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ESAs: How Education Savings Accounts Affect Homeschooling

By March 15, 2023July 10th, 2024No Comments

You’ve probably heard of ESAs, or Education Savings Accounts. How exactly do they affect homeschool families?

HSLDA attorney Scott Woodruff hosted a Facebook Live recently for MPE about this topic, especially in view of ESA legislation in the Kansas legislature. Scott also discussed the “ugly baggage” that can come with ESA statutes from his experience in other states.

Highlights from Facebook Live on ESAs

Scott: First, let me kind of get out the most important thing first. The ESA bill that is pending in Kansas right now, HSLDA does not oppose. We are neutral, and that is because we worked with proponents of the bill to get language inserted in there that we think will protect homeschoolers going forward. So we are not asking for action at this point.

Now, we’re gonna keep tracking the bill and watching what happens. A lot can happen in a legislative session. If something happens and we think the bill takes a turn for the worse, or the protections that we have crafted are removed, we won’t hesitate to ask for action.

But right now we are neutral on the bill. We’re not asking people to support the bill, but we’re also not asking people to oppose the bill. So that’s what I wanted to kind of get out upfront.

I’ll come back to the Kansas situation in a minute, but I wanna talk about ESA bills in general and what’s happening across the nation.

ESAs nationwide

For the last year or two, we’ve been seeing a steadily building wave of interest in laws that allow money that has been collected by the government to be sent back to families for supporting methods of education other than public schools.

You know, five years ago this would’ve been considered kind of a crazy idea, but it’s gained momentum and for the last several years it’s gotten more and momentum. And this year we’re seeing a veritable tidal wave of these kind of bills.

Now, they tend to appeal most in states where the lawmakers are very friendly toward individual freedoms. Bills like this generally don’t pop up in states that I would call liberal leaning or states where they have less of a value on individual freedoms.

States where they believe the government is there to kind of solve all your problems – we don’t see bills like that. We don’t see bills like this in say, you know, New York or Massachusetts or Illinois or New Jersey. Those states are are firmly in the hands of lawmakers who have a moderate to iffy valuation on individual freedoms and liberties.

But in the states where individual freedoms and liberties are held in a very high esteem, for example, Utah, Iowa, South Dakota, Kansas, a number of others, West Virginia, Arkansas, these bills have gained tremendous traction.

So it’s a very odd situation because generally when there’s a legislature that values individual freedoms, they’re going to want to protect homeschooling because homeschooling is, I could say the quintessential example of an individual freedom and individual liberty.

But we find ourselves in a very strange situation of very openly opposing many of our friends, because it’s our friends, the people on the conservative end, the people who value individual freedoms, who want to make this government money available for alternatives to public school.

Now, on the one hand, I’m sympathetic. I went to public school, I graduated high school in 1973. That’s back when dinosaurs roamed the earth. And the internet hadn’t even been invented yet to put videos of the dinosaurs up there.

public school to homeschool transition switch

But back then, high schools were very secular, not particularly friendly to Christianity, but they’ve gotten much worse. And with rampant wokeism and pushing gender identity issues to a point where kids feel like they’re not really going to be accepted as normal unless they get on the gender change bandwagon, you kind of have to feel sympathy for parents who really want an alternative.

And when we see a bill that only sends money to private schools where the private school is not the same as a homeschool, we don’t oppose those bills. For example, in Iowa an ESA bill was proposed, opponents knew that homeschoolers did not want to be included In Iowa, the homeschool is not a private school.

So the proponents crafted a bill that made it very clear that this money could only go to private schools. We looked at it, we analyzed it, we said, “Okay, this money cannot go to homeschoolers, so we are okay with it.” And that bill became law.

But in contrast in the state of Virginia this year, a bill was filed that would’ve allowed homeschoolers to get government money.

One of the chief sponsors of that bill was a very good friend of homeschooling, I mean a very, very good friend. And yet he had the belief that it would somehow help us to get government money.

I don’t think it’s going to help homeschoolers to get government money. And let me explain why.

Reason 1: Government money creates government dependence.

