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BIPPS Policy Points

September 19, 2024

Flawed report ignores school choice savings, student achievement


Despite the fact that Amendment 2 doesn’t set up school choice programs, opponents of education freedom opine such policies would decimate public education funding in Kentucky, while ignoring the savings and academic achievement being produced in a multitude of states where parents have such options. 


A policy brief released today by the Bluegrass Institute for Public Policy Solutions, Kentucky’s free-market think tank, responds to claims by the Kentucky Center for Economic Policy (KCEP) designed to stoke opposition to Amendment 2.


In his report, “Fiscal Effects of School Choice: Doomsday Speculation Versus Reality,” Bluegrass Institute Scholar John Garen, Ph.D., addresses inaccurate and misleading assertions made in the KCEP’s flawed report, summarized below.


  • Claims that school choice programs in other states are bankrupting state budgets.


The KCEP analysis implies education savings accounts (ESAs), which allow a portion of state education funds to “follow” students for schooling expenses – including private school tuition- are bankrupting the education budget in Arizona, where parents can choose from a multitude of school-choice programs.


However, Arizona’s Department of Education ran a surplus at the end of the state’s fiscal year on June 30, which actually helped shrink an overall state budget deficit.


In Arizona, anti-school-choice forecasters “made several key errors that led to faulty predictions which became clear when confronted with reality,” Garen reports. “The Kentucky report makes similar fundamental errors such that it cannot provide useful guidance. Essentially, the fiscal costs of school choice are exaggerated while the fiscal benefits are ignored.”


  • Exaggerated  assumptions that the nearly 98,000 students currently attending nonpublic schools in Kentucky would receive a voucher, thus greatly multiplying the cost of this type of school choice program.


The KCEP report “exaggerates the fiscal cost of potential school choice programs by assuming 100% eligibility and 100% participation,” Garen notes. “The first is sometimes true and the second never has been.”


Most well-established programs in other states have utilization rates in the 2% to 6% range, though some cases are around a 20% rate, he added.


Bluegrass Institute President Jim Waters added that “assuming 100% eligibility and utilization greatly diminishes the credibility of KCEP’s approach, removes any sense of objectivity and sends a clear signal to reasonable Kentuckians, including their policymakers, that the conclusions reached by such exaggeration cannot be taken seriously and certainly should not guide decisions that will affect families for generations to come.”


  • A failure to factor in potential savings from school-choice programs. In its review of all school choice programs through 2018, EdChoice found that virtually all the policies offered their states net fiscal savings.


In its review of all school choice programs through 2018, EdChoice found that virtually all the policies offered their states net fiscal savings.


Vicki Alger, Ph.D., a Bluegrass Institute Visiting Fellow, national expert on education choice programs and an Arizona resident herself, notes her state’s ESA program “generates an estimated savings of $1.25 for every dollar spent – a staggering 125 percent return on investment.”


Alger estimates the program has saved the Grand Canyon State an estimated $41 million due primarily to the fact that “choice programs typically cost thousands of dollars less per pupil than public schools,” she notes. Also, an Arizona ESA sets aside just $7,200 for those who take the school-choice option – about half the amount spent by the state on each traditional K-12 student, on average.


In his report, Garen estimates that an ESA program in Kentucky reflecting realistic participation rates would offer “a $116 million benefit as opposed to a KCEP estimate of a $700 million fiscal cost."


  • Completely ignoring the positive impact of other states’ education-choice policies in improving educational outcomes.


Recent studies show that as Florida has offered parents additional options, students' outcomes in traditional public schools have improved. In the 1990s, Florida’s public school test scores on the “Nation’s Report Card” were below the national average, and below or near Kentucky’s. However, as Florida has expanded school choice, its outcomes – including for minority students – have surpassed Kentucky’s and are above the national average.


“Opponents like the KCEP never talk about student achievement and how to improve it,” Waters said. “It’s all about propping up the current system and protecting the jobs it creates. Instead, we should be funding students over systems.”

 

Read the entire report here.

 

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Bluegrass Institute works with Kentuckians, grassroots organizations, and business owners to advance freedom and prosperity by promoting free-market capitalism, smaller government and defense of personal liberties.

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