How ALEC and Promoters of Privatization Are Helping Legislators Rip Off State Governments

In her story on Iowa’s tuition tax credit program in yesterday’s NY Times, Dana Goldstein explains: “Iowa is one of 31 states where legislators have proposed creating or expanding school choice programs this year, without Washington even lifting a finger.”

Knowing that the U.S. Secretary of Education, Betsy DeVos, is a great fan of school privatization through vouchers, tax credits, education savings accounts and the expansion of unregulated charter schools, we might wonder how and why all this school choice expansion Goldstein describes is happening without any assistance at all from DeVos and Congress.

Goldstein mentions one of the primary factors, the American Legislative Exchange Council: “In 2013 and 2014, the most recent years for which financial disclosures are available, several organizations associated with Ms. DeVos invested over $7 million in school choice lobbying efforts in states now considering new bills.  Americans for Prosperity, the activist group founded by the Koch brothers, and the conservative American Legislative Exchange Council are also pushing private school choice in statehouses across the country.”

One cannot possibly review too often the role of the American Legislative Exchange Council (ALEC) in state politics. If your state legislature is one of the 31 states now considering some form of school vouchers, your representatives are probably considering one of ALEC’s model laws.  ALEC is what is known as a bill mill, a membership organization that pairs member state legislators with corporate member lobbyists and representatives of far-right advocacy organizations promoting school privatization; these people collaborate in writing model bills that can then be introduced by ALEC-members in the legislative chambers of the 50 states. Members of ALEC’s Education Committee have cooked up a number of model bills to choose from: the Special Needs Scholarship Act, the Foster Child Scholarship Program Act, Opportunity Scholarships, the Smart Start Scholarship Program, the Education Savings Account Act, and the Great Schools Tax Credit.  The outrageous irony about ALEC is that, despite a long-running legal challenge from Common Cause, it is still considered by the IRS to be an educational, not a lobbying, organization.

Goldstein reminds us that vouchers don’t really serve very many students across the United States, despite that they drain a lot of money from states’ public education budgets: “The number of American students benefiting from private school programs now is relatively small. Estimates by EdChoice, the organization founded by Milton Friedman, the University of Chicago economist who first introduced the idea of vouchers, put the number at 446,000 this year, out of a total school-age population of 56 million. Three million attend public charter schools, which Ms DeVos also has championed and which generally do not accept vouchers.” (This blog has disputed proponents of charters who dub the schools, “public.” Although charter schools are publicly funded, they are always privately operated and have been considered in several court challenges as private contractors.  Because charter schools are publicly funded and tuition-free, students at charter schools have no need to carry a tuition voucher of any kind.)

Goldstein profiles a parent, Mary Kakayo in Des Moines and her participation in Iowa’s already-operating, tuition tax credit program.  Ms. Kakayo would also like to benefit from the newer education savings account program now being considered by Iowa’s legislature: “Tuition credit scholarships like the one that helps pay tuition for Ms. Kakayo’s daughter…. allow individuals and corporations to receive credit on their state income taxes for donations to nonprofits that provide tuition aid to students. Iowa’s program, currently used by 11,000 students, has income limits—$73,000 for a family of four—and the average scholarship award is only $1,583.” We learn that the Kakayos personally pay tuition of $85 per month on top of their tuition tax credit.

Goldstein continues: “Iowa is one of the states where legislators this year proposed education savings accounts, an even more expansive benefit. The accounts (would) give parents state money each year—under one proposal, in the form of a $5,000 debit card—that they can use on private school tuition, home schooling costs, online education or tutoring.  Ms. Kakayo said she would welcome further tuition support from the state, which would allow her to save money for college for Alma and her younger sister….  Under one proposal, after a student graduates from high school, any money left in the account could be used for tuition at in-state colleges.”

Goldstein describes the concerns of opponents of the tuition tax credit program and the proposal being considered for education savings accounts: “Opponents have called the programs a giveaway to religious institutions. All but five of the 140 schools currently participating in the (Iowa) program are Catholic or Protestant, and the Diocese of Des Moines is among those lobbying for the expansion… Opponents also point out that private schools are allowed to reject some of the neediest students, like those who have severe disabilities or are lagging behind their grade level.”

Goldstein examines the financial implications for Iowa’s public schools: “Under the most far-reaching proposal, the new education savings accounts would be available to every child in Iowa without income caps, and include the over 40,000 who are already enrolled in private schools or home schooling.”  She adds: “School districts and some legislators also were concerned that if parents of privately educated students suddenly had access to thousands of dollars in state education money, public schools could be significantly affected financially.”  So far no bill being considered in Iowa has moved far enough for a vote in either of Iowa’s legislative chambers.

To see what might happen if Iowa were to expand these programs, one need only look to Indiana. In late December Emma Brown of the Washington Post reported:  “Indiana’s legislature and then-governor Mitch Daniels first approved a limited voucher program in 2011, capping it at 7,500 students in the first year and restricting it to children who had attended public schools for at least a year.” After Mike  Pence was elected governor in 2012, “Indiana lawmakers eliminated the requirement that children attend public school before receiving vouchers and lifted the cap on the number of recipients. The income cutoff was raised, and more middle-class families became eligible. When those changes took effect, an estimated 60 percent of all Indiana children were eligible for vouchers and the number of recipients jumped from 9,000 to more than 19,000 in one year.  The proportion of children who had never previously attended Indiana public schools also rose quickly.” Chalkbeat Indiana reported two weeks ago that the number of students who have never attended public school, that is children who are already enrolled in religious or private schools, who are now using vouchers has risen to 54.6 percent. “The state’s voucher program is one of the largest in the nation, and more than 34,000 students received vouchers in 2016-2017…  To qualify for a voucher that is 90 percent of state tuition dollars, a family of four can’t earn more than $44,955 per year.  For a 50 percent voucher, a family of four can earn up to $89,910 per year. Under the most recent draft of the state’s next two-year budget, Indiana is expected to spend $146 million in 2017 and potentially $163 million in 2019….”

