Gov. Bill Lee on Thursday revealed long-awaited details about his plan to give Tennessee parents more education choices for their children, beginning with a legislative proposal to spend up to $75 million to launch an education savings account program in the fall of 2021.
Half of the money would go that first year to qualifying families paying for private education services, and the other half would help six districts that would lose per-pupil funding if their students opt to leave public schools.
The Republican governor hopes the funding split — which would end after the first three years — will be enough to give vouchers a foothold in Tennessee after years of rejections by state lawmakers. If he’s successful, up to 15,000 students could be receiving taxpayer money for private education services by 2025.
Eventually, though, the split would end, with state education funds following students and leaving public schools. By 2024, the voucher program could cost as much as $125 million, with $25 million in recurring school improvement grants set aside for the state’s lowest-performing public schools.
The legislation, which will be filed with the Tennessee General Assembly on Friday, will unleash likely the biggest battle of this year’s legislative session.
The proposal also will place Tennessee in the national spotlight in the tug-of-war between those who want to use taxpayer money to give parents more education choices and others who say that approach siphons off money from already underfunded public schools.
Lee offered few specifics earlier this month when he announced his proposal in his first State of the State address. He told lawmakers that “now is the time” to stop “nibbling around the edges” with efforts to fix struggling schools and instead provide students from low-income families with more opportunities.
He also never used the word “vouchers,” which polls poorly among voters.
The governor wants to use education savings accounts, a newer form of vouchers that polls significantly better. Tennessee has been offering such accounts to families of many students with disabilities since 2017.
Unlike traditional vouchers that are widely used in states like Indiana, education savings accounts are not limited to use at private schools. They would provide qualifying parents with a debit card loaded with an average of $7,300 in public funds annually to spend on an array of education services that also include private tutoring and online courses.
But like traditional vouchers, education savings accounts are the subject of inconclusive research — a point amplified by Democrat and rural Republican lawmakers who have fought off vouchers for more than a decade. And with dozens of local school boards and educator groups on record opposing vouchers in any form, Lee can expect a major fight in his first year in office.
Lee wants state funds to “follow the student” as they choose either public schools or private education services. But in the first three years, he’s proposing extra money into a “transition fund” to help affected school districts in Memphis, Nashville, Knoxville, Chattanooga, and Jackson.
That fund would halt after the 2023-24 school year.
The bill is being co-sponsored by majority leaders in both chambers, but will be shepherded by two powerful “parent choice” advocates: Sen. Dolores Gresham, a Somerville Republican who chairs the Senate Education Committee, and Rep. Bill Dunn, a Knoxville Republican who earlier this year was elected speaker pro tempore, the No. 2 leader in the House of Representatives.
Staff members for the governor briefed reporters Thursday about specifics of the proposal and answered these questions:
Which students would be eligible to receive an education savings account?
Students must come from families with up to double the annual income under federal eligibility requirements for receiving free and reduced-price lunches. The Lee administration says that equates to about $76,886 for a three-person household. They must have attended a Tennessee public school for the preceding full year or be eligible to enroll in kindergarten or a public school after moving to the state. They also must be zoned to or attend a school in a district with three or more schools in the state’s bottom 10 percent, which currently applies to school systems in Shelby, Davidson, Knox, Hamilton, and Madison counties, including the state-run school turnaround district in Memphis.
What are the conditions for participating?
Parents must agree to provide an education that meets state requirements for school attendance, including subjects in English language arts, math, social studies, and science. They cannot enroll in a public school (although they can contract for some public school services such as individual classes or extracurricular activities) and must agree to relieve the local school system from its obligations to provide a free and appropriate education for their student while participating in the program.
What expenses would be eligible?
In addition to tuition, fees, textbooks, and uniforms at a private school, the account could be used to pay for private tutoring, instructional materials, transportation costs, computer and software equipment, educational therapy services, and fees for early postsecondary opportunity courses and exams required for college tuition. Contributions could also be made to federally approved college education trust funds.
What agency would be responsible for managing the program, and how would systems be established to prevent fraud or abuse?
The state Board of Education would adopt rules on spending requirements, and the state education department would manage the program, including procedures to determine student eligibility and which private schools could participate. Similar to Tennessee’s current voucher program for students with disabilities, allegations of fraud would be investigated by the state comptroller or law enforcement and is punishable under the state’s criminal code.
Would private schools have to accept the average $7,300 voucher amount as the full cost of a student’s tuition and fees?
No. Private schools could still charge their full amount, but also may choose to provide students with financial aid or additional support.
Would students who accept education savings accounts be required to take state tests?
Yes. They would have to take the same annual assessment required of their counterparts in public schools.
How would the voucher program be allowed to grow?
Up to 5,000 students could receive vouchers beginning in the fall of 2021, growing by up to 2,500 annually to 15,000 by the fall of 2025. Beginning with the fall of 2026, the program could grow by 1,000 students annually. However, each annual cap must be met before the state moves to the next threshold and the administration doesn’t expect to meet those. The administration says states with similar programs like Indiana and Florida have experienced a maximum of 75 percent enrollment.
What if the number of applicants exceeds space under the annual caps?
If that happens, the education department would accept eligible students through a random lottery. But after the first year, students who were already in the program would get first dibs, and other students would be prioritized in the lottery if they have a sibling already participating or if they attend a “priority school” in the state’s bottom 5 percent.
This story has been updated with additional details.