Tag: scholarship tax credits

2013: Yet Another ‘Year of School Choice’

In 1980, frustrated by the attention given to Paul Ehrlich’s Malthusian doomsaying, economist Julian Simon challenged Ehrlich to a wager. They agreed on a basket of five commodity metals that Simon predicted would fall in price over 10 years (indicating growing supply relative to demand, contrary to the Malthusian worldview) and Ehrlich predicted would rise. In 1990, all five metals had decreased relative to their 1980 prices and Ehrlich cut Simon a check.

In 2011, two education policy analysts made a similar wager. After Jay Mathews of the Washington Post predicted that voters would “continue to resist” private school choice programs, Greg Forster of the Friedman Foundation for Educational Choice challenged Matthews to a wager, which Mathews accepted: Forster would win if at least seven new or expanded private school choice programs (i.e., vouchers or scholarship tax credits, but not including charter schools) were signed into law by the end of the year. That July, the Wall Street Journal declared 2011 to be the “Year of School Choice” after 13 states enacted 19 new or expanded private school choice programs, nearly triple the number Forster needed to win the bet.

Undeterred, the following year Mathews proclaimed that school choice programs “have no chance of ever expanding very far,” prompting another challenge from Forster. Mathews did not take the bet, which was fortunate for him because in 2012 10 states enacted 12 new or expanded private school choice programs.

Now, for the third year in a row, Forster’s prediction has proved true, with 10 states enacting 14 new or expanded private school choice programs, including:

Most of these laws are overly limited and several carry unnecessary and even counterproductive regulations like mandatory standardized testing. Nevertheless, they are a step in the right direction, away from a government monopoly and toward a true system of education choice.

Of course, that’s why defenders of the status quo have made 2013 the Year of the Anti-School Choice Lawsuit.

New Study Explains How and Why Parents Choose Private Schools

Why do parents choose a particular school? What information do they consider in making that choice? Do they prioritize high standardized test scores, rigorous college preparation, moral or religious instruction, or something else?

This morning, the Friedman Foundation released a new study, “More Than Scores: An Analysis of How and Why Parents Choose Private Schools,” that sheds light on these questions. The study surveyed 754 low- and middle-income parents whose children received scholarships from Georgia GOAL, a scholarship organization operating under Georgia’s scholarship tax credit law.

The study’s findings provide analysts and advocates across the education policy spectrum with much to consider. 

SPLC: If You Can’t Help Every Child, You Can’t Help Any Child

Most people know the story of the boy who was rescuing sea stars that had washed up on a beach by throwing them back into the ocean. When a man scoffed to the boy that his efforts didn’t make a difference since he couldn’t save all of them, the boy tossed another sea star back into the ocean and replied, “It made a difference to that one.” The little-known ending to the story is that the boy was sued by the Southern Poverty Law Center for violating the Constitution’s Equal Protection clause.

Sadly, this is only a slight exaggeration. Earlier this week, the Southern Poverty Law Center filed a federal lawsuit contending that Alabama’s new scholarship tax credit program violates the Equal Protection clause and harms the low-income students attending failing public schools whom the law is intended to help:

[SPLC] President Richard Cohen said the new Alabama Accountability Act will take millions away from public schools and will make the failing schools worse than they are now. He said the law was promoted by Republican Gov. Robert Bentley as giving students a way out of failing schools. 

“It’s a lie. Our clients do not have a way out of the failing schools that they are in,” he said.

The Montgomery-based law center sued on the opening day of classes for most public schools in Alabama. The suit focuses on a part of the law that allows families with children in Alabama’s 78 failing public schools to move them to a non-failing public school or to a private school that participates in the program. They can get a state tax credit of about $3,500 annually to help cover private school costs.

The lawsuit was filed on behalf of eight plaintiffs who say that they can’t afford to go to private schools and that the non-failing public schools are not accessible. The lawsuit raises equal protection issues.

One of the eight plaintiffs, Mariah Russaw, said she couldn’t afford the transportation costs even if her 12-year-old grandson, J.R., could leave Barbour County Junior High School in Clayton. All junior highs in the Barbour County school system are on the failing list. The nearest non-failing public school is 19 miles away in Pike County. The nearest private school is about 30 miles away, but it is not participating in the program.

