On Friday, April 5, the New Hampshire Senate will vote on an expansion of the statewide school voucher program, which would increase the income eligibility threshold to $124,800, or about 51% of New Hampshire students. The cost of the voucher program could increase to about $53 million per year if all eligible homeschool and private school students were to enroll in the 2024-2025 school year.
On Tuesday, Senators Jeb Bradley (R-Wolfeboro) and Tim Lang (R-Sanbornton) amended Senate Bill (SB) 442 to include the voucher expansion and extend phase-out grants for school districts that lose students to vouchers.
The original version of SB 442 would have added an eligibility category for students who were denied a transfer request by the state, but the language was removed and replaced with the expansion language.
The bill also extends the state’s phase-out grant, which provides districts with funding for two years for each student who leaves their public school to enroll in the voucher program. The program provides school districts with 50% of their per-student state funding in the first year after they leave and 25% in the second year. The phase-out grant was supposed to sunset in 2026; however, SB 442 would extend it to 2029.
The bill will head to the Senate floor with a party-line recommendation in favor of the bill as amended.
About the expansion
Under current law, students are eligible to participate in the school voucher program if their family income is less than 350% of the federal poverty guideline, which would be $109,200 for a family of four in the 2024-2025 school year.
SB 442 would increase that threshold to 400% of the FPG, which would be $124,800 for a family of four. According to US Census data, about 51% of New Hampshire students have family incomes that meet this threshold.
Using those figures, if all eligible private- and home-schooled students enrolled in the program, it would cost the state about $53 million per year. In 2023-2024, the school voucher program will cost approximately $24.5 million.
Efforts to expand to universal eligibility have stalled this year
Five efforts have been made to expand the school voucher program this year, including proposals to extend eligibility to all students regardless of income. Amid strong public opposition, those efforts have failed, and lawmakers have pursued incremental expansions by lifting the income eligibility amount.
In March, the House passed HB 1665 along party lines. This bill would increase the threshold to 500% of the FPG, or $156,000 per year for a family of four, and would include about two-thirds of New Hampshire youth. Despite the significant fiscal impact on the state budget, House Finance Chair Ken Weyler (R-Kingston) waived the opportunity for House budget writers to consider and analyze the bill, instead sending it straight to the Senate. The bill currently sits in the Senate Education Committee, awaiting consideration.
Read more about HB 1665: Partial school voucher expansion could cost the state up to $66 million per year, according to RHNH analysis
Model Assumptions
The following assumptions are included in the model:
- The totals are based on the Public School Adequacy FY2025 Estimate, and do not take into account any changes to the state adequacy formula made after July 1, 2023.
- The models are based on 2023-2024 private school and homeschool enrollment and assume no changes in enrollment for the 2024-2025 school year. They do not include students who reside in New Hampshire and attend an out-of-state private school.
- The FRL eligibility rate is assumed to be equivalent to the district public school eligibility rate, which is 26.5% in SFY2024. There is expected to be a decrease in eligibility from the current SFY2024 for FRL if the income cap is removed; therefore, the model uses the district public school eligibility rate.
- The Special Education and ELL eligibility rates are assumed to be equivalent to the current participation rates for the school voucher program in SFY2024.
- The model assumes that all students who receive a school voucher in FY2024 are counted in the private school and homeschooling enrollment figures. Similarly, the model assumes that all private school students reside in New Hampshire. The NH Department of Education does not have data on either of these scenarios, so this remains an assumption of the model.
- The model uses US Census Bureau data to approximate the percentage of eligible students. The US Census Bureau data used in the model includes data for children ages 6-17; therefore, there is a model assumption that school-aged children who are not in that age band follow the same demographic trends.
- The model does not account for the margin of error associated with the US Census Bureau data.
- The model uses the latest available US Census Bureau data, which is the 2022 ACS 5-year estimates. Therefore, the model assumes that the income ratios remain constant through FY2025.
About the model
The model uses data from the 2023-2024 homeschool and private school enrollment reports from the NH Department of Education. The model does not include students who live in New Hampshire but currently attend a private school outside of New Hampshire, although they would be eligible to receive a school voucher if these laws passed. There is no requirement that school voucher recipients attend a school in the state, and voucher funds are permitted to be used on out-of-state school tuition.
The model does not include students who may disenroll from their local public school to enroll in the school voucher program; however, the vast majority (77%) of students who have participated since the program’s inception were already enrolled in private schools or homeschool programs.
The model only includes private and homeschool students; therefore, it does not take into account the local fiscal impact of school vouchers or the cost to the state to fund phase-out grants.
While it is unlikely that there will be a 100% participation rate in the first year of the school voucher program expansion, it is important for lawmakers and the public to understand its full cost since there is no cap on the number of students or allocated state funds. Per state law, the state must fund every eligible school voucher request, regardless of the state’s budget; therefore, the state should take into consideration the total amount for which they would be liable under full participation.
About school vouchers in New Hampshire
New Hampshire’s school vouchers are personal accounts that can be used to pay for certain education-related expenses, including private school tuition, homeschooling expenses, tutoring, books and materials, and transportation. Eligible families receive the base amount of state funding per student plus any additional aid for which their student qualifies (eligibility for school meals, special education services, English Language Learner program, or the third-grade reading aid). When participating in the program, families agree not to enroll their child full-time into their resident district school or public charter school; however, families may enroll their children into public and charter schools part-time, depending on the policies of the school.
Currently, students are eligible for participation in the program if they are eligible to enroll in a New Hampshire public school and meet the income eligibility guidelines at the time of application. Students only need to qualify in the first year of the program and do not need to meet the income eligibility guidelines in subsequent years.
Independent studies have found that outcomes for participation in similar school voucher programs in other states are, at best, mixed. However, more recent studies have suggested that these programs have had significant negative effects on student outcomes for the students who participate in them and have diverted funding from public schools. Researchers have stated that school vouchers “cause catastrophic academic harm” and have had a worse impact on student outcomes than any other policy or event in public school history, including the global pandemic.
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