Texas House, Senate voucher bills differ on authority to increase funding

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The Texas House and Senate are at odds over how much discretion to give state leaders in funding a private-school voucher program — the latest flashpoint in the ongoing battle between the two chambers over whether the state should help schoolchildren pay for a private education.

A key difference between Republican proposals in each chamber lies in whether to allow state leaders to grow the program by sweeping money from other agencies without approval of the Texas Legislature.

House Bill 1, by Rep. Brad Buckley, R-Killeen, states explicitly that Republican Gov. Greg Abbott and the Legislative Budget Board cannot use the board’s budget authority to boost the amount of tax dollars for the bill’s education savings accounts.

The Legislative Budget Board — composed of Lt. Gov. Dan Patrick, House Speaker Dade Phelan, and appointed budget leaders from the House and Senate both chambers — and the governor share “budget execution” authority, which gives them the power to shift money around without legislative action.

Last year, Abbott, with the required approval of the LBB, swept nearly $1.4 billion from several state agencies — without public hearings or legislative approval — into his Operation Lone Star border mission under the auspices of a declared border emergency. The same can be done without the governor declaring an emergency but would require a public meeting.

Buckley’s bill, filed Thursday night, says state funding for an education savings account program must come only from dollars already appropriated during this year’s regular session — up to $500 million for the biennium from the general revenue fund, which comes from state tax dollars. The bill, which caps enrollment, does not say how much of that money would be spent by HB 1.

Buckely could not be reached for comment Friday.

By contrast, the Texas Senate has thrown its support behind Senate Bill 1, by Conroe Republican Sen. Brandon Creighton, which explicitly allows budget “transfers” to fund the program at any point before lawmakers meet for the next regular session in 2025.

If there is enough interest in SB 1’s savings account program, the bill could conceivably use the entire $500 million in its first year, which could trigger a potential $1 billion commitment every two years if it continued at that level.

Neither bill, at this point, projects actual costs of the program beyond its first year. Both bills allow the fund to also accept money from grants, gifts and other donations.

As a result, the eventual size and cost of a voucher program — if approved by Republican lawmakers who are locked in a rancorous intra-party fight over the issue — is, at least for now, unknown.

Rather than being crafted as a major policy shift in the way Texas educates its future generations, one that could lock Texas into billions of dollars in commitments each budget cycle, the education savings accounts in both bills are being treated as pilot programs — slim in scope, funded for one school year, with an uncertain future.

Adding to the tension over that uncertainty is the notion that Patrick, Abbott and their allies on the LBB could decide to lock Texas into a more expensive program with the stroke of a pen.

“It looks like a bait and switch to me,” Dallas Democratic state Sen. Royce West, who does not support vouchers, told Creighton during floor debate earlier this month on SB 1, which passed largely along party lines in the Senate and is now awaiting action in the less-supportive House.

West was skeptical about trusting Abbott and other supporters of the program and asked Creighton to support changing the bill to restrict those budget transfers and effectively give lawmakers the ability — much as the House bill does — to adjust its funding only during the regular appropriations process, which includes extensive public hearings.

In floor debate, West suggested that the current $500 million price tag on SB 1 was not a guaranteed number, and that the bill allowed too much room for higher costs at the discretion of the few Republican state leaders at the top who were pushing for it — particularly Abbott, who said he will not include public school funding legislation in the special session agenda until lawmakers agree to a deal.

Creighton, a Patrick-appointed member of the LBB, told senators during floor debate on his bill that it’s common for state budget writers to build flexibility into the budget process for programs that may need funding to be adjusted up or down based on unexpected costs or savings.

In the case of his bill, he said, adjustments may need to be made simply because it’s unclear how many students would participate, which would affect how much money is needed for the program.

“A lot of work has to happen over the next year before this program goes into effect before the 2024-25 school year, and those flexibilities for our appropriators are necessary,” Creighton said. “I don’t think it means unbridled funds can continue beyond what we’ve established as a start for funding the program itself at $500 million.”

The funding in SB 1, which was approved by lawmakers in May, would be enough to pay for up to 625,000 Texas schoolchildren to use $8,000 in state money each year to pay for private tuition and related costs. That participation number might change depending on what share of those accounts would be used by home-school students, who would get only $1,000.

