Education Savings Accounts Customize Education and Provide Equal Access

by Wyoming Liberty Group Staff

Educational Savings Accounts, or ESAs, are modeled on highly successful health savings accounts (HSAs) and put taxpayer funds directly in the hands of parents so that they are free to optimize their children's education. Now that COVID19 health orders prompted school shutdowns across the country, education savings accounts are even more critical to the economic underpinnings of Wyoming schools and as a way to promote and engage students and increase overall academic proficiency moving forward. We now have the clarity to see that education can no longer be tied exclusively to local school locations controlled by government bureaucracy. Perhaps Wyoming should look to how other states implemented wildly successful ESA programs: For example, Arizona, which had 144 students participate in its first year of implementation and now has in excess of 6,423 students.

Education savings accounts (ESAs) allow families to customize their children's educations using all available education providers—including à la carte classes from local schools or colleges, tutors, textbooks, online classes, homeschool materials, educational therapy and others. Some states issue families debit cards tied to restricted-use bank accounts with the funds appropriated for their children by the state. Thus, an ESA pulls these funds from the school bureaucracy and hands them directly to the family instead. From there, the family chooses the best method of education for their children, and cost-related restrictions are eased or eliminated. This provides true, equal access to a publicly funded education that is specialized to fit the child's needs.

Submitting receipts to prevent fraud or accidental misuse are a requirement of any good ESA program. However, in Arizona, the State Auditor General found that only about 1 percent of ESA funds were misspent, an improper payment rate far below most government programs. Online platforms such as those developed by ClassWallet combine the highest level of financial accountability with the least amount of bureaucracy. They also have the potential to empower parents by providing them with useful information on educational products and services they are considering. As the platforms only allow the purchase of eligible products and services, this model provides the highest form of financial accountability. Moreover, it is much more cost-effective than the alternatives because it does not require a huge staff to pore over innumerable receipts.

In addition to financial accountability, online platforms have significant potential to provide more academic accountability. Just as on Amazon and similar websites, ESA families could provide reviews about their personal experiences with the products and services they purchased in order to provide other ESA families with valuable information. As it is, research finds that educational choice policies induce parents to seek more information about their educational options. Over time, such information sharing would help direct families toward higher-quality educational goods and services, creating a strong incentive for education providers to constantly improve.

A growing number of ESAs across the nation offer thousands of students additional pathways to success that are specifically catered to the students' needs and incorporate family involvement in their education. The net benefit to students and the state's purse should be acknowledged and properly vetted this legislative session in order to spark sustainable education funding models moving forward.

Wyoming legislators are already discussing the new notion of Tele-Ed, but perhaps we should consider how to implement a fully functional ESA program also. With the promise of lower costs, better outcomes for students, and less need for costly buildings and maintenance that is shut down and inaccessible to students during emergencies, Wyoming can lead the way through implementing family and peer-reviewed ESA platforms. Wyoming families deserve the best education possible, and when the costly bureaucratic structure fails their students, it is time for innovation with a program that has proven effective.

Update: SCOTUS case Espinoza v. Montana Dept. of Revenue prevailed for fair equality between religious and secular schooling, our state lawmakers may consider Education Savings Accounts as a form of taxpayer savings, specialized educational services, and relieved burden off the school district toward flattening the curve on enrollment and construction needs while still retaining many federal dollars outside of the ESA program. SCOTUS held that the application of Montana Blaine Amendment discriminated against religious schools and the families whose children attend or hope to attend them in violation of the free exercise clause.