Some Answers About the Alabama Accountability Act from New Reports Mandated by Law
The first full round of new reports required as a results of changes made to the Alabama Accountability Act (AAA) in 2015 are in. Those reports answer a lot of questions, but some questions remain unanswered about the effectiveness of the program.
For basic information on the AAA, click here.
Initially, Republican lawmakers backing the law said the purpose was to help children stuck in failing schools. In 2015, state lawmakers clarified the intent of the AAA was to provide “educational choice”.
Though two types of tax credits are available under the AAA (one for parents who incur expenses moving their child out of a “failing” public school and one for donors contributing to non-profit groups serving as scholarship granting organizations, or SGOs), the most popular provision has been the SGO scholarship-granting provision.
Each tax year, state law allows up to $30 million to be donated to SGOs and then claimed as tax credits, dollar-for-dollar, against a business, corporation, or individual’s tax liability, though the rules differ a bit for each group.
Though that $30 million is never actually paid as tax to Alabama, critics of the program claim the provision diverts dollars that would have otherwise gone into the Education Trust Fund and subsequently flow to public schools.
Initially, reporting requirements were few, but in 2015, state lawmakers beefed up the information required from SGOs about who is getting scholarships (though still no information is provided about race, ethnicity, grade level, or school of origin) and where scholarship recipients attend school.
What follows are the answers that could be gleaned from required annual and quarterly reports filed by the SGOs and also from reporting by other journalists in Alabama.
If you have questions you’d like answered, please write them in the comments below. We’ll try to get answers.
How much money has been contributed to SGOs?
Only four of the state’s six approved SGOs filed the required annual reports, according to the Alabama Department of Revenue’s (ADOR) web site.
Those four are: AAA Scholarship Foundation, Inc., Alabama Opportunity Scholarship Fund, Rocket City Scholarship Granting Organization, Inc., and Scholarships for Kids, Inc.
Annual reports cover the period July 1, 2015, to June 30, 2016. Annual reports show donors gave $16.1 million to SGOs during the reporting period.
In total, more than $65.3 million in contributions have been collected since these four SGOs began collecting donations. All four have been operating since the 2013-2014 school year.
How much has been claimed as tax credits?
Mary Sell of The Decatur Daily recently reported the following amounts have been claimed as actual tax credits: $19.5 million in 2013; $5.1 million in 2014 and $4.9 million in 2015.
ADOR told Sell $33,000 had been claimed for 2015 by corporations, but that number could rise and unused credits can be carried forward up to three years.
That adds up to about $29.5 million claimed as tax credits through 2015 of the $65.3 million collected in contributions through June 30, 2016.
Different reporting years make it difficult to make dollar-for-dollar comparisons (tax years run January to December and reporting years run July to June), but those are the numbers we know.
How many scholarships were awarded for the 2015-2016 school year?
During the annual reporting period, a total of 4,127 scholarships were awarded at a total cost of $21,420,287, for an average per student award of $5,190.28.
After adding in allowable non-scholarship expenditures of $1,016,002, the average award per student rises to $5,436.36.
SGOs are allowed to use up to 5% of all donations collected, for a combined total of $3.3 million, to cover costs to administer the program. SGOs have used $3 million of that $3.3 million for administrative expenses through the end of the reporting period.
That average amount per student is less than the previously calculated of amount of more than $5,700 per student (which was based on quarterly reports), but it is still more than the $5,207.86 per public school student amount allocated by the state legislature.
There are a number of things about the actual cost of the education received by scholarship recipients we still don’t know, including the costs incurred for uniforms, lunches, transportation, and textbooks.
It is important to note the AAA does not require the scholarship to fully fund a child’s education, only that the scholarship cover part of tuition and mandatory fees. However, the full cost of annual testing required under the AAA (see next section) must be covered by the scholarship.
In 2015, state lawmakers set a cap on tuition allowed to be paid by scholarships:
- Elementary school: $6,000
- Middle school: $8,000
- High school: $10,000
Another piece of information not reported is whether the students were actually enrolled full-time in the school where the scholarship was used. While 4,127 scholarships were actually funded, only 4,017 students were enrolled in participating schools as of June 30, 2016. It is unclear what happened to the other 110 students not accounted for in the final numbers.
Did students using the scholarships perform better on standardized tests than students in Alabama’s public schools?
