Education savings accounts: A flexible alternative for Texas schools
The K-12 school system in Texas is currently at a crossroads.
Since 1990, public school enrollment in Texas has grown by more than 50 percent — from approximately 3.3 million students in 1990 to 5.2 million today. The current public school system is incapable of handling the state’s growing population of 5- to 17-year-olds, and without substantial reform, students will suffer from overcrowding and a lack of opportunity to achieve their full potential. The Census Bureau projects that there will be an additional 1.6 million school-aged Texas residents by 2030. The state’s school districts simply can’t keep up with this growth, despite taking on enormous debt.
However, a recent concept that would create K-12 education savings accounts (ESAs), which would be managed by parents with state oversight, seems to be a step in the right direction. In an ESA program, the state places public funds into a participating child’s account, allowing the parent to design a K-12 plan to suit the child’s needs and interests.
These savings accounts allow parents to choose from among a variety of service providers to custom-build a K-12 education for their child. Parents can use account funds to pay for tuition at private schools, community colleges, or even universities.
Allowing parents to use public funds to send their children to private schools would disperse the student population and alleviate the problem of overcrowding. Likewise, with expanded school choice, students would have the freedom to attend schools that best suit their educational needs and interests.
Five states currently have ESA programs, much to the delight of participating parents. Facing an overcrowding problem similar to the one in Texas, Nevada lawmakers made all public-school students eligible to participate in an ESA program in 2015. Arizona, Florida, Mississippi and Tennessee also have ESA programs. These states have created provisions for parents to purchase individual public school courses, hire certified tutors and/or pay for special education services and therapies.
Parents also have the option to save a portion of funds to build assets for future higher education expenses under federal and state programs, though the usage of such funds vary by state. For example, the state of Arizona allows parents to roll over funds from year-to-year to either use the ESA for post-secondary expenses, or to make annual contributions to a federal Coverdell Savings Account. Florida allows parents to contribute to the state’s pre-paid tuition program.
Texas can lead the nation by taking the next logical step and establishing parent-managed accounts for all types of K-12 services. Education funding should go first to parents, and then to providers and schools — not the other way around. Parents know their children best and should be able to enroll them in the schools or other educational programs that best meet their needs.
And to be clear, Texas public schools wouldn’t be going anywhere.
Funding for elementary and secondary education is guaranteed in the Texas Constitution. Moreover, the state needs every current building and every current teacher it already has, in addition to new buildings and new teachers. Texas students, parents, taxpayers and schools all face problems that the overstressed public school system alone cannot hope to address under a one-size-fits-all model.
Broadening the array of options and giving parents the power to choose what is best for their children will work to the mutual benefit of students, parents, taxpayers and public schools. But first, policymakers must evaluate the challenges that lie ahead to create productive and sustainable learning environments.
The future of Texas’ children depends on it.