Two Oklahoma school-choice programs have generated up to $181 million in cumulative savings since their inception, freeing up financial resources to benefit students in traditional public schools, according to a new report.

“Fiscal Effects of School Choice,” a new study authored by Martin F. Lueken, director of the Fiscal Research and Education Center at EdChoice, analyzed 48 private education choice programs in 25 states plus D.C., including two programs in Oklahoma.

The programs in the analysis include five education savings account (ESA) programs, 22 school voucher programs, and 21 tax-credit scholarship programs.

All 48 programs in the analysis were in operation for at least five years through the 2022 budget year, with 31 programs in operation for at least 10 years.

The two programs examined in Oklahoma were the Lindsey Nicole Henry Scholarships for Students with Disabilities (LNH) program, which provides scholarships for students with special needs to attend private schools, and the Equal Opportunity Education Scholarship program, which provides a tax credit for donations to private-school scholarship-granting organizations.

According to the report, the LNH program has created between $43.9 million and $71 million in cumulative savings during its existence. For every $1 spent on an LNH student, the Oklahoma state government has saved between $1.89 and $2.44. From its creation to 2022, the LNH program provided scholarships to 6,928 students, according to the report.

During the first 10 years of its existence, the Equal Opportunity Education Scholarship program has funded private-school scholarships for more than 16,000 students. The EdChoice report estimated that program has generated between $52.9 million and $110 million in cumulative savings. For every $1 spent on the program, the Oklahoma government has saved $2.71 to $4.56.

The two programs, combined, have benefited 22,933 children during their existence, according to the report, and generated combined cumulative savings of $96.8 million to $181 million for the state. For every dollar spent on the two programs, the Oklahoma government is saving $2.21 to $3.26.

The reason school-choice programs generate such significant savings is that they pay to educate children at a much lower cost than the per-pupil spending for those same children in public schools.

“These savings result from many of the students who exercised choice who would have been enrolled in a public school if these choice programs did not exist—and would have enrolled in public schools at a much larger taxpayer cost,” Lueken wrote.

The report showed that the average per-pupil funding for the two education-choice programs in Oklahoma through the 2022 state budget year was just 29 percent of the per-pupil funding provided for public-school students.

Similar conclusions were reached for all school-choice programs nationwide.

“In FY 2022, the average public funding per student for education choice programs was about $6,000, compared to $17,000 per student for public schools in states where choice programs operate,” Lueken wrote. “That is, students using education choice programs only received around one-third (36%), on average, of the per- pupil funding amount their peers received in nearby public school systems.”

School-choice programs produced savings even if many children who benefit from the programs never attended a public school.

“On average, if at least 57% of students who participate in choice programs switched from public to private schools, these programs saved taxpayer dollars overall,” Lueken wrote. “For programs that have been in operation a long time, this break-even rate may be as low as 36%.”

Overall, the report concluded that the 48 education choice programs examined cumulatively saved state and local taxpayers in those 25 states between $19.4 billion and $45.6 billion from the programs’ inception through 2022.

Public Schools Have Reaped Up to $71 Million

The report’s findings contradict the claims made by school-choice opponents, including in Oklahoma.

For example, the Oklahoma State School Boards Association (OSSBA), a lobbyist organization, claims on its website that the LNH program “has shifted more than $38 million away from public schools to private schools over the last decade,” saying voucher programs like LNH scholarships “erode public school funding and harms the 700,000 students who attend public schools.”

But far from reducing public-school funding by $38 million, as OSSBA claimed, the EdChoice report shows that public schools have reaped at least $43.9 million (and up to $71 million) from the savings generated by the LNH program, money freed up for use on other students who remain in the public-school system.

Former state Rep. Jason Nelson, an Oklahoma City Republican who authored the 2010 law creating the LNH program, said the study’s results are no surprise.

“The report confirms what I and other supporters said at the time: It not only helps kids who are not able to be adequately served in their neighborhood school, but also improves the education system for all the kids by increasing the per-pupil spending in the traditional public schools,” Nelson said. “Opponents carried on that that was not the case and we simply didn’t understand school finance, but it turns out they were incorrect. It is a simple division problem, and the law has performed exactly as we said it would back then.”

While a dozen states have enacted broad-based school-choice programs since 2020 that allow nearly all families to qualify, only one of those programs was examined in the EdChoice study because the study relied on federal data that precedes the launch of most universal school-choice programs.

However, the report did examine Arizona’s Education Savings Account program, which allows most families to use a portion of their child’s per-pupil taxpayer allotment to pay for private-school tuition or other needs.

Arizona’s ESA program became universal starting in the 2023 budget year and had a short-run net fiscal effect on state and local taxpayers of $37 million in the 2024 budget year.

However, the EdChoice report found that Arizona’s program will “lead to annual net fiscal savings of $244 million.”

“These results call into question claims that education choice is ‘blowing a hole’ in the state’s budget,” Lueken wrote.

Similar savings may be generated by the Oklahoma Parental Choice Tax Credit Act, which provides refundable tax credits of $5,000 to $7,500 per child to help Oklahoma families cover the cost of private school tuition. The lower a family’s income, the larger the tax credit, and all families qualify.

The current maximum credit of $7,500 is significantly less than the per-pupil taxpayer funding in Oklahoma’s public schools.

According to Oklahoma State Department of Education data from the Oklahoma Cost Accounting System, public school district expenditures in 2023 (the most recent available) totaled $9,538,453,992, and enrollment in the 2022-2023 school year totaled 701,066 students. That means Oklahoma public schools had an average of $13,605 per student that year.

As a result, anytime a child shifts from public school to private school using the Parental Choice Tax Credit, it will free up $6,135 to $8,605 per student for use in the public-school system. The number of students shifting from public school to private school is expected to increase significantly over the next few years due to the Parental Choice Tax Credit program’s existence.