Launching vouchers or tax credits or education savings accounts as part of a state’s education plan is a zero-sum game. Vouchers and tax credits are always a way to redirect some of a state’s public school budget to a privatized alternative. It has never happened that legislators have increased taxes significantly to cover a new voucher program and at the same time protect a state’s investment in the public schools. School privatization undermines the public system even as a parallel system of schools is created. Indiana demonstrates clearly just how vouchers and tax credits are likely to swallow a state public school budget to pay private school tuition for families who have never even considered enrolling their children in public schools.

Fraud and corruption have not been the major problem with vouchers and tuition tax credit programs. The financial scandals have been more prevalent in the charter school sector where money is to be made by the for-profit management companies—profits that can be invested through political contributions that block sufficient oversight by state government to prevent self-dealing that violates the public interest.  Vouchers have primarily provided tuition  to religious schools, which have been less involved in overt ripoffs of tax dollars. However, in the NY Times earlier this month, Kevin Carey profiled a problem in one state where vouchers have involved self dealing and enormous profits:

“Steve Yarbrough is one of the most powerful men in Arizona. As president of the State Senate, he has promoted a range of conservative policies, including a tuition tax credit system that provides over $100 million per year to finance vouchers for private schools.. But Mr. Yarbrough is not just a champion of tax credit vouchers. He also profits from them personally… State tax credit voucher programs have grown rapidly in recent years. The number of students receiving them increased to 256,000 this year from about 50,000 in 2005. Arizona has one of the oldest and largest programs… The Arizona Christian School Tuition Organization (ACSTO) is one of the state’s largest voucher-granting groups. From 2010 to 2014… the group received $72.9 million in donations, all of which were ultimately financed by the state. Arizona law allows the group to keep 10 percent of those donations to pay for overhead. In 2014, the group used that money to pay its executive director $125,000. His name?  Steve Yarbrough… Yet the group doesn’t do all the work involved with accepting donations and handing out vouchers. It outsources data entry, computer hardware, customer service, information processing, award notifications and related personnel expenses to a private for-profit company called HY Processing.  The group paid HY Processing $636,000 in 2014, and millions of dollars in total over the last decade. The owner of HY Processing? Steve Yarbrough, along with his wife, Linda, and another couple.  (The “Y” in “HY Processing stands for ‘Yarbrough.’)”

Carey explains: “(I)t’s not clear that states can be relied upon to prevent self-dealing. Mr. Yarbrough’s personal financial interest in tax credit vouchers first received wide attention in 2009…. Yet in the years since, Mr. Yarbrough has continued to be paid hundreds of thousands of dollars from overhead funds.”  And as president of the Arizona senate, “He also supported the expansion of the tax-credit system.”

Last week when the PBS NewsHour profiled Indiana’s school voucher program, Dr. Wendy Robinson, Fort Wayne’s public school superintendent warned: “You have established a totally separate school system on the back of a structure that was intended for public schools.” “I’m worried that people aren’t alarmed. Public education is the backbone of this country.”

Many Predict Trump-DeVos Will Privatize with Tuition Tax Credits, Not Plain Old Vouchers

Everyone is wondering exactly how President Donald Trump’s and Secretary of Education, Betsy DeVos’s plans for expanding privatization of public education will play out. Two upcoming events may provide more details.  It has been predicted that the President will lay out his priorities when he releases his budget proposal in mid-March. Even before that, however, in a major address tomorrow to a joint session of Congress, he has said he’ll outline his policy priorities. Here is Politico commenting on what is expected from tomorrow’s address: “White House officials said that after a first month driven almost entirely by policies they could enact unilaterally, the joint congressional address will focus on work the White House wants done on Capitol Hill during the rest of 2017.”

The President and his education secretary have said they will expand the privatization of education but how that will happen isn’t yet clear. One member of the House of Representatives has already introduced a bill to eliminate the federal education law, the Elementary and Secondary Education Act (now called the Every Student Succeeds Act) entirely and redirect the money now spent on Title I, ESEA’s primary program, to a school choice expansion. Others predict that Trump and DeVos will expand the one existing federal voucher program in Washington, D.C.

Some have suggested that Trump will convince Congress to go back to tinker with ESSA and pass a program Lamar Alexander and other conservatives endorsed back in 2015, Title I Portability—the idea that each poor child would be able to carry a designated amount of extra money to any public school that child chose to attend. Title I Portability was never broadly endorsed in Congress, however, because it would defeat the primary purpose of Title I, which was designed to address concentrations of poverty in particular school districts.  Schools educating concentrations of children whose families are extremely poor face an overwhelming set of challenges.  In its excellent (2010) book, Organizing Schools for Improvement, the Consortium on Chicago School Research documented the challenges for schools in neighborhoods where over 90 percent of children live in extreme poverty: “An endemic concern for urban schoolteachers are the students in their classrooms with extraordinary personal and social needs. Many urban children live under unstable home and community circumstances, including homelessness, domestic violence, abuse, and neglect. In such circumstances, a most basic need for healthy child development—stable, dependable relationships with caring adults— may not always be present… At both the classroom and the school level, the good efforts of even the best of educators are likely to be seriously taxed when confronted with a high density of students who are in foster care, homeless, neglected, abused….” (pp. 172-173)

