Education Savings Accounts Are For More Than Just Private School Tuition

A parent from Arizona with a master’s degree in special education instruction knew that her son was going to need a flexible approach to learning. When the boy was just 18 months old, doctors diagnosed him with autism and a severe sensory and auditory processing disorder. “He would need to be in the maximum restrictive environment in a traditional school,” his mother says.

But that isn’t what she wanted for him. Now that he is entering second grade, his mother is using an education savings account (ESA) to pay for personal tutors, educational iPad applications to use alongside their curriculum, and art and music specialists to help the boy.

“I’m so excited about it. Months before we got the card I was planning what curriculum I was going to teach,” the mom says. “Education savings accounts are something that Arizona is getting right when it comes to education.”

Arizona families’ experience demonstrates that if given the opportunity, parents will access multiple learning options for their children. Just as a child needs a pediatrician, dentist, and in some cases, even a physical therapist for their health, so they also may need a tutor, educational therapist, and an online class for their education. Moreover, new learning experiences require flexible education funding mechanisms.

The changing landscape of education has created virtually unlimited opportunities for students to access academic content. The type of student-centered learning that is possible with technology “opens the door for students to learn in ways that match their intelligence types in the places and at the paces they prefer by combining content in customized sequences,” write Clayton Christensen, Michael B. Horn, and Curtis W. Johnson in their seminal book Disrupting Class.

Although education reform advocates had theorized that ESAs would lead to customization of education on the part of families, it wasn’t until the option had actually been in place for more than a year that researchers were able to obtain the necessary data to determine whether or not families we’re actually taking the opportunity to do so.

In 2013, the Friedman Foundation for Educational Choice conducted the first study of Arizona families’ purchases with Empowerment Scholarship Accounts. The study found approximately 34.5 percent of Empowerment Scholarship Account recipients appeared to use their funds for multiple learning experiences.

A forthcoming updated analysis using education savings account data from the Arizona department of Education from FY 2013-14, Q4, and FY 2014-15, Q1-4, finds:

• 83 percent of Empowerment Scholarship Account money spent was used for private school tuition (compared to 85 percent in the 2013 Friedman Foundation report);
• Parents spent more money on tutoring (7 percent of all money expended) in this dataset than in the prior study (4 percent);
• Parents spent less on educational therapy (5 percent of all expenses) than in the prior study (7 percent);
• More money was spent over this time period, 69 percent, than in the prior report (57 percent);
• And 28 percent of accountholders spent their funds on multiple educational products and services.

These results demonstrate that with a larger and different cohort of students over a different time period, a similar percentage of students still use the accounts for multiple options. New eligibility criteria and the passage of time do not change how families value the accounts’ flexibility. Parents continue to access unique products and services to meet their children’s learning needs.

In addition, the data allow policymakers to see what is happening with taxpayer money directed to a child’s education. Instead of Byzantine school district budget spreadsheets based on complicated projections of student enrollment, ESA data provide a dollar-for-dollar report on how parents using an account are educating their children.

Customization continues to play a major part in the story of ESA use among families, with nearly 30 percent of the 1,416 families in this study using their ESAs for multiple purposes. Even though most families are using the accounts in part to pay for private school tuition, the findings contained in our dataset reveal that tuition is not the only thing parents are using their child’s account to afford. Education savings accounts are functionally different from private school scholarship programs. Families take advantage of the flexibility provided through the unique structure of ESAs to access a variety of learning opportunities.

– Guest Bloggers Jonathan Butcher and Lindsey Burke

Jonathan Butcher is education director at the Goldwater Institute and Lindsey Burke is the Will Skillman Fellow in Education in the Institute for Family, Community, and Opportunity at The Heritage Foundation. The research on which this is based will be published by the Friedman Foundation in 2016.

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