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Stephen Dyer · January 16, 2020

Ohio’s School Voucher Explosion and 5 Potential Solutions

Well, that was fast. 

In late November, we at Innovation Ohio noticed there was a startling increase in the amount of taxpayer money being transferred from school districts to private, mostly religious schools.

In fact, it was an explosion — $47 million since the end of last school year and $57 million between November 2018 and November 2019 – a more than 20%, November-to-November increase.

We also noticed that many school districts losing sometimes hundreds of thousands of dollars to private schools this school year lost zero dollars to them only two years ago.

Our post led to a series of newspaper and other media reports demonstrating the issue throughout the state. It even forced Ohio House Speaker Larry Householder to say that his top legislative priority this year is to fix the voucher issue.

But what is this voucher issue, and why has it exploded so recently?

The answer is simple: the state report card and money. 

Let’s take each issue in turn.

Problem 1 – The State’s Report Card

While there are several voucher programs in Ohio (for more detail on them, check out our report from a couple of years ago), the one that’s exploded is the EdChoice voucher transfer program. This program has been around since 2005 and it takes state money originally designated for a traditional, public school district and instead transfers that money to a private, most often religious school.

Which Ohio school districts are eligible for the EdChoice voucher program? Well, it’s complicated. 

Generally, the worst-performing districts in the state on the report card, as well as any child who would attend a building that has received bad marks on the state report card would be eligible for the EdChoice voucher program. Thus, a student who would otherwise attend a poor-performing school building in a well-performing school district would be eligible to receive a public subsidy to attend a private, most often religious school.

Ten years ago, the group of schools and districts eligible for EdChoice were mostly concentrated in Ohio’s urban areas, with only about 30 or so of Ohio’s 613 districts losing at least some of their state funding to private, parochial schools.

But then the state started to use Common Core tests — tests that ended up being changed several times over the course of a few years.

Common Core tests were changed several times over the course of only a few years, prompting the legislature to provide a “safe harbor” period allowing school districts to adjust to the evolving changes.

The “safe harbor” was implemented to prevent mass exodus via the voucher program of students headed to private schools on taxpayer subsidies meant for public school districts due to test changes and not actual student performance.

That safe harbor provision ended last school year, yet district and building grades in Ohio have remained artificially low

A bar chart illustrating how letter grades per school district have declined erratically during the period of time where Common Core was being changed year-to-year (2012-2019)
Letter grades per district have declined erratically during the period of time where Common Core was being changed year-to-year.

As the data trends suggest, poor letter grades on the state’s report card are much more likely today than they were under previous report card iterations.

In addition, as of the 2019 state budget, if districts received failing grades in only one of several report card categories, they’re eligible to lose state funding to vouchers. 

The grades earned need only be failing in one of the categories for 2 of 3 years between the 2014-2015, 2017-2018, and 2018-2019 school years. 

Yes, you read that correctly. 

The years in question are nonconsecutive. That is the state’s policy.

Under the new measurements, there are now more than 1,200 school buildings that will qualify for vouchers next year, and 512 of 613 Ohio school districts will lose state funding to the EdChoice voucher.

As the data trends suggest, poor letter grades on the state’s report card are much more likely today than they were under previous report card iterations.

In addition, as of the 2019 state budget, if districts received failing grades in only one of several report card categories, they’re eligible to lose state funding to vouchers.

The grades earned need only be failing in one of the categories for 2 of 3 years between the 2014-2015, 2017-2018, and 2018-2019 school years.

Yes, you read that correctly. The years in question are nonconsecutive.

That is the state’s policy.

Under the new measurements, there are now more than 1,200 school buildings that will qualify for vouchers next year, and 512 of 613 Ohio school districts will lose state funding to the EdChoice voucher.

Under the new measurements, there are now more than 1,200 school buildings that will qualify for vouchers next year, and 512 of 613 Ohio school districts will lose state funding to the EdChoice voucher.

Problem #2 – Way more money diverted to vouchers

In addition to expanding the universe of eligible voucher students, state lawmakers have steadily increased the amount of taxpayer money diverted into the voucher program, away from public schools for each voucher recipient. 

Today, for high school students, it is the same amount of money per pupil as the base aid amount the state’s school funding formula provides for a public school student. That amount used to be far less – a key point for why the U.S. Supreme Court determined Ohio’s voucher system to be constitutional in 2002.

Now that voucher funding per pupil is on par with public school funding for high schools (it’s about $1,500 less for elementary school students), more private schools are opening their doors to these public subsidies, further draining funds from our public school districts.

 It used to be that, generally, the dollar amount of vouchers were worth less than those students would have received to attend the local public school district. 

Now that the voucher transfer is so much more, in many more instances, the amount going to the voucher is actually greater than the amount of funding the state would have sent the district for the same student. Thus, significantly more local revenue is subsidizing the state funding loss – along the lines of what has been happening with charter schools for years.

These changes are forcing districts to go to the ballot for new money levies more frequently and at higher levels.

Through state policymaking, pro-voucher proponents have significantly expanded the universe of potential voucher recipients to encompass nearly 1/3 of all school buildings in the state. 

By increasing the funding that follows students who opt to take advantage of the voucher program, the state has hugely expanded the universe of potential schools willing to accept vouchers for these students.

The result? Vouchers have exploded.

A bar chart showing the drastic increase in voucher-eligible school buildings in Ohio over the 2018-19, 2019-20, and 2020-21 school years. The number has increased from around 200 in 18-19 to around 1200 in 20-21.
The number of school buildings in Ohio whose students are eligible for the EdChoice voucher program has exploded this year.

Now what?

Many public school advocates are effectively pushing back against the expansion of vouchers.

One event will be held next week in Toledo. I will participate in this event as Innovation Ohio’s Education Policy Fellow.

These and other events have forced the Speaker’s hand.

There are many ways to fix this. Here are a few:

  1. Limit the vouchers to only students who have been enrolled in the school building or district that’s eligible for the voucher for more than 180 days. It’s tough to “fail” a student if that student never attends the district or building

  2. In order to be designated a voucher-eligible school or district, you have to receive failing grades in at least 2 (rather than 1) report card categories for three consecutive years. Additionally, limit it to buildings in districts with overall report card grades of C or below. This is the standard for charter school closure. It shouldn’t be easier to get a voucher than it is to close ECOT.

  3. Reduce the amount of funding for the vouchers to something approaching the ratio of the original program considered by the U.S. Supreme Court. Ohio is inviting legal challenges by granting private, mostly religious schools essentially the same base aid amount as a public school student, especially given that the state already pays to bus many of these students to the private school.

  4. Add financial accountability to the taxpayer dollars going to the private, mostly religious schools. One of the real issues with now more than $330 million going to private schools is none of that money is audited. We have no idea how it’s being spent. One of the checks we had on the privately run, publicly funded charter school sector was the public auditing of the money they received, which led to the uncovering of many incidents of taxpayer money being misspent.

  5. Directly fund all EdChoice voucher students from the state. The state already does this through the EdChoice expansion program (where any family of 4 making about $100,000 or less can receive a voucher, regardless of school performance, but that’s another story). Eliminating the deduction will also all but eliminate the local revenue-subsidizing-vouchers problem, and it will reduce the angst many district leaders have when they see on their state funding reports that they are slated to receive a certain level of funding, but get much less because the vouchers take a bunch off the top.

These are just a few of the ways to respond to this crisis that’s hammering many districts.

Tagged in these Policy Areas: K-12 Education | Ohio State Budget