It now appears more likely, however, that while Trump is likely to enlarge the federal Washington, D.C. voucher program, any program on a national scale will expand school choice through tuition tax credits.  Here is Valerie Strauss of the Washington Post: “Is there enough support in Congress to close the Education Department and create a federal voucher program for America’s schoolchildren?  No, according to people on Capitol Hill who are familiar with the issue, though a pilot federal voucher program is possible. Still, Trump has said he wants to spend $20 billion in federal funds to expand school choice, and the Hill sources said this could come in the form of a federally funded scholarship tax credit program that would be part of a Trump-promised reform of the U.S. tax code… Scholarship tax credit programs offer lucrative tax credits to individuals and corporations donating to nonprofits that provide money for students to use for tuition at private and religious schools and public schools outside a student’s designated district.  There are now 17 states with programs that offer scholarship tax credits… including Florida, the state that DeVos has frequently mentioned as a model for the kind of reform she is seeking.” (This blog covered the range of voucher, tax credit, and education savings account programs here.)

A tax credit plan would be easier to pass in Congress according to Caitlin Emma at Politico, “A federal tax credit scholarship program could be part of a larger tax reform bill and pass through the budget reconciliation process with only 51 votes in the Senate.”  Diverting Title I funds, by contrast, would require an appropriations bill, that could potentially be filibustered and require 60 votes.

You might wonder how tax credits could damage the public schools, if they merely divert tax dollars to private schools without affecting already-existing federal public school programs. Here is how this would likely work out. While the federal government provides less than 10 percent of school funding, states are a primary funder of public schools, covering about half of school spending. Any federal tax credit program would very likely be designed to incentivize states to launch new tuition tax credit programs or expand existing programs. And establishing or expanding state tax credits would reduce the amount of tax dollars flowing into the states’ public education budgets.  Here is how David Berliner and Gene Glass define tuition tax credits in their book, 50 Myths and Lies That Threaten America’s Public Schools: “There are tax credits and then there are tax deductions. They are very different things. Suppose you and your spouse have an income of $100,000…. And suppose that the federal income taxes you owe… amount to about $25,000 a year. If you take a tax deduction for your contribution of $1,000 to the Red Cross, that will reduce your tax indebtedness by about $250. Not so with tax credits… If you and your spouse live in a state with a state income tax (and a tuition tax credit program)… then you can direct $1,000, say, of your state income tax to the My-Pet-Project fund, and your state income tax indebtedness will be reduced by the full $1,000.” (p. 188)

Jeff Bryant quotes Kevin Welner of the National Education Policy Center explaining more about how such schemes  work: “Welner explains, tax credit scholarship programs are a ‘money-laundering mechanism’ that inserts into the transaction a third party—often called a school tuition organization (STO). Instead of taxpayer money being distributed directly to parents as vouchers, credits are issued by the state when tax deductible donations go to an STO. That credit then becomes scholarship money for parents to pay for private school tuition.”

Meanwhile, as Trump and DeVos move forward with some kind of expansion of vouchers or tax credits, in the NY Times, Kevin Carey just published a scathing critique based on three new research reports on the performance of traditional school voucher programs that have been operating for some time in a number of states.  Carey reports on a new study of the Indiana voucher program, created by Governor Mitch Daniels and rapidly expanded by Mike Pence when he was Indiana’s governor. The new research confirms that Indiana students who have moved to voucher schools “experienced significant losses in achievement” in mathematics and no improvement in reading.  Another 2015 study, this time in Louisiana, documents “negative results in both reading and math” when students used a voucher to transfer to a private school. Then this past June, “a third voucher study was released by the Thomas B. Fordham Institute, a conservative think tank and proponent of school choice. The study, which was financed by the pro-voucher Walton Family Foundation, focused on a large voucher program in Ohio. ‘Students who use vouchers to attend private schools have fared worse academically compared to their closely matched peers attending public schools,’ the researchers found.  Once again, results were worse in math.”

Carey concludes: “The new evidence on vouchers does not seem to have deterred the Trump administration, which has proposed a new $20 billion voucher program.  Secretary DeVos’s enthusiasm for vouchers, which have been the primary focus of her philanthropic spending and advocacy, appears to be undiminished.”

These new voucher studies would not surprise Christopher and Sarah Lubienski, professors at the University of Illinois, who, in their 2014 book, The Public School Advantage, explain: “We were both skeptical when we first saw the initial results: public schools appeared to be attaining higher levels of mathematics performance than demographically comparable private and charter schools—and math is thought to be a better indicator of what is taught by schools than, say, reading, which is often more influenced directly and indirectly by experiences in the home. These patterns… held up (or were ‘robust’ in the technical jargon) even when we used different models and variables in the analyses… (T)he data show that the more regulated public school sector embraces more innovative and effective professional practices, while independent schools often use their greater autonomy to avoid such reforms, leading to curricular stagnation.” (pp xvii-xviii)

How Can Schools Be Voucherized? Let Us Count the Ways… and the Consequences

School privatization via vouchers has been endorsed by President Donald Trump. Private school vouchers are also a favorite cause of Vice President Mike Pence and the new Secretary of Education, Betsy DeVos.  Most of us are not particularly familiar with vouchers in general because they have until now been a project of state governments. We are likely to know about what’s happening in our own state, but perhaps be unaware about trends across the states. Did you know, for example, that school vouchers are called by a number of names?

