Study finds school choice saves local taxpayers $
Winslow Homer: School Time, 1874. Image in public domain
A recent EdChoice analysis asserts that school choice policies aren't just financially feasible—but, in states where they're implemented, they're actually saving taxpayers $3,300 to $7,800 per program participant. Could this be an answer to the Bay's failing, going-broke school districts?
A new EdChoice report, The Fiscal Effects of School Choice: The costs and savings of private school choice programs in America through FY 2022, estimates the short- and long-term fiscal effects of 48 programs across 25 states. The analysis includes five education savings account programs, 22 school voucher programs, and 21 tax-credit scholarship programs. This report updates the previous version of EdChoice’s Fiscal Effects report from 2021, which analyzed 40 programs through fiscal year (FY) 2018.
The report uses short-run and long-run variable cost estimates to generate lower bounds and upper bounds of the fiscal effects of education choice program on taxpayers through FY 2022. Because this period pre-dates any universal or near-universal program getting up and running, the main analysis does not include such programs. …
Here are the key takeaways from the study:
From their inception through FY 2022, the 48 school choice programs studied generated cumulative net fiscal benefits for state and local taxpayers combined ranging from an estimated $19.4 billion to $45.6 billion. Since all programs analyzed had been operating for over five years by FY 2022, the fiscal benefits are likely closer to the high-end estimate of $45.6 billion.
On a per-student basis, these cumulative net fiscal benefits equate to $3,300 to $7,800 per program participant.
Put another way, states experienced fiscal benefits worth an estimated $1.70 to $2.64 for every dollar spent on a school choice program.
On average, if at least 56% of students who participate in choice programs switched from public to private schools, these programs saved taxpayer dollars overall. For programs that have been in operation a long time, this break-even rate may be as low as 37%. These break-even switcher rates are significantly lower than switcher rates observed in random assignment studies (85% to 90%, on average) and imply significant savings from choice programs.
These savings result from many of the students who exercised choice who would have been enrolled in a public school if these choice programs did not exist—and would have enrolled in public schools at a much larger taxpayer cost.
The fiscal benefits generated by school choice programs occur for several reasons:
Funding gaps between school choice programs and traditional public schools are large. Public schools cost an average of over $17,000 per student annually, while the average cost to taxpayers for students in school choice programs is approximately $6,000 — about a third of the cost of public schools.
While there are some fixed costs in the short run, districts also experience lower variable costs when enrollment declines. As time goes on, districts eventually can adjust their operations and budgets fully to a change in enrollment. Thus, savings grow over time.
By reducing the number of students in public schools, choice programs can alleviate overcrowding, potentially avoiding the need for costly expansions and additional personnel and equipment. …
Policymakers should note that these fiscal effects ignore any indirect economic benefits that choice offers, such as lowering crime rates and improving longer term outcomes by reducing high school dropout rates and boosting post-secondary outcomes.
Read the whole thing here.
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