A closer look at House, Senate proposals to spend public dollars for private schools (Capitol Update)

With just under $1 billion in new recurring revenue potentially on the table for appropriation this session, the leaders of the House and Senate have directed their attention to increased education funding. But the conversation has taken unexpected twists and turns with both leaders having dueling proposals. 

Last session Senate President Pro Tempore Greg Treat, R-Oklahoma City, proposed a private school voucher plan that was to cost the state $128.5 million if passed. Under Treat’s proposal last year, families with a household income of 300 percent of the earnings needed to qualify for reduced-price school meals — $38,500 per person in the household — could draw on an “education savings account” of state funds to pay for private school tuition. For example, a family of four could have a household income of $154,000 and qualify for the private school vouchers. 

Each participating student would have had funds deposited in an education savings account equal to how much money the state would appropriate for the child to attend a public school. Depending on the school district and the child, that could range from $7,800 to $17,000 per student if extra weights were included for various student characteristics.

Speaker Charles McCall, R-Atoka, pronounced Sen. Treat’s plan dead-on-arrival in the House last year saying it would not be given a hearing. McCall said the voucher bill was a non-starter for rural legislators because rural districts have far fewer private school options. However, the House never had to act on Treat’s proposal because it failed 24-22 on a Senate floor vote.

This year started with a series of education bills proposed by Senate Education Chair, Sen. Adam Pugh, R-Edmond, for teacher pay raises and other proposals aimed primarily at teacher retention. Sen. Pugh said private-school vouchers were not part of his proposals. Sen. Julie Daniels, R-Bartlesville, introduced a voucher proposal called the “Oklahoma Education Freedom Act.” However, the bill was never assigned to or heard in a committee. Sen. Treat opted not to introduce a voucher bill this year. 

In the House it appeared, at the beginning of the session, that there was no serious voucher proposal being introduced. With Senators Treat and Pugh opting out of the voucher discussion, it outwardly appeared vouchers would not be considered this year. However, in mid-February, Speaker McCall amended a bill he had authored as a shell bill and announced a tax credit proposal up to $5,000 per student for tuition to a private school and a $2,500 tax credit for students being home-schooled. The cost of the tax credit program is about $300 million which, according to the Speaker, would go primarily to families living in metro areas.

Since students in rural areas do not have as much access to private schools as metro students, McCall balanced his proposal by distributing $300 million in a way favoring rural school districts. The top 23 districts in funding based on the per-pupil state aid formula, located in metro areas and educating over half the state’s student population, would be capped at $2 million per district with the remainder being distributed to the smaller rural school districts. Speaker McCall also proposed a $2,500 teacher pay raise costing over $200 million. The total McCall package is about $800 million. 

The Speaker slammed the door shut on compromise by announcing the House proposal could not be amended by the Senate, or the Senate’s education proposals would not receive a hearing in the House. The Senate, rising to the challenge, with Sen. Treat replacing Sen. Daniels as Senate author on the Speaker’s bills, quickly amended them and passed them on the Senate floor, returning them to the House, as amended. 

The Senate amendments change the tax credit from $5,000 to $7,500 per student with households exceeding a $250,000 cap on adjusted gross income ineligible for the credit. The Senate also changed the home school tax credit from $2,500 to $1,000 and increased the teacher pay raise from $2,500 across-the-board to $3,000 to $6,000 based on longevity in the classroom. The Senate also dedicated $30 million for teacher bonuses based on school district bonus plans.

Although there is currently a standoff, one thing seems clear. The leaders of both chambers have now endorsed the idea of using public money to pay for education in private schools. The difference between a tax credit and a voucher is in process only, not substance. The amendments to the Speaker’s bill passed the Senate 40-7 along party lines. I don’t know how the votes will stand in the House. Last year, the Speaker said he couldn’t pass vouchers in the House. But there has been an election and a change in membership since then. And Gov. Kevin Stitt, a proponent of private school funding, was re-elected. 

Judging from the Speaker’s proposal, it looks like the only way to get rural House votes for private school tax credits is to direct disproportionately more public funding to rural school districts. This would appear to balance the perception that the tax credit funding is going primarily to metro dwellers who send their kids to private schools. The losers are the metro public schools. 

The Senate moved dramatically toward the House proposal by accepting the tax credits. In fact, with their $250,000 income cap, the Senate cut the cost of the tax credit said to benefit city dwellers from nearly $300 million to only $98.7 million. An additional $300 million going through the state aid formula to all school districts would likely send substantially more than $98.7 million to rural schools, especially with the additional funding for teacher raises. I hate to see it happen because I think vouchers or tax credits, whichever you call them, are a bad idea, but it looks to me like there’s a deal to be made here. The question now is whether the House can take “yes” for an answer, or if they even want to.


Steve Lewis served as Speaker of the Oklahoma House of Representatives from 1989-1990. He currently practices law in Tulsa and represents clients at the Capitol.

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