Proposition 305 Delayed the Modernization of the Arizona Empowerment Scholarship Program

October 30, 2018

(Guest Post by Matthew Ladner)

The Arizona Auditor General has performed an update on their review of the Arizona Department of Education’s administration of the Empowerment Scholarship Account program. Back in 2016, the Auditor General found a number of deficiencies in the Department’s oversight of the program. Two years later, they find…many of the same shortcomings. Given the proximity of a public vote on ESA eligibility and administrative modernization, this is basically like pouring a bucket of chum in shark infested waters. Overreaction is guaranteed, despite the fact that the funds discussed represent less than 1% of the total. The greatest irony here is that the bill that the Save Our Schools group placed on the ballot (thus either delaying or killing depending upon the will of the voters) took robust steps to improve the administration of the program.

ESAs are complex programs to administer, and bless their hearts the Arizona Department of Education volunteered to be the first to try. The Arizona Republic’s story on the Auditor General update includes push-back from the outgoing Superintendent of Public Instruction Diane Douglas on the Auditor General update:

State schools Superintendent, Diane Douglas said the misspending of the voucher money is the result of decisions by the Republican-controlled Legislature to deny her department money needed to properly administer the program. Douglas said lawmakers resist properly funding oversight because they want a private entity to oversee it.

“If you’re not willing to put the resources into the oversight, then it doesn’t happen appropriately,” Douglas told The Arizona Republic on Monday. 

She said her staff has “done a phenomenal job with the lack of resources.”

She criticized the audit for glossing over the Legislature’s failure to properly fund oversight.

That’s a story but not a credible one. From the outset, the Arizona Empowerment Scholarship Program has included fees for management companies as an allowable expense for accounts. While the Arizona Department of Education had no experience in managing multi-vendor accounts, there are in fact multiple private firms which have gone up and down the learning curve of managing (for instance) health savings accounts. Other states with ESA programs have contracted with these firms in order to build digital platforms so that both administrators and parents can view accounts and account transactions in real-time. They’ve also developed methodologies to prevent misspending of account funds from occurring. They do this for a very modest fee. These platforms also collect user reviews to help inform the decisions of other parents- which is the only plausible way to hold, for instance, an occupational therapist or online education provider accountable for performance.

What was requested of the department repeatedly and I know this because I myself personally all but begged them to do this on multiple occasions- was to have them hire one of these firms so as to radically improve the administration of the program. The parents would have received superior program that was easier to use, misuse of funds could be dramatically curtailed, and transparency improved. Everyone wins, and you can see this underway in Florida, where the main Gardiner Scholarship administrator (Step Up for Students) has contracted with SAP Ariba to create such a platform.

I interpreted the feedback I received as “Nah man- hold my beer! We’ve GOT THIS!” No wait I think what I was actually told was “the Superintendent is suspicious of outside vendors” which translated in practice to approximately the same outcome. In any case since then the Department’s administration of the program has looked something like:

Notice that this is not a bureaucratic turf issue. The avenue allowed left the Department of Education in charge of the program. Any outside vendor would have reported directly to them, and they could tell them what to do and hire/fire them at will within the normal confines of state contracting. The great advantage here is that these firms have decades of experience in navigating these waters and there are multiple players in the space that could compete if the state created an RFP.

The complaint about under funding of administration also rings hollow because as previous reporting from the Republic established the Department failed to spend the resources allocated for program administration by leaving funded FTE spots open. If you don’t spend the funds appropriated for you, then you don’t get to complain that you needed more funds. And by the way, the private firms with plentiful experience in managing account based program could have been funded for a very modest fee by the account holders, and would have not needed to subtract from the funds the department didn’t in any case fully spend.

Oh but it gets better.

Arizona SB 1431 from the 2017 session included a large number of items to improve the administration of the program and to increase transparency. You can read a list of these items here. In evident despair of the Department modernizing the program administration, the legislature (wisely imo) included these provisions:

Directs ADE to post on its website information and data that are updated monthly regarding ESAs that includes the following:

a)info on all purchases and expenditures made with ESA monies that does not violate the personal privacy of any student or family and that includes only aggregate date;

b)the number of enrolled students disaggregated by eligibility; and

c)any other information or data that may be pertinent to promoting transparency and accountability of the ESA program.

and…

Requires, rather than allows, the Treasurer to contract with private financial management firms to manage ESAs and directs ADE to cooperate with the Treasurer and the contracted firm.

