The Friedman Foundation for Educational Choice

Advancing Milton and Rose D. Friedman's Vision of School Choice for All Children

Road to Reform Runs Through Indiana

Tuesday, June 28, 2011

Foundation Staff

School Choice Advocate
Road to Reform Runs Through Indiana

Indiana is known as the “Crossroads of America.” A vast network of highways runs through the state carrying people and goods literally from “sea to shining sea.” In one sense, it could be said that if you really want to go anywhere you have to go through Indiana. The same now can be said of the highways of education reform. Thanks to Gov. Mitch Daniels and many courageous legislators, all education reform roads now come through “the Crossroads” of Indiana.

In 2011, Indiana passed the most comprehensive set of systemic education reforms ever seen nationwide. Collective bargaining was limited to wages and benefits only. The practice of laying off teachers with the least seniority first regardless of their competence was ended. A teacher and principal evaluation system was created that will pay teachers based on quality, not length of service. Charter and virtual schools were dramatically expanded and the school funding formula was changed to ensure money follows kids.

In addition to all this, Indiana passed what will likely become the nation’s largest school voucher program.

New Voucher Program Created

On May 5, Gov. Daniels signed into law HB 1003, the School Scholarship Act. After signing the bill, which will have the broadest eligibility of any voucher program in the nation, he sealed it with a kiss.

Here’s what makes it unique: Eligibility for the new voucher program is set at 150 percent of the federal Free and Reduced Price Lunch program. Stretching well into the middle class, the program allows a family of four earning up to $62,000 per year to receive a voucher to attend the private school of their choice. Uniquely, the program is not limited to students with special needs, students attending failing schools, or those residing within a particular municipality. Any family in the state whose child has previously attended public schools and falls within the broad income requirements is eligible—period. For the first time in modern history, the public will have the opportunity to observe real market forces at work and see the effects that a broad school choice program can have on the landscape of American education.

This victory was possible in large part because of Gov. Daniels, who is an outspoken supporter of school choice. In his 2011 State of the State address, Gov. Daniels declared, “We must begin to honor the parents of Indiana. We must trust them, and respect them enough, to decide when, where, and how their children can receive the best education, and therefore the best chance in life…. For families who cannot find the right traditional public school, or the right charter public school for their child, and are not wealthy enough to move near one, justice requires that we help. We should let these families apply dollars that the state spends on their child to the non-government school of their choice.”

Thus, the voucher legislation became a cornerstone of Gov. Daniels’ education reform agenda. Strong support and leadership from Superintendent of Public Instruction Tony Bennett, Senate President David Long, and Speaker of the House Brian Bosma, enabled the passage of the School Scholarship Act, dramatically expanding educational options in Indiana.

Importantly, this historic legislation goes further than just creating a new voucher program. The bill also expands Indiana’s existing tax-credit scholarship program and creates a new personal tax deduction for educational expenses for families with children in private school.

Tax-Credit Scholarship Program Expanded

Indiana lawmakers also doubled the preexisting cap on the state’s tax-credit scholarship program to $10 million from $5 million in available scholarships. Moreover, onerous restrictions that slowed the growth and implementation of the tax-credit program were removed, clearing the way for more robust growth in the program. The increased cap, coupled with common sense reforms to the rules governing the program, will result in even more families being able to choose the school that best meets their children’s needs.

New Personal Tax Deduction Created

The legislation also created a $1,000 tax deduction for private and home school families. The new deduction has universal eligibility and applies to any approved expenditure, including tuition. With the addition of the tax deduction, there is truly something for everyone in the Hoosier state when it comes to educational options, public or private.

Role of the Foundation

Throughout the last five years, the Foundation has played a critical role in Indiana. We have provided literally over 1,000 unique program services to educate the public and policymakers.

As State Rep. Cindy Noe stated following the choice measure’s passage, the Foundation has been “...the cavalry through all of this from the beginning. They were the germinators of ideas and then they put the thought, people and resources behind it to see these ideas come to fruition…. They have put the focus on the children and what is best for them.”

In 1998, Nobel Laureate Milton Friedman wrote, “We have so far only seen the early fruits from the introduction of vouchers, from giving parents a choice. The best is yet to come.”

Today, Milton Friedman’s vision for school choice is becoming a reality across the country. Thanks to the leadership of Gov. Daniels and so many others, Indiana has paved the road to additional bold reforms throughout the nation.

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