Indiana Vouchers: Private School Coupons for Wealthy Families
Program costs nearly $500 million, funds private school discounts for the rich
Indiana produces an annual report on its private school voucher scheme. This year’s data makes it clear: The voucher program continues to eat an ever larger portion of the state budget AND the program essentially serves as a private school discount coupon for rich families.
The Indianapolis Star reports:
Indiana’s Choice Scholarship Program allows families to use state dollars that would have followed their child to a traditional public school to instead pay for a private, parochial or nonreligious school.
The state releases this report annually, and for the 2024-25 school year, it showed that the state spent around $497 million on the program, which is an increase of just over $58 million from the previous school year.
Just a few years ago - in 2017 - the Indiana school voucher scheme cost the state $54 million. Now, the year-over-year increase in voucher expenses exceeds what the entire program cost just 8 years ago.
At the current growth rate, spending on vouchers in Indiana will have grown tenfold in less than a decade.
Tennessee starts a universal school voucher plan in the 2025-2026 school year. That program is already at capacity in terms of the number of applicants. All 20,000 slots will be taken.
If growth of the program tracks Indiana, that would mean that by 2035, Tennessee will be spending more than $1.4 billion on private school coupons.
Which brings us to the second big takeaway: These vouchers are just creating a discount for wealthy families - they are not a pathway for low- and middle-income families to gain access to private school education.
The program is nearly universal in Indiana, with the state legislature in 2023 increasing the income requirement for participation to up to 400% of the amount needed to qualify for the federal free and reduced lunch program. For a family of four, that is an annual income of $237,910.
However, that will change starting in June 2026 since the legislature approved removing income requirements for participation in legislation that passed this year.
And the ever-increasing (and now removed) income caps are “working:”
The largest year-over-year increase in the number of households using the vouchers, in terms of income, was among those with incomes of $200,000 or more, at a 1.65% increase.
The majority of students who use vouchers have never attended public schools, a trend that previous years have shown as well.
What’s the impact?
“. . . the cost is projected to grow 263 percent in just five years. This expansion is predicted to force public school districts to either make severe cuts or ask taxpayers for more money through public referendums.”