Study Finds Costly Loophole in Voucher Law

Due to a little-known accounting loophole, Milwaukee’s private school voucher program has allowed schools to collect nearly $2.5 million in additional payments in the last three years solely on the basis of how much their school buildings are worth, according to a report in “Rethinking Schools.”

The education publication’s spring edition reports that schools participating in the voucher program receive state funding based on per-pupil costs, which can be significantly above the schools’ tuition charges.

Due to a highly unusual accounting loophole, the schools are able to include in their costs the current market value of their buildings – even if those buildings had long ago been paid off.

“Rethinking Schools” examined hundreds of financial documents filed by private schools participating in the voucher program for the school years ending in 1999, 2000, and 2001. The newspaper calculated that, under the terms of the voucher formula, schools collected a total of $2.47 million in payments tied solely to the current market value of school facilities.

Resource page on private school vouchers
Rethinking Schools Web site

Posted March 15, 2002