Public Schools of Choice Give Parents More Options

But Choice Squeezes Budgets at Some Schools

Michigan families have enjoyed expanded educational options since the state's public schools-of-choice program began in 1996, but some districts have had to make significant budget changes to adjust for students switching to different schools.

Under the schools-of-choice program, parents can send their children to a public school outside of their home district, provided the home district and district of choice both approve the transfer. In 1996, the first year of the program, nearly 6,200 students switched to a public school different from the one assigned to them by their home district. In 1997, another 10,750 students changed schools. The numbers for 1998 have not yet been released, but are expected to show an even greater increase.

For some districts, the effect of students coming and going is negligible. But for others, the gain or loss of students can mean millions of dollars in state funding. Essexville-Hampton Public Schools in Bay County received an additional $1.2 million for the current school year from students bringing their state foundation grants from neighboring school districts. Nearby Bay City Public Schools, however, stands to lose about $1.4 million in state aid as a result of students transferring out.

Rather than viewing this loss as a setback for his district, Bay City Public Schools Superintendent David M. Hutton sees the situation as an opportunity to improve. "I look at this as a positive initiative for good schools to get better," Hutton told the Bay City Times. "I feel we have a very good school district with excellent programs."

The monetary losses are not always as bad as they sound. Districts that lose students to other districts no longer have to spend money educating the students who chose another school.

But public school choice can still wreak havoc with budget planning. For the 1998-99 school year, Jackson Public Schools budgeted for a loss of $1.1 million in state funding, due to an expected loss of 200 students. Early projections based on actual student transfers, however, caused the school board to revise its estimated losses to over 540 students, which created an additional budget shortfall of $2 million.

Some districts respond to the budget shortfalls by adopting competitive contracting for school support services, according to Michael LaFaive, managing editor of Michigan Privatization Report. "Schools don't have to just absorb financial losses when students choose another school. Districts of all sizes can offset losses with major cost savings by competitive bidding of bus, janitorial, food services and teacher health insurance," LaFaive said.

Not every Michigan public school district is willing to accept outside students and allow current students to leave as part of the schools-of-choice program. Currently, 275 school districts offer full choice among themselves while 162 other districts have designed their own limited choice programs exclusively within their Intermediate School Districts. One hundred-twenty districts do not allow any form of school choice for families.

One example of a limited school choice plan is the one designed by Bloomfield Hills School District in Oakland County. Due to dwindling enrollment, Bloomfield Hills decided to open its doors to students outside the district. The school board set tuition for nonresident transfers at $8,000 for elementary students, $9,000 for middle schoolers, and $10,000 for attendees of Andover High School.

Parents must pay only the difference between Bloomfield Hills's tuition and the state foundation grant provided that their home district releases the state money to Bloomfield. In this example, parents would personally have to pay additional tuition of approximately $4,000 to send a child to public Andover High. So far, 34 students among these three Bloomfield public schools have exercised this option.

The legislation that created the state public schools-of-choice program is up for review this year. Early indications point to the possibility of an expansion of the program to include every school district in the state, not just those willing to participate.