When people have to fund their own homeschooling, they’re not relying on anybody else for that money. That means they can do whatever they want with their money.

But if homeschoolers get in a situation where they are relying on someone else to give them that money, then they are gonna become dependent upon that entity.

And when that entity starts telling them, “Oh, you can’t homeschool that way, you can’t homeschool with those books, you have to homeschool according to our specifications,” it’s going to be very hard for them to turn down that government money. So number one, government money being sent to homeschoolers will create dependence.

Reason 2: Government money = ‘quid pro quo’.

If government money goes to homeschool families, it will create a quid pro quo mentality where the government says, “Oh, we did you a favor. We sent you thousands of dollars. Now it’s time for payback. You have to give us our quid pro quo now because we’re doing you such a big favor. The quid pro quo is we’re gonna double homeschool regulations on you.”

And we think that is a very unhealthy situation. That’s a situation where the government is going to demand a pound of flesh for all the good stuff they’ve given you.

Now, let me hesitate to add that the lawmakers who are proponents of these bills, the ones pushing them right now, they would never do that. The lawmakers in Kansas who like this bill would never in their lives turn around and say, “Okay, we want to double the regulations on homeschoolers,” but we have to be realistic.

One day the guard will change, the tide will change. One day there will be a legislature in Kansas that is not friendly to individual rights. It could be two years from now or five years, or 10 years or 20 years. But those of you who’ve been around long enough know that tides do tend to turn. It’s rare for one party to totally control a state for multiple decades.

After a while, people get tired of one party, one philosophy, they tend to un-elect them and put someone else in power. We would be naive to think that the folks who are in control in Kansas right now, that that will be the dominant philosophy 10, 20, 30, 40 years from now.

But we’re interested in protecting homeschool freedom, not just now, not just today, not this year or next year, but for generations, for generations to come. That’s our vision and it’s our view that ESA bills create a long tail, long-term hazard to freedom.

Now people will say, well, what harm has happened so far from ESA bills? That’s a very valid question. Problem is ESAs have not been around very long. In fact, in the states that have enacted ESA bills, there hasn’t yet been time for the other party to come into control.

Arizona enacted an ESA bill. They were like the granddaddy of all. There hasn’t been a total change of party control in Arizona. New Hampshire enacted an ESA bill. There hasn’t been a total change of control in New Hampshire. West Virginia enacted an ESA bill in 2021. People with that same philosophy are still in control.

So the short answer is, there hasn’t been enough time for the train wreck to occur. This is going to be a slow-moving train wreck. And the train wreck will happen when the party with the other philosophy takes control.

And when they take control, what we believe is very possible, maybe even likely, is that they’ll say, “Oh, we’re sending thousands of dollars to homeschoolers. We better tighten up on that. We need to be fiscally accountable. We aren’t doing enough to create accountability. We’re sending money out there and not insisting on results.”

And that mindset of insisting on accountability is going to produce, we think in some states, in very, very bad homeschool law situations.

homeschool law missouri

Example of ESAs in West Virginia

Let me give you something that’s the closest I know to an example in America. As I mentioned, in 2021, West Virginia enacted an ESA.

As we looked at the situation, as we looked at who was in favor of the bill, who was against it, the politics of the situation, we did not think that we had the power to outright kill the bill. We didn’t think that was possible.

Next best solution was to create some kind of safeguard within the bill that would hopefully isolate us from collateral damage down the road.

So HSLDA worked with the local state group, and we were successful in getting amendments added into the bill to create different legal silos for homeschooling and recipients of the scholarship money in West Virginia, they’re called Hope Scholars.

And we crafted an amendment which created a whole new exemption from compulsory attendance law called exemption M. Homeschoolers per se were under exemption B in the statute. And so by siloing them, we created different legal categories.

So if sometime in the future someone wanted to crack down on just the people getting the HOPE scholarship, they could go after exemption M and hopefully they would leave our exemption alone.

Did we think that was foolproof? We knew it wasn’t foolproof, but it was something that would help us.

Now let’s fast forward to right now, this current legislature in West Virginia. A bill was filed, we think primarily at the request of the treasurer who wanted to do some pretty minor procedural tweaks to how the money flows in those scholarships.

