Opportunity Scholarship Foes Hurt Students and State

Ron Knecht

In August, legislative Democrats turned down Gov. Joe Lombardo’s proposal to fund Nevada’s Opportunity Scholarship program reasonably from surplus funds available, and they left the funding at a minimum level.

But Lombardo pulled a rabbit out of the hat and found enough private reserve funding to keep hundreds of students already in the program from losing scholarships this year.

Opportunity Scholarships are funded from private corporate contributions in lieu of tax payments to provide need-based aid to let students from low- and middle-income families attend private K-12 schools. They especially benefit demographic minority students.

The scholarships were created in 2015, when Republicans had legislative majorities, with an initial $5 million-pe- biennium allocation with automatic 10 percent increases every two years.

When Democrats won back legislative majorities in 2016 and elected Steve Sisolak governor in 2018, they killed the automatic increases, leaving the reference-level funding at $6.6 million per biennium.

Despite Lombardo’s proposed $50 million funding from available funds in this year’s legislature, Democrats cut the previous $11.4 million funding to the $6.6 million level.

Ben Kieckhefer, Lombardo’s chief of staff, and Amy Stephenson, finance director, worked to support Lombardo’s $3.2-million interim financing request so no current aid recipients would lose their places in the schools they attend.

Democrats, who have been trying to kill the program and resisted proposals to reform it, turned them down unanimously after a nine-hour hearing featuring legions of parents and children led by Valeria Gurr.

The history, details and daily action on the matter were excellently reported by Chuck Muth in his daily “Muth’s Truths” emails. The Daily Current and Educate Nevada Now, parroted the erroneous ideological ranting of Democrats hearing the case.

Their arguments, and those of the governor’s office, Muth and Gurr are widely available and deserve thoughtful folks’ review. But the more basic issues concerning private school funding have not been covered and deserve to be enunciated.

There’s a good case to be made for taxpayer subsidy of education. Education, especially K-12, improves the skills and social productivity of people and thus promotes economic growth and fairness – i.e., the public interest.

Families often lack the means or commitment to purchase optimal levels of education for their children. Hence, it is in the public interest to develop tax and subsidy regimes to achieve socially optimal levels of education throughout society.

Tax and subsidy regimes also apply to a few other areas, even though subsidy levels in those areas and education are often excessive due to political activities (“rent seeking”) of recipients and providers of the products and services. Besides education, sectors widely subject to such public support include food, housing and healthcare.

The fact that sound economic and policy analysis supports tax and subsidy regimes in principle does not justify the excess levels to which they have risen in recent decades.

Most important, the principle does not at all support the idea that the public sector should be the provider of the subsidized goods and services. Thus, we provide food stamps for recipients to use at private stores, not government outlets that have proven disastrous in many socialist countries.

We provide housing vouchers, having seen the abomination that resulted from government housing projects. Finally, healthcare subsidy is a mess, but would be worse if the government were the provider.

So, why is government the primary provider of education? The reason is that public subsidy of education began before the Civil War, when vouchers and similar means really had not been developed.

So, government provided the service directly and public school teachers and administrators gained unmerited monopoly power as the incumbent providers.

With the rise of teacher unions after 1959, they cemented this hold and have captured education policy and funding to be run for their benefit, not the public interest. Funding that follows the student is the essential reform that will improve our K-12 system; competition works better than government monopoly.

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Ron Knecht

Ron Knecht

Senior Policy Fellow

Ron Knecht, MS, JD & PE(CA), is a Senior Policy Fellow at the Nevada Policy Research Institute.  Previously, he served Nevadans as State Controller, a higher education Regent, Senior Economist, college teacher and Assemblyman.  Contact him at RonKnecht@aol.com.