Public Dollars, Private Schools

For the vast majority of America’s children, going to school has changed little from their parents’ generation, even their grandparents’: Where you live is where you learn, in a school run by your local public school district. But last year, Arizona functionally declared its school-aged students free agents, putting parents, not real estate agents, in control of directing where and how their children are educated. In time, the effect could be as disruptive to K-12 public education as the transfer portal and “name, image and likeness” deals have been to college athletics.

More than a decade ago, Arizona passed a first-in-the-nation education savings account (ESA) law with eligibility restricted mostly to families of children with special needs. Last September, Arizona expanded the program, adding $1 billion in funding for public education and giving every parent the power of the purse—putting in their hands 90 percent of the state’s share of education spending, an average of $7,000 per child, which parents can use to pay for tutoring, online education, or other authorized educational expenses—including private school tuition.

If lawmakers assumed that setting families free with a backpack full of cash would create a market for quality private school operators to open or expand, their faith is about to be rewarded. Arizona’s most successful charter school operator, Great Hearts Academies, which operates 42 charter schools in Arizona and Texas, has quietly been courting churches and pastors to partner in a network of private Christian academies aimed at low- and middle-income families, with tuition paid almost entirely with ESA funds. Great Hearts officials confirm they will shortly begin recruiting families to schools in the network, dubbed Great Hearts Christos. Plans call for three church-based schools to be opened in the Phoenix area this August.

“This is our response to the legislation,” said Great Hearts Chairman and CEO Jay Heiler, who compared Arizona’s ESA expansion to the law authorizing charter schools nearly 30 years ago. “Parents may now directly receive and direct funds to support their child’s education. And that directs us to the creation of private schools in response to that policy.”

By expanding the state’s ESA to permit universal eligibility, Arizona becomes the most interesting public education state in the nation and an emerging laboratory for innovative school choice policies and programs. The state has long shown a stronger appetite for choice than nearly every other U.S. state. Much of this has to do with who avails themselves of choice options in Arizona.

Nationally, the best-known charter schools tend to serve mostly low-income families of color in inner cities long beset by educational failure. In Arizona, however, Great Hearts, BASIS, and other charter schools are popular choices among relatively affluent suburban families. This dynamic has tended to insulate Arizona charter schools from the partisan political fights common to other states, creating a more hospitable political climate for school choice policies at large.

That said, challenges to the hegemony of traditional public schools are never without controversy, even in the deepest red states. Or in Arizona, which has earned a reputation as education’s policy’s “Wild West,” a label often invoked derisively, but one that has been embraced affectionately by choice and charter school proponents. An attempt by teachers and public-school advocates to block implementation of the expanded ESA program through a referendum initiative failed to garner enough signatures to get on the statewide ballot last November.

Still, Great Heart’s rush to open the first Christos academies less than eight months from now suggests at least some concern that Arizona’s universal ESA is likely to remain in political jeopardy under new Democratic Gov. Katie Hobbs, and in the state legislature, where Republicans, who backed the expansion, maintain a slim one-seat majority in both houses. Great Hearts declined to say if its leaders are concerned about shifting political winds, but it’s politically harder to close existing schools than to stop new ones from opening. “So far as Caesar allows, we will organize to serve parents and families,” Heiler tells me.

Jason Bedrick, a research fellow at the Heritage Foundation’s Center for Education Policy and an Arizona resident, suggests Great Hearts and other would-be private school operators are wise not to be complacent, but notes that “no private school choice program in this country—no tax credit, ESA, or voucher program—has ever been legislatively repealed” once it goes into effect. That does not mean, however, that there will not be court challenges or attempts to limit funding. 

Indeed, Hobbs claims the expanded ESA “will likely bankrupt the state.” Her budget proposal released earlier this month would functionally repeal the universal ESA expansion by eliminating funding for it. Bedrick, a former New Hampshire state lawmaker, notes the original, more limited program has already withstood more than a decade of lawsuits; he thinks there is “nearly no chance” the legislature will go along with gutting the program. Arizona Speaker of the House Ben Toma was the Republican majority leader last year and the prime sponsor of the bill. “It’s his baby,” Bedrick said. “The speaker of the House is not letting the governor undo his signature achievement.”

While Arizona is positioned to become the first state to see significant numbers of students attending religious K-12 schools at public expense owing to Great Hearts move into the market, the pieces are falling into place to spread rapidly to other states. A U.S. Supreme Court decision last summer ruled that Maine cannot exclude religious schools from public funding that allows rural students to attend private schools. A legal opinion from Oklahoma’s attorney general recently cleared the way for religious charter schools. Courts in West Virginia have refused to block a school choice program nearly identical to Arizona’s. Iowa Gov. Kim Reynolds introduced school choice legislation this month, and it is widely expected to pass the Republican-controlled legislature. It would make universal choice a feature of that state’s education system within three years.

The entry into the private school market of high-quality operators such as Great Hearts is a best-case scenario for school choice proponents. Critics including teachers’ unions have long pilloried vouchers, ESAs, and similar mechanisms as bids meant merely to siphon public dollars to the private sector without accountability or transparency. Great Hearts, however, enjoys a sterling reputation in the Grand Canyon State, with 18 of its 21 schools earning an A rating on Arizona’s accountability system. There is also strong evidence to suggest church-based schools will be effective for the disadvantaged families Great Hearts Christos hopes to recruit. William Jeynes, a professor of education at Cal State-Long Beach and one of the nation’s leading researchers on the influence of religious schools, estimates that “just attending a faith-based school, whether a student is religious or not reduces the achievement gap [between white students and students of color] by 25 percent. Just as a matter of objectivity, shouldn’t we be doing more of this if we want the achievement gap to go down?” he said.  

Following the launch of the first Christos schools this fall, plans are to open “four or five new schools a year” according to Great Hearts’ co-founder Daniel Scoggin, “and then from there to Florida, West Virginia, and other states” where ESA adoptions and expansions make the model attractive to parents and financially feasible for them. Heiler also tells me that Great Hearts’ classical school model could spawn any number of faith-based academies, not just Christian schools. “We could also open schools, for example, with Jewish communities that want a private school,” he said. “We can place schools wherever there’s a funding mechanism.” 

The vast majority of students still attend a zoned, district-run public school and likely will for the foreseeable future, even with a rapid expansion of ESA programs and similar school choice funding mechanisms. Cobbling together a child’s education from a menu of providers is fair game under an ESA, but it requires a high degree of parental engagement and bandwidth; it would likely be an option only for the most committed and motivated families. Busy parents with jobs, daily routines, and obligations will always need a safe place for their children to spend their days. Low-cost private schools based in families’ church communities could pose a significant challenge to traditional public schools. Great Hearts and Arizona bear watching carefully.