Do Charter Schools and Private School Vouchers Save Money?

School Choice proponents believe that the competition of “free market” education—through charter and on-line schools, home schooling, and vouchers/tax credits that use public money to pay private school tuition—will result in a better education system at less cost than can be obtained through traditional public schools.

It is hard to track charter school and voucher spending because they are not subject to the same strict transparency rules as public schools. However, after two decades of experimenting with taxpayer-funded choice, there is mounting evidence that these “free-market” solutions neither save taxpayers money nor provide a superior educational experience or result. Whether from fraud, abuse, or lack of oversight, the school choice sector is bleeding money.  

·        By 2015 the federal government had spent more than $3.7 billion promoting charter schools, some of which never opened. For example:

o   In 2011 and 2012, $3.7 million in federal taxpayer money was awarded to 25 charter schools in Michigan that never opened.

o   In Ohio $4 million federal taxpayer dollars went to 15 charter schools that closed within a few years and 7 that never opened.

o   In California $4.7 million was awarded to charters that closed within a few years.

o   In 2016, despite lack of oversight in the charter sector, the federal government spent another $333 million to promote charter schools.

·        Many charter schools spend exorbitant amounts of money on administration and contracted services.

o   In 2014-15 Arizona charter schools spent $128 million more than Arizona public schools on administration. There are 666 public school districts in Arizona serving 1,089,384 students. By contrast, 556 Arizona charter schools serve just 186,900 students.

o   New Jersey charter schools spend $1,000 more per pupil on administration than public schools do.

o   A study in Pennsylvania found that charter schools spend twice as much on administration as traditional public schools.

·        Vouchers drain state tax dollars, taking money away from other needed services without providing a proven benefit.

o   In 2016 Indiana spent $131.5 million on taxpayer funded vouchers, despite a 2015 study that found students who transferred to a private school from public school dropped from the 50^th to the 26^th percentile in math and experienced no improvement in reading.

o   In Louisiana, 7,500 New Orleans voucher lottery winners were awarded $5,311 to attend participating private schools, for a total of more than 37.5 million spent in taxpayer dollars. A 2015 study found that after a year of attending the private school, students’ scores dropped 24 percentile points in math and 13 percentile points in reading.

o   A Fordham University study of a large-scale voucher program in Ohio found that students who used vouchers to attend private schools fared worse academically than their closely matched peers attending public schools, with the negative effects greater in math than in language arts.

In some states public charter schools are funded with taxpayer dollars that carry some oversight. However, the bottom line is that, with billions of dollars of both public and private money going to support various types of “school choice,” the result is generally that lack of transparency makes the funding hard to track, most studies show a negative effect on achievement, and the sector is riddled with waste, abuse, and outright fraud.

Information for this article was taken from the Washington Post, the Center for the Media and Democracy, the Brookings Institution, the Education Research Alliance for New Orleans and the Fordham Institute.