----

##  The Prospects for Education Vouchers after the Supreme Court Ruling.            ERIC Digest.                                                                 

In June 2002, newspapers were full of headlines about how the U.S.              Supreme Court had approved vouchers for America's schools. In fact,             the Supreme Court had only considered the legal status of a small               voucher program in Ohio, the Cleveland Scholarship and Tutoring                 Program. It ruled that the program does not offend the                          Establishment (of religion) Clause of the U.S. Constitution--even               though over 90 percent of the voucher students attended religious               schools. The majority opinion was premised primarily on the need to             expand school "choice" and the fact that the Cleveland program "is a            program of true private choice... neutral in all respects toward                religion. It is part of a general and multifaceted undertaking by               the State of Ohio to provide educational opportunities to the                   children of a failed school district" (see Zelman v.                            Simmons-Harris). Fundamental to public schooling--the Supreme Court             decided--should be the right to choose which school to attend. 
To             some commentators, this ruling is "as historic" as the 1954 ruling              in Brown vs. Board of Education. It has certainly spurred                       pro-voucher advocates to launch legal challenges in several other               states, including Maine and Washington, with the longer term goal of            extending voucher programs across the country. This digest examines             the prospects for voucher reforms across the U.S. education                     system. THE IMPORTANCE OF VOUCHERS IN THE U.S. EDUCATION                      SYSTEMCurrently, fewer than 20,000 American students use                    publicly-funded school vouchers in Milwaukee, Cleveland, and                    Florida. As a proportion, this figure is tiny, even when compared to            the numbers of students attending private schools (5.3 million),                enrolled in charter schools (0.6 million), or being                             home-schooled (0.8 million) (Bauman, 2002; U.S. Department of                   Education, 2002). 
Education voucher programs are neither prominent            nor popular now, but the future may be different. Whether the                   programs proliferate over the next decade will depend on three key              issues: the legal framework for vouchers, the extent of the demand              for them, and the sufficiency of the supply of schools accepting                voucher funds. THE LEGAL FRAMEWORK FOR VOUCHERSEven though one            voucher program has been given the go-ahead by the U.S. Supreme                 Court, it is not assured that all programs will be supported by                 courts. The law only declares what is permissible; it does not say              what is desirable. In the Cleveland case, vouchers were appraised in            light of the many schooling options available there, such as magnet             and community schools, and the acknowledged educational failures in             the Cleveland School District. Such conditions do not exist in all              states, or across all districts. The ruling also does not override              state proscriptions on funding to private or religious schools. In              fact, only 19 states have constitutions that would follow the                   Supreme Court ruling; another 15 have constitutions that place heavy            restrictions on voucher programs, and the remaining states could go             either way (Kemerer, 2002). 
Generally, the power of court rulings             to effect any change has been regarded skeptically: in this case,               the courts are not compelling reform, nor are they suggesting a way             to finance it. Overall, the U.S. Supreme Court decision in Summer               2002 does encourage vouchers, but there will be further legal                   challenges to statewide voucher programs. THE DEMAND FOR EDUCATION            VOUCHERSTwo primary benefits of education vouchers are expected:            more freedom of choice and more efficient and effective                         schools (Gill, Timpane, Ross, & Brewer, 2001). Freedom of choice is             enhanced because students need no longer attend their neighborhood              school. The efficiency gains from introducing vouchers have four                sources: higher achievement scores for voucher students, competitive            pressures between schools for voucher funds, more efficient schools,            and faster rates of school innovation in response to parental                   preferences. 
Three main groups might have a stake in education                vouchers: 
* Parents. There is reasonably strong evidence that                 vouchers promote greater school choice, and so make some parents                more satisfied with their children's schools, particularly if the               previous options were failing or low-performing schools (Peterson &             Hassel, 1998). Indeed, voucher programs can now be seen as                      redistributive: they help families who are least well-served under              the current education system (Howell & Peterson, 2002). 
