Over the past year, several states have proposed, instituted or extended their version of school vouchers. The popular format these days is the Education Savings Account, a form of voucher that funds a scholarship administration company which in turn provides a stack of cash (perhaps loaded onto a debit) to parents to spend on education expenses. Betsy DeVos and Ted Cruz attempted to create this type of voucher nationally, and although they failed, ESAs have been around for some time in states, allowing families to leave the public system and buy themselves- even educational programs and materials.
If your state has or is considering ESAs, how do you assess the program? Here are six essential questions to ask.
What is the source of funding?
The money for the “scholarship” in an ESA usually comes from one of the following two sources. Some states offer tax credit scholarship programs, in which donor contributions to ESA count as a tax credit. Essentially, donors pay for the scholarship program instead of paying taxes. In some states, donors may be individuals, but some states (eg Pennsylvania) are reserved for corporate donors. These systems generally have a cap on the amount of money the state will have to give up in the form of tax credits; $ 50 million tax credit scholarship program leaves a $ 50 hole in state revenues.
The other source of funding may be the state itself, which may choose to fund the program with taxpayer money originally intended to pay for the state’s share of funding for public education.
Who is running the actual program?
The funding will go to an organization responsible for allocating it to families. Several companies have embarked on this activity (for example, ClassWallet, based in Florida). Typically, they earn their money by taking a percentage of the money they manage.
In some states (like Georgia), a small number of student scholarship organizations (SSOs) act as intermediaries for ASEs. In Pennsylvania, which has TCS but not ESAs, there are several SSOs, each serving their own school.
The scholarship organization is generally responsible for maintaining the list of participating providers. It is important to know who will actually manage the money, their qualifications and their experience.
How can the money be spent?
Traditional vouchers have been put in place to pay for the tuition fees of students (or at least part of it) at a particular school. But ESAs more generally allow families to spend the money on a wide range of educational expenses, from textbooks and tutoring to therapy services and computer equipment. Dollars could be spent on micro-schooling or other online education products. Therefore, ESAs can be used by homeschooled families as well as those who wish to transfer their child to a private school.
What oversight is there for spending?
Usually not much. In Georgia, an audit found parents spent $ 700,000 on items like cosmetics and clothing. Some proposals do not include any monitoring other than a way to report parents after the fact. If you want to know how your taxpayer’s money was spent in the program, you might be out of luck. See what the state is proposing to do to track spending of taxpayer money that goes into the program.
What quality control is it?
Do suppliers entering the program have to meet any standards to qualify for ESA expenses? In some states (eg New Hampshire) sellers simply need to apply to be on the approved list. In some cases, they can be removed if they fail to deliver the promised services. Many ESA laws include a clause explicitly prohibiting the state from setting rules on how the seller conducts business. For any ESA program, it is fair to ask who decides that a provider should be eligible to get taxpayer money through ESAs.
What protections are in place for families?
What if a family gets ripped off by one of these uncontrolled educational providers? What if they simply run out of ESA money until they finish their child’s education that year? What about families who just don’t have the expertise to navigate the education provider market and make honest mistakes? Should he simply re-register his child in the public system, or does he have recourse if the ESA money turns out to be insufficient to ensure a full education for the child?
The answers to these six questions will tell you a lot about the transparency and accountability of your state’s existing or proposed ESA program. Such voucher programs are a step towards financing and dismantling the public education system; it is reasonable for taxpayers to ask what they will get in his place.