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Research & Commentary: Proposed ESA Bill Would Be Giant Boon to Virginia Students, Families

January 11, 2017

Passage Of ESA Bill Would Make Virginia A Leader In Education Reform

For the third year in a row, an education savings account (ESA) bill has been introduced in the Virginia House of Delegates. The bill would set up “Parental Choice Education Savings Accounts” that allow “the parent of a public preschool, elementary, or secondary school student to apply to the school division in which the student resides for a one-year, renewable [ESA].”

Under an ESA model, state education funds are placed into parent-controlled savings accounts. The House bill would then “permit the parent to use the moneys in such account for certain education-related expenses of the student, including tuition, deposits, fees, and required textbooks at a private sectarian, or nonsectarian elementary or secondary school or preschool.”

Families with incomes at or below 300 percent of the federal poverty level or with children with special needs would receive 100 percent of the state’s per-pupil spending in their ESAs. Families with incomes above 300 percent of the federal poverty level would receive 90 percent of the state’s per-pupil spending.

“ESAs are about empowering parents and improving the range of educational options for children,” Renee Porter, executive director of Choice Matterstold 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.”

Only 47 percent of Virginia 4th graders and 38 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 43 percent of 4th graders and 36 percent of 8th graders tested proficient in reading. These results show Virginia’s public school system is failing to educate roughly six out of ten 4th grade and 8th grade students to a proficient level in reading and mathematics.

Virginia’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 the Old Dominion 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 examining 100 empirical studies on school choice programs. Eighteen of these studies used random assignment to measure outcomes, referred to in academia as the “gold standard.” According to the report, “Students who apply for a voucher enter randomized lotteries to determine who will receive the voucher and who will remain in a public school; this allows researchers to track very similar ‘treatment’ and ‘control’ groups, just like in medical trials.” The overwhelming majority of the available empirical evidence makes it clear educational choice offers families equal access to high-quality schools that meet their widely diverse needs and desires – and does so at a lower cost – while simultaneously benefitting public school students. 

Outside of the Education Improvement Scholarships Tax Credit Program, private education choice in the commonwealth is literally nonexistent. The passage of this universal ESA bill would go a long way toward remedying Virginia’s lackluster record of failing to educate its children. Educational choice programs can give all families a greater opportunity to meet each child’s unique education needs. 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 about education savings accounts.

A Win-Win Solution: The Empirical Evidence on School Choice (Fourth Edition)
https://www.heartland.org/publications-resources/publications/a-win-win-solution-the-empirical-evidence-on-school-choice-fourth-edition?source=policybot
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
https://www.heartland.org/publications-resources/publications/201617-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. 

Competition: For the Children
https://www.heartland.org/publications-resources/publications/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
https://www.heartland.org/publications-resources/publications/recalibrating-accountability-education-savings-accounts-as-vehicles-of-choice-and-innovation?source=policybot
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 Tax-Credit Scholarship Audit: Do Publicly Funded Private School Choice Programs Save Money?
https://www.heartland.org/publications-resources/publications/the-tax-credit-scholarship-audit-do-publicly-funded-private-school-choice-programs-save-money
In this study, EdChoice Director of Fiscal Policy and Analysis Martin Lueken updates previous work examining the fiscal effects of private school choice programs on state governments, state and local taxpayers, and school districts. This report analyzes savings from tax-credit scholarship programs, which allow individuals and businesses to reduce their state tax liability by making a private donation to a nonprofit organization that provides scholarships for children to attend private schools of their choice. This audit examines 10 tax-credit scholarship programs operating in seven states between 1997 and 2014, which serve 93 percent of all students participating in tax-credit scholarship programs nationwide.

The Fiscal Effects of School Choice Programs on Public School Districts
https://www.heartland.org/publications-resources/publications/the-fiscal-effects-of-school-choice-programs-on-public-school-districts?source=policybot
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
http://www.heritage.org/Research/Education/wm727.cfm 
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
https://www.heartland.org/publications-resources/publications/how-school-choice-can-create-jobs?source=policybot
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.”

Research & Commentary: Indiana School Choice Parental Satisfaction Should Lead to More School Choice
https://www.heartland.org/publications-resources/publications/research--commentary-indiana-school-choice-parental-satisfaction-should-lead-to-more-school-choice?source=policybot
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.

 

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://www.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 https://www.heartland.org/policybot/index.html.

The Heartland Institute can send an expert to your state to testify or brief your caucus; host an event in your state; or send you further information on a topic. Please don’t hesitate to contact us if we can be of assistance! If you have any questions or comments, contact Nathan Makla, Heartland’s state government relations manager, at nmakla@heartland.org or 312/377-4000.

Author
Tim Benson joined The Heartland Institute in September 2015 as a policy analyst in the Government Relations Department.
TBenson@heartland.org