July 2002

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Education 

Lance T. Izumi is director of the Center for School Reform at the Pacific Research Institute for Public Policy.

Now that the U.S. Supreme Court has ruled that government-funded school-choice vouchers, which parents may use to pay for religious or secular private-school tuition, are constitutional, lawmakers can now focus on the costs and benefits of this policy option and the various forms in which it could be implemented. Despite the fact that voucher ballot initiatives have been defeated twice in California, there may still be a good future for school choice in the Golden State.

First, with California facing a massive budget deficit and with predictions that deficits will continue for several years to come, it is noteworthy that vouchers are an economical way to improve the quality of education for children. The Cleveland school-choice program, which was the subject of the Supreme Court decision, offers a voucher worth $2,250 to low-income families who send their children to private school. In Florida, the state’s accountability program offers a $3,800 voucher to the families of students who attend consistently failing public schools. In Milwaukee, the site of the nation’s first school-choice program, the voucher amount is around $5,000. Compare these voucher amounts with how much it costs government to educate – or, all too often, mis-educate – children at a government-run school.

In California, if one counts state general fund and local property-tax expenditures (so-called Prop. 98 spending), per-pupil spending is about $7,000. However, if one also includes all state expenditures, including lottery funding, federal dollars, and other local funds, then total K-12 per-pupil spending is nearly $9,200. In some school districts, the per-pupil spending is even higher. One study found that in 1999-00, the elementary school district in Sausalito, north of San Francisco, spent $16,555 per pupil. That year, second-grade reading scores in Sausalito on the state SAT-9 exam were in the bottom third.

Not only do vouchers cost less, they also shift the school facilities burden to the private sector. Vouchers are a critically important strategy to meet the growing  student population. State and local borrowing cannot cover all the school facilities costs. The state has about 6 million students, 1.5 million of whom speak little English. Because of the projected growth of the K-12 population, state lawmakers have placed $25.3 billion in bonds, much of which will go to the school facilities, on the November 2002 and March 2004 ballots. These state bonds come on the heels of the 1998 passage of a $9.2 billion school facilities bond. If the 2002 and 2004 bonds are passed, then Californians would have approved $34.5 billion in state school bonds in six years. California taxpayers will be responsible for paying back these bond debts plus interest.

In addition, at the local level, voters passed 23 school construction bonds, worth more than $1.2 billion, in November 2001 and 50 bonds, worth $3.5 billion, in March 2002. Since local bonds are repaid by increased property taxes, homeowners and other property owners will foot the bill. And whereas prior to 2001 local school bonds needed a two-thirds majority of votes to pass, California now has a 55-percent majority requirement. As opposed to the two-thirds rule, where around half of bonds passed, 100 percent of the bonds on November 2001 ballots passed. Eighty-eight percent of such measures were approved in March 2002. Without a voucher safety valve, school districts will be forced to put more and bigger bonds on local ballots, with property taxes rising accordingly, and it won’t be enough.

Obviously, vouchers have more to recommend them than mere cost savings.  Researchers from Harvard and other universities have found that students in the Milwaukee school-choice program have performed significantly better than similar students in the city’s public schools. The state Legislative Analyst’s Office has pointed out that there is enough evidence in favor of vouchers to warrant a pilot school-choice program in California.

Here, then, is the key question for voucher proponents in California. If there is to be another effort to enact a voucher program in the state, what form should the vouchers take?  Some favor a universal approach. State Senator Ray Haynes (R-Riverside) has a bill that would redirect half of the tax money that school districts now receive per pupil to any parent who wants to spend it on private-school tuition. Other school-choice supporters are looking at options that target smaller groups of students. For instance, vouchers could be given to students at failing public schools, a la Florida, under the sanctions portion of California’s school accountability program. Pilot programs could be initiated in specific low-performing school districts. A statewide voucher program could target low-income students.

The bottom line is that vouchers, regardless of form, will ensure taxpayer savings, either through lower government per-pupil spending or lower facilities costs, and greater competition in the education marketplace. As a result of increased competition, there will be incentive for public schools to improve their performance and run more efficiently. Parents, especially low-income parents, and their children will be able to become real market consumers, choosing between a variety of public and private schools based on issues such as academics, teacher quality, and discipline. The Supreme Court has opened the door to vouchers and California should use this opportunity to step across the threshold into a better education future for our children.