School voucher price tag continues to climb

Many public schools in Wisconsin had their first day of classes today- the first school year under the new statewide voucher expansion plan, which allows for state aids from any public school district in Wisconsin to move to the voucher school that child may attend. With this in mind, State Senate Democratic Leader Jennifer Shilling released a document she received from the Legislative Fiscal Bureau which totals up the added costs of the state’s various voucher program since Gov Walker’s first budget was signed in July 2011, and the tax write-off resulting from a new deduction for private school tuition for those too rich to get a voucher.

The result is a whole lot of taxpayer dollars have been poured into voucher schools, a figure that is slated to reach nearly $500 million in this upcoming budget, and a figure Shilling notes will total $1.1 billion from 2011-2017. That number is in stark contrast to public schools, who saw aid reductions from Gov Walker in his first budget, and only had meager amounts added back in the last two budgets, barely reaching the rate of inflation. Now to be fair, some of that money to vouchers will be offset by aid reductions to the public school districts that lose voucher students (yay?), but as you’ll see, that only takes care of a fraction of the $1.1 billion Shilling cites for the 6 budgetary years of the Age of Fitzwalkerstan.

I’ll start with the previous 4 years, which expanded the already-existing Milwaukee voucher program to the Racine School District in 2011-13 (when the Joint Finance Co-Chair was…future Assembly Speaker Robbin’ Vos of ALEC Racine County). Then the Racine model was taken statewide in the 2013-15 budget.

2011-2015 added costs to taxpayers from voucher programs

Milwaukee Voucher Program
State tax dollars for vouchers $651.0 million
Reduction in MPS state aid $232.6 million
TOTAL COST TO STATE TAXPAYERS $418.4 million

Racine/Statewide Voucher Program
State tax dollars for vouchers $37.6 million
Reduction in Racine/other districts’ state aid $1.8 million
TOTAL COST TO STATE TAXPAYERS $35.8 million

You’ll note that most of the statewide program didn’t have aid reductions in the first years (conveniently not taking effect until after the 2014 elections for Governor), but there are significant changes in the aid reduction measures for the 2015-17 biennium, especially for districts outside of Milwaukee. We’ll let LFB explain.

To partially offset the cost of the Milwaukee program to the state, the Department of Public Instruction (DPI) is required by law to reduce the general aid for which the Milwaukee Public Schools (MPS) is eligible by a percentage of the estimated total cost of the program. However, beginning in the 2013-14 school year, the MPS aid reduction will be reduced by 3.2 percentage points in each year until no aid reduction is made beginning in 2024-25. The reduction was equal to 32% in 2014-15. MPS can levy to make up for the aid reduction, less the amount of any high poverty aid MPS receives.

For the Racine program, DPI was required to reduce the general aid for which the Racine Unified School District (RUSD) was eligible by 38.4% of the estimated total cost of the Racine program in the 2011-12 and 2012-13 school years. RUSD was permitted to levy to make up for the aid reduction. No aid reduction applied for the Racine or statewide choice programs in the 2013-14 or 2014-15 school years. Under the provisions of 2015 Act 55 (the 2015-17 biennial budget), the cost of per pupil payments for pupils who begin participating in the Racine or statewide choice programs in 2015-16 or later will be fully offset by a reduction in the general aids of those pupils’ school districts of residence. School districts will not be permitted to levy to make up the aid reduction, but will be able to count incoming choice pupils for general aid and revenue limit purposes.

Note the differences between the MPS and statewide voucher programs, where MPS at least gets to keep some of the state aid that’s taken away from it by vouchers (of course, they also lose much more aid than all the other schools combined), but all other districts do not. MPS also can tax to make up the difference (which likely means Milwaukee residents pay higher taxes just to maintain current levels of service at MPS), but every other district cannot, which will often mean school cuts and larger class sizes for districts that have kids who leave for voucher schools. It’ll also make the upcoming school budget season VERY interesting after the attendance reports come back in late September which help to determine final aid levels for the 2015-16 school year.

So here’s how these numbers change in the current 2015-17 biennium.

2015-17 added costs to taxpayers from voucher programs

Milwaukee Voucher Program
State tax dollars for vouchers $405.8 million
Reduction in MPS state aid $110.2 million
TOTAL COST TO STATE TAXPAYERS $295.6 million

Racine/Statewide Voucher Program
State tax dollars for vouchers $88.2 million
Reduction in Racine/other districts’ state aid $48.2 million
TOTAL COST TO STATE TAXPAYERS $40.0 million

TOTAL COST TO STATE TAXPAYERS 2011-17 $789.8 million

The other part of the equation is the private school tuition break, another ALEC bill that was championed by now-Congressman Glenn Grothman in 2013, among others. This deduction kicked in for the first time in tax year 2014, and the LFB explains how it works.

The deduction was limited to tuition expenses of up to $4,000 per year per pupil enrolled in kindergarten through grade eight and $10,000 per year per pupil enrolled in grades nine through twelve. The pupil who is the subject of the deduction must be a dependent, for federal income tax purposes, of the individual claiming the deduction. It is estimated that individual income tax collections will be decreased by $30 million annually under this provision beginning in tax year 2014.

I’ll also add that the tax filer who gets a write-off from the private school deduction also can still write off the property taxes they pay for their local school district (not a bad way to double-dip, eh?), and the local district loses the state aid they would have received from having that kid in a public school.

Since the first Fiscal Year being hit by this new deduction is 2014-15, that means there will be 3 years of the private school tuition deduction by the end of this biennium, so add another $90 million to our previous number for vouchers, which brings total net cost of the ALEC policies to Wisconsin taxpayers from 2011-2017 to $879.8 million.

And these voucher moves are slated to grow above its current 2-year cost of $395.6 million in the upcoming budget, as the aid reduction associated with MPS’s voucher program goes down, and the statewide voucher program has its enrollment limits go up in future years. So not only is it likely that public school kids are seeing larger classrooms and less-experienced teachers in those classrooms, but also that Wisconsin taxpayers are paying a lot more out of their pockets because of the pro-voucher policies put in place by Scott Walker and the WisGOP Legislature.

If you don’t find this to be an acceptable outcome, understand that the only way this changes is if the elected officials are changed. Because those elected officials of the Wisconsin GOP are owned by ALEC, Wisconsin voucher bagman Scott Jensen, and other privatization backers, and they will not do the right thing when it comes to education policy. Know this, and work to remove these money-funnelers from power.