The House Finance Committee is likely to report SB 193, the Education Savings Account (ESA) bill, out of committee much changed compared to the version that passed the House in January.  After a flurry of recent amendments (we will continue to update this post as further amendments emerge), there are a number of misconceptions about it. Here are some of them.

Misconception: Few students will use the ESA program and, as a result, there will be minimal impact on school districts.

Reality: Over the first 11 years, the version of SB 193 currently under discussion would redirect $100 million in state support from school districts to ESA grants for just 2,000 students.  And our poorest communities would pay most of that.

Many fewer students would now use an amended version of SB 193 Education Savings Account  (ESA) program under discussion in Finance Division II, compared to the program passed by the House, but the impact on school districts is much larger.

In the amendment currently under consideration, only students in grades 2-12, primarily those who are qualified for the Free and Reduced Lunch (FRL) program (family income not more than 185% of poverty) would be eligible.  There are 45,139 FRL students in grades 2-12 of NH public schools. You can see the number and percentage of FRL students for each town here.

In addition, the recent proposed amendments have introduced district level caps on the number of ESA grants that can be made each year in each town.  In a town with over 300 students (over half of the towns) the maximum number of ESA grants each year equals 3% of the total number of FRL students in the town. If 100-300 students, 4% of FRL students.  If under 100 students, 5% of FRL students. And no school can lose over 5% of its students in any one year.

The most recent LBA projection as of 3/11 was that 527 students would use the program in the first year and 2,000 over the first 11 years, far fewer than under the house-passed bill.  

The new structure would virtually eliminate any cost to the General Fund but would cost school districts $35 million in lost revenue over the first 5 years and $100 million over the first 11 years.

Since the cap is based on the number of FRL students, property poor communities with high FRL enrollments will bear most of the burden, while better off communities will see minimal impact. For example:

• Claremont has 1,368 students in grades 2-12 and a high FRL rate so 24 students per year could get ESA grants.   Bow has almost as many students but a low FRL rate so is capped at just 3 students per year.
• Pittsfield has only 461 students in grades 2-12.  It’s FRL rate is 50% and its ESA cap is 8 students per year.  Rye has 479 2-12 students and a low FRL rate.  Its cap is just 3 students.

Misconception: Private schools would not be able to receive grants from both the SB 193 ESA program and the 2012 Education Tax Credit program.

Reality: This was true in earlier proposals but double-dipping has been added back into the most recent amendments.

 Our public schools get a set amount of state “adequacy funding” per student per year.  Under the double-dipping proposal the Finance Committee is now considering, private schools could get a far larger adequacy payment for each student than the public schools do.  The ESA program would pay the private school the same adequacy funding public schools get, already among the largest such grants in the country. Then the school would be able to get an additional grant of thousands of dollars from the 2012 voucher program.

So private school students would be getting much higher state support than public school students, while attending schools that don’t have to provide the special services required of public schools.

Misconception: The sunset clause will make it possible to correct for any unintended consequences or shut the program down if necessary.

Reality: The sunset clause has been removed from the proposed amendment to the bill.

Misconception: Only schools accredited by the department of education can participate.

Reality: The bill requires no school accreditation and other measure of private school quality,  Schools must only be “Approved for Attendance” by the New Hampshire department of education, meaning that they meet certain zoning, fire and safety requirements.  

The bill and proposed amendments also allow for the payment of unqualified tutors.  

Misconception: ESA students are required to take the same state test that public school students must take.

Reality: Students are not required to take any state test.  Private schools must give a standardized test, but different schools can choose different tests.  The bill requires the low income parent to select an assessment mechanism, keep records of the results and report annually to the scholarship organization.  The many testing options available to homeschoolers include a subjective evaluation by a private school teacher, any teacher, certified or not.  

There is actually no way for parents or the Legislature to assess the academic progress of ESA students or compare it to their public school peers.

Misconception: The NH department of education will be responsible for the program

Reality:  No, an independent scholarship organization would control the ESA program.

The bill does not specify required specific attributes or capacities of the group. The scholarship organization would be free to target specific communities independent of any state policy priority and make other day-to-day decisions – such as targeting ESA grants to students in certain grades – independent of state policy priorities.  While the scholarship organization would get up to 5% of the base adequacy amount for each ESA grant it makes (including the automatic follow-on grants for students already in the program), the bill provides no audit or detailed oversight of the scholarship organization.

Misconception: SB 193 provides a private school option for parents of children with special needs.

Reality: The bill does not provide special supports for children with special needs, as other states do.  Parents placing a child in a private school give up their access of IEP services and will have access to limited funds (if any) for any needed special supports.

There is no prohibition in the bill that would prohibit private schools that receive state funded ESA grants refusing enrollment or discriminating in other ways against children with special needs.

Misconception: Parents move their children to private schools for higher quality education  

Reality: Actually, most parents with voucher support are not moving their children to private schools to gain access to greater academic rigor.

New Hampshire experience shows that school quality is no insurance against students leaving with a grant to pay for private schooling.  Many grants from the 2012 ETC program have gone to students from Bedford, Rochester, Londonderry, Rindge, and Concord so it’s not primarily a question of school quality.

It turns out that parents move their children for a variety of reasons.  Sometimes they may be seeking greater academic challenge. But it’s also to play sports, or because the student would rather be in a larger or smaller school or be with friends.  Or parents would prefer their children attend a school closer to home or work.

And it’s often for religious instruction.  The country’s leading voucher advocacy organization, The Friedman Foundation, reports that, nationally, 57% of parents using vouchers are seeking a religious or moral education.  Only 20% say they choose private schools or academic reasons.

In New Hampshire, in the last three years, over 80 percent of the grants used for private school tuition under the 2012 voucher program funded by business tax credits went to religious schools.  

Misconception: SB 193 helps low income parents provide children who don’t fit in public schools the same options children of wealthy parent have.

Reality: SB 193 is not a bill actually geared to supporting low income parents and or their children.

The bill leaves low income parents, often single parents working multiple jobs to make ends meet, the opportunity to manage their children’s educations.  But the bill leaves them on their own to do this. It requires no school accreditation or other measure of private school quality, and no certification or other qualifications to narrow the range of tutors who could offer their services to busy parents. Although private schools must administer standardized tests each year, there are no required annual assessments to assure parents that students have benefitted  from tutors or other services their ESA accounts are paying for.

These supports could have been included if improving educational attainment for poor kids who don’t fit.  However, the bill’s supporters continue to push for higher income limits (“to reach the middle class”) and for make children who have never attended public school eligible for the program.

The $100 million this program would spend by 2029 to send 2,000 to private schools is not a cost effective way to help low income students. We should work together to find ways to help all our low income students, not just a select few at the others’ expense.