The Legislature has developed a rather complicated state funding formula that grants the public school district a set amount per student called tuition supports. This amount is based on a variety of factors specific to the local district and varies between districts but is typically around $5500. So for XYZ public school district $5,500 is a good approximation for the marginal spending per student. How is it that state tuition supports are only about half average spending per student in public school districts? The answer is that other sources of funding, generally from local, state and federal tax dollars, supplement the state tuition supports in a school district’s budget. Particularly important is local property taxes that support public school buildings funds.
The core provision of the statewide voucher program for private schools is as follows: If a student exits the XYZ public school district for a participating private school XYZ public school district loses $5,500 from state tuition supports, while the private school obtains a voucher from the state worth no more than $4,700. If 100 students exit XYZ public school district to various private schools, XYZ loses $550,000 from state tuition supports while the private schools receive no more than $470,000. Although the structure of the program is a bit more complicated, the results are clear: What the public school loses in state tuition supports is by design less than what the private schools obtain from the state vouchers.
Cecil Bohanon, Ph.D., an adjunct scholar with the Indiana Policy Review Foundation, is a professor of economics at Ball State University.