Big surprise in the federal school voucher programme

Mary Ellen Klas, Tribune News Service

Whether on purpose or by accident, the Trump administration’s new voucher programme could do something it never promised to do: help public schools. It’s a bit of a surprise from the White House that promised to abolish the Department of Education and then dismantled large parts of it. But under rules released this month by the US Treasury Department, the programme authorising the first Federal Scholarship Tax Credit allows kids to receive a voucher even if they stay in their public school.

That’s an important distinction from state-level programmes. Advocates praise voucher programmes as the epitome of “education freedom” because, they say, it empowers parents to choose the best education for their children. But the way vouchers have been implemented at the state level drains resources from public schools and primarily subsidises choices families have already made to send their kids to private schools. The federal programme is an unexpected improvement over state-level programmes but still comes with a host of flaws and caveats.

Here’s how it works: Beginning in January, donors may deduct contributions of up to $1,700 per individual and $3,400 per couple to “scholarship-granting organisations” from their federal taxes. The organisations may distribute the money in the form of vouchers to schools to use on eligible students (those making 300% or less of a region’s median income). The money can be used to pay for private school tuition and a host of related programmes, but public schools can also use the funds for eligible students, on things like tutoring, after-school programmes, transportation and special education services.

The federal rules have won over some surprising critics, like Josh Cowen, a Michigan State University education professor who has spent two decades researching voucher programmes. He argues that state voucher programmes are a danger to American education because they “severely hinder academic growth — especially for vulnerable kids” and siphon resources from public schools to private ones. But, Cowen told me, because the new plan doesn’t do that, “I just can’t in good faith say this is going to defund public schools the way state plans do.”

That could explain why 31 states — covering 59% of the nation’s public school population — have decided to accept the federal vouchers, including Democrat-led states New York and Colorado. The remaining 19 holdouts are all led by Democrats and, for them, it’s a tough call. Most of those governors oppose voucher programmes and don’t want to see the federal programme succeed, but if they turn down the federal money for private schools, they also lose the opportunity to better fund their public schools.

And the programme does have some major flaws. The federal vouchers will subsidise private school tuition and steer taxpayer money to religious schools while setting no standards for academic performance or treating all kids fairly. The biggest beneficiaries are likely to be families that have already chosen to send their kids to private schools, as is already the case in states with universal voucher programmes. In Florida, 69% of the new voucher students had already been enrolled in a private school. In New Hampshire, that total was 89%; in Wisconsin, 77%; in Arizona, 80%; and in North Carolina, 87%.

Jon Valant, director of the Brown Center on Education Policy at the Brookings Institute, and his colleagues recently analysed the potential donor stream for the federal programme and concluded it will reinforce the same pattern. Because the tax credits will be used “disproportionately by wealthy individuals in wealthy communities,” the programme is more likely to become a benefit “for rich kids than a source of redistributive, charitable giving,” he wrote. What’s more, the federal voucher rules could exacerbate the income inequities and discrimination seen in many state voucher programmes. “State leaders have virtually no control over this programme after deciding whether they will participate,” Valant notes. For example, states can’t prevent the scholarship-granting organisations from discriminating against certain classes of students — those who practise certain religions or those with disabilities.

Congress did not allocate a specific appropriation to pay for the programme, which was tucked in to the so-called Big Beautiful Bill last year. The drop in tax revenue will expand the deficit and cost taxpayers $25.9 billion over 10 years, according to the Joint Committee on Taxation. And while there are reporting requirements and qualification checks, there are no guardrails to make sure the money is used wisely.

Congress should either remedy these problems or replace the entire programme with something better. For starters, they could require students that accept federal vouchers in private schools to take the same exams as students in public schools. They could erect financial guardrails — to prevent the kinds of voucher fraud that’s occurred in states like Florida and Arizona. And they could give states the ability to ensure that the funds go to students who need them most and prevent them from discriminating against any student.

There’s nothing wrong with sending more money to states for education, but it should come with assurances that taxpayer money will be used to benefit all students, not the elite few.