Testimony on the Bill to Amend the Education Scholarship Trust Fund

I am a Policy Analyst at the Cato Institute’s Center for Educational Freedom. My areas of scholarship and public policy research include school choice, homeschooling, microschools, and other innovative educational options. I have published numerous articles on these subjects as well as testifying before state and Congressional committees. In 2023, I wrote a Cato Briefing Paper, School Choice Programs Need a Firewall for Homeschoolers, that is directly relevant to this legislation.¹

The flexibility of the ESTF is a crucial component of it. ESTF is an education savings account program, which means it creates accounts that parents can use for a variety of educational expenses. While this includes private school tuition, it also includes tutoring, curriculum, other instructional materials, computer hardware for educational purposes, services for children with special needs, and more. This is in stark contrast to a school voucher, such as North Carolina’s Opportunity Scholarship, which can only be used for tuition and fees at private schools.

Recently, it has become clear that there is confusion about what this flexibility means in practice. The ESTF law states that parents who use the program must agree “not to participate in a home instruction program” under state law. This language was included because several homeschoolers and homeschool organizations said they wanted homeschooling kept out of ESTF.

However, those homeschoolers do not speak for all home educators. There are many parents who would like to use ESTF to educate their children at home. The provision that “A parent’s signed agreement under subsection (D)(4) satisfies the state’s compulsory attendance law pursuant to Section 59–65-10” accommodates those parents. It allows them to receive ESTF and use it for the many approved expenses without registering as a homeschooler or enrolling in a private school. The SC Department of Education refers to these students as “unbundlers” since they are customizing their own education instead of getting all their classes as a “bundle” from a full-time school. For clarity, I will also use unbundler.

Many states use similar arrangements to create a distinction between homeschoolers and unbundlers. That’s the subject of the Briefing Paper I mentioned earlier, School Choice Programs Need a Firewall for Homeschoolers. As I explain in the paper, Arizona launched the first ESA in the nation in 2011 and amended it the following year to ensure homeschoolers were kept separate from ESAs. New Hampshire, West Virginia, Utah, and Florida all have ESAs that include this distinction.

While South Carolina and other states have created a legal distinction between homeschooling and using ESAs to unbundle education, families often just consider themselves homeschoolers either way because they are using a home-based education. Similarly, families who enroll in virtual charter schools, which are public schools where children access content and instruction online, often call themselves homeschoolers. Legally, these families are not considered homeschoolers, but that’s often how they see themselves.

Outsiders who are observing these families also use the understandable, albeit inaccurate, shortcut of using homeschooler to refer to any kids who are in a home-based education program. This includes news outlets that have recently run stories saying that homeschoolers were receiving “vouchers” despite being ineligible.² Their use of the term “voucher” shows they don’t understand the program, so inaccuracy about homeschoolers receiving them should be no surprise. Families who register as homeschoolers in South Carolina are not eligible for ESTF. Families who are using ESTF to customize their children’s education—even if most of that occurs at home—are not considered homeschoolers under South Carolina law.

The February 4th Senate Education Committee hearing on S 692 made it clear that several lawmakers felt they had been misled about the nature of the Education Scholarship Trust Fund program. Some seemed to think the Department of Education is approving unbundlers based on this line under qualifying expenses: “(n) any other educational expense approved by the department to enable personalized learning consistent with the intent of this act.” But it’s really the fact that using ESTF satisfies the state’s compulsory education requirement that enables parents to unbundle their children’s education.

The legislative history of ESAs in South Carolina has included the option to unbundle from the beginning. A 2017 bill, H.4308, the Equal Opportunity Education Scholarship Account Act, was a forerunner of ESTF. Several current Senate Education Committee members were co-sponsors of the Senate version of that bill, S.622. It included similar wording about not participating in a home instruction program under SC law, but it added language that explained parents could still use the ESA to educate their children outside of a school, “so long as purchases are limited to qualifying expenses.” In the ESTF statute, the provision that it meets compulsory education requirements performs a similar function.

Relating specifically to ESTF, there are numerous examples showing it was widely understood that families would not be limited to private schools.

• In 2023, Dr. Oran Smith of the Palmetto Promise Institute testified about ESTF before the House Education and Public Works Committee. He explained that with ESAs, “dollars could be directed by the parent to an array of educational services customized for the needs of their specific child. Private schools would be only one of the options from which parents could choose.”³
• In 2024, 2025, and 2026, Gov. McMaster cited ESTF in his state of the state address, noting these funds allow parents to choose “the type of education environment and instruction that best suits their child’s unique needs.”⁴ Why wouldn’t he just say choose the school that best suits their needs if the program didn’t allow customization?
• In February 2024, WLTX News 19 reported that parents could apply for ESTF scholarships that can be used “to create a customized, flexible education for their child.”⁵
• The following month, the South Carolina Homeschooling Connection discussed ESTF, noting parents “can customize their own program from a variety of providers (aka homeschooling). Advocates for the program explain it as a ‘4th option’ to homeschool.”⁶

Before cutting the flexibility from the ESTF program, I encourage lawmakers to see how innovative educational models are flourishing in states with flexible ESA programs. Any parent can tell you that no two children are the same. No wonder one size does not fit all when it comes to education.

I also hope you’ll speak to some of the parents who are using ESTF to unbundle. While a conventional classroom may work well for many students, it clearly does not work for others. Flexible learning options, like those currently allowed in ESTF, enable parents to find the right fit for each child in each subject. Kids who are advanced can work to their level. Kids who struggle can get additional support. And kids who are advanced in some areas and struggle in others can have both needs accommodated. For children who are easily distracted, they can be in a more engaging environment or one that lets them get up and “get the wiggles out” when needed.

By enacting ESTF and including a broad list of eligible expenses, South Carolina took a tremendous leap toward providing families with access to the diverse educational options that are available today. There are ways to address lawmakers’ concerns without eliminating the flexibility that is so important to many children. It is my strong opinion that retaining flexibility in the ESTF program would benefit the people of South Carolina as it would enable families to continue to access the learning environments that work best for their children.