems 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 Washington, DC program, 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.”
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, The Heartland Institute’s website, and PolicyBot, Heartland’s free online research database.
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