It would’ve been a simple bill. But as the bill got into the process, some sources we don’t fully understand, someone inserted language in there that added brand new requirements for homeschoolers that had never existed before.

Well, when we found out about that, we said this is absolutely unacceptable. We communicated with all of our contacts. We got in touch with lawmakers who we know value individual freedom. We communicated with leadership type people and pretty soon, because everything worked out just right, got the bill amended to take out all the bad stuff.

When it got to the house floor, a Democrat offered an amendment. And I’m gonna kind of paraphrase what he said. It’s not his exact words, but a paraphrase. He said something like, since the state is now incentivizing parents to homeschool, we need to provide additional layers of protection for those children. Because as we all know, homeschool parents tend to abuse and neglect their kids. So since we are incentivizing homeschooling, we owe it to those kids to add new layers of protection. Not a quote, just to paraphrase.

Now, as you and I know, that’s absolute nonsense.

There are many very respected institutions that have chimed in on what the risk factors are for child abuse. And there are very well documented risk factors for child abuse. No reputable institution or hospital lists homeschooling as a risk factor for child abuse. It’s an absolute myth. There is no scientific study anywhere that says that homeschooling is a risk factor for child abuse. Doesn’t exist.

But the myth is out there. And people who already don’t like homeschooling love to perpetuate that myth. So this Democratic representative got up there and proposed his amendment.

And then of course there was debate and there are a couple people argued in favor of a couple people argued against it. When the vote came, his amendment was voted down. So that’s great news, but this illustrates a tremendous vulnerability in any state where an ESA becomes law.

ESAs: ‘A very substantial danger’

The fact that an ESA exists gives every lawmaker who doesn’t value individual freedom a platform for saying the same thing: since we are incentivizing homeschooling, now we have to make sure it runs well. Now we have to make sure those parents are accountable. Now we have to make sure it produces results. Now we have to make sure parents aren’t abusing their children or neglecting them.

It gives them that kind of a platform, and that is a very substantial danger. So those are the main reasons we oppose government money for homeschooling.

Homeschooling has worked fantastic ever since its inception, largely because it’s not connected to government purse strings. Homeschooling is not expensive, not expensive in terms of like out-of-pocket money.

homeschooling with adhd tips

Homeschooling can be done for free. There are free homeschool programs out there. When HSLDA did a survey, I’ll say 10 years ago on cost of homeschooling, about the average amount the family spent was in the neighborhood of $500.

That’s more than, you know, pocket money. But it’s not a whole lot, you know, at least if someone is blessed to have a job.

The big expense for homeschooling tends to be that one parent doesn’t have a job. Now, I totally realize that there’s some single parents who work in homeschool, they do it. God bless them, it’s fantastic. I know there’s some two parent families who both work and they homeschool. That’s great. They make it work.

But the most typical scenario is that when a family begins to homeschool, typically the mom, sometimes the dad, will withdraw from the labor force so they can give their full attention to homeschooling.

So that is the biggest expense of homeschooling. And there’s no ESA bill anywhere that offers to replace someone’s lost income because they’re home teaching the kids. What they’re offering is money – $4,000, $5,000, $6,000, $7,000, which honestly we don’t need.

Have any of you out there spent $5,000 on homeschooling? You know what? I’m sure some have, but that’s gonna be an outlier. If you have the money, maybe you’ll spend it, maybe you won’t. But it’s certainly not required to put on a high-quality program.

So homeschooling operates wonderfully without government money, without government strings, without inviting the kind of government attention. That will come from the fiscal hawks who say, “Oh, now we’re spending this money. Now we have to demand accountability.”

And all of those measures that they will call accountability, those all are going to tend to shrink freedom. It’s going to tend to get smaller and smaller, to I don’t know what point. And once families are habituated to the money, they’re going to find it very hard to turn down the money.

Now in the West Virginia example I gave you the amendment that the Democratic representative offered wasn’t limited to just homeschool families getting the money. His amendment would’ve applied even to homeschoolers not accepting the money. And that’s a little scary.