5 Names Politicians Use to Sell Private-School Voucher Schemes to Parents is a short resource that clarifies how all these programs work: “(V)ouchers divert taxpayer dollars away from public schools—starving them of the critical funding needed for students to thrive—only to use these funds to subsidize private and/or religious schools.  However, voucher proponents, like (Betsy) DeVos and politicians found in your state almost never call them vouchers. Instead, they attempt to mislead parents, taxpayers, and voters by re-branding these plots to drain and defund public education with some pleasant-sounding, flowery name plucked from the school-choice lexicon—Opportunity Scholarships—Parental Choice Scholarships—Tuition Tax Credits—Charitable Tax Credits—Education Savings Accounts.”

NEA explains that Opportunity and Parental Choice Scholarships give parents public money to use for tuition (and sometimes transportation, fees, and equipment) at private and parochial schools.  Because these vouchers are insufficient to pay for tuition at a great many traditional private schools which charge as much as private colleges, vouchers are frequently used by parents of students at religious schools.

According to the National Conference of State Legislatures, the only federally funded voucher scholarship program is the one in the District of Columbia. Congress has never been able to muster the support to enact vouchers federally—only in Washington, D.C. where, perhaps not coincidentally, the residents lack a voting Congressional representative. Vouchers, which began in Milwaukee back in 1989, have grown steadily as statehouses have tipped toward domination by the far right. Today, according to the National Conference of State Legislatures, 14 states plus the District of Columbia have plain old voucher (scholarship) programs in which students are given a publicly funded coupon to cover tuition at a private or parochial school: Arkansas, Florida, Georgia, Indiana, Louisiana, Maryland, Mississippi, North Carolina, Ohio, Oklahoma, Utah, and Wisconsin, along with Maine and Vermont which have both had longstanding tax scholarship programs for children in isolated rural areas lacking public school districts.

Tuition Tax Credits are also a kind of vouchers. Here is how David Berliner and Gene Glass define tuition tax credits in their book, 50 Myths and Lies That Threaten America’s Public Schools: “There are tax credits and then there are tax deductions. They are very different things. Suppose you and your spouse have an income of $100,000…. And suppose that the federal income taxes you owe… amount to about $25,000 a year. If you take a tax deduction for your contribution of $1,000 to the Red Cross, that will reduce your tax indebtedness by about $250. Not so with tax credits… If you and your spouse live in a state with a state income tax (and a tuition tax credit program)… then you can direct $1,000, say, of your state income tax to the My-Pet-Project fund, and your state income tax indebtedness will be reduced by the full $1,000.” (p. 188) For parents in states with tuition tax credits, the pet project is the education of their own children, but some states also have broader Charitable Tax Credits for education—tuition tax credit programs that allow individuals and corporations to contribute to state school tuition organizations that then make scholarship grants to students to pay for their tuition at private schools.

The National Conference of State Legislatures reports that as of December 2016, 17 states offered different types of tuition tax credits: Alabama, Arizona, Florida, Georgia, Indiana, Iowa, Kansas, Louisiana, Montana, Nevada, New Hampshire, Pennsylvania, Oklahoma, Rhode Island, South Carolina, South Dakota and Virginia.

The National Education Association defines another—the newest—kind of vouchers: Education Savings Accounts: “Education Savings Accounts (ESA) are the latest trend in publicly subsidized private school education… (T)he common factor is that these programs pay parents all or a large portion of the money the state would otherwise have spent to educate their children in exchange for an agreement to forego their right to a public education. Funds deposited into such accounts may be used for any number of expenses, including private school tuition, fees, textbooks; tutoring and test prep; homeschooling curriculum and supplemental materials; special instruction and therapeutic services; transportation; and management fees. These programs also permit parents to roll over unused funds for use in subsequent years and to invest a portion of the funds into college savings plans.” In Education Savings Account voucher plans, the state itself deposits funds in parents’ accounts, and the parents can shop around for particular services, perhaps split among a number of vendors.

According to the National Conference of State Legislatures, as December 2016, only 5 states had such programs—Arizona, Florida, Mississippi, Nevada, and Tennessee, though Nevada’s program is on hold because the state supreme court found its funding system unconstitutional.

Vouchers of all forms have arrived in the 50 state capitols in the form of bills cooked up elsewhere and then introduced by sympathetic legislators who are members of the American Legislative Exchange Council (ALEC). ALEC, a membership organization, pairs member state legislators with corporate lobbyist members and with members who represent special interests—in the case of vouchers, the ideologues from the American Federation for Children (Betsy DeVos’s organization), and the Friedman Foundation, now called EdChoice—to create model laws that can then be handed to member state legislators to be introduced in any state. ALEC is often dubbed a bill mill.  ALEC’s model bills for various kinds of vouchers include a Special Needs Scholarship Program Act, The Foster Child Scholarship Program Act, Opportunity Scholarships, the Smart Start Scholarship Program, the Education Savings Account Act, and the Great Schools Tax Credit Act.

Here is Carol Burris, executive director of the Network for Public Education, in a recent column commenting on what vouchers do to public school funding. This time the example is Mike Pence’s home state, Indiana: “Vouchers drain state tax dollars, creating deficits, or the need for tax increases. When Indiana started its voucher program, it claimed it would save taxpayers money. Not only did that not happen, the state’s education budget is now in deficit, and the millions shelled out for vouchers grows each year. Last year, vouchers cost the taxpayers of Indiana $131.5 million as caps and income levels were raised. Indiana now gives vouchers to families with incomes as high as $90,000 and to students who never attended a public school.” Burris adds that while the program was passed, “promising that it would help poor and lower-middle class families find schools they like for their children… as it turned out, five years after it began, more than half of the state’s voucher recipients have never attended Indiana public schools and many vouchers are going to wealthier families, those earning up to $90,000 for a household of four.”