But many              parents already face a reasonably large choice set--as high as 70               percent of parents have choice (Hoxby, 2001)--and can exercise                  choice across many dimensions (inter-district, intra-district,                  intra-school, and inter-sector). Many parents are reasonably happy              with their current public school (Moe, 2001). Parents may be                    risk-averse in changing from "standard" public schooling                        to "unknown" private schooling, where the variance in quality may be            wider. Perhaps as a reflection, the utilization rates for vouchers              are fairly low. In the Dayton, Washington, DC, and New York                     experiments, 20-35 percent of low-income voucher recipients awarded             a three-year voucher of between $1,400-$1,700 failed to use it at               all (Howell & Peterson, 2002). Of 15,000 available vouchers in                  Milwaukee, only about 9,000 have been taken after years of publicity            and expansion of supply. Thus, benefits would be limited to the                 additional choice options that would be made available and families             do actually select. 
* Tax-Payers. If the efficiency gains from                vouchers are sizeable, tax-payers would be expected to lobby for                political change to encourage their use. However, efficiency gains              from voucher programs appear modest. Voucher programs yield only                small positive achievement gains for participating                              students (Howell & Peterson, 2002). The pressures from competition              between schools induce some efficiency gains, but again the effects             are modest (Belfield & Levin, 2002). Alternatives to the traditional            public school--i.e., charter, for-profit, and private schools--do               not show clearly either greater effectiveness or greater cost                   effectiveness. Charter schools, even where regulation is lighter,               are no more efficient than traditional public schools (Miron &                  Nelson, 2002). For-profit schools often face financial difficulties,            particularly with high marketing costs and difficulties in                      establishing brand loyalty. The evidence on private schools suggests            that they serve to raise attainment (the amount of schooling) by                modest amounts, but have little effect on test scores. Even where               these schools show modest improvements over public schools in                   effectiveness (e.g., test scores), there is no clear evidence of                greater efficiency (e.g., test scores per dollar). Finally, vouchers            may promote innovation or invention or encourage the diffusion of               best-practice management, but the evidence of this is not                       widespread. Critically, any efficiency gains must be set against the            adjustment costs needed to finance and administer a large voucher               program (see Levin & Driver, 1997). 
* Homeowners. Education is                funded in large part through local property taxes, and school                   enrollments are determined by residence. Property prices reflect the            quality of local schools, so parents who want good schools have to              pay a high price for their homes. Education vouchers might break the            link between school enrollment and place of residence, thereby                  reducing the value of houses in high-quality school districts. Many             homeowners in these areas might therefore see the value of their                property fall. If this were to happen, they might be strongly averse            to the introduction of education vouchers. SUPPLY OF SCHOOLS                  WILLING TO ACCEPT VOUCHER STUDENTSIf the voucher is set at a                high value, then a sufficient supply of private schools will be                 forthcoming. However, if the voucher is set significantly below the             average per pupil expenditure of public schools, then it is                     reasonable to predict that private schools will not be overly                   enthusiastic about vouchers. For vouchers to create more choices and            promote efficiency, there would need to be a large supply of private            schools ready to accept them. Several factors will influence private            school decisions. One is the amount of surplus capacity in private              schools, although evidence suggests that economies of scale are                 exhausted at relatively small school sizes (Andrews, Duncombe, &                Yinger, 2002). Another is whether existing schools can expand to                serve new groups of students. But such an expansion may be limited              for religious schools, if they are sensitive about enrolling                    students who are imperfectly devout. Similarly, independent schools             may be sensitive to the potential or perceived loss of selectivity              from enrolling voucher students. Perhaps most importantly, however,             private schools may be cautious about taking government funds in the            form of vouchers, which could be accompanied by increased government            regulation and oversight. In law if not in practice, the government             has substantial discretion over how private schools are run, and                this law is likely to encroach further if private schools accept                voucher-funded students. Survey evidence shows more than half of all            private schools are likely to refuse to accept voucher students                 under such regulation (Muraskin & Stullich,                                     1998). CONCLUSIONIn emphasizing freedom of choice, the Supreme            Court has clearly given support to reforms involving education                  vouchers. At issue is whether this support means that the prospects             for education vouchers are bright. Undoubtedly, the ruling will                 please voucher advocates. It stresses the advantages of choice over             possible losses in social cohesion from entanglement between                    religion and government. It also corresponds well with advocates'               new, focused agenda: voucher programs for low-income families in                inner cities. And, it clarifies a debate where beforehand                       uncertainty had scared away supporters. At issue for the future is              whether these factors--when set in the context of legal constraints,            public support or opposition, and private school buy-in--are                    sufficient to tip the balance in favor of more                                  programs. REFERENCESAndrews, M., Duncombe, W., & Yinger,                  J. (2002, June). Revisiting economies of size in American education:            Are we any closer to a consensus? Economics of Education Review,                21(3), 245-262. (EJ 647 047) 
Bauman, K.J. (2002). Home-schooling              in the United States: Trends and characteristics. Education Policy              Analysis Archives, 10(26). 