The collection of signatures against SB 1431 by the Save Our Schools group at minimum delayed the modernization of the program in the form of Prop. 305. If the yes vote prevails, SB 1431 will take effect, whereas if no prevails it’s back to the drawing board. The polls on this provision have been mixed, and at the time of this writing it seems the proposition could go either way. Regardless of what happens at the ballot, it remains abundantly clear that program administration must be modernized.

Just as a reminder, this is the same Arizona Department of Education which mis-allocated $85,000,000 in federal title I and IDEA funds, giving some schools too much while short-changing other schools. The “blame the legislature” trick also doesn’t work here as the positions that allocate funding are funded by Uncle Sam (like every other state) but one doesn’t read stories about Montana, Oregon or (fill in the blank here) managing to make a mess of these sorts of things.

Note that the response to this has never been nor should it be “If the Department can’t administer Title I we should just get rid of it!!!!” but I’m fairly confident that I could go on to twitter right now to find this argument being made with hypocritical gusto. In fact I fear I could find this double standard being applied by the very people who delayed the modernization of the program. It’s a neat trick to prevent the implementation of solutions while continuing to complain about the problems. Let’s see what happens next.

 

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American Families Rebel Against K-12 Standardization with their Pocketbooks

September 27, 2018

(Guest Post by Matthew Ladner)

Research from Sabrino Kornrich and Frank Furstenberg tracks enrichment spending by family decile income. The above chart tracks trends in enrichment spending by the top and bottom deciles of income over time. As you can see, upper income families are enriching with increasing gusto, while lower-income families have flat enrichment expenditures.

Enrichment- coming in various forms such as tutors, club sports, Kumon, Mathnasium etc. has become increasingly ubiquitous among the posh. It seems entirely normal, but we should recognize the significance of this trend. In addition to the equity issue staring back at you in this chart, there is also something else worth noting in the data: upper-income America continues to put their children into public schools in high numbers but they are solely relying upon those schools less and less. It’s always been the case that all American families should know better than to entirely rely upon any school to provide the totality of the education of their child. Upper income families have the ability and increasing willingness to act. Jay refers to this trend as hybrid homeschooling. I think of it as a better American version of Japanese cram schools.

In places like Japan and South Korea university admission is highly selective and competitive, and families routinely send their children to what are called “cram schools” after their regular school to prepare for admission exams. Andrew Coulson made a convincing case in Market Education that these private after school programs were more responsible for Japan and Korea’s high PISA scores than their public school systems.

To which America says “I see your obsessive preoccupation with standardized test prep mania and raise you a hackerspace for kids!”

 

If that’s not your child’s cup of tea don’t worry because there are many other options. On the academic side you can get Advanced Placement coursework and textbooks for free, and take the AP exams for a shot at college credit for approximately $85 per course. That however is just academic stuff, albeit academic stuff that can earn you college credit at an amazingly low price- how about something fun like animation camp? Or museum programs? If you go to Cottageclass.com you can find all kinds of stuff- from art, music, wood shop to ethics classes.

The trend towards enrichment may in fact be in part fueled by the overreaching of standardization in public education. Jack Coons and Stephen Sugarman for instance noted in Education by Choice:

To the extent that schools of choice must conform to state imposed curriculum requirements, the principle of family control is compromised. Each centrally imposed curriculum prescription or prohibition tends to shrink the proportion of families that can be satisfied. If the state demands too much the effect will go beyond simply adding or eliminating certain courses; entire schools will be excluded. For example some preexisting private institutions would refuse to participate if sex education were required, others would refuse if it were forbidden. It seems sensible for us for the state to impose very few restrictions or mandates. In general schools should be free to please themselves and their customers.

