Voucher Initiative: What Will It Cost?

Californians are leery of the fiscal implications of Proposition 174, the statewide initiative on the Nov. 2 ballot that would supply parents with taxpayer-supported vouchers worth about $2,600 that could be used at private or parochial schools. Would it save money, or just add to costs? The arguments on both sides, unfortunately, have been extreme.

Voucher supporters claim that there would be billions of dollars in taxpayer savings. Foes say that it would immediately decimate public school funding. The honest answer, according to the likes of RAND Corp. and Policy Analysis for California Education, is that this depends on many factors, such as how many youngsters transfer.

It depends on the availability of slots in the private schools, on where those slots are geographically, on whom the private schools accept, and on whether there are matches. Will the supply, for example, react in concert with demand? Will voucher schools open in South-Central L.A. if the demand is there? If the demand comes from handicapped kids, will voucher schools be opened for them, or for language-minority children? No one really knows, and that makes Proposition 174 a very shaky rack on which to hang one’s hat.

Experts say that eventually the state could be exposed to enormous costs if huge numbers of students already in private schools became eligible for vouchers under the provisions of Proposition 174. (Currently there are 540,000 children enrolled in private schools in California.) That cost was the primary factor cited by Gov. Pete Wilson in his recent and welcome decision to oppose Proposition 174.

The break-even point, in which there would be no additional cost because of the initiative, would be a 17% to 20% transfer rate of students from the public schools. That means that close to 1 million of the state’s public school students would have to transfer to voucher-redeeming schools to offset the cost of the state’s funding of students moving to those schools. In other words, private school enrollment would have to triple over the next two years to pay for that outlay.

If transfers out of public schools exceeded those figures, there would be money that could be returned to state residents as lower taxes. The Legislature could decide to invest it in other services, or it could be reinvested in the public schools. If that happens, there will not be any savings from this entire enterprise, with the exception of what might be saved in public school construction costs.

The bottom line is that Proposition 174 is fraught with uncertainties and potential problems that are difficult to predict. To us, that’s reason enough to vote against it.