Doing Your Homework on Education Options

The appropriate use of public funds should be a priority for policymakers. But those who object to legislation to provide more education options for Georgia’s children, on the premise that these bills will result in misspent public funds, should do a bit more homework.

The example always cited is Arizona’s Empowerment Scholarship Account (ESA) Program. A state audit of that program in the 2018 fiscal year found more than $700,000 in funds were misspent by participating parents. That dollar figure not only gets thrown around as if it’s the inevitable fate of any similar program, but as if it’s the last word in the matter. Neither is true.

Let’s deal first with the inevitability issue. Critics may not use the word “inevitable,” but their faithful recounting of Arizona’s experience clearly is intended to suggest ESAs and misuse of public funds go hand-in-hand. If they wanted the public to know Arizona’s problem was a one-off, they’d say so.
This obsession with a single year’s troubles at the first program of its kind is out of all proportion. For starters, we see similar problems with other government programs: As with the federal government’s SNAP benefits, or food stamps, Arizona funded its ESAs with debit cards that were approved only for certain purchases. As with SNAP, sometimes unapproved purchases were made anyway.
Oh – and, as with SNAP, those purchases amounted to less than 1% of the overall program.
I’m not arguing a small amount of misspending is OK. I’m saying we need to keep it in perspective as we evaluate whether that misspending is worrisome enough to scuttle Georgia’s proposed program.
I doubt ESA critics would also recommend ending SNAP benefits because of its similar degree of misspending. Or shuttering school districts’ maintenance departments because of the $6 million embezzlement case at Floyd County Public Schools several years ago. Or ending the federal E-Rate program because of the $73 million in misspending that once occurred with those funds at Atlanta Public Schools. If anything, Georgia can learn from mistakes made in Arizona.
All of that should show you that the Arizona example is not illustrative. It can, however, still be instructive.
While $700,000 of misspending is clearly undesirable, the problem hasn’t remained anywhere near that large. In a follow-up report last year, the state auditor reported that from October 2018 to October 2019, out of 168,020 approved transactions it “found only one successful transaction at an unapproved merchant totaling $30.”
You read that right: Within one year of allowing 900 successful transactions at unapproved merchants totaling $700,000, the state slashed that to a single transaction of thirty bucks.
That’s an astonishing example of solving a problem, and perhaps unmatched: Certainly, we haven’t seen an equally dramatic correction with misspending in SNAP, Medicare or other programs. Isn’t it odd how that successful response never comes up in the ESA debate? We only hear about the original mistake.
Also coming in for scorn from critics is the Georgia proposal’s inclusion of a “parent review committee” to help determine which expenses are justified. I’m afraid I don’t read it the same way critics do. Rather than holding sway over their peers’ account spending, I read their role as being advisers. They are to give their input about what might be reasonable uses of the money to the Office of Student Achievement staff, who may not have the personal experience to know what would be educationally useful for some participating families. But nowhere does the legislation being considered indicate the parents alone would make those decisions.

I would not make a blanket prediction that a new public policy won’t have any problems; I’ve been watching government operate too long to be so naïve. But nor would I insist a past problem, later successfully addressed, is bound to be repeated. We should learn from others’ examples, not use them as an excuse to deny children the options they need to get the best education they can.

Kyle Wingfield is president and CEO of the Georgia Public Policy Foundation:

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