The 62-year-old grandmother said it wouldn’t matter if the private school were participating. “I cannot afford to transport him to another school,” she said.

In short, SPLC argues that if the law can’t rescue every child from a failing school, then it shouldn’t be allowed to rescue any child. Not only would this line of reasoning hobble almost every government effort to incrementally address any problem, but the argument also rests on a misunderstanding of the status quo and the law’s likely impact.

The SPLC lawsuit claims that the law “creates two classes of students assigned to failing schools – those who can escape because of their parents’ income or where they live and those, like the Plaintiffs here, who cannot.” In fact, those two classes of students already exist. In our existing education system, low-income families are trapped in failing schools while wealthier families can afford either to live in districts with better public schools or to send their children to private school. The scholarship tax credit program is too limited to solve all the existing inequities, but it moves more students out of the first category and into the second. In other words, by expanding opportunities to low-income families, it makes an already unequal education system more equal.

Moreover, there is no evidence the program does harm to students who remain in public schools. The SPLC claims that the failing public schools are “likely to deteriorate further as their funding is continually diminished” as a result of students fleeing from those schools. But a mere assertion that harm is “likely” doesn’t cut it. Had the SPLC consulted the research literature instead of their fevered imaginations, they would have discovered that 22 of 23 studies of school choice programs found that they have positive impact on public school performance. The last study found no visible impact.

In other words, the increased choice and competition help both the students who participate in the program and those students who remain in their assigned public schools. Striking down the program would thus make matters worse for the litigants and other families like them, not better. Expanding the program would improve outcomes even further. If the SPLC is truly motivated by a desire to help low-income families, it should drop its lawsuit and join the effort to expand educational options. There are lots of sea stars left on the beach and they could use a hand.

School Choice at the Polls

In a nation with a strong tradition of holding major political contests in years divisible by the number two, politicos are mostly confined to chirping about distant elections during odd-numbered years. The exceptions in the year following a presidential election are New Jersey and Virginia, which hold their gubernatorial elections. In addition, due to the passing of Senator Frank Lautenberg, New Jersey will hold a special election to the U.S. Senate. In all three elections, one or both of the major candidates have made school choice an issue. That makes sense because school choice is increasingly popular, especially once implemented. Unfortunately, while the candidates should be commended for promoting school choice policies in general, their specifics leave much to be desired.

Last week, the Republican gubernatorial candidate in Virginia, Ken Cuccinelli, unveiled an education plan calling for an expansion of the state’s scholarship tax credit program (or the creation of a separate program) that would direct funds to students currently attending a failing public school. However, what Virginia’s scholarship tax credit program really needs is the policy equivalent of Extreme Home Makeover to remove unnecessary regulations on private schools, shift administration of the program to the Department of Revenue, increase the credit amount, and expand the uses of the scholarships beyond just tuition. As Andrew Coulson has demonstrated, it is the least regulated, most market-like private schools that do the best job of serving families. 

Parents Want More Education Options

A record number of low-income families participated in Florida’s scholarship tax credit (STC) program this year.

According to the Florida Department of Education’s latest report, the number of scholarship recipients grew by 10,827 students from 40,248 in 2011-12 to 51,075 in 2012-13, an increase of 26.9 percent. More than half of the scholarship recipients are in grade 3 or lower, indicating that the program will continue to grow over time.

Florida’s sole scholarship organization, Step Up for Students, focuses aid on the families that are most in need. Florida’s STC program requires that the families of first-time scholarship-recipients earn less than 185 percent of the federal poverty line ($43,568 for a family of four), but the average scholarship recipient’s family income is only about 106 percent of the federal poverty line ($23,579 for a family of four). 

Scholarship recipients are much more racially diverse than Florida’s general population. Scholarship recipients are 25 percent non-Hispanic white, 33 percent non-Hispanic black and 35 percent Hispanic compared to 78 percent non-Hispanic white, 17 percent non-Hispanic black, and and 23 percent Hispanic in the general population.

