The Fiscal Effects of School Vouchers


  • Sep 20 2018

Fiscal Effects of School Vouchers

By Martin Lueken

In this new study, our Director of Fiscal Policy and Analysis Marty Lueken examined the fiscal impact of voucher programs across America—from their inception through FY 2015—to determine whether they generated costs or savings for state and local taxpayers.

Listen to a podcast with the author of the report discussing the findings.

What Will I Learn? Download Report

Breaking Down Fiscal Effects of School Vouchers

In this report, you will learn:

  • 1

    Public schools’ costs are not all fixed; all costs are variable in the long run.

    Public officials often voice concern about the fiscal effects of these program on district schools. One common line is that schools “need to keep the lights on,” and they argue that because of high fixed costs, school choice programs will cause harm. If it was true that schools have high fixed costs, and by extension there are no savings from enrollment declines, then it follows that there would be no added costs when enrollment increases. Of course, this is not the case. It is common for public school officials to testify in front of appropriations committees to request more funding because they anticipate enrollment growth.
  • 2

    Because of school voucher programs, public schools are left with more money to educate fewer students.

    Today, the federal, state and local shares of K–12 revenue are 10 percent, 47 percent and 45 percent, respectively. Because school voucher programs allow students access to only all or a portion of the state funds allocated for their education, some or most of the federal funds, all local funds, and any remainder from state funds allocated for the student remains with the public school district. Facing challenges when revenue declines is not a problem uniquely tied to school choice. Rather, officials have long faced these enrollment fluctuations and are adept at handling them.
  • 3

    From their respective inception dates through fiscal year 2015, school voucher programs have saved state and local taxpayers $3.2 billion.

    These savings represent $3,400 per voucher recipient. In 2015 alone, all the programs analyzed in this report generated $408.5 million in cumulative savings, or almost $3,100 for each student using a voucher.
  • 4

    This report includes individual profiles on the following school voucher programs.

    1) District of Columbia Opportunity Scholarship Program
    2) Florida's John M. McKay Scholarships for Students with Disabilities Program
    3) Florida's A+ Opportunity Scholarships Program
    4) Georgia Special Needs Scholarship Program
    5) Indiana's Choice Scholarship Program*
    6) Louisiana Scholarship Program (formerly known as the Student Scholarships for Education Excellence Program)
    7) Louisiana's School Choice Program for Certain Students with Exceptionalities*
    8) Mississippi Dyslexia Therapy Scholarship for Students with Dyslexia Program*
    9) Cleveland Scholarship Program
    10) Ohio's Autism Scholarship Program
    11) Ohio's Educational Choice Scholarship Program
    12) Ohio's Jon Peterson Special Needs Scholarship Program*
    13) Oklahoma's Lindsey Nicole Henry Scholarships for Students with Disabilities Program*
    14) Utah's Carson Smith Special Needs Scholarship Program
    15) Milwaukee Parental Choice Program
    16) Wisconsin's Parental Private School Choice Program (Racine)*

    The six programs marked with an asterisk represent recent programs added to the analysis since the School Voucher Audit report.

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