TN School Voucher Bill Will Cost Taxpayers Billions, Part 2

As with most school privatization plans, Tennessee legislators can count on a stable of bare-knuckled billionaires and millionaires to provide the cash to drive the current school voucher scheme that appears destined to become law--unless citizens who support public education raise enough hell to stop it.

The legislation (HB1183/SB0503) will provide, during the 2024-25 school year, just over $7,000 in state funding for 20,000 of Tennessee's just over one million K-12 students (including private school students). In Year 2 (2025-26), any or all of the parents of Tennessee's one million+ students may sign up.

Of the 20,000, half will be made available to students whose families’ income are below 300% of the federal poverty level, students with disabilities, and those who meet eligibility requirements for the existing ESA pilot program. The remaining 10,000 will be made available to any student currently entitled to attend a public school. 

Beginning in the 2025-26 school year, eligibility for the program would be opened to all Tennessee students, regardless of income or previous school enrollment. If demand exceeds available funding, previously enrolled program participants, low-income students, and students enrolled in public schools would be prioritized.

Based on conservative estimates of the Tennessee General Assembly Fiscal Review Committee, the costs will be staggering:

The total amount of scholarships awarded will result in an increase in state expenditures
estimated to be:

o $141,500,000 (20,000 x $7,075) in FY24-25;
o $343,147,000 (47,000 x $7,301) in FY25-26; and
o Exceeding $343,147,000 in FY26-27 and subsequent years.

If the voucher scheme led to 10 percent of Tennessee students in private schools by 2027 and moving forward, that would mean an additional $700,000,000+ every year for a state that is ranked 44th among states for K-12 funding.

How Will Local Education Agencies (LEAs) Be Affected?

Because the Republican voucher scheme does not include a hold-harmless provision, local school systems will be required to absorb the loss of state funding for their students who move to private schools. The information below is from the Tennessee General Assembly Fiscal Review Committee's Fiscal Memorandum, dated February 26, 2024:

The proposed legislation does not contain a hold-harmless provision for LEAs that
experience a decrease in local revenue due to students leaving the LEA to attend private
schools . . . .

Based on school voucher data from other states, the scholarships available to students
who are not subject to household income restrictions will be awarded to 60 percent of
students from private schools and to 40 percent of students from public schools . . . .

The total local decrease in revenue and decrease in state expenditures is estimated as
follows:

$101,525,200 ($89,905,200 + $11,620,000) in FY25-26; and

Exceeding $140,710,480 ($124,598,880+ $16,111,600) in FY26-27 and
subsequent years.

A loss in TISA funding would not necessarily be offset by avoiding the cost of educating
the student. Any offset or decrease in local expenditures would depend upon whether
certain cost-savings could be realized through staff reductions or service and resource
reductions.

However, it is assumed that LEAs will maintain spending levels despite a decrease in
student enrollment (pp. 3-5). 

In short, school systems who lose 10-15 percent of their students still must maintain physical plants, transportation systems, maintenance programs, and instructional programs for 85-90 percent of remaining students.  For a largely rural state, these costs could be devastating to budgets that are already bare bones.

 Do Vouchers Offer Improved Test Scores?

This new voucher scheme will be layered on top of the previous one that was implemented during the 2022-23 school year.  The data from Spring 2023 state tests demonstrate that the current push for school privatization is not driven by a desire for academic improvement:

In 2023, only 11.3% of program participants scored proficient on the math section of TCAP, compared to 33.7% of public school students. Similarly in English language arts, 22.8% of ESA recipients scored proficient, while 38% of public school students hit the benchmark.