An effort to expand a North Carolina program that uses taxpayer dollars to send students to private school collapsed in the statehouse as lawmakers drew the short legislative session to a close on Thursday.
Republican leaders of the state House and Senate had hoped to expand the Opportunity Scholarships program and had earmarked more than $460 million for the program in separate budget proposals. But negotiations fell apart between the chambers as they tried to figure out how to spend a $1 billion surplus.
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Without additional funding, the voucher program is set to be short by more than $200 million, which would mean 54,000 students whose families applied wouldn’t receive vouchers.
The Senate had approved a standalone bill to expand the voucher program, but the idea didn't gain traction in the House. Senate leader Phil Berger, R-Rockingham, said his chamber sought to negotiate in other ways with the House, offering the chamber several other opportunities to come to an agreement.
“Folks need to ask them why it's not funded,” Berger told reporters Thursday. “Because we have tried every way that we know.”
Teacher pay appears to have been the sticking point. The House budget proposed an average pay bump of 1.4% — on top of previously approved 3% average raises teachers are set to receive next year. And the chamber pushed for the restoration of extra pay for teachers with Master’s degrees. But the Senate didn’t propose any additional raises in its spending proposal.
"We feel like it needs to be done in a comprehensive manner," House Speaker Tim Moore, R-Cleveland, told reporters. "... We don't believe it's appropriate to just as a one-off."
He added: "The only thing that we were asking is that there be components in there to also put funds to our traditional public schools. And we were unable to get that agreement from the Senate."
Democratic Gov. Roy Cooper has opposed expanding voucher access, saying the private schools that receive the funds aren’t held publicly accountable and that traditional public schools need more funding to recruit and retain quality teachers.
Cooper would likely veto a bill expanding private school vouchers. Republicans have veto-proof supermajorites in both chambers and so far this session have overridden all of Cooper's vetoes.
What the House had proposed
In a spending plan approved last week, the House earmarked $487 million over the next two years for the state’s private school voucher program, known as Opportunity Scholarships — including $24.6 million the associated Personal Education Student Accounts for Children with Disabilities funds. The proposed funding would be a major increase to what was already budgeted for the program in the 2024-25 and 2025-26 school years. The House proposed spending $175.6 million more from the general fund for those two programs, plus $97 million from the State Lottery Fund and $215.5 million from a savings fund, to pay for the vouchers for tens of thousands of more students.
Of the voucher spending, $248 million would be for the 2024-25 school year. That would nearly double spending for the state’s program that writes checks to families who wish to send their children to a private school instead of a public school.
The increase for next year would be on top of the $293.5 million already appropriated for next year from the Opportunity Scholarship fund and from two other funding sources, leading to a total appropriation of $541.5 million.
More applicants, not enough money
Next year is the first year that families of any income and families of current private school students have been allowed to receive a voucher, resulting in about 72,000 new applicants for the program that already enrolled more than 32,000 students. The vouchers cover at least $3,000 for families and up to more than $7,000 for the lowest-income families, unless actual tuition is lower than that.
Voucher opponents argue the program siphons money away from the public schools that more families are able to attend and that are not adequately resourced.
The state spends more than $11 billion on public schools, and counties spend another more than $3 billion on public schools.
It’s unclear how many of the 72,000 new students who applied for an Opportunity Scholarship already attend a private school, because the state Educational Assistance Authority doesn’t ask for that information when students apply.
About one-fifth of applicants were from families in the highest-income tier. That means a family of four earning more than $259,740. About two-fifths were from families with incomes in the tier below — between $115,400 and $159,740 for a family of four. But none of those families are set to receive a voucher next year. Very few families in the second-lowest income tier — between $57,720 and $115,440 for a family of four — are set to receive a voucher. All families in the lowest-income tier — $57,720 for a family of four — are set to receive a voucher, and all families who already have a voucher are set to receive one again.
Median income for a family of four in 2022 was about $105,000 in North Carolina, according to the U.S. Census Bureau.
WRAL Capitol Bureau Chief Laura Leslie contributed to this report.