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Think Tank: Vouchers Have Saved Taxpayers $1.7 Billion

The various school voucher programs created around the United States since 1990 have saved taxpayers over $1.7 billion since their inception, argues a new report from a school choice group. With 505,000 vouchers dispersed in that time frame, the total averages out to about $3,400 per voucher student, per year.

The report was released Tuesday by the Friedman Foundation for Educational Choice, an education reform organization founded by Nobel-winning economist Milton Friedman which primarily advocates for the creation of school voucher programs. It looked at ten different voucher programs that were created in six states and the District of Columbia from 1990 through 2010. Twelve additional voucher programs created since 2010 were not a part of the research.

The alleged savings occur when the money spent on a voucher is less than the variable cost of educating the student receiving it in a public school. For example, Ohio’s Educational Choice Scholarship Program offers vouchers to students who attend failing public schools to attend private schools instead. In 2011, the average variable cost for a student at one of the eligible  failing schools was calculated to be $7,776, while the average cost of a voucher was only $3,855, a difference of $3,921. With 13,733 students participating in 2011, that year’s savings are calculated to be almost $54 million.

According to the report, savings are rapidly increasing as more programs are created and more students participate. While all existing voucher programs saved under $100 million throughout the 1990s, by 2011 annual savings were above $300 million and rising by tens of millions a year.

“As policymakers consider ways to balance their state budgets in 2015, school vouchers absolutely must be a part of their toolkits,” Robert Enlow, President of the Friedman Foundation, said in a statement. “Parents already are demanding school choice. Taxpayers should be, too.”

Researchers took pains to ensure the savings could be calculated properly. Many public education costs, such as the cost of buildings and facility maintenance, are largely fixed in the short term and do not reduce even when enrollment drops. To avoid finding savings where none would actually occur, the researchers only considered the average expenditures on areas such as teacher salaries and student supplies that track enrollment more directly even in the short-term. The report also attempts to factor in the cost of students who would have attended private schools even without a voucher, and who thus cost the state extra money rather than creating savings.

While opponents of vouchers often argue the programs divert funds away from the majority that still attends public schools, the report’s author says vouchers often wind up helping public schools as well.

“Voucher savings typically are plowed right back in to the public school system,” author Jeff Spalding said. “Taxpayers have no idea that vouchers are generating a savings for public education budgets.” Enlow added, however, that more transparency is needed in state governments to adequately track what ultimately ends up happening with voucher savings, since the Foundation found no instances of governments returning them to taxpayers via tax breaks.

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