Indiana University

News Release

Thursday, September 1, 2011

Last modified: Thursday, September 1, 2011

CEEP report surveys school choice, calls for neutrality in Indiana's implementation

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Sept. 1, 2011

BLOOMINGTON, Ind.-- Establishing a neutral entity to gather information on the performance of schools and their unique cultures in order to to help families navigate school choice options is among the recommendations of a new report issued by the Center for Evaluation and Education Policy (CEEP) at Indiana University.

"School Choice Issues in Indiana: Sifting through the Rhetoric" assesses the status of school choice laws and policies from across the nation and provides an analysis of issues facing the new school choice laws enacted by the Indiana General Assembly during the 2011 session that ended in April. Report authors are Rebecca Billick, an attorney with Andrews, Harrell, Mann, Carmin, and Parker in Bloomington and a licensed school counselor who was a graduate research assistant at CEEP last spring and summer; Stephen Hiller, current graduate research assistant at CEEP; and Terry Spradlin, CEEP's director for education policy.

Report authors presented their findings and recommendations today (Thursday, Sept. 1) during a meeting of the Indiana Public School/University Partnership, also called "Partnershare." Partnershare formed to stimulate school improvement by bringing together researchers from IU and educators from many of Indiana's public school corporations to share information and ideas for the advancement of education.

The report takes a critical look at challenges and opportunities facing Indiana as the first students take advantage of the new laws by enrolling in chosen schools this fall and as parents take advantage of income tax credits and deductions in the months ahead. Some education observers have called the Indiana school choice program the nation's most comprehensive.

Under three laws, certain Indiana parents can receive a tax deduction for home schooling as well as other private school expenses; acquire scholarships for private schools from the private donations of individuals or corporations incentivized to donate to Scholarship Granting Organizations (SGOs) because of tax credits; or receive a "Choice Scholarship," commonly referred to as a "voucher." Each of these three programs has various eligibility requirements, which are discussed in the report. The IDOE can award 7,500 vouchers this year, 15,000 next year, with no cap thereafter.

"Schools participating in the school choice programs are prohibited from discriminating on the basis of race, color, or national origin and must also use a lottery system to fill seats when there are more applicants than seats available," Billick said.

Billick said that while the legislation allows for tax incentives to promote private donations for scholarships, the actual tax credits issued have been far less than appropriated.

"The annual limit on the amount of tax credits allowed each year to individuals donating to Scholarship Granting Organizations was increased from $2.5 million to $5 million during the 2011 legislative session," Billick said. "But what's important to keep in mind is that the Department of Revenue only granted about $340,000 in tax credits during the 2011 fiscal year for this program."

Among the report's findings is that the voucher program is projected to save the state money. That's because the amount of funds given to each Choice Scholarship recipient is calculated in a way that ensures that the chosen school is given less money from the state for educating the child than the local public school would have been given for educating that same child. However, while the program saves the state money, individual school districts near a large number of private schools (generally urban areas), may experience a drop in local revenue. The report also notes a concern that if an eligible family obtains a scholarship from one of the SGOs and a scholarship from the Choice Scholarship state funds, potential state savings for that student may be decreased or eliminated.

The report finds that the Indiana school choice legislation is crafted to avoid some of the legal pitfalls of other similar programs across other states. Carefully crafted to mirror laws that have created legal precedent, the tax deduction and tax credit programs may avoid violating the U.S. Constitution's "Establishment Clause" because money does not go directly from the state treasury to religious institutions that may operate private schools. The Establishment Clause is in the First Amendment, and states that "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof." However, the CEEP report notes that if in executing the Choice Scholarship program, funds are sent directly to religious institutions without filtration through the private choices of citizens, the Choice Scholarship may be more prone to being seen as "advancing religion." The report closes with several recommendations as the state moves forward with the school choice program:

"As stated in the policy brief, the intent of these laws is to provide competition to the traditional public education system, which in turn is to drive improvement in the overall quality of education available to all elementary and secondary education students in the state," Spradlin said. "We do have achievement gaps that persist in K-12 education and whether these are the right strategies to serve marginalized children, time and good, unbiased data and evaluation of the systems will tell. For the sake of students who are not succeeding academically, I hope they help."

The full CEEP report on the school choice program is available at

CEEP, one of the country's leading nonpartisan education policy and program evaluation centers, promotes and supports rigorous evaluation and research primarily, but not exclusively, for educational, human services and nonprofit organizations. Center projects address state, national and international education questions. CEEP is part of the IU School of Education. To learn more about CEEP, go to

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