ESA legislation in Kansas

Now I want to shift gears and talk about the Kansas bill a little bit. When this bill began coming down the pike, we analyzed the situation, looked at the politics, looked at the makeup, looked at the mood, and it was our assessment that like in West Virginia, we were not gonna be able to outright kill the bill.

Part of politics is being realistic. And when our own friends are pushing a bill and they’re united and they’re eager, it’s very, very hard for us to turn that ship around.

So in Kansas, it was our judgment that we could not outright kill the bill. So at that point, we began looking for a way to create a separate silo. So the people who would be receiving the Sunflower Equity money would be in a different legal silo than homeschoolers per se.

That was a little tricky because as you know, homeschooling is not in the Kansas statutes. Homeschooling is just a private school.

homeschool laws missouri

(Editor’s note: See more about starting a homeschool in Kansas.)

And so it became a very, very complicated question. How do we create a separate silo for us without subjecting us to, you know, unusual or new requirements?

But we came up with a way and the proponents of the bill worked with us, we feel like in good faith, in a cooperative way to address our concerns. And they added exactly the language we requested. We told them that if they would add this language, we would be neutral on the bill. They followed through on what they would said that what they said, and therefore we are going to be neutral.

So here’s the language that they added, and this is kind of the core of it. And this is within a definition section that says private school includes competent private instruction of a child directed by a parent or person acting as a parent. Private school does not include instruction provided pursuant to subsection C. That subsection C is the sunflower equity program.

So this language does two things. It recognizes that education by a parent is a kind of private school. So that drives a stake through the heart of in re: Sawyer.

In re: Sawyer, which was a Supreme Court case in Kansas in 1983, I think held that the family before the court wasn’t doing a private school. It was a mere home instruction. If you read that case, that family did homeschooling the same way most of you do. You could read that and say, oh, that’s a good homeschool family.

But the Kansas Supreme Court said, Nope, nope, nope. That’s not a private school. That’s mere home instruction. Now, after in re: Sawyer, we won a number of court cases, mostly lower level in which we were successful in defending a family who was homeschooling.

After we won several of those, there was also an attorney general opinion, which came out that said, “Yeah, you know, maybe what homeschool families do is okay if they follow certain factors in Sawyer, like planning, scheduling, evaluating.”

But there’s never been a statute that specifically allowed homeschooling. And there’s never been a court case that specifically allowed homeschooling the language I just read to you. That puts what we know is homeschooling into statute in black and white. And it has the effect of legislatively overruling in re: Sawyer.

So if this becomes law, then families will have a very high confidence level that they can follow the law and not be worried that some rogue prosecutor is going to come after them and claim they’re all truant because of in re: Sawyer.

So if this law is passed as is, we can be very happy because homeschooling will have kind of a special place, not a separate place, but we’re we, we would come within the definition of private school and that gives us a very firm legal foundation.

The second thing this language does, it’s there again to create the silo effect. The Sunshine Equity program has its own exemption from compulsory tenants law, but not under subsection C. So as we go down the road, if someone wants to add additional regulations to the Sunflower Equity program, they’ll be able to do that in a pretty straightforward way and leave homeschoolers alone.

Now, can I promise you that that’ll be bulletproof protection against further meddling or, or calls for restrictions? No, but we think that it’s the best practical thing we can accomplish right now, and that’s why HSLDA agreed to be neutral when the proponents agreed to adopt that language.

So that’s the Kansas situation. It’s still rumbling through the legislature. Is it gonna be enacted? We don’t know for sure. We think probably yes. We’re going to have to be alert, you know, all the time because that’ll give people who want to restrict freedom a platform and inroad access to arguing for more restrictions.

But we’ve been fighting to protect freedom for a long time. These ESA bills just kind of give us a bigger fight to fight. But HSLDA will continue fighting that fight in states with and without ESA bills.

