In 2001, Pennsylvania enacted a masterful piece of legislation to allow funding to assist the children of qualifying families to attend faith-based or private schools.  Rather than a “voucher” system, which directs funds collected from the State government to schools willing to accept the amount as payment in full for the child to attend a private or faith-based educational institution of their choice, tax credits are provided to businesses who make a contribution to a scholarship organization or educational improvement organization.

What’s the difference between those two?  A scholarship is awarded to parents of children in faith-based or private schools, and scholarship organizations are responsible for ensuring a family’s qualification to receive such funds.  Either the scholarship organization or the school can make the determination as to how much the scholarship will be – a flat amount, or, perhaps, a percentage of the tuition, based on the family’s calculated financial need.

The educational improvement organization awards funds to organizations – many of them public school districts – to fund innovative educational programs within the school.

So, while articles from watchdog organizations, like this one – http://www.pennbpc.org/still-no-accountability – decry their perceived “lack of accountability” in the program (with a huge report with charts, graphs, research and evidence that the authors are economists), they leave out key components of the legislation (for instance, that businesses could not direct funds to just one child, and that scholarship organizations had to make awards to more than one school), as well as the fact that there is a whole additional facet that goes to assist innovative educational programs, a number of which benefit children in the public schools.

The other fact that it leaves out is that in Pennsylvania, funding to a public school district is based on the number of children within the school district.  If those children are enrolled in a faith-based or private school, the public school district still receives funds from the education budget.  The tax credits provided in the scholarship program come from the Department of Community and Economic Development, in that the benefit is to the businesses, and nothing is funded by the state’s Education budget.

As an example, let’s say there are 5,000 children in a public school district, and the district receives $75,000,000 in education funding from the State.  That’s a cost per student of $15,000.  If 200 of those children are in a local faith-based school, the district still receives $15,000.  However, if the child is enrolled in a state-funded cyber charter school, since the school charges no tuition and is funded with public tax dollars, the district receives a reduction in the amount of funding they receive.  If only 50 students are enrolled, that’s could mean a loss of $750,000 to the school district…and there’s also a lack of accountability on this side of the equation.

What tax credits do is allow the parent to make a choice, without affecting the revenue of the public school district, allowing for a more advantageous student to teacher ratio, promoting smaller class sizes in the public school.  It was always said that if a faith-based school closes, then the student would have no choice but to go to the local public school.  But today, they can be enrolled in a cyber school, a charter school, a cyber-charter school, and the district could lose money as well as the student.  Does the parent care?  Of course not.  They want what they believe is the best educational option for their child that is affordable to them.  Public school districts have awoken to this realization that they now need to recruit students, just like faith-based and private schools do, and now must engage in marketing strategies to attract parents…and that’s something they’ve never had to do before.

They also must raise outside sources for funds – yet many of them haven’t realized that they’re a non-profit organization.  Why is it so difficult for this realization to manifest itself?  Because it costs money to start a foundation, and time to build the relationships necessary for meaningful engagement with donors.  And everyone want’s everything for free, and right now.

Back to the report for the glaring misrepresentation – it refers to the tax credit program as a “voucher” program.  It’s not a voucher program.  Vouchers come from funds given to the government, and from a budgeting perspective, could come from the state’s Education budget.  That’s giving government funds to private or faith-based schools, which is completely different from how a tax credit program works.  Further, the voucher means that the school accepts the voucher as complete payment for their services.  Parents should not be expected to pay additional costs for technology fees, books, transportation…nor should they be expected to participate in fundraising activities or pay development fees.

Well guess what?  Those parents that do those things and don’t qualify for vouchers get upset and leave.  That means that most of the children in the school are on vouchers, and, if the school relies on tuition to operate, receiving no tuition as income is the first step to potential closure.

But how can that be, since the school is full of voucher-qualified students?  Easy.  If there’s more revenue needed, there are two choices.  Development is one of those.  Additional work by the school so that alumni and their families, businesses, and community members become donors to keep the school operating.  However, many of those people might see the school getting vouchers, and decide not to contribute to the school’s sustainability.

The other choice – which would also happen if the voucher program goes away – is closure…which is something the program was supposed to help prevent in the first place.