Recently a colleague gave me a little brochure put out by an organization called Citizens For More Sensible Financing Of Education, with headquarters in Lansing, the state capital of Michigan. I have written for more information concerning both the organization and the proposal which it is promoting. But from the information in this brochure it appears that the proposal set forth in this brochure is nothing more than an attempt to revive parochiaid, or government financial support of private schools. However, this time the proposal is in disguise, the disguise of a tax-reform proposal. And while, perhaps, tax-reform may be attractive to some, even to many—and perhaps this very attractiveness is intended to be the lure—nevertheless, from the information I now have, it appears to me that this is a rather thinly veiled disguise. And, again drawing my conclusion from the information I now possess, it appears to me that the disguise is also deceitful and dishonest.
It is the avowed intent of this editorial to expose this disguise and to militate against the proposal.
Admittedly, this is a proposal which affects Michigan readers directly. Yet the issue of parochiaid in general is broader than that, and is of importance for readers in other states as well. In fact, it may safely be predicted that if the Michigan proposal would be approved by the voters in the proposed referendum, and if then the proposal would also be found to be constitutional, the same type of plan would be attempted in other states.
In the interest of fairness, I will quote all of the information furnished in the brochure, Before I do so, however, I must point out that the entire approach of this material is oblique. At no point does it attempt to leave the impression that this is a parochiaid proposal; the opposite is true. In fact, the whole attempt is to leave the impression of being a ,tax-reform proposal. The front cover of the brochure, for example, poses the question in large print, “Isn’t there a more sensible way to finance education?” Now who would not be interested, in this day of unreasonable and increasing taxes, in a “more sensible way to finance education”? At the bottom of the front cover is a slogan which has been becoming increasingly popular, at least in Michigan: “Down With Property Tax—Up With Education.” That’s, of course, like being in favor of motherhood and apple pie! Moreover, the name of the organization itself gives no hint of being a pro-parochiaid organization. Nevertheless, in the course. of the information furnished, the proverbial cat comes out of the bag.
This is a proposal for a referendum, that is, to submit to a popular vote the following plan:
This proposal would place a referendum on the 1978 ballot, mandating the following changes:
1. All property taxes previously earmarked for educational operation purposes would be eliminated.
2. A statewide voucher system would be established allowing each child an allocation of state tax dollars to be applied to educating that child at a school of his or her parent’s choice.
3. Restrictions relative to support of children in non-public schools would be removed.
Already here, of course, the question arises: what does item No. 3 have to do with the main thrust of the proposal? Besides, what does a voucher system have to do with more sensible financing? But let us allow the brochure to explain in full. I will quote the brochure in full. The only change I have made is the addition of numerals to the questions and answers, for the sake of reference. Under the heading of “Taxes” the following is presented:
1. Q. How do we currently pay for education?
A. The operational income for public schools is currently gathered from local property taxes in the amount of $1.8 billion and state taxes amounting to $1.3 billion.
2. Q. Why remove the property tax?
A.The present system of financing education is inequitable and unfair because property ownership in itself does not represent a true measure of a person’s ability to pay. Families in homes of similar value can have widely different incomes, and yet pay the same property tax.
In addition, the archaic formula for state financing of education is based upon the amount of millage levied in each school district, and this has resulted in great disparities of educational opportunity from community to community.
3. Q. What changes will this make in the taxes collected by the state for education?
A. The proposal specifically prohibits the levy of property taxes for financing K-12 educational operations; it eliminates any use of property taxes to pay for school operations. The proposal directs the Legislature to establish a program of general taxation for the support of education.
4. Q. How much of the property tax now goes for, the support of education?
A.In 1960 property taxes for public education in Michigan amounted to $434 million. By 1976, that figure had increased to one billion, eight hundred million dollars!
This figure represents about 65% of all property taxes levied on a statewide average. This means that if your property taxes amounted to $1,000, using the state average, $650 of your property tax payment would be used to finance the operation of local public schools.
5. Q. How can these costs skyrocket when local millage requests are turned down repeatedly by the voters?
A. A millage issue is never closed until it passes. If defeated by the voters, the issue simply keeps showing up on the ballot until it is ultimately approved. Also, property tax revenue can be increased, through assessment without a vote, merely by re-evaluating local property. In the last 12 years, state equalized property values have increased 126% and millage levels have jumped 30%.
6. Q. Is the proposal a shift from property tax to income tax?
A. No, the proposal does not mandate a shift. It is likely, though, that the Legislature will proportionately increase the personal income tax and the single business tax within the current constitutional requirements in order to generate the funds necessary to finance schools. The Legislature may also consider other forms of taxation, such as excise tax, sales tax, intangibles tax, etc.
7. Q. Will this proposal hurt business and industry?
A. No. On the contrary, the proposal removes the educational property tax from business and therefore does not penalize a business for owning property. Business taxes which are now contributed to the General State Fund would be expected to increase to the amount of property tax eliminated.
8. Q. Won’t I lose my one chance to reject school millage at the ballot box if this referendum passes?
A. Yes, school millages would be unnecessary since that large portion of property tax now earmarked for operational educational support would be eliminated from property tax payments. However, you gain a greater opportunity to exercise economic control over your child’s education through receipt and use of individual vouchers. Funding and control go hand in hand; this greatly enhances the voucher.