Meanwhile, the House bill is less clear on the amount each family would get, tying it to per-student funding across the state — a number that is currently in flux. It caps annual participation at 25,000 students, a sliver of the students served in the Senate bill, with increases of 25,000 students a year until 2017, when the limit would be lifted.

If the program is wildly popular and fills up, the Senate proposal triggers a system that prioritizes public school kids with educational disadvantages, economic hardships and disabilities.

Alternatively, lawmakers could simply put more money into the program. Unlike the House bill, which caps participation at 25,000 for its first three years, the Senate doesn’t limit its program to any specific number of students.

Instead, participation under the Senate proposal depends entirely on how much tax money the state pours into the program.

But the spirit and intent of SB 1, Creighton told West during the floor debate last week, was not to back-channel more money into the program than what lawmakers agreed to spend.

On Thursday, Creighton told The Texas Tribune that any increase in funding would be needed only if SB 1’s program — which has room for about 1% of school-age children in Texas — grows in the future.

First, though, the state needs to find out how successful the savings accounts will be, he said. After that, he told fellow senators during floor debate, it’s not the intention to cut lawmakers out of the decision making process over the program’s life.

“From the start, it is important for our lawmakers to track the demand for, and the success of, education savings accounts,” Creighton said in an emailed statement to the Tribune this week. “I am confident that an ESA’s program designed to expand educational opportunities for students across Texas will find widespread success, but any proposal to broaden the program would only be necessary if applications actually exceed available funding.”

“In that hypothetical situation,” Creighton added, “it is a decision for future legislators to consider.”

On Friday, West told the Tribune that he was glad to see the House bill include the same transfer restrictions that he was pushing in the Senate — although ultimately school vouchers won’t get his vote, he said.

“It’s lipstick on a pig,” he said in a statement. “This pig needs this lipstick, but it’s still lipstick on a pig.”

Conservative economist Vance Ginn said he believes it would be “an uphill battle” to expand the program through the LBB before the next regular session.

Ideally, he said, the state will go with full universal ESAs now, start funding it with the Foundation School Program, which funds public schools, “and stop going around the edges before Texas falls further behind in education outcomes.”

“Given the fungibility of taxpayer dollars, I think it will be challenging to do [budget transfers], which is why I have been critical of this [Senate] bill with minimal school choice options for about 1% of all students across the state,” said Ginn, a former budget analyst with the Texas Public Policy Forum, a conservative think tank. “With nine other states already moving to universal education savings accounts, Texas will fall behind quickly without broader school choice.”

Abbott has made no secret about his wish for a program that eventually allows every Texas family that wants to avoid public education to access tax dollars to help them do that.

“This is one of those unparalleled opportunities when all of us together have the ability to achieve a better state for all families across Texas,” Abbott said in a statement earlier this month. “I believe that every parent can do a better job of raising their children if they are given the power to choose the school that is best for their child.”

If broad participation and universal availability is truly the goal, however, it’ll come with a hefty price tag.

According to the Texas Education Agency, about 5 million students attend Texas public schools. More than 750,000 students are being home-schooled, according to the Texas Home School Coalition. An estimated 250,000 are in the state’s more than 1,200 private, nonprofit and/or religious schools.

For the program to pay private-school tuition for even a quarter of the estimated 6 million students who qualify for Creighton’s proposed $8,000 annual education savings account, the state would be on the hook for more than $21 billion every two years. Depending on how the House bill formula is interpreted — a state budget fiscal analysis has yet to be attached to HB 1 — the cost of that program eventually could wind up being similar.

Opponents say giving everyone in Texas the opportunity to use taxpayer dollars that would otherwise go to public schools is something they desperately want to avoid.

“The program will grow exponentially in its cost, and the vast majority of students that take advantage of vouchers will be students who already are in private schools right now, meaning that it’s an expensive new entitlement program that is taxpayer funded,” said Monty Exter, a lobbyist for the Association of Texas Professional Educators, which opposes vouchers.

“And students who cannot afford to pay the difference between the voucher and the cost of most existing private schools will likely end up in a pop-up, fly-by-night voucher school that is almost certainly low quality and is likely to close within two to three years of opening,” Exter said.

Disclosure: Association of Texas Professional Educators has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune’s journalism. Find a complete list of them here.