Coons and Sugarman go on to say that in a choice system we should allow individual public school campuses to decide upon their curriculum as well. Such freedom is far more plausible in a liberal system of choice, and in the absence of that freedom local control was largely abandoned in a largely futile effort to improve outcomes through centralization. In many ways Coons and Sugarman arrived a place similar to John Stuart Mill, who had warned presciently:

All that has been said of the importance of individuality of character, and diversity in opinions and modes of conduct, involves, as of the same unspeakable importance, diversity of education. A general State education is a mere contrivance for moulding people to be exactly like one another: and as the mould in which it casts them is that which pleases the predominant power in the government, whether this be a monarch, a priesthood, an aristocracy, or the majority of the existing generation, in proportion as it is efficient and successful, it establishes a despotism over the mind, leading by natural tendency to one over the body. An education established and controlled by the State should only exist, if it exist at all, as one among many competing experiments, carried on for the purpose of example and stimulus, to keep the others up to a certain standard of excellence.

American families have deep misgivings about the conduct of public schooling, especially the modern practice of standardized testing. We should aspire to a schooling system that is a good deal more than providing test-prep custodial care for the advantaged before they move on to more genuine educational experiences after school. Likewise, the equity issue in the above chart deserves to be addressed but realistically must be addressed within a context of increasingly constrained resources. The trend towards top-down standardization in K-12 has predominated in recent decades and produced too little at too great a cost despite good intentions. It’s time for a more liberal approach that gives opportunities to educators to create schools and educational experiences, and families the opportunity to select among them. The last 40 years has gone mostly wrong, some bold states should see if Mills, Coons and Sugarman had it right.

 


Moving from Caps to Freedom for Special Needs Children in Texas

January 24, 2018

(Guest Post by Matthew Ladner)

Yours truly is in the Houston Chronicle today on the U.S. Department of Education’s finding on the special education cap in Texas. Here’s a sample:

This sad affair reminds us of aspects of human nature we might feel more comfortable forgetting. Yale psychologist Stanley Milgram ran a series of fake experiments to test the willingness of people to obey an authority figure in the early 1960s. Milgram’s experiments asked students to administer what seemed to be electric shocks to subjects who were actors. Disturbingly, a large percentage of people were willing to administer what seemed to be fatal shocks if an authority figure told them to do so.

Texas Gov. Greg Abbott and Education Commissioner Mike Morath took prompt action to end the TEA practices after the Chronicle revealed them. Education officials, however, have a long road to walk to restore broken trust. One of the best steps policymakers could take would be to make the families of special-needs children more independent of bureaucracies.

Several states – Arizona, Florida, Mississippi, North Carolina and Tennessee – have given the families of special-needs students the ability to control their own education destiny by passing Education Savings Account programs. ESAs give these students an opt-out of the public school system in lieu of a state-funded account families can use to pay for individual public school courses, therapies, certified tutors, private school tuition and other expenses.

ESAs give special-needs families the opportunity to customize the education of their child. Families participating in these programs report sky-high levels of satisfaction, and two of the pioneering states that have been expanding options for special-needs students the longest – Arizona and Florida – have also demonstrated some of the strongest academic improvement for special-needs students remaining in the public schools.


North Carolina sets special needs children free, will Texas be next?

June 22, 2017

(Guest Post by Matthew Ladner)

The North Carolina legislature has passed an Education Savings Account program for children with disabilities as a part of the budget. If the budget becomes law as expected North Carolina will become the sixth state to join the ESA family.

Next month Texas legislators will return in special session, and Governor Greg Abbott has put a choice program for special needs children on the session call. Governor Abbott quite rightly has called for a choice program as part of an effort on the part of the state to dig itself out of a deep hole with special needs parents after 12 years of secretively running a de facto cap on the number of children who would receive services. Today in the Texas Tribune I make the case for why such a program would be especially beneficial to special needs children in Texas:

Put yourself in the shoes of a special needs student or parent for a moment: Would you desire a limited set of options and cold-blooded state policies discouraging districts from meeting your needs? Or would you desire a system in which you have additional options if things don’t work out?