Now we are not interested so much in the tax aspect of the proposal. Yet we must remember that this is intended as an attractive part of the whole proposal. In itself, of course, there is nothing wrong with a proposal to reform the method of taxation. I suppose, too, that property owners can be attracted by a proposal which somehow wants to lift the burden of school taxes from property owners only and to spread that burden around to all taxpayers. Yet we must remember that under the terms of this proposal the over-all tax burden will be increased tremendously. Why? The proposal wants to include payment for the education of all present non-public school students. I do not have the statistics at hand on the number of private school students in Michigan; but it is large. And it does not require a tax expert to figure out that if state taxes are going to support the students of private schools at about the same rate as public school students are now supported, this is going to increase the total bill by an enormous amount. In other words, for the general public this proposal is after all not so very attractive! Besides, in the second place, it is almost an axiom of government that the farther away from the citizens the control of taxes gets, the less voice the citizens have, the higher the taxes go; and, once they are up, it is extremely difficult to get taxes down. The proposal admits (Q. & A. 8) that we will lose the power of the ballot box on school millage. It foolishly claims greater economic control. The truth is that the control will be with the legislature, not with the citizens. And in the legislature the education lobby and the teachers’ lobby are some of the most powerful! The conclusion? Taxes for educational purposes will go up, up, up! Some may call this more sensible financing of education. I demur.
The next subject treated in the brochure is “The Voucher System.” On this subject there are the following questions and answers:
9. Q. What is a voucher?
A. A voucher is a certificate representing a sum of money issued by the state to parents for the education of their children.
10. Q. How will a voucher system work?
A. Under a voucher arrangement each school child, or parent, would be issued an authorization which could be redeemed at any state-approved school. The voucher would be applied toward th1111111e cost of the child’s education during that school year, with the exact amount determined by a formula which would encompass a wide variety of factors bearing on costs in the district and the needs of the child. When cashed at a school where tuition costs exceed the voucher payment, parents of the child would be required to make up the difference.
11. Q. Will the proposal change school district boundaries?
A.No. The proposal itself will not change school district boundary lines. The Legislature has determined the current school district boundaries and retains the authority to change these boundaries. It is anticipated that the Legislature will recognize the need to increase the choices available to parents and students among public schools. The freedom to attend non-public schools has never been geographically restricted, since there are no legislatively defined attendance areas for non-public schools.
12. Q. This voucher system of providing funds to each student individually is pretty radical. How do we know it can work?
A.The feasibility of this type of arrangement was thoroughly tested with great success in the federal government’s GI Bill education provision, which provided veterans with the economic opportunity to select the type of education and school of their choice.
13. Q. Will total state funding result in more state control if this voucher system becomes a reality?
A.No. The proposal grants no additional power for state regulation of public or non-public schools. The proposal does not change or add any statutory controls by the state. (As an example, acceptance of the GI Bill did not result in added government control of schools, either public or private.)
14. Q. What could be some other beneficial results of the voucher proposal?
A.1. Parents and students could freely choose the type of school and type of education they desired.
2. A more equitable and reasonable formula for financing education would be created. (i.e. educational payments to individuals, not to school institutions.)
3. Competition between schools would provide incentive to upgrade standards.
4. Parents will become more actively involved with schools.
5. Schools would be motivated to develop better course offerings.
6. Parents would finally have a voice in the education of their children by exercising their own economic decisions through a voucher.
We have the following comments on the proposed voucher system:
1.First of all, this voucher system is definitely NOT a part of tax-reform, nor can it be justified as being “more sensible financing of education.” The fact of the matter is that if this proposal were limited to the present system of public schools, the voucher system would not even be necessary, would, in fact, be unnecessary red tape. The simple fact is that at present the State of Michigan distributes state aid to the public schools on a per-pupil-formula. All that is necessary is that the state be informed of the number of pupils enrolled in a given school or school district, and an equivalent amount of aid is given to that school district on the basis of a certain amount per pupil. No voucher system is needed.
2.Of course, this voucher system is designed with parochiaid in view. Notice that Question and Answer 11 already makes mention of non-public schools. Question and Answer 12 speaks of “the type of education and school of their choice.” Question and Answer 13 again mentions non-public schools. And Question and Answer 14 suggests that “Parents and students could freely choose the type of school and type of education they desired.” The whole voucher system is designed with parochiaid in view. But the strategy is to have the funds go to parents, and, of course, to all parents, rather than directly to schools. By this strategy they think to avoid the charge that this aid is unconstitutional because the state is supporting religious education. I am no lawyer, and surely not an expert on constitutional law. But it seems to me the ruse is so transparent that a child can discern it.
3.Can you begin to imagine the endless miles of red tape (and expense) involved in a voucher system? Furnish a voucher to every parent for every school-age child? And in this connection, let no one talk to me about the GI Bill! I and members of the Theological School Committee had abundant experience with its red tape during the late 1940s and again recently. And this is presented as “more sensible” financing of education?
4.The brochure makes the claim that this will not result in more state control. True, the proposal as such grants no more powers of state regulation. But do not forget that already in Q. and A. 8 the brochure itself has argued that “Funding and control go hand in hand.” Do not forget that the state will hold the purse strings over both public and nonpublic schools: for the state has the power to grant or not to grant vouchers. Where does the control lie? With the parents? No, with the state which grants the vouchers. Funding and control go hand in hand. Perhaps the proposal itself grants no further powers of control. But the principle of control through funding is implicit in this proposal. And the potential for state control is plainly present. As far as our parental schools are concerned, we must avoid this like the plague!
(to be continued)