This article was co-authored by Hunter Fox, a research intern at Libertas Institute.
The new $82 million government scholarship program in Utah is inevitably going to draw a lot of attention. That attention combined with the fact that details on spending are only released annually will undoubtedly draw suspicion. Despite the negatives and the naysayers, the new $82 million Utah Fits All Scholarship isn’t suspicious, it just isn’t funded enough.
Demand & Impact
First off, we need some context. Currently, Utah pays just over $11k per pupil per year; less than almost any other state in the country. Still, the total education bill that taxpayers are footing every year is now over $9 billion. That $82 million for the UFA scholarship accounts for just 0.9% of education spending. Not only are UFA scholarships less than a percent of the overall budget, but the per student award amount ($8k cap) is about 25% less than what districts are already spending per student.
This year, over 27,000 students applied for the UFA scholarship, with 10,000 receiving aid and over 17,000 students waitlisted. So far, about a quarter of this year’s UFA budget has already been spent. Unlike Education Savings Accounts, the scholarship awards do not roll over to the following year. This means if there are not any funds remaining at the end of the year, the program will have been even cheaper than the $8k/student cap. If $8k scholarships were granted to all 27k applicants, the UFA program would need a funding increase of an additional $134 million, making the new total still only 2.4% of education spending. Thus, we don’t need to worry about this program significantly impacting public school funding anytime soon.
More Options are always better
The spirit of this program is to let parents and those closest to the child decide how their education dollars can best benefit him. UFA has strong guide rails preventing misuse; scholarship funds can only be spent at one of over 700 approved providers.
When we level the playing field, even just slightly, what we see is the emergence of a diverse education marketplace. Entrepreneurs with innovative ideas and a desire to improve educational outcomes are competing for your education dollars. With public schools, your street address basically determines who teaches your kid math; in this marketplace, you get to find not just the best school, but even the best teacher for your child’s needs.
Even public schools benefit from this program. Public schools keep almost 25% of the per-pupil funding for each student receiving the UFA Scholarship. That means the public schools also benefit by gaining a little more per-pupil funding for the remaining students that do not leave. There is clearly demand for this program, and we can afford to do even more to make Utah a hub for educational innovation and let parents make the choices they feel are best for their kids.