ESAs in other states

I thought you might be interested in a quick rundown of what’s happening in some other states. I’ve mentioned to you that in states that I would call like deeply, firmly Democratic, ESA bills have no chance. But let me mention a few others to you.

homeschool other kids conference

In Arkansas this year, an ESA bill just became law. In Iowa an ESA bill became law. As I mentioned previously, we didn’t oppose that bill because homeschoolers were not eligible in Illinois, a deeply Democratic state. An ESA bill has been filed. I would say it’s just for show, just to make a statement. No way in the world it’s ever gonna be passed.

An ESA bill is filed in Indiana that has been killed. No bill has been filed in Kentucky, in Massachusetts, in Maryland, another very Democratic state, an ESA bill’s been filed, but honestly it’s just for show. In Mississippi and Montana, we were able to help kill ESA bills in those states.

A bill was filed in North Dakota that excludes homeschoolers. So that one is okay. A bill is filed in Nevada, but so far it leaves homeschoolers out. That’s very good. In Utah, the ESA bill did pass, and it does include homeschoolers. So not a desirable situation.

In Pennsylvania an ESA bill made a lot of progress a a year or two ago, and a sponsor has said they’re going to bring that bill back. The governor has said that he likes the idea of an ESA bill in Pennsylvania.

I have sent a letter to the person I think is going to be the sponsor, telling her that if the bill is available for homeschoolers, HSLDA will oppose it. The response I’ve gotten back from Senator Ward’s office is very lukewarm. I think we’re going to have to follow up and get more assertive on that point.

Q&A on ESA-related matters

Are there states that have crafted ESA legislation in which homeschoolers are not eligible?

Yes, Iowa is one that’s the best. I also mentioned another state where homeschoolers were left out and that was Nevada. So it can be done. Honestly, it’s gonna be way, way trickier in states where a homeschool is a private school because they fall under the same legal category.

What is an education savings account as it relates to public school funding legislation?

The idea of an education savings account, which by the way is just a euphemism – nobody’s really saving anything. It’s just government that comes out of the state treasury to a family. It’s the equivalent of a voucher or a subsidy, but it comes from public money. So the government collects tax money and then it sends that money back to people.

So it comes to you as government money, while in contrast, the tax credit or a tax deduction is simply you keeping more of your own money. HSLDA does not oppose those bills. We feel like they create much less of a hazard of bringing down higher regulations down the road. But an ESA bill, it’s not a tax credit. Not a tax deduction. It’s actual money that the government has collected going to private people.

tax breaks for homeschool in kansas or missouri

What are the risks to homeschooling if a student becomes an ESA student in the short term?

Not really much because all of these ESA bills are being crafted in a way that they’re kind of okay so that people who take the money don’t feel like they’re being pushed under the, the heel of government regulation. But you have to think, okay, that’s just the camel’s nose under the tent. So the short-term danger is probably pretty minimal. The long-term danger is that people become habituated to that money. It’s going to be really hard to stop receiving that money when more and more the camel comes into the tent.

Once you start receiving money in an ESA program, can you opt out?

I’m sure you can. No one has to be in the ESA program. So receipt of the money is voluntary.

What would be your response to someone who opposes this bill because the public schools will get stuck with all the special needs kids without the resources to properly educate them. If more children are being schooled for less money, wouldn’t it make more resources available for public schools?

I’m not an expert on public school financing. I expect if that actually happened, if public schools became heavily loaded with special needs kids, that the government would find a way to send them a lot more money.

And you know, I’d be okay with that. I have a special needs child and I understand that kids who are, you know, not neurotypical, not developmentally average, have needs that probably are more expensive to take care of than a child who’s otherwise kind of in the typical range. But you’re right that fewer kids means fewer expenses incurred by the public school.

I’d also say that the public schools become more heavily involved in special needs kids, you know. God bless ’em, rise to the occasion. Maybe they can actually get good at it. Because right now they stink.

I’m not wanting to minimize the incredible people who are individually super good with special needs kids. I don’t want to criticize every program everywhere because I’m sure there are some exceptional programs.

But in the main, I hear complaints all the time about people who feel betrayed, kids who feel ignored, needs that are unmet, schools that don’t want to listen, kids who are hurt, kids who are abused, abominably. And it breaks my heart.

