It will be a fall unlike any in our lifetime. North Carolina must learn to live with a pandemic and its aftermath. Many questions hang over the reopening of schools this fall. One that deserves more attention than it’s currently getting is: How many private school students will transfer to public schools because of the economic fallout from the coronavirus shutdown?
A legislative proposal to add $75 million to schools to address the impacts of a pandemic on our schools and ADM enrollment growth passed a first hurdle last Wednesday.
I’ve written about the devastating economic impacts of coronavirus and how they could spur an enrollment migration (See here and here). Recently, EdChoice.org estimated that a 10 percent migration of private school students to public schools in North Carolina would cost the state $64 million. If you include local county expenses, costs increase to $90.6 million. Likewise, a migration of 30 percent of private school students to public schools would cost the state $191.9 million. If local county costs are included, total costs balloon to $272.0 million.
A recent survey of independent schools in North Carolina found almost half of the private schools surveyed expect enrollment declines of between 5-10 percent in the coming academic year as a result of Covid-related issues.
The impact of such changes on students and schools is significant. Students who transfer schools will face new teachers, and often find themselves having to adjust to new curriculum material. They are forced to leave a situation where they have friends and know most of their classmates and establish new relationships.
The changes are also difficult for schools. A decline in enrollment in private schools is particularly significant. As tuition is the largest component of revenue, the loss of tuition revenue can lead to layoffs, reductions in programming or even school closures. Neal McCluskey of the Cato Institute is tracking the impact of Covid-19 on private school closures. While by no means a complete assessment of all closures, McCluskey notes as of May 29, 44 private schools said that they were permanently closing their doors – at least in part due to the economic downturn from the government’s shutdown.
Closures are the most dramatic action. Many private schools that avoid closure will nevertheless also be significantly impacted by enrollment changes. In the independent schools survey previously referenced, one school noted that admission inquiries in March, April and May were 10 percent of what they had been during the same three months of the previous year.
To help provide relief for private schools and families impacted by coronavirus, Rep. Rob Bryan (R-Mecklenburg) recently introduced S -857. In a recent interview, Bryan said, “It will help save the state money and provide continuity for families. . . Most families are generally happy with their situation and want to stay in their situation the following year. This is a COVID relief provision.”
The bill provides eligible families a one-time $2,500 tax credit, per child, to help those who have children in private schools. In addition, the bill also provides a tax credit of up to $500 per child for eligible families that home school. Tax credits cannot exceed $7,500 for private school families or $1,500 for home school families. To be eligible, married taxpayers must have a household income of $150,000 or less; or a single taxpayer of $75,000 or less. Taxpayers would also have had to receive a federal stimulus check and experienced a decline in adjusted gross income of 10 percent or more. Families whose children are recipients of the Opportunity Scholarship, Disabilities Grant, or Personal Education Savings Account are not eligible to apply.
As expected, anti-school choice advocates oppose the measure. Michael Priddy, acting president of the Public School Forum, told the Raleigh News & Observer, “Senate Bill 857 ultimately diverts those already scarce and desperately needed public resources toward families who have made the choice to attend private schools and homeschools. . .”
Priddy’s comments are ill-founded and reflect a fundamental misunderstanding of school finances and coronavirus relief. There are strong reasons why policymakers and all educators should support SB 857.
Civitas does not normally support policies which carve up the tax code. They conflict with good tax policy. However, this case is different. It is entirely appropriate for state government to help families impacted by the government shutdown.
Since government is the author of much of the economic hardship, it bears a responsibility for helping families and children impacted by its policies, no matter where the children attend school. The fact is, families whose children attend public, private and homeschools lost jobs and income. If private school closures or enrollment declines are rooted in government responses to coronavirus, the government has an obligation to help impacted families.
S-857 can be part of that answer. The legislation not only helps families whose children attend private schools or home schools; it also helps the public schools. Private schools enroll approximately 102,000 students statewide. Those are students who don’t have to be educated in the public schools. According to the Statistical Profile of North Carolina, In 2018-19, the state spent an average of $6,479 per pupil to educate a child in the public schools. Adding local per pupil funding ($2,410) increases total funding per student to $8,889. So, a tax credit of $2,500 per child that keeps a student in their private school saves the state nearly $6,500 in added expenses. The relief is temporary. It’s directed to those families most in need; helps students, helps private schools and ultimately saves taxpayers money.
Coronavirus and the response by state government has changed the landscape of education in North Carolina. The economic fallout is expected to propel a student migration from private to public schools. Such changes can have dire consequences for those on both ends of the migration.
S-857 can help to moderate these impacts, provide real relief for families and private schools and help to stem a significant — and expensive — influx of additional students to the public schools. For these reasons SB 857 deserves the support of lawmakers, families and educators.
This article was updated to reflect recent changes.
