THE QUESTION Should the state make yearly payments of $4,000 or more per student in kindergarten through twelfth grade, for use as tuition in private or religious schools? PROVISIONS This measure would:
BACKGROUND AND ANALYSIS In the 1998-1999 school year in California around 5.8 million students enrolled in public schools and 0.6 million students enrolled in private schools (69 percent of them in religious or church schools). For several years about 10 percent of California students have attended private or religious schools. Only schools with six or more students are counted; home-schooled students are not in this private school student count but may be eligible for the $4,000 voucher. The average cost at for-profit private schools is $5,500 yearly per student. The cost of religious or church schools is less, since churches often subsidize their schools. Under Proposition 38, when private school tuition is less than the voucher amount, the excess is saved in a special account that parents can later use to pay for a private school that costs more than the voucher amount. California spending per student in 1998-1999 was $5,627, and the national average spending was $6,638. Spending for California schools is limited by Proposition 13, which restricts the amount available from property taxes, and a law more than 20 years old that limits the amount each school district may receive. Proposition 98, which the voters approved in 1988, raised the limit by guaranteeing a minimum amount for grades kindergarten through 14. Projected growth in the California economy and increases in the number of public school students will result in an increase in yearly funding for public schools under Proposition 98. The funding calculation defined in Proposition 38 is different than the standard funding calculation used in state and national education documents. The standard calculation is based on yearly operating expenses, which exclude capital expenses and payment of debt such as bonds for school buildings. The calculation in Proposition 38 includes all funds to support grades kindergarten through twelfth grade, including federal, state, local, and unrestricted funds, and also payments on bonds or other debt. The California Legislative Analyst's Office has calculated the spending per student, using the method defined in Proposition 38, as almost $8,000 yearly. Proposition 38 would permit the legislature to replace the current public school funding guarantee of Proposition 98 with funding per student at the national average or more. In 1999-2000, 71,058 students were enrolled in private kindergartens. The phased approach of Proposition 38 means that in the first year of this program over $284 million ($4000 per student) would be paid out for children who are already attending private kindergartens. In 2004-2005, when vouchers would be phased in for all private and religious school students (K-12), the cost of vouchers (at $4,000) for the 640,802 students already enrolled in private schools in 1999-2000 would be more than $2.5 billion. Proposition 38 would save money when students currently attending public school, or new kindergarten students who would have attended public school, choose to attend private schools. The amount saved would be the difference between the spending in public schools and the $4,000 voucher. The Legislative Analyst's Office estimates the amount saved in the public schools at $7,000 per student based on all funding, and the difference as $3,000. A California Budget Project Budget Brief and the California Legislative Analyst's Office analysis have both compiled estimated ranges under various scenarios. Because of the many unknowns, these estimates vary widely. The California Budget Project's Budget Brief says that state costs would increase under all scenarios. For example, if 5 percent of students transfer from public to private schools, the total net costs to the state in 2004-2005 would range from $2.3 to $3.5 billion. If 20 percent of the students transfer, the costs would range from $4.2 to $4.9 billion. Their calculation of the net costs, including savings in the public schools based on 10 percent of students transferring, would be $3 billion in 2003-2004. The estimate from the Legislative Analyst's Office shows long-term net costs of about $2 billion yearly if 5 percent of students transfer, and a net savings of $700 million if 15 percent of public school students transfer. Improving the performance of students in California is important. In 1997-1998, average SAT scores were:
Whether academic performance would improve if California students move from public to private schools is unknown. Proposition 38 provides for standardized testing of the students in private schools that accept vouchers, but does not specify which tests. It does not require that the same tests be administered in all California private and public schools to provide an accurate comparison. In 2004 a High School Exit Examination will be required for students graduating from twelfth grade in public schools. Proposition 38 provides no exit requirements for students graduating from private schools. State funding for religious schools under Proposition 38 may be challenged as violating the separation of church and state. Voucher systems for private and religious schools in other states have been challenged in the courts. Historically, no state has such an extensive scholarship system with government funding for private schools as would occur with Proposition 38. Currently, voucher or scholarship systems include only a very small number of students, usually for special-needs students. Therefore, no historical data exists to predict results in the long term for the voucher system in Proposition 38. FISCAL EFFECT Proposition 38 would greatly change the funding for California schools. The estimated yearly cost for the first several years from the Legislative Analyst's Office ranges from no additional costs to $1.1 billion. Long-term cost estimates from the Legislative Analyst's Office show savings of $3.4 billion to costs of $2 billion. There are other cost savings to the state including reduced teacher retirement contributions and reduced capital expenses. There are also other fiscal considerations such as the loss of federal education funds. There would be administrative costs for the voucher program. IMPACT OF YES OR NO VOTE A YES vote means the state should make yearly payments of $4,000 or more per student in kindergarten through twelfth grade for tuition in private or religious schools. A NO vote means students in California private schools would not receive state funding (except for a small number of special-needs students). SUPPORTERS SAY
OPPONENTS SAY
SUPPORT AND OPPOSITION Ballot arguments in support are signed by Carmela Garnica, Teacher, Escuela de la Raza Unida; Tim Draper, parent; John McCain, United States Senator. Other supporters: National Tax Limitation Committee and Bishop Charles Blake. Ballot arguments in opposition are signed by Lavonne McBroom, President, California PTA; Lois Wellington, President, Congress of California Seniors; Wayne Johnson, California Teachers Association. Other opponents: Governor Gray Davis, Lieutenant Governor Cruz Bustamante, Superintendent of Public Instruction Delaine Eastin, American Association of University Women, Association of California School Administrators, California State Board of Education, League of Women Voters of California, and others. For more information: Supporters: Pat Rosenstiel, Prop38yes, School Vouchers 2000, 310-394-2952; email: campaign@voucher2000.com, website: www.38Yes.com Opponents: No on Prop 38 committee, 916-442-4406; email: info@NoVouchers2000.com, website: www.NoOnProp38.com
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