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January 10 2019

Universal ESA Program Could Produce More Than $4 Billion in Social Benefits for Tennesee

The Heartland Institute
featuring Vicki E. Alger

new report from the Beacon Center details how a statewide, universal education savings account (ESA) program could provide the Volunteer State $4.26 billion in economic benefits through 2038 due to increasing high school graduation rates and a decrease in criminal activity.

Counting Dollars and Cents: The Economic Impact of a Statewide Education Savings Account Program for Tennessee, authored by the Cato Institute’s Corey DeAngelis and the Wisconsin Institute for Law & Liberty’s Will Flanders, conservatively projects adoption of a universal ESA would increase the number of high school graduates by 13,480 through 2038 and add $2.9 billion in economic benefits for these students, including a $683 million increase in personal income, over the course of their lifetimes due to the higher earning potential that comes with having a high school diploma. Furthermore, the report estimates the ESA program will help reduce the number of felons in Tennessee by more than 15,000 and the number of misdemeanants by more than 21,000 through 2038, which would produce a $685 million reduction in social costs.

“These numbers represent expected additional dollars in the pockets of Tennesseans as well as additional taxpayer revenue for the state itself that could be used for other meaningful reforms,” the authors wrote. “But even more importantly, the numbers serve as stand-ins for the meaningful improvements to quality of life brought about by a better education.”

With an ESA, state education funds allocated for a child are placed in a parent-controlled savings account. Parents are then able to use a state-provided, restricted-use debit card to access the funds to pay for the resources chosen for their child’s unique educational program. Normally, these ESA funds can be used to pay for tuition and fees at private and parochial schools, textbooks and curriculum, online learning programs, tutoring services, and educational therapies. 

Tennessee currently has the Individualized Education Account Program, an ESA for special-needs students. But eligibility for that program is limited to just two percent of Tennessee students. For the 2018–19 school year, only 137 children at 14 different schools participated in the program.

Copious empirical research on ESAs, their sister voucher programs, and tax-credit scholarships finds these programs offer families improved access to high-quality schools that meet their children’s unique needs and circumstances. Moreover, these programs improve access to schools that deliver quality education inexpensively. Additionally, these programs benefit public school students and taxpayers by increasing competition, decreasing segregation, and improving civic values and practices. Students at private schools are also less likely than their public school peers to experience problems such as alcohol abuse, bullying, drug use, fighting, gang activity, racial tension, theft, vandalism, and weapon-based threats. 

“For policymakers,” the authors conclude, “this study suggests that the implementation of a universal or statewide ESA is not only the right one when one considers the tangible academic benefits that accrue to choice participants, but also from the perspective of continuing to expand Tennessee’s position as an economic engine of the southeast and the nation as a whole.”

The school a child attends should not be determined solely by his or her ZIP code. However, this is currently the case for most Tennessee children. The goal of public education in the Volunteer State should be to enable all parents, no matter their income level, to choose which schools their children attend. Public schools should not hold a monopoly on education. By implementing a universal ESA program, we can make sure every child has the opportunity to attend a quality school.

Protecting Students with Child Safety Accounts
https://www.heartland.org/publications-resources/publications/protecting-students-with-child-safety-accounts
In this Heartland Policy Brief, Vicki Alger, senior fellow at the Independent Women’s Forum and research fellow at the Independent Institute, and Heartland Policy Analyst Tim Benson detail the prevalence of bullying, harassment, and assault taking place in America’s public schools and the difficulties for parents in having their child moved from a school that is unsafe for them. Alger and Benson propose a Child Safety Account program, which would allow parents to immediately have their child moved to a safe school – private, parochial, or pub­lic – as soon as parents feel the public school their child is currently attending is too dangerous to their child’s physical or emotion­al health.


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Independent Women's Forum is an educational 501(c)(3) dedicated to developing and advancing policies that aren’t just well intended, but actually enhance people’s freedom, choices, and opportunities. IWF is the sister organization of the Independent Women’s Voice.​
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