Lawmakers can and should take other actions to improve the dismal state of special education in the Lone Star State. However, any reform effort should include the broadening of opportunities and should not preclude other efforts. After all, children with disabilities will only have the best opportunity to thrive and flourish when they have the ability to choose their service providers.

During the same period Texas bureaucrats covertly implemented a cap, Arizona lawmakers began increasing the options for special needs children. Let’s see how that has been working out for the special needs children:

K-12 reactionaries dragged us through the court system twice trying to stop us from offering options to these students in Arizona. We had to invent an entirely new form of school choice in order to ultimately prevail. It.was.worth.it.

 


Jason Riley: The Next Step is Education Savings Accounts

March 1, 2017

 

(Guest Post by Matthew Ladner)

Jason Riley weighs in on ESAs, federalism and parental choice in his Wall Street Journal column today:

After years of federal overreach through No Child Left Behind, Common Core and Obama administration “guidance” on lavatory usage, the states—where Republicans now occupy 33 of the 50 governors’ offices—are not only reasserting local control of K-12 education but reimagining it.

In addition to this charter progress, education reformers see prospects for more private school choice in the form of education savings accounts, or ESAs, which they describe as the next step in school choice. Under an ESA system, money that would otherwise go to funding a child’s public-school education is instead placed into a restricted-use bank account, from which the family can withdraw to spend on a variety of education-related services. Like vouchers, ESAs allow the money to follow the child. But ESAs don’t limit education options in the way that vouchers do. Instead, families can use money in the account for tuition, textbooks, tutoring, test preparation, transportation, Advanced Placement courses, online learning and even college savings accounts.

Jason Bedrick, a policy analyst at the research organization EdChoice, told me that along with allowing families to tailor spending to the education needs of their children, ESAs can control costs. “Moving from a coupon or voucher model to a bank-account model helps guard against tuition inflation like we’ve seen in Pell Grants,” he said. With ESAs, “there’s no price floor. If you’ve got a $5,000 voucher, no school is going to charge less than $5,000. With an ESA, there’s a lot more competition because private schools are not just competing against each other and against public schools but also competing against other sorts of education opportunities.” In other words, a parent with an ESA has the ability to hold both public and private schools accountable.


The Florida Legislature Renames Florida ESA for Senator Gardiner over his humble objection

October 20, 2016

(Guest Post by Matthew Ladner)

In this time of cynical politics it is refreshing to see something as fantastic as this floor debate in the Florida Senate.  Earlier this year the sponsor of a bill to expand Florida’s ESA program for special needs children offers an amendment on the floor to rename the program after Senate President Gardiner, a special needs father and advocate and the original sponsor of the legislation. Gardiner objected and appealed to the Senator to drop his amendment, noting that he had promised to send the bill over to the Florida House without amendment.  Not to be thwarted, the Senators secure a release from this promise from the Speaker of the Florida House, and then the Senate co-sponsors the amendment 39-0.

There is still some good in this world Mr. Frodo- and it is worth fighting for.

UPDATE: I am told that after all of this Senator Gardiner still refused to allow the program to be named after him, so the legislature named it after his family instead.


TXESA

September 20, 2016

(Guest Post by Matthew Ladner)

The Texas Public Policy Foundation, the Texas Business Leadership Council and Excel in Ed teamed up to publish a new white paper by yours truly called The Yellow Rose The Achilles Heel of Texas: Improving College Eligibility Rates through K-12 Savings AccountsBottom line: only a minority of Texas public school students get prepared for even a moderately selective college or university, and the percentage moves to catastrophically low levels when looking at the ethnic minority student groups which now constitute a large majority of Texas students. Meanwhile an annual 90k+ of new students per year has been driving resources out of the classroom and into debt, with no end in sight and an aging population that will slow revenue growth and create new costly problems in health care and pensions.

Judging from the number of applications received in the first year of NVESA, enrollment growth in Texas could be substantially slowed by a universal ESA program, which would give the public system a chance to focus resources away from the debt spiral of constantly building new facilities and then surrounding them with portable buildings. We could expect such a system to have the well-established positive effects for both participating and non-participating students, but also represents an opportunity for low-income students especially to save and build assets for future higher education expenses.