In the Know: The True Cost of School Voucher Programs
Vouchers, as a catch-all term, refers to public money going to parents or a student so that the student can choose any type of school or education that is best for that individual. Its purpose is to allow students to go to any type of school without tuition being a barrier. Public schools, including charter schools, are tuition-free. Vouchers would allow students to receive public money to attend private and religious schools or even home schools.
Vouchers encompass a wide range of school funding policies that have been around various parts of the United States since the Brown v. Board of Education Supreme Court decision in 1954. The original vouchers at that time were intended to support white students resisting integration by allowing them to attend private institutions through “tuition grants.” More recently, they have been set up in various states for many different types of students to access a preferred educational experience.
According to research from the Center on Budget and Policy Priorities, current voucher programs tend to be one of two types:
- K-12 tuition tax credits: This type of voucher program is where individuals and businesses can get a state tax credit for donating to organizations that pay private school tuition and other expenses on behalf of students. As of March 2023, 22 states had tax credit voucher programs.
- Education Savings Accounts: These are vouchers that are funded through the state budget and typically have a variety of uses such as tuition, exam fees, tutoring, homeschooling, and school supplies. The funding is attached to the family in a set amount per year, and can be used for qualified educational expenses. According to EdChoice – a national nonprofit that advocates for school choice – 17 states offered Education Savings Accounts as of April 2024.
Colorado’s recent history with voucher programs includes a challenge involving a Douglas County program that went to the Colorado Supreme Court. In 2011, Douglas County School District adopted a voucher program called the “Choice Scholarship Program,” which sent over $4,000 to 500 students that could be used at district-approved private school partners – many of which were religious schools. After the program was blocked by a District Court, and that decision upheld by the Colorado State Supreme Court, the voucher program was disbanded. The court decisions were based on language within the Colorado Constitution that prohibits state dollars from aiding religious practices.
More recently, the United States Supreme Court ruled in Carson v. Makin in 2022 ruled that if state and/or local governments choose to use state dollars to subsidize private education, religious schools must be allowed to participate. This opened the door to larger voucher programs that include religious institutions in states across the country.
As more states have adopted voucher programs, the data has started to pile up in terms of their cost to states and who is eligible for them. Here is a look at a few states that have established voucher programs and what has happened as a result:
- Arizona: Arizona has an older voucher program funded by tax credits – as explained above – that was created in 1998 and subsidized tuition for more than 30,000 students in 2023. Between 1998 and 2023, $767 million was spent at 20 different schools, 19 of which were religious in nature. More recently, Arizona expanded to a universal vouchers program that is funded by the state and open to all students. In the 2022-2023 school year, that cost more than $300 million and $200 million of it went to pay for tuition at religious institutions. For 2023-24, Arizona set aside $624 million to fund their “Empowerment Savings Accounts,”the name for the educational savings accounts in the state. However, three months into the fiscal year, that amount of money was already short of what was needed, with newer estimates projecting a $900 million cost. Finally, recent studies from opponents of universal vouchers in Arizona found that “more than 75 percent of vouchers go to students who were already attending private schools.”
- Indiana: Indiana has had a type of school vouchers since 2011, but in 2022 and 2023 expanded the program dramatically to cover many more students by raising the income limits so that families making up to $222,000 annually qualified. It began with an income limit of $40,000. That is why the budgetary impact has grown from $15.5 million in 2011 to more than $600 million in 2024. According to research from the University of Notre Dame, 36 percent of new state taxes for K-12 education is being directed to private schools that only educate 7 percent of the population. That leaves 64 percent for public schools that educate 93 percent of students. Starting with nearly 4,000 students in 2011, Indiana now has 70,000 students qualifying for vouchers, due to the increase in income limit. 68 percent of Indiana voucher recipients have never attended a public school.
- Utah: In 2023, the Utah Legislature created the Utah Fits All Scholarship, which allowed families to use state funds for private school, homeschooling, or other options. The voucher is worth up to $8,000, which is double the current per pupil funding for public education in the state. The state first appropriated $42.5 million for the program, but within one year, the sponsors of the legislation that created the vouchers asked for $150 million more to meet increased demand.
- Arkansas: Arkansas is another state that recently enacted school vouchers, kicking off the Education Freedom Accounts in June 2023. The first annual report from the Arkansas Department of Education stated that 95 percent of voucher recipients did not attend public school in the year prior to receiving vouchers. While 94 schools are participating in the program, 30 percent of voucher recipients attend just seven schools. While the program in Arkansas is not quite as robust as in other states, likely due to it just starting, the state set aside more than $46 million in the budget for vouchers. That number is expected to increase in future years as the program expands and more families are eligible.
36 percent of new state taxes for K-12 education is being directed to private schools that only educate 7 percent of the population. That leaves 64 percent for public schools that educate 93 percent of students.
When looking at all states that have adopted voucher programs, it is clear that spending for public schools have decreased. That has disproportionately hurt students in higher poverty areas, according to research from the Economic Policy Institute:
Finally, it is important to note that in many states, vouchers are not large enough to cover the full tuition of private schools. That means that families have to cover a portion of the tuition, which excludes many children, as their families may not have the means to pay for some of the cost. Some states statutorily use taxpayer money to cover all of the tuition, but many other states just cover a percentage of the state’s per pupil funding, which would be less than the full cost of attending a private school.
Colorado allows families to choose where their children are educated, even if it is not their neighborhood public school, and that has been in place since the early 1990s. However, the state does not allow public funding for private education or homeschooling. The state has struggled since the Great Recession to just fund public education up to the level required by the state’s constitution. State lawmakers in 2024 finally eliminated the Budget Stabilization Factor, which had been used since 2010 to cumulatively reduce required school funding by nearly $10 billion..
Colorado cannot afford a shift towards vouchers, or any public funding for private education. While there is no immediate threat of that in Colorado, there are organizations and entities that wish to put language in our constitution that could eventually lead to vouchers. For example, Amendment 80 on the November 2024 statewide ballot would enshrine a right to school choice in our state’s constitution. This amendment would not immediately lead to vouchers, but it would surely lead to court cases on whether a “constitutional right to school choice” means that the state has to pay for students’ education regardless of what kind of school they attend. There is justifiable fear that it would be logical that a constitutional right could force the state – or allow individual school districts within Colorado – to adopt vouchers to ensure school choice for all students. If that were to come, other states’ experiences with school vouchers show that it could devastate public school funding in Colorado, and impact other programs and services in Colorado’s state budget. Instead, investing in public education is a proven way to help students, teachers, and their communities.