Last week, writing for the Los Angeles Times, Milwaukee journalist, Barbara Miner shared her insights after observing the Milwaukee voucher program since its beginning: “For more than a quarter-century, I have reported on the voucher program in Milwaukee: the country’s first contemporary voucher initiative and a model for other cities and state programs, from Cleveland to New Orleans, Florida to Indiana.  Milwaukee’s program began in 1990, when the state Legislature passed a bill allowing 300 students in seven nonsectarian private schools to receive taxpayer-funded tuition vouchers. It was billed as a small, low-cost experiment to help poor black children, and had a five-year sunset clause. That was the bait. The first ‘switch’ came a few weeks later, when the Republican governor eliminated the sunset clause. Ever since, vouchers have been a divisive yet permanent fixture in Wisconsin.” “Since 1990, roughly $2 billion in public money has been funneled into private and religious schools in Wisconsin, and the payments keep escalating.” “Today, some 33,000 students in 212 schools receive publicly funded vouchers, not just in Milwaukee but throughout Wisconsin. If it were its own school district, the voucher program would be the state’s second largest. The overwhelming majority of the schools are religious.”

A serious problem, reports Miner, is that voucher schools are not required to protect the civil rights of their students, including the rights guaranteed by federal law in all public schools: “Because they are defined as ‘private,’ voucher schools operate by separate rules, with minimal public oversight or transparency. They can sidestep basic constitutional protections such as freedom of speech. They do not have to provide the same level of second-language or special-education services. They can suspend or expel students without legal due process. They can ignore the state’s requirements for open meetings and records. They can disregard state law prohibiting discrimination against students on grounds of sex, pregnancy, sexual orientation, or marital or parental status.”

Miner warns, “Wisconsin has sunk so deep into this unaccountable world that our voucher program not only turns a blind eye toward discrimination in voucher schools, it forces the public to pay for such discrimination… Privatizing an essential public function and forcing the public to pay for it, even while removing it from meaningful public oversight, weakens our democracy.”

Nevada Education Savings Account Vouchers Ruled Unconstitutional by Nevada’s Supreme Court

In a short brief, the National Education Association concisely defines Education Savings Accounts—the kind of school voucher program that was found unconstitutional by the Nevada Supreme Court last week:

“Education Savings Accounts (ESA) are the latest trend in publicly subsidized private school education… (T)he common factor is that these programs pay parents all or a large portion of the money the state would otherwise have spent to educate their children in exchange for an agreement to forego their right to a public education. Funds deposited into such accounts may be used for any number of expenses, including private school tuition, fees, textbooks; tutoring and test prep; homeschooling curriculum and supplemental materials; special instruction and therapeutic services; transportation; and management fees. These programs also permit parents to roll over unused funds for use in subsequent years and to invest a portion of the funds into college savings plans.”

Education Savings Accounts are advocated by the American Federation for Children (Betsy DeVos’s organization) and the Friedman Foundation.  The American Legislative Exchange Council (ALEC) has a model Education Savings Account bill ready to be introduced in any state legislature. (If you are unfamiliar with ALEC, check out this post.) As of 2015, NEA reported that five states—Arizona, Florida, Nevada, Mississippi and Tennessee—had passed legislation to establish Education Savings Accounts.

Nevada’s program was said to be the most radical. In June of 2015, after Nevada’s law was passed, Lyndsey Layton and Emma Brown reported for the Washington Post: “Starting next school year, any parent in Nevada can pull a child from the state’s public schools and take tax dollars with them, giving families the option to use public money to pay for private or parochial school or even for home schooling… Nevada’s law is singular because all of the state’s 450,000 K-12 public school children—regardless of income—are eligible to take the money to whatever school they choose.” While most voucher programs are designed for poor and special needs students, every student in Nevada was going to be able to take $5,100 (or $5,710 for special education students) and use the money for her or his parents’ choice of educational services. The only demand: the student must have been enrolled in a public school for at least 100 days in order to qualify.

Of course, a big problem loomed: this plan was guaranteed to break the public education budget of the state and to destroy the public schools. The program was never fully implemented, as legal challenges were immediately filed, although the Las Vegas Review-Journal reports that 8,000 families had applied to participate.

And in its decision last week, the Nevada Supreme Court found the program’s funding, not the program itself, unconstitutional. By denying the program’s funding, however, the supreme court’s decision will effectively end the program. The Education Law Center, part of the pro-bono legal team in this case, commented on the significance of the Nevada Supreme Court’s decision: “The Court’s ruling makes clear that the Nevada Legislature violated a constitutional prohibition against the use of public education funding for any purpose other than the operation of the public schools. The ESA voucher program would have diverted funds from the public schools for private education expenditures. This decision strikes at the heart of the ESA voucher program, which was designed to remove significant amounts of funding from public school budgets to pay for private school tuition and other expenses, even for the wealthy.  The court’s sweeping ruling permanently blocks the program from being implemented in the future.”

Supporters of Nevada’s Education Savings Account program have pledged to find another funding mechanism. They have explained that the court did not specifically find Education Savings Accounts unconstitutional and instead merely rejected the way Nevada funded the program. For the program to be resurrected at this point, Nevada’s legislature would have to create a funding stream entirely separate from Nevada’s education budget for this particular program.

What is clear is that with support from far right advocates and even a model bill from ALEC, other state legislatures will be introducing plans for Education Savings Accounts.  And not all state constitutions have specific language prohibiting the diversion of state education funds away from the public schools.

