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David Rodeback's Blog

Friday, October 19, 2007

Three Big Buckets of Money, and Other Voucher Details

. . . And how Radio Grandpa is lying, and Radio Mom is helping him do it.

Last evening's planned political romp -- that is, the meet-the-candidates event in American Fork, attended by three of five American Fork City Council candidates and moderated by state Rep. John Dougall -- turned out to be a two-for-one deal. When the scheduled event was finished, Dougall stayed for another half hour or so to answer numerous questions about State Referendum One, the school voucher question.

Before we go to substance, I have one note of appreciation. The whole thing went somewhat beyond the libary's closing time, 9:00 p.m. One can envision crusty old (or crusty young) library personnel complaining or turning the lights out to hasten everyone's departure, but not last night. The librarians quietly waited for things to wind down, even though their patience probably meant they got home from work a little later than they wanted to. Whether done out of a heightened civic sensibility, innate kindness, or some other motive, it was a welcome indulgence in pursuit of a worthy civic purpose. You don't always get that from government.

Three Big Buckets of Money

Rep. Dougall explained that there are three big buckets of money, as far as the state budget is concerned. There is the education fund, fed by all state income taxes and a big chunk of property taxes. There is the transportation fund, fed largely by gas taxes and other transportation-related revenues. And there is the general fund, which is used for everything else, and which comes largely from sales taxes.

The vouchers are funded from the general fund, not the education fund. The implication is clear: Unless you concede that the public schools have a legitimate claim to every budget dollar -- which sounds a lot more absurd to the rest of us than it does to the teachers' unions and the educational bureaucracy -- then the anti-voucher claim that vouchers will take hundreds of millions of dollars from the public schools is false on its face.

Any who bother to read the legislation can see for themselves. Funding in the public schools is based on head count; the average cost, including capital expenditures, is approximately $7500 per student per year. When students leave the public schools to attend private schools on vouchers, here's what happens under the voucher laws (the one we're voting on and the one we're not, which refines the first in a few ways and will automatically take effect if the first survives the referendum):

1. The number of students leaving a school district on vouchers is multiplied by the average value of a voucher. This amount of money (somewhere between $500 and $3000 per student) is subtracted from the money the public school district receives.
2. The public school district keeps the rest of the money for the students not attending schools in that district, somewhere between $4500 and $7000 per student. The effect is that the dollars per student actually taught at the public schools increase.
3. You might think that the amount the school district doesn't get to keep (see #1 above) would fund the voucher, thus going to the private schools the voucher students attend, but it doesn't. It stays in the education fund, reverting to the state level for use as needed in the public schools anywhere in the state.

As you see, once in the education "bucket," money never leaves it to go to a private school. The voucher is funded from the general fund, which is separate from the education fund and funded by a different set of taxes altogether.

If you've heard a certain popular anti-voucher radio ad, you might look at it this way: Grandpa is lying, and Mom is helping him do it.

Other Interesting Notes

These are in no particular order, and most definitely not a comprehensive account of the discussion:

• One lady in the audience was doing her homework. She brought the Voter Information Guide the state mails out and asked Rep. Dougall a question about what it said, which he answered clearly and (to me) convincingly. Good for her.
• Rep. Dougall noted that the proposed vouchers are not a lot different from a Pell Grant, except the latter is for higher education (e.g. college) and the vouchers are for primary and secondary education.
• The most expensive student in the Utah public schools is said to cost $96,000 per year. This is a case of multiple severe handicaps.
• The first bill (HB 148) passed by a narrow margin in one house of the legislature, and so is subject to referendum. The second bill (HB 174) passed by at least a two-thirds margin in both houses and is therefore not subject to a referendum petition.
• Four years ago, Rep. Dougall himself was opposed to vouchers. He finally was overwhelmed by parents who have no reasonable alternatives when the public schools fail to meet their children's educational needs. He mentioned math as a very common concern in his legislative district (which is in the Alpine School District, where math for years has been, to some extent, something we learn about but are not expected to do).

It was a useful and interesting evening.

M. Ryan Taylor comments (10/29/07):

I was discussing this issue with several family members (I've never seen such a hot button topic), and it was suggested by one of my brothers that the vouchers will only be of help to the rich because of the overall cost of private education. I was completely sold on vouchers until this, and I'd like hear what you have to say about it since you seem to know what is going on. So much truth-stretching out there; you'd think we were voting on capital punishment or abortion . . .

David Rodeback comments (10/29/07):

In brief -- at least, sorta brief -- the vouchers rapidly shrink in value, from $3000 down to $500, as family income increases. The argument in a recent anti-voucher flyer that the average cost of private school is about $8000 is irrelevant and deceptive. And the implication that good private schools aren't and won't become available in the $3000 to $5000 range -- where a voucher might pay all or most of the cost -- is at best sloppy economics. Details are in today's post, as is this thought:

"The argument that a voucher is meaningless if it does not pay the entire cost of tuition is absurd. The same reasoning applied elsewhere in my own life would have turned up its nose at some substantial college scholarship money, because it wasn't a full ride; would have turned away the generous grandmother who helped my wife and me with a down payment on our first home, because she wasn't paying the entire cost of the home; and would have sneered at the 60-percent-off sale at J. C. Penney, where I recently bought some clothing I needed, because they weren't simply giving the clothing away. In each of these three cases, partial relief from normal costs enabled me to do things I could not otherwise have afforded, or at least to do them much sooner. I respectfully suggest that this applies to education, too: Most families don't need or want everything handed to them; they just need things to be a little more affordable."

Copyright 2007 by David Rodeback.
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