A new way to look at funding education
Nathan Howard likes “Star Wars” and Legos, proudly recites the names of all 50 states, and proclaims his favorite “subject” is recess — although his mother would tell you his math skills have skyrocketed the past couple of years.
Nathan is, in many ways, a typical 7-year-old boy. But when it comes to his educational needs, Nathan requires a little more support than his district-assigned public school can provide. Thankfully, Nathan’s parents have been able to make educational choices to meet his needs.
Two years ago, Nathan began using an education savings account (ESA). An ESA enables parents to pay for private school tuition, online learning, curriculum, textbooks and other education-related expenses.
Signed into law by Gov. Jan Brewer in 2011 as “Empowerment Scholarship Programs,” Arizona became the first state to begin using ESAs. Arizona’s ESAs are available to children with special needs, children from active duty military families, children in foster care and children in underperforming schools.
ESAs are the first of their kind, giving parents full control over 90 percent of the funds that would have been spent on their child in their assigned public school. Once parents choose to withdraw a child from the public system, funds are deposited onto a restricted-use debit card; the parents are then able to direct spending to any education-related service or provider of choice.
Families can use ESAs to pay for private school tuition, online learning and private tutoring. Parents are even able to roll over unused funds from year to year, and can even roll those funds into a college savings account.
Early data from Arizona show that not only are parents considering opportunity costs — whether they’re getting good value for their education spending — they’re also seizing the opportunity to tailor their child’s educational experience.
An evaluation from the Friedman Foundation for Educational Choice found that more than a third of families are using their ESAs to create a customized education for their children. While most families use their ESAs like a school voucher to attend a single private institution that they’ve chosen, about 34 percent use their ESAs to finance multiple education options in a given day.
Arizona’s model is easily replicated. It could yield great dividends for states seeking a more robust system of educational opportunity.
A report from The Heritage Foundation and The Goldwater Institute outlines how states can transform their existing school choice programs — whether tax credits or vouchers — into an ESA. By transitioning existing school choice programs into an ESA, either by creating public school ESAs, expanding the allowable uses of school vouchers, or empowering parents to deposit voucher funds into an ESA, state and local leaders can customize learning options for families.
Arizona is showing states across the country that it’s possible to create educational environments that fully meet the needs of families. Other states would do well to follow its example.