Tax-Funded Vouchers Boost Private School Tuition |
The 2024-25 school year was the first year that North Carolina’s Opportunity Scholarship taxpayer-funded private school voucher program became universally available. For the first time, all families could apply to receive a tuition subsidy regardless of income or whether their child had ever attended a public school. This policy change marked a striking shift in taxpayer burden from using public dollars to fund only public schools open to all students to adding the expense of funding private schools through tuition vouchers. Studies tracking voucher expansions in other states such as Iowa and Arizona revealed that private schools raised their tuition and pressured families to apply for vouchers once they became universally available. Our examination found similar patterns. We found sharp tuition rate increases in the first year of universal voucher availability, with many schools raising rates to match the voucher amounts. We also found evidence of schools taking advantage of the voucher program by giving admissions preference to families who applied for vouchers or requiring families to apply for a voucher as part of the school’s admissions process. To examine whether the introduction of universal vouchers accelerated tuition increases, we looked at tuition rates for schools dating back to at least 2022-23. We were able to obtain three groups that satisfied this requirement, obtaining data back to 2020-21, 2021-22, and/or 2022-23 in addition to tuition for 2023-24 and 2024-25. In all three groups, the average percentage change in tuition increased substantially in the year the voucher expansion went into effect. In two groups, it more than doubled. The data strongly suggest that voucher availability drove the increase in tuition rates. |
|
|---|
|
|
Tuition for Thales Academy private schools provides another view of tuition increases produced by voucher programs. There are currently 10 Thales Academies in North Carolina located in Chatham, Johnston, Union, and Wake Counties. The one Thales Academy located in Virginia—where the state’s tax-credit voucher program has not changed substantially since 2020—shows a sharp contrast in tuition rate increases to the increases for the North Carolina schools. Between 2000-2021 and 2024-25, Thales in Virginia did not increase tuition. It stayed constant at $5,300/year (K-5). Tuition at Thales schools in North Carolina increased little until voucher expansion was on the horizon (2023-24) when tuition increased 7%. In the year vouchers became universally available (2024-25), average tuition across all 10 schools increased 12% to $6,651. These data suggest that North Carolina’s voucher expansion incentivized this and other private schools to increase tuition prices. In other words, once voucher funds became readily available, private schools used the opportunity to raise tuition prices. |
|
|---|
|
|
In addition to raising tuition, we found that many private schools strongly encourage and, in some cases, even require applicants to apply for vouchers. For example, Grace Christian School in Lee County lists as #4 in its admissions process “Apply for the NCSEAA Opportunity Scholarship” followed by the statement: “Complete the NC Opportunity scholarship Application during the scholarship application period for each student who will attend GCS. All students must apply for this scholarship prior to applying for enrollment at GCS.” Before the 2024-25 school year, applying for a voucher was not a step in their admissions process. In 2024-25, Grace Christian School received more than $5.1 million in Opportunity Scholarship tuition payments from the state. Other schools say clearly that they give preference in their admissions processes to students who have received state-funded vouchers. For example, ALC Mosaic in Mecklenburg County stated on its website that “We will be prioritizing families who have applied for and received the opportunity scholarship for 2024-25.” When new applications for Opportunity Scholarships rose to more than 72,000 for the 2024-25 school year in response to expanded eligibility, voucher supporters claimed that family interest and need drove the increase. Our data suggest that private school admission policies encouraging or requiring families to apply for vouchers also contributed to the rise in applications. As North Carolina lawmakers enter the budget negotiation process, they are poised to spend $731 million on voucher programs in 2025-26 despite public schools across the state facing budget cuts and staffing shortages. The pattern in tuition increases we revealed shows that private schools are raising tuition to take advantage of the voucher funding. At the same time, many schools are incentivizing families to apply for vouchers. As a result, families may be forced to apply for a voucher even if they have no financial need or would choose not to apply if left to their own devices. Are private schools gaming the system at taxpayer expense? Can the state afford to subsidize private school tuition increases at the expense of the many other programs left unfunded? Read our new fact sheet on private school tuition increases! |
|
|---|
|
|
Legislative and SBE Updates |
|
|---|
|
|
| The NC General Assembly reconvenes on Monday, June 3 at 3:00 p.m. Tuesday's calendar is busy, with several press conferences and committee meetings. Check it out HERE to make sure you don't miss anything. Links to livestream sessions are found on the calendar page. See our Week in Review for a summary of bills, bills that made crossover, and key education bills to watch. The State Board of Education will meet Wednesday, June 4 and Thursday June 5 for its monthly meeting. Agenda and executive summaries are found HERE. |
|
|---|
|
|
Have You Heard? Ethnic Studies Works! |
|
|---|
|
|
| Ethnic Studies courses in CA have shown tremendous academic benefits for students who take the course. Benefits for students include improved GPAs, better attendance, and higher graduation rates. Students are also more likely to become engaged with the school community and feel a sense of belonging. As a result, starting with the class of 2029-30, an ethnic studies course will be a graduation requirement. This highly beneficial ethnic studies course was originally developed for 9th grade students by a group of teachers in the Bay Area. A study about the course, The Causal Effects of Cultural Relevance: Evidence from an Ethnic Studies Curriculum, was published in 2016. It shared the course's remarkable impact on students: increased 9th grade attendance by 21 percentage points, GPA by 1.4 grade points, and high school credits earned by 23 points. The raised awareness of the course’s benefits for students helped it spread throughout the state. However, recent culture wars have brought the future of the course into question. Listen to this great “Have You Heard?” podcast by Jennifer Berkshire and Jack Schneider to learn more: #198 Ethnic Studies Works. Does That Even Matter Anymore? |
|
|---|
|
|
Check Out Our New Audiocast |
|
|---|
|
|
| Teaching is NOT a Sacrifice: It's Time to Change the Story, by Amelia Wheeler, PhD. We’ve all heard the headlines: the teacher shortage is reaching crisis levels. But what if I told you this shortage isn’t just about low pay or pandemic burnout? What if it’s rooted in something much older and deeper—a cultural story we’ve been telling about teachers for over a century? |
|
|---|
|
|
| Tuesday, June 10, noon - 1:00 p.m. Join PSFNC and UNC law professor Barbara Fedders to discuss our latest report, North Carolina Charter Schools: Undermining Quality Education for All. We will discuss important findings in the report about problematic features of charter schools in North Carolina: racial segregation, exclusionary student discipline, the rate of school closures, and financial mismanagement. There will be time for Q & A, so come ready to discuss! REGISTER HERE |
|
|---|
|
|
| Need a speaker for your next event or group meeting? PSFNC welcomes the opportunity to speak to your group or organization on public education-related topics. We offer our programs virtually to improve accessibility and attendance and therefore extend your reach. Our services are free of charge but may require travel-related expenses if the program is in-person. Email us at [email protected] for more information. |
|
|---|
|
|
Words to Remember"As [voucher] programs have scaled up over the last ten years to the statewide versions we’re talking about today the negative effects of vouchers on test scores for the children who transfer from public to private schools—I am not exaggerating when I tell you—they are on par with what the COVID 19 pandemic did to test scores more recently, what Hurricane Katrina did to test scores in Louisiana, in 2005. They’re so large that we haven’t really seen anything else like it in the research record." — Josh Cowen, NPE Conference, 2023 |
|
|---|
|
|
Help us support public schools!Public Schools First NC is a statewide nonpartisan, 501(c)(3) nonprofit focused solely on pre-K to 12 public education issues. We collaborate with parents, teachers, business and civic leaders, and communities across North Carolina to advocate for one unified system of public education that prepares each child for productive citizenship. |
|
|---|
|
|
|