So if more special needs kids end up in public schools, I would love it if they would use that to rise to the occasion and really truly figure out how to do a good creditable conscientious job for those kids.

homeschool profile

What about Missouri?

Great question. We are in a heck of a fight in Missouri. There’s a bill coming through right now, again by someone who I would call a friend of homeschooling. And we’ve sent alerts to our members asking them to oppose that bill.

We’ve approached the sponsor through many avenues saying, “Look, if you’ll just add these two phrases to the bill, it will take homeschoolers out and we won’t oppose it.”

So far the sponsor has said, “Nope, not interested.”

So at this point, we are in a knockdown drag out fight. The sponsor won’t do this small thing. We’re asking to keep us out. So we’re gonna fight it, uh, with, with might and Maine all we can keep getting the message out.

Missouri thankfully has a strong state organization, but you know, right now it’s a very Republican conservative oriented state, which in most respects is really good.

But when it comes to ESA bills, that’s actually a liability. I hate to say it, but <laugh>, you know, I find myself in the very weird situation of actually being on the same side of the issue as teachers unions, which I like never am.

One of the disadvantages of fighting an ESA bill is that it takes a long time to explain <laugh>. So I’ve just spent about at least 20 minutes of this program explaining why HSLDA opposes these.

Most of the time you’re not going to have 20 minutes to sit down and talk to a lawmaker and explain all those reasons to you. And while you’re explaining your reasons, he is going to be telling you all the reasons why the bills is a great idea. So to get through an entire discussion with a lawmaker where he tells you what he thinks and you tell him why his idea creates an unreasonable risk for freedom down the road, you’re talking about a 45-minute to an hour discussion.

And in this day and age, when attention spans are so short, when our brains have become like microwaves – they’re so quick – it’s honestly hard to have a conversation that long. People just don’t want to listen.

But if you’re listening from Missouri, please go have that conversation with your senators and representatives because we are in a major, major battle in Missouri. As I said, if a sponsor would make a simple change to keep us out, we’d be neutral. But at this point, he’s not willing to do that.

Does this legislation allow the government to interfere in private schools that enroll participants?

That would be pretty minimal at this point because they want people to get into the program. If they had too many restrictions right now, nobody would want to do it.

So to make these programs attractive, they have to initially go very light on the restrictions, but it does create the scenario where down the road more restrictions could easily be justified by people who are not the friends of freedom, not the current legislature. The current folks in Wichita – Topeka, rather – are not going to do this. They’re not going to add restrictions because they value freedom. But 10, 20 years from now could be a totally different situation.

Any advice to a friend who’s enrolled in private school?

They’re just going to have to look at what strings come with the program and decide if they’re willing to accept those strings.

Some people have said, “Well, Scott, how do you know the future? How do you know this bad stuff is gonna happen? It hasn’t happened yet. Why do you think it’s going to happen in the future?”

Every single bill makes a statement about the future. Every bill that is filed presupposes that something will or won’t happen in the future. Every time a lawmaker votes yes or no on a bill, he is making certain assumptions about the future. He has to, she has to.

We hope that those assumptions are reasonable and that a lawmaker makes a decision in good conscience. I believe our assessment of the situation is reasonable and realistic.

HSLDA has been looking at the national homeschool legal scene since 1983. I personally have been looking at the homeschool legal scene for 24 years. I’ve been doing this a long time, long time I’ve been fighting bills that would restrict homeschool freedom. Long time I’ve been drafting bills to expand freedom.

I’m not naive about this. I can see the handwriting when it’s on the wall. I know the kind of scenarios that are going to tend to pour fertilizer on the idea of, “Yeah, we should regulate homeschoolers more.” And again, it’s not going to happen with the people who write these laws now because they like freedom. But one day the guard will change. That’s when we’re gonna see the slow-motion train wreck happen.

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Shanxi Omoniyi

Shanxi Omoniyi (@ShanxiO on Twitter) is MPE's online content director. A homeschool alumna, Shanxi graduated from the University of Kansas with degrees in journalism and English. Her company, Wordspire Media, helps businesses and nonprofits share their stories through content marketing, social media management, and email marketing.

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