North Carolina Approves Universal School Choice

North Carolina passed a budget that allows education funding to “follow a student” to public or private school.

Universal School Choice — or having publicly-funded education dollars follow a student to either public or private school — is growing nationwide, with varying means of implementation.

There are three main ways states have expanded school choice:

  • Education savings accounts (ESAs): let parents use an allocation of public money to cover a wide range of education expenses, including private school tuition and homeschooling costs;
  • Vouchers: provide a set amount of money to cover private school tuition; and
  • Tax credit scholarship programs: allow businesses and individuals to receive tax credits for donations to organizations that provide private school scholarships.

North Carolina is the most recent state to adopt school choice using the ESA model. The North Carolina legislature passed a state budget on September 22 with bipartisan support that, among other things, would establish an education savings account (ESA) for any family that wants to opt for private education over the state’s public system. Funding for the program would increase each year, reaching $520 million by 2032.

North Carolina is now the ninth state with universal school choice, and, according to the education reporting site The74, the North Carolina program will be the second largest in the country after Florida’s:

With amounts ranging from $3,200 to $7,500 per child, depending on family income, the program is expected to be the second largest in the nation, after Florida’s.

Arizona, Arkansas, Florida, Iowa, Utah, and West Virginia implemented universal school choice programs similar to the North Carolina model, while other states have enacted slightly different versions. Oklahoma, for example, has a universal tax credit program, and Ohio has a universal school voucher program. In Indiana, on the other hand, the “family income ceiling for a voucher is set so high that it’s nearly universal.”

It is expected that roughly 80 percent of the 126,000 students in North Carolina’s private schools will take advantage of the new ESA option. Unlike Arizona’s program, however, homeschooling is ineligible under the North Carolina ESA, which only allows funding to follow students to private schools.

Reporting from The74 on North Carolina’s bill noted opposition to ESAs:

Opponents argue that universal ESAs hurt funding for public schools and largely go to families whose children never attended the public system rather than those seeking to escape failing schools.

With these concerns top-of-mind, Governor Roy Cooper declared a state of emergency over the bill and called it a “bad budget that seriously shortchanges our schools.”

Additionally, and similar to opponents of vouchers in other states, the North Carolina legislation drew opposition from advocates concerned that the plan will significantly hurt schools in rural areas:

Ann Wolf, president and executive director of Public School Forum, an advocacy group that opposed the bill.

“Eighty of our 100 counties are rural,” she said. “Our schools are the hub of so many of our communities.”

Where does Maryland stand?

Similar bills have been introduced and failed in Maryland, not moving from their assigned committee. One of those bills, HB 569 from the 2023 legislative session, took the North Carolina approach.

That bill would have taken the per-pupil funding required in Maryland and split by county and state governments to follow a student from public school to private school. This means that some public funding for Maryland’s public education system, including a portion of the local county share, would instead be funneled to private institutions. HB 569’s fiscal and policy note reads:

This bill creates the Education Savings Account (ESA) program in the Maryland State Department of Education (MSDE) to provide grants to families to defray specified costs related to nonpublic schooling for eligible students. Participating students are included in the enrollment count used to calculate required State and local education aid for local school systems. The State must deposit specified amounts of per pupil State and local education aid in each participating student’s account, with each county reimbursing the State for the local share deposited.

HB 569 and similar bills have drawn opposition from various public education advocacy groups, including the Public School Superintendents’ Association of Maryland (PSSAM), the Maryland State Education Association (MSEA), which represents teachers across Maryland, and the Maryland Association of Boards of Education (MABE).

Stay tuned to Conduit Street for updates on this and other education funding and school policies.

Read more about the North Carolina bill and ESAs.