Other than potential fireworks over Bitcoin mining, the legislative fiscal session, which began yesterday, probably won’t produce much drama. It’s very unlikely there will be significant changes to the $6.3 billion general revenue budget proposal Gov. Sarah Huckabee Sanders released last month.
Appropriations bills have major stakes — funding levels may impact the scope of what state government does just as much as the policy-related statutes that get more ink. They are also, let’s be honest, kind of dry.
But the Sanders budget is revealing for a couple of reasons. It shows that, unlike her father, former Gov. Mike Huckabee, she is a doctrinaire right-winger willing to aggressively advance an austerity agenda that slashes spending for those most in need. And it reveals that Arkansas LEARNS handouts to private school families in the form of school vouchers are swallowing up a substantial portion of the state’s spending pie.
Conservatives won’t like that I said spending was getting slashed, because in fact the governor’s proposal for fiscal year 2025 (which starts on July 1 and ends June 30, 2025) would increase the budget over last year by around $109 million, or 1.76%. Most of that is made up of an increase in funding for vouchers parents can use to send their kids to private schools under LEARNS, the government’s education overhaul that passed last year.
But budget watchers typically focus on the rate of growth, and the Sanders budget has a much smaller increase than we’ve seen in recent years. Fiscal year 2024, by comparison, was around 3% higher than fiscal year 2023. Critics argue that the austerity approach is a particular problem given high inflation in recent years.
Pete Gess, economic policy director at Arkansas Advocates for Children and Families, told the Arkansas Advocate earlier this week that the budget may prove inadequate to serve the needs of Arkansans because it doesn’t keep up with inflation:
Depending on which economist you ask or which consumer price index you check out, [inflation is] 5.5%. When you’re talking about a 1.76% increase, you’re moving backwards.
Arkansas Advocates for Children and Families has long complained that governors have budgeted in such a way to artificially create outsize surpluses. Underfunding key programs gives them wiggle room for their own priorities (and good headlines, perhaps, about generating a surplus).
One important piece of context for this year’s budget: Because of new funding slated for LEARNS, the relatively lower funding for other areas is actually more extreme than it looks on the surface.
LEARNS enacted a voucher system that allows families to use public funds to send their children to private schools. Funds allocated for those vouchers get a major bump in the governor’s proposed budget, roughly tripling from $31.7 million in fiscal year 2024 to $97.5 million in fiscal year 2025.
That $65.8 million increase for vouchers accounts for around 60% of the total increase for the entire budget.
This clarifies just how austere the governor’s budget is: Outside of the LEARNS funding, the proposed budget is only increasing by roughly 0.7% compared to last year. It also hints at the extent to which pouring money into the pockets of private school families is already crowding out other priorities.
The LEARNS funding bump is not a surprise — it’s baked into the law itself. The number of students eligible for LEARNS is limited to select categories during this school year, but opens up to more students next school year, and finally all K-12 students the following year. That requires a steady increase in funding. This year, the program wasn’t quite as popular as expected, so it actually spent less than originally forecast. But the entire point of the law is to give vouchers to as many students as possible, and the floodgates will likely open once eligibility is universal. And that will continue to squeeze out other needs, given the governor’s stingy approach.
LEARNS vouchers have no income test for families and are fully available to those who already send their kids to private school and would do so even without vouchers. This year, around 95% of voucher recipients did not attend public school last year (some were existing private school students and others were new kindergarteners). Only a few dozen voucher students in the entire state came from the lowest performing schools, ostensibly a key focus of the legislation.
Whatever its intentions, the voucher law is structured in such a way that it uses taxpayer money to funnel money into the pockets of private school families, many of them in the top income brackets in the state. It’s as if the state designed a special tax break or stimulus check for such rich families that serves no purpose other than fattening their bank accounts.
This is the point that Arkansas Advocates was hammering home at an event at the Capitol earlier today, reported on by Austin Gelder:
In Prescott, those vouchers are worth nothing because there’s not a private school anywhere nearby to spend them, Williams said.
Arkansas Advocates for Children and Families is a member of the Strong Families coalition, and Advocates Executive Director Keesa Smith criticized the budget’s emphasis on school vouchers over other education issues we’ve all been talking about for years.
“That increase does not include pre-K, early childhood education and investment in childcare to ease the burden of working families,” Smith said.
And more from the Advocate’s report:
Meanwhile, the Division of Children and Family Services within DHS is projected to receive a 0.03% increase of $43,118, and the line item for child care and early childhood education is left blank for the second year in a row on the proposed budget.
Gess said Arkansas’ child care shortage means directing state funds toward it should be a priority.
“We don’t believe there is a [budget] surplus,” Gess said. “We believe there are lots of underfunded programs.”
Budgets are about priorities, and the governor’s choice is clear.