Day 16 - Voucher fiscal impact
Voucher opponents argue that Rep. Steve Urquhart’s voucher bill (HB 148) is bad policy because the official fiscal impact is about $9 million. Some opponents argue that the fiscal impact would be even higher.
Here’s what they are not telling you
The fiscal analyst’s methodology has one serious omission: when calculating costs to educate students in public schools, the model does not include costs covered by local property tax dollars. The fiscal analyst has always argued that his/her job is to calculate costs and savings to the STATE budget, which excludes property taxes. (However, the legislative fiscal analyst includes local fiscal impacts when a bill is proposed that would cut local taxes).
As a result, the fiscal analyst’s model excludes a very large portion of taxpayer savings when students transfer from public schools to private schools because of vouchers. In FY2005, expenditures from local sources (primarily property taxes) were $2,237 per student. In FY2008, the first year the voucher will be available, the amount will be much higher, probably around $2,500. By understating taxpayer savings by $2,500 per student, the official fiscal note severely overstates the impact of the proposed voucher bill.
We don’t know how many students the fiscal analyst is projecting will switch to private schools because of a voucher. If the amount is 3,600 students or higher, the voucher fiscal note turns positive if the $2,500 savings per student is accounted for.
Are there other problems with the fiscal note methodology? Maybe, but unless we get a chance to look at the model and the assumptions underlying the model, we’ll never know.
But what about fixed costs?
Voucher opponents argue that there will be no savings because education costs are fixed. Let’s start off by acknowledging that fixed costs are not an issue in areas experiencing enrollment growth. There are no fixed costs associated with buildings that have not yet been built, teachers that have not yet been hired, and equipment that has not yet been purchased.
Regarding districts with declining enrollment, we’ll cover that next week.