Nevada’s Education Savings Account (ESA) Program, enacted in 2015 and launching January 2016, is the nation’s first universal ESA program. It allows parents to remove their children from their assigned public schools and access a portion or all of their children’s public education funding to pay for services like private school tuition, curriculum, learning therapies, tutoring and more. Read this page to learn more about the program’s requirements, limits and regulations.
Nevada’s Education Savings Accounts (ESA) program provides parents funds to pay for a variety of educational services for their children, including private school tuition, distance learning programs, tutoring, curriculum, therapy, post-secondary educational institutions in Nevada and other defined educational services. Funds remaining in the account at the end of a school year may be rolled over to the next school year.
For students with special needs or those that live in families with incomes up to 100 percent of the free and reduced-price lunch program ($44,955 for a family of four in 2016–17), annual account payments may be worth 100 percent of the statewide average basic support per pupil ($5,710 in 2015–16). For all other students, annual account payments may be worth 90 percent of the statewide average basic support per pupil ($5,139 in 2015–16).
Students qualify if they attended a Nevada public school for at least 100 days immediately prior to establishing an ESA. Additionally, children of active duty military members and those under 7 years old qualify immediately.
This program is by far the closest to the type of school choice program Milton Friedman envisioned to date. It has the highest funded eligibility rate of any program in America to date, 93 percent, and funding amounts for low-income children are set at 100 percent of the average state public school per-pupil funding amount. This program sets the bar that all other school choice programs should try to reach. There is still room for improvement, however. First, additional pathways for eligibility could be added, including a sibling preference, new entrants into the state and/or low-income students who currently attend private school. Ultimately, every single child in the state should be able to access an ESA. Second, all state expenditures should follow children with special needs, which would provide the most challenged students to access the services they need. Right now, they receive only the base support. Lastly, funding amounts, in general, could be raised to what a public school receives per student. An amount closer to $7,000 per child would help more families access more private schools, especially those who come from low-income households. This is somewhat mitigated by families’ ability to stack the state’s tax-credit scholarship program on top of an ESA, but that program also has funding limitations.
N.R.S. §§ 353B.850-880; 388D.100-140; 392.070(3)
The American Civil Liberties Union (ACLU) of Nevada filed a lawsuit on August 27, 2015 on behalf of five citizen plaintiffs alleging the ESA program violates Nevada’s constitution by a) allowing funding to potentially be used for a “sectarian purpose,” b) creating a “competing system of private schools whose curricular, instruction, and educational standards diverge dramatically from those of public schools,” and c) allowing participating private schools to potentially discriminate based on “religion, sexual orientation, and gender identity.” Americans United for Separation of Church and State joined the ACLU. The District Court ruled against the plaintiffs, and they appealed to the Nevada Supreme Court. Duncan v. State of Nevada, Clark County Eighth Judicial District Court, Case No. A-15-723703-C.
Additionally, on September 9, 2015, Educate Nevada Now, along with the Education Law Center of New Jersey, filed a lawsuit on behalf of public school children and parents with overlapping but different allegations than the Duncan case. The plaintiffs believe the program a) will divert funds set aside for public schools to private, often religious, schools, b) will reduce the funds deemed sufficient to operate Nevada public schools, and c) will create a system of schools that is not legislatively established and that are not free and open to all students. In January 2016, the District Court granted plaintiffs’ motion for a preliminary injunction against the ESA, halting the program pending a ruling by the Nevada Supreme Court. Lopez v. Schwartz, Carson City First Judicial District Court, Case No. 150C002071B.
On July 29, 2016, the Nevada Supreme Court heard oral argument for each case, separately, but on the same day. The high court consolidated its rulings on these cases, issuing one decision on September 29, 2016. The court ruled that Nevada’s ESA is constitutional, but also ruled that the legislature did not adopt an “independent basis” to fund ESAs outside of constitutionally protected funding for public schools. Therefore, the ESA program “is without an appropriation to support its operation.” The court affirmed in part and reversed in part the rulings of the lower courts and directed the lower courts to enter a final declaratory judgment and permanent injunction against Section 16 of the bill creating ESAs, Senate Bill 302. Section 16 contained enabling language for funding, but the court ruled there was no corresponding language in the bill appropriating funds for education, Senate Bill 515. Lopez v. Schwartz, 132 Nev. Adv. Opn. No. 73. EN BANC Nos. 69611/70648.
In a third case, filed in support of the program on December 22, 2015, the parties submitted a joint stipulation to stay litigation in the case, effectively suspending the case indefinitely. Norman v. State, District Court, Clark County, Case No. A-15-729344-C.