VP Nominee Mike Pence Brags He Supported ALEC “Before It Was Cool”

After the Republican convention in Cleveland, Mike Pence, the Republican nominee for Vice President of the United States, went home to Indiana, where he is governor, and made a speech to the annual meeting of the American Legislative Exchange Council (ALEC).  Here is a description from James Briggs, a reporter for the Indianapolis Star: “First, Gov. Mike Pence returned home to Indiana from the national campaign trail. Then, he came home to his base. Pence on Friday addressed a room full of kindred spirits at the American Legislative Exchange Council. The free-market policy group concluded its three-day annual meeting at the JS Marriott in Downtown Indianapolis.  ‘You are the model for Washington, D.C., after this election,’ Pence told the room….”

Pence’s description of ALEC as a model ought to terrify anyone who knows anything about the American Legislative Exchange Council. ALEC is a sort of dating service that pairs member corporate lobbyists with member state legislators. Too often the corporate lobbyists are the primary authors of ALEC’s model bills.

Here is how New York’s Common Cause describes ALEC in a recent report: “Through the American Legislative Exchange Council (ALEC), some of the nation’s largest companies invest millions of dollars each year to pass state laws putting corporate and private interests ahead of the interests of ordinary Americans. ALEC’s membership includes some 2,000 state legislators, corporate executives and lobbyists.  ALEC brings together corporate lobbyists and state legislators to vote as equals on model bills, behind closed doors and without any public input, that often benefit the corporations’ bottom line.  These model bills are then introduced in the state legislatures across the country….”  ALEC’s effort to undermine government and promote privatization through “model” laws that can be adopted by any state legislature is underwritten by corporations along with some of our nation’s wealthiest political investors, and it pairs state legislators with the corporations that stand to gain from legislation their lobbyists help design.

Briggs of the Indiana Star continues: “Pence’s speech… was light on references to Trump and heavy on ALEC’s bread and butter: state government.  ALEC is an influential policy group that drafts model legislation for statehouses across the country.  Pence joked that he was ‘for ALEC before it was cool.'”  Briggs quotes Pence “telling ALEC members he came to ‘say thank you for the work all of you have done in state legislatures.’ He urged those in attendance to use the November election to make the federal government reflect politically conservative states such as Indiana.”

Writing for PR Watch, Jessica Mason and Lisa Graves describe Pence’s record of pushing ALEC’s priorities in Indiana: “As Governor, Pence appointed an ALEC staffer to his cabinet, and pushed parts of the ALEC agenda into law, such as anti-worker bills like repealing the prevailing wage and privatizing public schools in various ways.  He even sent a letter to state legislators urging them to join ALEC, which is widely described as a corporate bill mill. ALEC is funded by Koch Industries, Peabody Energy, huge global tobacco and drug companies, and other corporations that pay a premium to access ALEC lawmakers.”

The PR Watch report explains: “School privatization proponents have slowly been dropping the pretense that the ‘school choice’ movement is about helping underprivileged children.”  Last week’s convention featured a workshop on education titled: ‘The Path to Universal Choice: From Theory to Passage to Implementation.”  And at ALEC’s annual meeting last week, delegates considered new model bills that can be disseminated across the states to make it harder to close poor performing charter schools: “Two new bills being considered by what ALEC now dubs its ‘Education and Workforce Development Task Force’ could help poorly performing charters stay open without having to improve. Under the Assessment Choice Act, instead of using a uniform assessment for students statewide, charters’ authorizers would take their pick from a ‘menu’ of tests, unlike traditional public schools. If propping up test scores isn’t enough to save a charter from closure, the ‘Student and Family Fair Notice and Impact Statement Act’ promises to add new hurdles. Before closing or restructuring a charter school, this act would not just require that families be notified. It would also create a public hearing process in which parents, teachers, and ‘experts’ could give testimony about the school, and the charter board would be allowed to suggest a response plan. In case it wasn’t obvious that the bill is meant to keep the charter in operation, the drafter of that model bill added: ‘[drafting note: it should be clear the school can present an alternative for supporters of the school to rally around.]'”

Members of the Indiana State Teachers Association rallied during Pence’s address to protest the governor’s long affiliation with ALEC and his decision to address ALEC’s annual convention.  Think Progress reporter, Casey Quinlan notes that under Pence and his predecessor as governor, Mitch Daniels, ALEC has increased its legislative membership in Indiana by 40 percent.

The American Legislative Exchange Council is currently granted 501(c)3 educational nonprofit status by the Internal Revenue Service.  We all need to join Common Cause and others who have been working to press the IRS to treat ALEC as what it really is: a lobbying organization.

Southern Education Foundation Traces Tax Funded Segregation via Vouchers, Tax Credits

While schools remain highly segregated by race across the United States, the de jure kind of segregation in which Southern states had explicit laws to separate white from African American children was eradicated during two decades’ of civil rights struggles that followed the 1954 Supreme Court decision in Brown v. Board of Education.  As the Brown precedent was used to test and overturn segregation statutes across the South, one of the responses was to offer various tax credits to families whose children moved to the private, white segregation academies.  In a major report released at the end of March, Race and Ethnicity in a New Era of Public Funding of Private Schools, the Southern Education Foundation traces that history as a backdrop for an up-to-date investigation of the role of private schools today as segregationist escapes for white children and the implications of the expansion of tax credits and vouchers to support private schools that virtually exclude African American, Hispanic and American Indian children.

Here is a bit of the history recounted in the report: “From 1954 to 1964, Southern state legislatures enacted as many as 450 laws and resolutions attempting to block, postpone, limit, or evade the desegregation of public schools.  A large number of these acts were aimed at re-directing public resources, including those in the public school system, to benefit private schools.”  But such statutes were eventually overturned by the early 1970s: “Each of these enactments supporting private schools, even indirect efforts like tax credits shrouded in non-racial language were invalidated by federal courts or abandoned by Southern states that faced likely court challenges because the bills were seen as indirect, covert efforts to evade or disrupt public school desegregation….”

