Report: The Fiscal Consequences of Private School Vouchers
Samuel E. Abrams and Steven J. Koutsavlis wrote a fiscal analysis of private school vouchers, and it comes as several states have enacted new voucher programs without any realistic review of the financial consequences for their states. It is typical of voucher proponents to give a low-ball projection of the cost, then to say “Oops, sorry” when the actual cost is two or three times their projection. Whatever the limits or caps in the first legislation, you can be sure that those limits and caps will be lifted or erased in future legislative sessions.
Samuel E. Abrams is the director of the National Center for the Study of Privatization in Education, Teachers College, Columbia University, and the author of Education and the Commercial Mindset (Harvard University Press, 2016). He is serving during the current academic year as a Fulbright visiting professor at the University of Turku in Finland. Steven J. Koutsavlis is a Ph.D. candidate in education policy at Teachers College, Columbia University, and a veteran math teacher at MS 443 in Brooklyn.
In their analysis, they explain the three different types of vouchers: conventional vouchers; tax credit scholarship programs; and educational savings account vouchers.
They explain the dangers of these three types of vouchers:
The prevalence of all three types of vouchers described above has surged over the past decade. The number of students using vouchers in the fall of 2012 was 212,000.12 By 2021, that number had topped 600,000.13 While that sum in a country with nearly 50 million students in public PK-12 schools is small,14 the trend is significant. Indeed, although dozens of voucher proposals are rejected by state legislators and governors each year, many states continue to estab- lish or expand these programs, despite their consequences for
state budgets.15
With this growth come mounting concerns. As noted, voucher programs—of any type—send public dollars to private schools or companies, depleting the public treasury and shifting public resourc- es to private hands. The programs are expensive to operate, with studies showing they typically cost more per student than public schools.16 And many of the nation’s public schools remain chronically underfunded although they serve the vast majority of the nation’s children.17
States can ill afford to siphon scarce resources away from public education to private providers.
The claim that it costs less to educate students with private school vouchers than in public schools ignores numerous realities. Voucher programs shift key expenses to parents; often subsidize private tuition for families who would never have enrolled in public schools; do not dilute fixed costs for public education systems; and concen- trate higher-need, more-costly-to-educate students in already-un- derfunded public schools.18
As noted above, early voucher programs were explicitly discriminatory—providing white families with educational opportunities unavailable to Black children with the explicit intent to preserve segregation. Still today, data show that voucher programs exacerbate racial segregation.19 Moreover, private schools accepting vouchers are not subject to many of the anti-discrimination laws that protect students with disabilities, LGBTQ+ students, and other vulnerable groups, who may—sometimes unknowingly—give up their rights when they move to private schools.20 While public schools are required to serve all children, many private schools have a history of denying admission or pushing students out based on these and other characteristics. These discriminatory practices often apply to educators and staff, as well.
Private schools participating in voucher programs are generally not subject to the same regulatory standards as public schools. These may include standards for licensing of teachers, criminal background checks for employees, curriculum requirements, building safety codes, and more.21 Most states do not require private schools partici- pating in voucher programs to publicly report the results of state and national tests. Nor do they require public reporting of demographic data on participating students.22 A lack of fiscal transparency and oversight has resulted in incidents of fraud and mismanagement
of public funds, as documented in several states.23
Separate and apart from these troubling issues, numerous studies have failed to demonstrate that vouchers improve academic outcomes, particularly for low-income students and students of color. A range of studies on academic outcomes for students using vouchers have found that there is either no significant change in student test scores or that students actually perform worse than similar peers in public schools.24
The authors review the costs of vouchers in seven states.
They reach the following conclusions:
The pattern of education spending in these seven voucher states is unmistakable. Private school voucher programs are initially proposed as limited in size and scope, then grow as existing programs are expanded, and/or additional voucher programs are established. This results in greater and greater amounts of public funding diverted to private educational institutions and private corporations. At the same time, as noted, funding for public schools in these states has largely decreased.
Although direct cause and effect is difficult to prove, the bottom line is clear: As states transfer millions of dollars to private hands, there are fewer available state resources for projects that serve the public good, from mass transit to public parks, libraries, and schools.
Voucher programs, even with significant expansion during the last one to two decades, still serve only a small percentage of the nation’s children.82 Nearly 90 percent of PK-12 students in the U.S. continue to attend public schools. Yet this expansion in voucher programs is nevertheless cause for substantial concern, particularly in districts with heavy usage of vouchers. The financial consequences of vouch- ers in such districts can be severe. Even when students with vouchers leave public schools for private schools, the fixed costs involved in running public school systems remain virtually unchanged. In addition, the children with the greatest needs, who, in turn, require the greatest resources, in large part remain in the public schools.
In most states, public elementary and secondary education accounts for over a third of state general fund spending. Public schools were hit particularly hard by the 2007 Great Recession. Amidst the economic crisis, states made deep cuts in public education spending. Yet, as economies rebounded over the ensuing years, most states chose not to restore those investments. Education Law Center’s 2021 report $600 Billion Lost: State Disinvestment in Education Following the Great Recession found that public schools across the U.S. lost nearly $600 billion through state disinvestment in the decade following
the Great Recession.25 While economic activity, measured as gross domestic product (GDP), recovered, state and local revenues for public schools lagged far behind, despite increasing enrollment and, importantly, increases in the percentage of high-need students concentrated in public schools.26Over that same decade, state spending on vouchers nevertheless mounted considerably. In some states, spending on vouchers doubled during this time, and in the case of Georgia—one of the states profiled here—it increased by nearly 900 percent. Beyond expanding existing voucher programs, many states launched new ones.
In this report, we document rising spending on voucher programs in seven states from fiscal year 2008 through fiscal year 2019. As a point of comparison, we also provide data on these states’ spending on public education during the same period.
Over that same decade, state spending on vouchers nevertheless mounted considerably. In some states, spending on vouchers doubled during this time, and in the case of Georgia—one of the states profiled here—it increased by nearly 900 percent. Beyond expanding existing voucher programs, many states launched new ones.
This is an important study. Open the link and review the data. Then share it with your elected officials.
