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Expert: School Choice One Option To Ease Fiscal Stress From Newcomers

Influx of older and younger residents will strain state budgets, education researcher says

Matthew Ladner of the Foundation for Excellence in Education speaks of changing demographics at a Wednesday luncheon in Raleigh. (CJ photo by Barry Smith)
Matthew Ladner of the Foundation for Excellence in Education speaks of changing demographics at a Wednesday luncheon in Raleigh. (CJ photo by Barry Smith)

Baby boomers nationwide are reaching retirement age at the rate of 10,000 every day day. Meanwhile, they’re sending their grandchildren to school, creating a general tension on state budgets — one that could be alleviated in part by adopting wider school-choice initiatives.

That’s the picture that Matthew Ladner, senior advisor for policy and research at the Foundation for Excellence in Education, painted during a luncheon on Wednesday hosted by Parents for Educational Freedom in North Carolina on the N.C. State University Centennial Campus.

“The Census Bureau projects that North Carolina is going to add 550,000 additional school-age children between 2010 and 2030 and at the same time you’ll be adding over a million residents age 65 and older,” Ladner said during a media briefing after the luncheon.

The state has been dealing with a rapid increase in the kindergarten through grade 12 population for some time, he said.

“But what you’ve never done is to do that at the same time when you have an increasing elderly population,” Ladner said. “The two of those happening at the same time is going to bring challenges.”

“The pressures on the budget are going to be sort of a health care vs. education tension,” Ladner said. “Quite frankly, you’re going to have different funding priorities between different generations of North Carolinians.”

Ladner said that the elderly are disproportionate consumers of Medicaid services. “On a per enrollee basis, they’re some of the most expensive people in the Medicaid system,” he said. “With a million additional [residents] 65 and older on the way, you’d expect a very pronounced increased demand for increased Medicaid spending while you’re also trying to cope with half a million more new K-12 students.”

State lawmakers only have so much money, Ladner said, adding that they’ll have to establish priorities.

“The best scenario for North Carolina to not only survive this but [also] thrive through it has to lie in a faster rate of economic growth because that means more state revenue, which makes all the problems a lot more bearable,” Ladner said, adding that a second need is “policy innovation.”

Ladner said innovations should be driven toward getting a bigger bang for the buck in K-12 education. He said continued increases in per-pupil spending, the approach public schools have taken over the past 50 years, are unlikely to be sustainable. But, he also noted a reduction in the growth of per-pupil spending does not mean that student performance must suffer.

“What we have to do is increase incentives for improved results,” Ladner said. That can be done either with higher spending or better use of existing dollars. “The focus on K-12 reform has to be an increased return on investment.”

One way to do that would be to increase parental choice, Ladner said. Many school choice programs, such as private school scholarships and charter school programs, tend to spend fewer state tax dollars per child than traditional public schools, he said.

Those schools also tend to get better results, Ladner said. “It doesn’t mean that they’re better schools,” he said. “It means that they are better schools for the kids that chose to enroll in them.”

Ladner also suggested direct incentives to successful public schools. He said Florida started providing incentive bonuses for schools that increased the number of students who passed advanced placement exams. “What we’ve seen is huge increases in the number of students passing AP exams, getting college credit, and are more likely to graduate high school.”

He said the increases in performance are especially pronounced among disadvantaged students.

Ladner also encouraged North Carolina to follow the lead of five other states and adopt education scholarship accounts. Those programs allow parents to exempt from taxation a certain amount of money each year (such as $2,000 in Arizona) so long as it is used for educational purposes. That money could be spent on private school tuition, tutors for children going to public schools, enrolling in some classes at private schools, or college expenses.