Today, according to this report, beginning in the 1990s, nineteen states have once again passed vouchers or tuition tax credits to pay students’ tuition at private schools including nine states across the South: Alabama, Florida, Georgia, Louisiana, Mississippi, North Carolina, Oklahoma, South Carolina and Virginia: “Most legislation adopted and considered to fund private schools in the Southern states in recent years has been introduced and supported with the stated purpose of improving educational opportunities and success for low income students, many of whom are students of color, especially African American and Hispanic students.”  The report notes that most of these states “do not collect or publicly provide reliable data that includes reporting of the race and ethnicity of students who attend private schools with public funding.  For this reason, there is no verifiable means at this time to determine accurately the demographic characteristics of private school students whose attendance has been subsidized by state funds….”

The Southern Education Foundation therefore considers another question as a proxy for the unavailable documentation that would identify the number of children of color receiving vouchers and tax credits: “(W)hat is the role of private schools in comparison to public schools, in educating students of color in the South and the nation?” After all: “Unlike public schools… private schools… are often entirely free to decide which children to admit as students, so long as the schools adopt a non-discriminatory policy and publicly declare that they do not discriminate on the basis of race, color, or national origin.  Therefore, an analysis of enrollment patterns among white students in private schools throughout the 50 states can advance an understanding of the choices that private schools have made, with and without public funding, in selecting students to admit.”

What are the report’s findings?

  • Across the South, from 1998 to 2012, the percentage of white private school students exceeded the number of total white students in the region by 20 percentage points, twice the margin in the rest of the nation.
  • Across the U.S., from 1998 to 2012, the number of all students enrolled in private schools declined slightly for both white and students of color.
  • A third measure is what the report calls “virtual segregation” of white students—white students comprising 90 to 100 percent of a school’s enrollment.  “In 2012, white students were far more likely to be educated in virtual segregation in private schools than in public schools. “Forty-three percent of the nation’s private school (white) students attended virtually all-white schools in contrast to 26.9 percent of public school students.”  In South Carolina, 63 percent of white students in private schools were being educated in extremely segregated settings compared to 5 percent of the state’s public school students. The difference in Mississippi is 56 percent segregation of white students in private schools vs. 15 percent in the public schools.
  • The report adds another category: virtual exclusion—the number of white students attending private schools with 10 percent or less students of color. “Nearly two-thirds of white students attending private schools across the 50 states were in schools that virtually excluded African American, Hispanic, and Native American students.”  Again South Carolina led the states with 84 percent of white students in South Carolina’s private schools attending schools that exclude children of color.  Delaware came in second with 72 percent of white private school students attending schools with a virtual absence of racial-ethnic minorities.  “Seven of the ten states with the largest measures of racial exclusion in private schools were in the South… The percentage of white students in private schools in the 15-state South exceeded the percentage in the public schools by 37 percentage points.”

The report’s conclusion: “Today… private schools in nine states of the South, and eight other states including Kansas and Arizona in the rest of the nation have begun to receive special public funding through vouchers and/or state tax credits.  As a result, private schools receiving special public funds are no longer entirely private, no longer free of special government support.  With the special public funding of vouchers and tax credits, private schools should have a higher pubic duty to observe higher public standards—higher standards of non-discrimination—than before.  In other words, public funding of private schools, directly or indirectly, should… mean that token desegregation and ‘schools for whites’ among the private schools in the South and other sections of the nation are no longer acceptable as a matter of law or practice… The predominance of virtual segregation and virtual exclusion, which this study documents in private schools in the South and beyond, is clear and convincing evidence that private schools are failing to achieve a practice that meets a reasonable public standard for non-discrimination.”

ALEC Relentlessly Cashes in on Kids and their Public Schools

The Chicago and Detroit and Philadelphia school districts are out of money due to political fights in their statehouses. Privatization through charters and vouchers continues to grow.  States adhere to the supply-side theory that prescribes radical tax cutting as the only way to attract jobs and grow the economy.  States rank and rate school districts and create policies that explain low achievement in the very poorest districts by castigating the schools and blaming the teachers.  I hope those of us who know better will stay informed, get organized, and continue to lift our voices, because the forces on the other side have constructed and funded an institutional framework to ensure that their policies get enacted by the legislatures across the states.  And as more and more states have school vouchers, for example, that give tax dollars to families to fund private and parochial schools, vouchers become normalized in the public’s mind and the idea that something is wrong with public education becomes normalized as well.  It is unsettling that none of this is being probed in the ongoing political campaigns for President.

This coherent, calculated effort to undermine government and promote privatization—being rolled out through “model” laws that can be adopted by any state legislature—is underwritten by corporations along with some of our nation’s wealthiest political investors, and it pairs state legislators with corporations that stand to gain from legislation their lobbyists help design.  It is called ALEC—the American Legislative Exchange Council.

Here is how New York’s Common Cause described ALEC in a report last year: “Through the American Legislative Exchange Council (ALEC), some of the nation’s largest companies invest millions of dollars each year to pass state laws putting corporate and private interests ahead of the interests of ordinary Americans. ALEC’s membership includes some 2,000 state legislators, corporate executives and lobbyists.  ALEC brings together corporate lobbyists and state legislators to vote as equals on model bills, behind closed doors and without any public input, that often benefit the corporations’ bottom line.  These model bills are then introduced in the state legislatures across the country….”  Some people have described ALEC as a dating service that pairs corporate lobbyists and state legislators. Too often the corporate lobbyists are the primary authors of ALEC’s model bills.

