American Experiment speaks up for education choice

Center of the American Experiment, along with 18 other state think tanks and nearly 50 school choice and scholarship groups, recently sent a letter calling on Congress to provide dedicated funding and tax policy changes to prevent massive non-public school closures during the coronavirus pandemic. While the K-12 education provisions included in the CARES Act rightly provide equitable services to private schools, it is important this equal access continue in future stimulus proposals.

According to the most recent data available by the National Center for Education Statistics, 5.75 million students attended 34,580 private schools across the country in 2015-2016. Because private schools do not receive state formula-driven funding and rely on family tuition payments and philanthropy, an alarming number of private schools face closure due to financial challenges and income loss that COVID-19 has caused.

Should such closures happen, all students—in both public and private schools—would be impacted, and public school districts would be financially impacted as well. With their learning environment disrupted, a number of students would be forced to transfer to public schools in the fall, placing more financial burden on states and districts already projecting major budget shortfalls. According to The Foundation for Excellence in Education, if 20 percent of private school students have to be reabsorbed into the public system, it would cost the public system roughly $15 billion. 

But there are several ideas for Congress to consider including in the next COVID-19 relief package that will help ensure all students impacted by this health care crisis have access to quality educational opportunities.

Equitable services. Language in future stimulus proposals should continue to ensure that education funds and resources purchased with federal funds are shared equitably with the private school community, similar to the Every Student Succeeds Act and Individuals with Disabilities Education Act. The CARES Act is an emergency relief fund, and rightly provided equitable services to all private schools. We request that all schools, public and private, impacted by this national emergency continue to have equal access to any additional emergency K12 education funding.

Tax policy. Both temporary and long-term tax policy changes could be considered to provide support for families’ education expenses, including K-12 tuition, and to encourage long-term philanthropic aid.

Temporary education tax credit — Provide families with a 50 percent tax credit on K-12 private school tuition for tax years 2019 and 2020.

Temporary charitable tax deduction — Allow parents an above the line tax deduction by designating K-12 private school tuition payments as a contribution to a non-profit. As the 2019 tax deadline has been extended, this deduction or credit could even apply to last year for an immediate savings for families. The deduction or credit could be means-tested.

Immediate Relief and Longer Term Tax Credit Policy — Modify the existing Education Freedom Scholarships legislation to include a one-time emergency grant for states to use for tuition scholarships to address the immediate needs of distressed private school families. The grant amount, per state, could be tied to ESEA Title IIA calculations. States receiving these emergency grants would continue the scholarship programs beginning in 2021, funded by corporate and individual contributions to instate, non-profit scholarship granting organizations, for which they would receive a federal tax credit. The scholarships could be used for an array of educational options, including private school tuition, online courses, tutoring, career and technical education.

529 Accounts — Allow 529 accounts to be utilized for K-12 homeschooling and other educational expenses.

ESAs or microgrants. Given the continued uncertainty ahead, making federal education funding for children portable could offer parents the resources they need to ensure continuity and make up for learning losses that could carry over into the next school year. Families should have access to funding through means-tested Education Savings Accounts (ESAs) or emergency micro-grants to supplement the costs of educating their child at home, assist families in need with tools and technology to support distance learning, and to provide compensatory educational services due to the disrupted school year. The ESAs or microgrants could be provided through a newly created mechanism or through existing mechanisms (e.g., via electronic benefits transfer cards used for SNAP benefits).

Many of these initiatives could be funded by setting aside 10 percent of any new federal COVID19 relief funding provided to public schools, which would be consistent with the overall population of private vs. public students in the country.

Read the full letter American Experiment signed on to here.