According to Jon East, spokesperson for Step Up for Students, there are still more than 10,000 students on the waiting list due to the program cap. This is consistent with the demand for STC programs in other states. For example, just one of Pennsylvania’s roughly 250 scholarship organizations, the Children’s Scholarship Fund Philadelphia, had to turn away 104,500 of 115,000 scholarship applicants over the last decade due to the state’s program cap.

Florida’s STC program is allowed to grow to meet demand over time because the law contains an “escalator” provision that automatically raises the cap whenever the program grows to at least 90 percent of the cap. While STC programs in Arizona and New Hampshire contain similar provisions, most do not. That’s unfortunate, since the caps limit the program’s ability to expand education options to low-income families.

New Hampshire Court’s School Choice Decision Was Flawed and Unprecedented

Last week, a New Hampshire trial court declared that the state’s nascent scholarship tax credit (STC) program could not fund students attending religious schools. The Granite State’s STC program grants tax credits to corporations worth 85 percent of their contributions to nonprofit scholarship organizations that aid low- and middle-income students attending the schools of their choice.

Writing on the Washington Post’s Answer Sheet blog, Professor Kevin Welner of the University of Colorado at Boulder mocked supporters of the program who criticized the decision. Welner argues that school choice advocates should have expected this decision, declaring that it was “unsurprising” that the court should find the program (partially) unconstitutional. But what Welner calls unsurprising is actually unprecedented.

Only toward the bottom of his post does Welner reveal that the only high courts to address the issue thus far—the U.S. Supreme Court and the Arizona supreme court—have ruled STC programs constitutional in their entirety. Indeed, though all but two of the remaining ten states with STC programs have similar “Blaine Amendment” provisions in their state constitutions, opponents haven’t even bothered to challenge their constitutionality. Additionally, other state courts have ruled on the question of whether tax credits constitute “public money” in a manner consistent with the previous STC cases, demonstrating that the courts’ rulings were not the aberrations that Welner imagines them to be.

If school choice supporters had a reason not to be surprised, it was because the ACLU and Americans United for Separation of Church and State shrewdly went judge shopping. That’s why they brought their lawsuit in Strafford County instead of Merrimack County, where the state capital is located. Their strategy seemed to pay off, as the judge’s decision relies heavily on the dissenting opinions in the U.S. Supreme Court and Arizona supreme court decisions, and misapplies the limited precedent from New Hampshire. Nevertheless, the final decision rests with the New Hampshire supreme court. As I detail below, logic and precedent suggest that they should overturn the lower court’s decision.

South Carolina Adopts School Choice

When South Carolina’s legislature narrowly rejected a school choice proposal last month, it seemed that the education reform movement would have to wait another year to make any progress in the Palmetto State. That changed yeseterday when both legislative chambers approved the conference committee’s state budget, which includes a scholarship tax credit (STC) program for students with special needs.

South Carolina’s legislation is only the latest sign of the increasing popularity of school choice. Last week, Arizona’s legislature voted to expand the types of corporate donors that could participate in its STC program. Earlier this year, Iowa and Georgia expanded their STC programs so that more students could receive scholarships and Alabama enacted a new STC program.

As with Alabama’s STC program, South Carolina’s program is very limited in scope relative to STC programs in other states, particularly New Hampshire. According to the Friedman Foundation for Educational Choice:

Under the proposal, taxpayers can receive a credit worth no more than 60 percent of their state tax liability when donating to nonprofits that distribute private school scholarships to children with special needs. Scholarships cannot exceed $10,000 per pupil. The statewide limit on tax credits distributed is $8 million. According to 2011-12 data, more than 12 percent of South Carolina students are identified as having a disability that would qualify them for the program.

A cap on donations makes fundraising more difficult for scholarship organizations while a cap on the total amount of tax credits limits the number of students who can participate. And while it is understandable that policymakers would prioritize students with special needs, they are far from the only students who would benefit from expanded educational options. Despite these limitations, South Carolina’s decision yesterday is a great step toward an education system that meets the individual needs of every child.