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Opponents of school choice have long predicted that Arizona’s Empowerment Scholarship Account policy would “bankrupt” the state, but school choice has saved money, as the state’s education budget surplus shows.
This will come as no surprise to Arizonans who have grown accustomed to Chicken Little’s empty threats that school choice will bring down the sky, but they are not the target audience for this poisonous propaganda; it is conservative lawmakers in other states.
Over the past three years, Republican lawmakers in 12 states have granted school choice to all or nearly all K-12 students, and more GOP-leaning states, such as Texas, seem poised to join in. To thwart this progress, school choice opponents have settled on a message designed to scare conservatives: that school choice is a budget strain.
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“The universal school voucher program is unsustainable,” Arizona Gov. Katie Hobbs (D) argued last summer, arguing that the program needed to be scaled back lest it “bankrupt the state.” Her proposed budget would eliminate ESA eligibility, cutting off about 50,000 students.
The fight over school choice is taking a dramatic turn as Arizona shows that school choice is more affordable than its scaremongers claim. (iStock)
School choice opponents in other states have echoed Hobbs’ threats. Rep. Trey Martinez Fischer, the Democratic speaker of the Texas House of Representatives, argued this year that Arizona’s ESAs have caused “nearly a billion dollars in losses.”[illion] The problem is that costs are skyrocketing.”
Kentucky Lt. Governor Jacqueline Coleman recently warned voters considering a school choice ballot measure (Amendment 2) that the ESA has blown a “huge hole” in Arizona’s budget. School choice advocates have heard lawmakers in several states express anxiety about the potential financial impacts of expanding school choice.
Fortunately, the Republican-majority Arizona Legislature knows this very well: The typical ESA student in Arizona pays more than $12,000 per student to public schools in state and local taxes alone, while receiving about $7,500 per year from Arizona taxpayers.
Looking at state budgets alone, ESA programs cost taxpayers hundreds, and in some cases thousands, of dollars less per child than the public school system, and states save money when students move from public school to ESAs.
In the first two years after ESAs were made universal under then-Governor Doug Ducey, Arizona experienced a large statewide budget surplus in Year 1, and a net reduction in the state’s education funding formula (which includes ESAs) relative to budgeted amounts in Year 2. This year, after drawn-out budget negotiations, universal eligibility for the ESA program came through without a hitch.
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ProPublica and the Grand Canyon Institute argued that the ESA was a major contributor to the $1.4 billion deficit Arizona faced last year, but not only has that deficit been eliminated, the latest education budget numbers paint a very different picture.
In Arizona, the bipartisan Joint Legislative Budget Committee said costs for the ESA program were $92 million higher than projected last year, but a surge in the number of ESA students to more than 72,000 at the same time as public school enrollment declined meant costs were $93 million lower than projected.
By the end of the 2023-24 school year, 62% of new students enrolled in ESAs will have transferred from public schools the previous school year. Taking into account shifts in student enrollment between the public school district, public charter and ESA sectors, JLBC estimated last month that this would result in net savings of more than $350,000 compared to the 2024 enacted budget.
Fortunately, the Republican-majority Arizona Legislature knows this very well: The typical ESA student in Arizona pays more than $12,000 per student to public schools in state and local taxes alone, while receiving about $7,500 per year from Arizona taxpayers.
Moreover, these are conservative estimates: As the Goldwater Institute noted, the JLBC analysis only looked at the basic state aid formula and “did not take into account additional ESA savings from all other sources, including state, local, and federal funds.”
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On Aug. 26, the Arizona Department of Education released a revised budget for this fiscal year, showing a $4.3 million surplus.
The sky is not falling. The financial difficulties Arizona faced this year came despite, not because of, its school choice policies. Lawmakers considering school choice policies in other states would be well advised to ignore Chicken Little.
Corey DeAngelis is American Federation for Children Visiting Scholar at Stanford University Hoover Institutionhe”The Parent Revolution: Saving our Kids from the Extremists Ruining Our Schools“
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