Is your state legislature considering passing Right to Work legislation to destroy the right of workers to unionize?  One of ALEC’s model bills is the “Right to Work Act.”  Here are titles of just some of ALEC’s other model bills: “The Great Schools Tax Credit Program Act” (tuition tax credits are a kind of school voucher); “Public Charter School Operations and Autonomy Model Legislation”; “The Virtual Pubic Schools Act”; “The Charter Schools Act”; “The Special Needs Scholarship Program Act” (another voucher plan);  “Public Charter School Funding and Facilities Model Legislation”; “Education Savings Account Act”; “The Next Generation Charter Schools Act”; “Alternative Certification Act”; and the “Parent Trigger Act.”

The Center for Media and Democracy and its PR Watch and its ALEC Exposed project have set out to demonstrate how ALEC operates across the states.  Here is how PR Watch’s Brendan Fischer describes ALEC’s activity during 2015: “Despite widespread public opposition to the corporate-driven education privatization agenda, at least 172 measures reflecting American Legislative Exchange Council (ALEC) model bills were introduced in 42 states in 2015… ALEC’s education task force has pushed legislation for decades to privatize public schools, weaken teacher’s unions and lower teaching standards.  ALEC’s agenda would transform public education from a public and accountable institution that serves the public into one that serves private, for-profit interests.  ALEC model bills divert taxpayer money from public to private schools through a variety of ‘voucher’ and ‘tuition tax credit’ programs.  They promote unaccountable charter schools and shift power away from democratically elected local school boards.”

ALEC’s model bills use a number of strategies to push an idea like vouchers forward.  Many of them seem targeted to very small groups of students, and they are usually not called “vouchers.” ALEC’s bills don’t always get passed, but legislative members of ALEC are relentless about keeping the legislative conversation focused on ALEC’s priorities. Here is how Fischer describes various voucher bills introduced across state legislatures in 2015: “ALEC has cooked up a variety of means of gaining ground on school privatization…. A handful of ALEC bills claim to offer ‘scholarships’ for sympathetic populations—like students with disabilities or foster kids—but are actually targeted voucher programs….  One ALEC bill, the Special Needs Scholarship Program Act, carves out vouchers for students with special needs, regardless of family income.  Nine states—Arkansas, Florida, Georgia, Missouri, Mississippi, North Carolina, New York, Oklahoma, and Rhode Island—considered similar legislation in 2015…. Another ALEC bill, The Foster Child Scholarship Program Act, would create a voucher program specifically for children in foster care, and was introduced in Missouri.  ‘Opportunity Scholarships,’ introduced in four states—Illinois, Missouri, New Jersey, and New Mexico—earmark vouchers for students in schools deemed ‘failing.'”

Once smaller bills are passed, there are relentless efforts to expand them.  The original Milwaukee voucher program, passed in the 1990s, was promoted to support access to private and parochial schools for Milwaukee’s poorest children.  Now under Governor Scott Walker, vouchers have been expanded statewide and the income requirement allows families with income above the statewide median to qualify.

Here is how Fischer describes the Center for Media and Democracy’s methodology in preparing its recent report: “CMD reviewed thousands of bills introduced in state legislatures in 2015 to assess whether they contained language consistent with ALEC bills.  In determining that there were at least 172 ALEC models within state bills—that is, bills containing key provisions consistent with ALEC’s legislative agenda—CMD examined both stand-alone and omnibus measures.”  At the end of his report, Fischer lists the bills state-by-state and identifies those that passed.

According to Fischer’s report on ALEC’s 2015 activity, it isn’t only corporations that fund ALEC by paying corporate dues for their lobbyists: “One of ALEC’s biggest funders is Koch Industries…. The Kochs have had a seat at the table—where the private sector votes as equals with legislators—on ALEC’s education task force via their ‘grassroots’ group Americans for Prosperity and their Freedom Partners group…. The Kochs also have a voice on ALEC’s Education Task Force through multiple state-based think tanks of the State Policy Network, ALEC’s sister organization, which is funded by many of the same corporations and foundations and donor entities.”  The State Policy Network includes such far-right state think tanks as the Buckeye Institute in Ohio, the Mackinac Center in Michigan, and the John Locke Institute in North Carolina.  Fischer describes additional ALEC allies including Dick and Betsy DeVos’s American Federation for Children and its affiliate the Alliance for School Choice and the relentless Lynde and Harry Bradley Foundation of Milwaukee that “has spent more than $31 million promoting ‘school choice’ nationwide between 2001 and 2012.”

One huge irony is that the Internal Revenue Service considers ALEC a tax-exempt, educational nonprofit instead of classifying it as a lobbying organization.  In 2012, Common Cause filed an IRS complaint to challenge ALEC’s status.  As the NY Times reported in Conservative Nonprofit Acts as a Stealth Business Lobbyist, ALEC defended itself by arguing, “that it provides a forum for lawmakers to network and to hear from constituencies that share an interest in promoting free-market, limited-government policies.  Lobbying laws differ by state, and ALEC maintains that if any of its members’ interactions with one another happen to qualify as lobbying in a particular state, that does not mean ALEC, as an organization, lobbies.”  The NY Times report continues: “ALEC, which is registered as a public charity under section 501(c)(3) of the tax code, traces its roots to 1973, when the conservative activist Paul M. Weyrich and several other Republicans sought to create a state-level clearinghouse for conservative ideas.  Although its board is made up of legislators, who pay $50 a year to belong, ALEC is primarily financed by more than 200 private-sector members whose annual dues of $7,000 to $25,000 accounted for most of its $7 million budget in 2010.”