Vouchers: Another Wrong Turn for Oklahoma Schools

• Printer-friendly summary [PDF]
• See the companion post:
10 questions every Oklahoman should be asking lawmakers about private school vouchers, tax credits

– – –

Oklahoma legislators are considering several unpredictable, expensive, and dangerous proposals to drastically change our state education policy. A school system long defined by equal access and shared responsibility could be hurt by a voucher program. Proposals being considered this session would use everyone’s tax dollars to fund private education for fewer than 1 in 10 Oklahoma children and take funding from public schools. Vouchers — which this session take the form of refundable tax credits — would also be a waste of our tax dollars because they would largely pay parents to do what they are already doing on their own.

School vouchers are public subsidies for households whose children don’t attend public school

A voucher is a transfer of public funds that recipients can spend for a specific purpose. School vouchers began in Milwaukee, Wisconsin, in 1991 and have since expanded to at least 15 states. Oklahoma has two such limited voucher programs: the Lindsey Nicole Henry Scholarship and the Equal Opportunity Education Scholarship.Generally, these programs have been limited in impact because they exclude students already in private or home schools, and they are limited to low- and moderate income families. 

Now, however, Oklahoma appears poised to join a handful of states embarking on an uncharted and reckless experiment in education policy: a voucher program — with no limits on how many tax dollars would be used for this purpose — that would be open to students already enrolled in, and paying for, private or home schooling. 

Separate versions of House Bill 1935 (by House Speaker Charles McCall, R-Atoka, and Senate President Pro-Tem Greg Treat, R-Edmond) have been passed by the House of Representatives and Senate. While they differ in some respects (most notably in whether there would be income limits for claiming the credit), both proposals would make nearly every Oklahoma family with children eligible for taxpayer funding for their private education and neither would cap the total cost to taxpayers. Technically, HB 1935 gives households a tax credit as a reimbursement for expenses, but the result is the same as a direct voucher: spending public funds for private purposes.

Vouchers or not, public schools will remain our go-to option for quality education

Estimating the enrollment in these aggressive voucher proposals is a difficult task at best. There has never been an official count of home school students in Oklahoma, and the most recent government data for private school enrollment is three years old. Both the state’s budget and school enrollment patterns were disrupted by the pandemic, and we don’t know for sure if or when they will return to normal. As a result, we can’t know for sure what enrollment will look like even without vouchers. Further, no other state is far enough down this path to give insight into how families will respond to vouchers. 

Nevertheless, the Oklahoma Policy Institute has estimated a range of projected use and cost of the House and Senate versions of HB 1935. Our estimates are based on trends in Oklahoma school funding and enrollment, data from the earlier generations of limited vouchers, and analysis of similar voucher programs being considered or implemented in other states. We expect future enrollment trends to return to pre-pandemic patterns, in which:

• Home schooling grows fastest, continuing a long-term national trend, and likely aided by technical assistance and support available on the Internet and the growth of cooperative arrangements among local home school parents,
• Public schools continue growth patterns experienced over the last decade, reflecting modest population growth and the convenience, effectiveness, and strong public support for local schools, and
• Private schools grow the slowest due to the cost of attendance, loss of students during economic downturns, uncertain demand, and the cost to expand or build new schools. 

Our projections assume that private school households will use vouchers at a higher rate than home school families, and that nearly all users in early years will be existing private and home school students. We expect shifts from public school enrollment will be relatively small.

Using these assumptions, OK Policy estimates that between 32,000 and 51,000 households would claim the voucher in the first year, growing to between 64,000 and 91,000 in the seventh year, Fiscal Year 2029-30. (Legislative staff estimate that vouchers would serve between 17,500 and 70,800 students.) The table below shows how school enrollment could change as a result of the vouchers; the private and home school estimates for the future include both students using the voucher and students not participating.

Vouchers will jeopardize essential services; the question is how much

Vouchers would reduce public school funding through two channels. First, the cost of vouchers will reduce what the state can spend on all services, including education. Second, state school funding is mainly determined by enrollment, so districts that lose students will receive a smaller share of a smaller state education budget. 

Oklahoma’s state budget provides nearly half of the funding for public schools, and funding for pre-K through 12th grade (PK-12) is the largest single item in the state’s budget. As shown below, before the COVID-19 pandemic disrupted state budgets, we invested nearly 40 percent of tax dollars in our children in public schools, three fourths of which is for per-student state aid for every public school in Oklahoma.

OK Policy estimates that these impacts from vouchers could reduce the state budget by $110-$232 million in the first year and by $215-417 million by Fiscal Year 2029-30. It’s inconceivable that a budget cut of this size would not impact the state’s future budget choices, including allocations to education and state aid to local schools. 

Ultimately, future lawmakers will decide how to reallocate state funds in response to this revenue reduction. They will determine which agencies and programs would be impacted by the fiscal choices made today. However, if current revenue allocation patterns were maintained, it’s reasonable to assume that approximately 30 percent of any reduction in education funding would come out of state aid to local schools.

In that case, vouchers would cut state aid by up to $123 million every year from 2030 and after. Oklahoma has long under-funded public schools, and the chart below shows that vouchers would be one more bad budget decision on top of those we’ve already made. Adjusted for inflation, the combination of prior funding cuts and the cost of vouchers would leave the state aid allocation 22 percent lower than in 2009 when Oklahoma had 55,000 fewer students than we do today.

Urban and suburban school districts will likely lose the most students because private schools are concentrated in these areas. Every district will face a budget crunch as a result of vouchers, regardless of how many students they lose. That’s because most costs —like teachers and staff, food service, utilities, and transportation — can’t be easily reduced as students leave in small numbers. For example, if a school loses five percent of its students, it may still need the same number of teachers and will almost certainly need the same food service workers, bus drivers, and other support staff, as well as operating costs for building space, buses, and other infrastructure. Already meager school resources will just be stretched even thinner, making teacher morale and retention problems even worse. These concerns almost certainly will result in worse outcomes for most Oklahoma children.

It’s time to stand up for our public schools and our children

Every Oklahoma public school student knows you can’t add through subtraction, but our legislators may have missed that lesson. Lawmakers currently are proposing the most significant change to educational funding in generations, but they haven’t really fully aired these plans in public, and there are many questions that have not been presented, let alone answered. Oklahomans who care about the future of public education should contact their lawmaker and ask hard questions about whether these proposals will improve Oklahoma’s public schools. We’ve run the numbers, and it just doesn’t add up.