Belfield, C.R., & Levin, H.M. (2002,               Summer). The effects of competition on educational outcomes: A                  review of the U.S. evidence. Review of Educational Research, 72(2),             279-341. 
Gill, B.P., Timpane, P.M., Ross, K.E., & Brewer,                     D.J. (2001). Rhetoric versus reality: What we know and what we need             to know about vouchers and charter schools. Washington, DC:                     RAND. (ED 461 917) 
Howell, W.G., & Peterson, P.E. (2002). The                 education gap. Vouchers and urban public schools. Washington, DC:               Brookings Institution. 
Hoxby, C.M. (2001). If families matter                 most, where do schools come in? In T.M. Moe (Ed.), A primer on                  America's Schools. Stanford, CA: Hoover Institution Press. (ED 460              194) 
Kemerer, F.R. (2002). The U.S. Supreme Court's decision in               the Cleveland voucher case: Where to from here? Working Paper. New              York: Teachers College, National Center for the Study of                        Privatization in Education. Available: www.ncspe.org 
Levin,                   H.M., & Driver, C.E. (1997, December). Costs of an educational                  voucher system. Education Economics, 5(3), 265-83. (EJ 559                      480) 
Miron, G., & Nelson, C. (2002).What's public about charter               schools? New York: Corwin Press. 
Moe, T.M. (2001). Schools,                   vouchers, and the American public. Washington, DC: Brookings                    Institution. (ED 453 343) 
Muraskin, L. & Stullich, S. (1998).                 Barriers, benefits, and costs of using private schools to alleviate             overcrowding in public schools. Washington, DC: U.S. Department of              Education. (ED 432 063) 
Peterson, P.E., & Hassel,                             B.C. (Eds). (1998). Learning from school choice. Washington, DC:                Brookings Institution. (ED 426 473) 
U.S. Department of Education,             National Center for Education Statistics. (2002). The condition of              education: Private schools: A brief portrait, 2002. Washington, DC:             Government Printing Office. 
CASE CITED 
Zelman v. Simmons-Harris.            No. 00-1751, slip op. (June 27, 2002). 
----- 
This Digest was                developed by the ERIC Clearinghouse on Urban Education, with funding            from the Office of Educational Research and Improvement, U.S.                   Department of Education, under contract no. ED-99-CO-0035. The                  opinions in this Digest do not necessarily reflect the position or              policies of OERI or the Department of Education.                             **Title:** The Prospects for Education Vouchers after the Supreme Court Ruling.            ERIC Digest.                                                                 **Note:** Digest number 179.                                                           **Document Type:** Information Analyses---ERIC Information Analysis Products (IAPs) (071); Information Analyses---ERIC Digests (Selected) in Full Text (073); **Available From:** ERIC Clearinghouse on Urban Education, Institute for Urban and                  Minority Education, Box 40, Teachers College, Columbia University,              New York, NY 10027. Tel: 800-601-4868 (Toll Free); Web site:                    http://www.eric-web.tc.columbia.edu.                                         **Descriptors:** Educational Finance,  Educational Vouchers, Elementary Secondary                Education, Federal Legislation,  Private Schools, School Choice,                Urban Schools                                                                **Identifiers:** Cleveland Scholarship and Tutoring Grant Prog OH, ERIC Digests,                 Zelman v Simmons Harris                                                      
###
[Return to ERIC Digest Search Page]