Education

Shift to Private Schools Predicted With Tax Credit

By Eileen White — July 27, 1983 8 min read
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About 5 percent of the students currently attending public schools would be likely to transfer to private schools if a tuition tax credit of $250 were available, according to a Congressionally mandated study of private schools.

The study also found that black, Hispanic, and low-income students, students whose parents attained low levels of education, and urban residents were most likely to make the change.

For story on U.S. Supreme Court’s tax-deduction decision, see page 9.

And it concluded that private-school tuition cost was the principal deterrent to parents who had considered switching from public to private schools.

The report, “Private Elementary and Secondary Education,” is the second part of a four-volume study known as the School Finance Project, which was mandated by the Congress in 1978 and conducted by the National Institute of Education.

Its findings are considered likely to contribute to the debate over tuition tax credits because they represent the first attempt by a research organization to estimate the effects of tuition tax credits through the use of a telephone survey and realistic cost and supply data, according to researchers familiar with the study.

The 1982 Gallup Poll on education reported that 45 percent of public-school parents would switch to private schools, but those responses were based on the assumption that students could attend private schools tuition-free. Other researchers have estimated that up to 16 percent of public-school students would transfer to private schools; their findings, however, were based on empirical evidence of private-school demand without consideration of the supply of places in private schools.

The school-finance report was completed in time for its scheduled presentation to the Congress in March. But the Reagan Administration ordered it revised, and a new version, completed early in June, has not been released. A copy of this later version was obtained by Education Week.

The Administration, according to informed sources, ordered the researchers to delete those portions of the report that estimated the cost of tuition tax credits to the federal treasury and the impact on the public schools of the loss of millions of students.

That information was deleted, although the law that established the study, the Education Amendments of 1978, specified that the study was to conduct “an analysis of current and future federal assistance for nonpublic elementary and secondary education, including ... the impact of private schools on public-school enrollments and financial support.”

Two Congressional education leaders wrote to the Secretary of Education early this month seeking copies of the study. According to aides to the legislators--Representative Carl D. Perkins, Democrat of Kentucky, and Senator Robert T. Stafford, Republican of Vermont--they have not received replies.

Education Department sources said that the Administration was reluctant to release even the revised version of the report because, although its findings appear to support President Reagan’s statement that tuition tax credits would “help low- and middle-income families afford the schools of their choice,” they also show the Administration’s estimate of the cost of tuition tax credits to be “unreasonably” low.

The basis of the controversy was said by sources to be a telephone survey of 1,200 parents of school-age children, in which 9.2 percent of public-school parents said they were “very likely,” and 16 percent said they were “somewhat likely,” to choose private schools if a $250 tax credit were available.

Places in Private Schools

Using that information, as well as parents’ relative “propensity” to act on their stated preferences and the supply of openings in private schools, the researchers projected that about 1.9 million--5 percent--of public-school students would seek places in private schools.

That conclusion was ordered omitted from the final report, the sources said. The survey results were included without interpretation, but they were characterized as “hypothetical” and “a poor predictor of behavior” at the request of Administration officials.

The Administration has proposed a credit that would be phased in over a three-year period, from $100, to $200, to $300. But officials’ cost estimates--$526 million at $300--are based only on current private-school enrollment. If the 1.9 million children identified in the survey were to switch, the cost of the $300 tax credit could more than double, according to sources familiar with the study.

“I think the Administration is afraid of the repercussions, of the public-school people saying, ‘this is what we told you would happen, the death knell for the public schools,”’ said an aide to a Republican Senator. “Secretary [of Education Terrel H.] Bell has been saying that there won’t be an impact on the public schools. The fact that there will be an impact would interfere with the new support the President is getting from the education community.”

Other sources said Administration officials were also concerned that cost estimates for tuition tax credits would increase at a time when the Administration is being pressured to extend tax credits to cover public-school costs in the wake of the U.S. Supreme Court’s Mueller v. Allen decision. In that case, the Court upheld a Minnesota law that permits parents to take a tax deduction for public- or private-school expenses. (See related story on page 9.)

“They haven’t released it because it would increase the figures at a time that figures are sensitive,” said a lobbyist who supports tax credits.

Robert L. Smith, executive director of the Council for American Private Education, questioned whether private schools could accommodate millions of additional students. “I would be surprised if they could absorb that many,” he said. Although no data exist on the current number of openings in private schools, Mr. Smith said he would put the figure at no more than 500,000.

Thought Varies Widely

The survey also led the researchers to conclude that “the amount of thought given to the choice of a school varies greatly among American families, with more thought devoted to school selection in more affluent and better-educated households.”

“For many children,” the report says, “enrollment in a public school is not the result of a conscious choice on the part of the parents, but a result of parental acceptance of the child’s assignment to a particular school.” Thirty-four percent of the public-school parents said they simply accepted their children’s assignment without question.

The study also found that 14.3 percent of the public-school parents reported dissatisfaction with their children’s schools, while only 3.4 percent of private-school parents were dissatisfied with their schools.

Cost was identified as the major factor preventing parents who wanted to leave the public schools from doing so. One-fourth of the public-school parents polled had considered switching to private schools, but 57 percent of them said they had decided against the move because of the cost.

“Academic Standards”

Parents who did choose private schools reported doing so for varying reasons. Of those who enrolled their children in independent schools, most said they did so for “academic standards and courses.” Of Catholic-school parents, academic quality was the primary consideration, with values and religion secondary factors. For parents who chose other types of religious schools, however, values and religion were said to be the primary factor.

The results “suggest that each [type of school] has a distinct constituency that overlaps little with the other two,” the study said.

The school-finance study also included data from sources other than the telephone survey. Among its other findings are:

The number of black students in private schools increased “dramatically"--by more than 52 percent--during the 1970’s, particularly in elementary schools and in central cities. Nevertheless, “the proportion of whites enrolled in private schools is more than double the proportion of blacks,” according to the study.

A “strong relationship” exists “between family income and private-school attendance.” Only 5 percent of children from families with $15,000 in annual income attend private schools; 27.5 percent of children from families earning over $50,000 attend private schools.

A similarly “strong relationship” was found between family income and tuition paid at private schools. The average tuition paid by families in the over-$50,000 group was nearly twice that paid by those in the under-$15,000 group.

Research data differ on the decline of private- versus public-school enrollments during the 1970’s. Although the U.S. Census Bureau reported that private-school enrollments declined more rapidly than public-school enrollments, the National Center for Education Statistics reported a 6.5 percent decline for private schools, and a 10.7 percent decline for public schools. Private schools enrolled 10.9 percent of students in 1980, according to the center’s data.

The proportion of children attending private schools in the Northeast is nearly twice that in the South, or 15.7 percent compared to 8.1 percent. Private schools in the North Central states enroll 12.2 percent of students, while those in the West enroll 8.9 percent.

Enrollment Growing

Enrollment declines are sharpest in Catholic schools, but enrollment in independent schools is growing. Between 1976 and 1980, enrollment in Catholic schools declined by 6.8 percent, and enrollment in schools affiliated with other churches declined by 4.5 percent. By contrast, enrollment in schools not affiliated with churches grew by 15.4 percent.

Regarding state regulation of private schools, 18 states have “some form of mandatory” requirements, 23 states have “voluntary” standards, and nine states have no laws or regulations governing private schools.

A version of this article appeared in the July 27, 1983 edition of Education Week as Shift to Private Schools Predicted With Tax Credit

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