The AAA requires biennial (every second year) public reporting of test results for students using scholarships. The University of Alabama’s Institute for Social Science Research was chosen to analyze test results for the 2014-2015 school year.
The first report was released September 1, as required by law, but drew few specific conclusions.
Researchers reported learning gains, the main required element, could not be calculated because the previous year’s test results were not provided for the majority of scholarship students. Therefore, only achievement results (not gains) for the 2014-2015 school year could be analyzed. Here’s what researchers found:
- On norm-referenced tests (e.g., the Stanford Achievement Test), scholarship recipients generally performed below the average U.S. student at their grade level.
- On criterion-referenced tests (e.g., the ACT Aspire), the majority of scholarship recipients failed to meet benchmark proficiency scores.
- These findings are similar to those of the National Assessment of Educational Progress for students attending public schools in Alabama.
Though researchers were required to compare learning gains of the scholarship recipients to students attending public schools, because 18 different standardized tests were used by the 104 schools reporting results, and few used the ACT Aspire and ACT college entrance exam (the tests taken by public school students), comparisons could only be made for grades 6, 7, 10, and 11. Here’s what researchers found:
- No cohesive pattern emerged across the different age groups with respect to achievement differences between scholarship recipients and public school students.
- There were very few subject areas in which more than 50% of the students met proficiency standards for either group of students.
To be fair, the majority of Alabama’s public school students also score below U.S. national standards on both the ACT Aspire (results by district here) and the ACT college entrance exam (though 52% of students did meet the ACT benchmark for English on the ACT college entrance exam).
Spring 2016 ACT Aspire results for public school students will be released in mid-October, according to an ALSDE spokesperson.
The next report on achievement and learning gain results for scholarship students will not be published until September 2018.
More on the results of that annual testing here, from Tim Lockette at The Anniston Star and also from Mary Sell at The Decatur Daily, including comment from SGO representatives. Excellent reporting.
How much money has been claimed as tax credits by parents moving their children out of a failing public school?
The other tax credit provision in the AAA allows parents to claim tax credits for the cost of moving their children out of a failing public school. Mary Sell of The Decatur Daily reported 140 parents received a tax credit in 2015 ($380,851), 125 in 2014($179,274), and 94 in 2013 ($169,373).
In which schools are students using tax credit scholarships?
Here’s where a map is helpful. (Here’s the list for those not wanting a map.)
This first map is a look at only the schools that enrolled students that used tax-credit scholarships.
Hover over the marker to learn more about the school, including the racial makeup of the student body (where available).
Private school enrollment data is from the 2013-2014 school year and is taken from the National Center for Education Statistics Private School Universe Survey (PSS). The PSS is voluntary and not all eligible schools participated in the survey.
Are students from “failing” public schools using the scholarships to enroll in private schools?
This question is impossible to answer. That information is not reported.
This next map shows both the schools enrolling students using the tax credit scholarships and the “failing” public schools. Use the sliders to narrow down the view to schools that enrolled students previously zoned to a “failing” public school and by the number of students overall using the scholarships. This gives a better picture of where students using scholarships may be coming from, but doesn’t answer the question definitively.
Note there are two public schools (indicated in green) where scholarships were used to help with costs transferring from a “failing” public school to a non-failing public school.
How many schools enrolled students zoned to a “failing” public school?
Though there were 37,442 students actually enrolled in schools deemed “failing” under the AAA, only 978, or 2.6%, of scholarship recipients were reported to have been zoned to attend a “failing” public school.
It is not known whether a student reported as zoned to attend a “failing” public school was ever actually enrolled in the “failing” public school, so it is unknown what effect, if any, the exit of those 978 students had on the “failing” public schools they were zoned to attend.
The map below depicts which private schools enrolled students from “failing” public schools.
Wasn’t there a provision for the “failing” public school to keep 20% of state funding for any students transferring out under the AAA?
The short answer is yes, the provision is there, but it only applies to funding for students who were actually enrolled in and subsequently transferred from a “failing” public school, and whose parents claimed the tax credit for that transfer.
We are waiting on clarification from the Alabama State Department of Education (ALSDE) as to whether that provision has been used and what those amounts might be. We will update the article when the information is received.
978 of the total 4,017 scholarships, or 24%, were awarded to students zoned to attend a “failing” public school.
Of the 153 schools accepting scholarship students, 103 schools enrolled at least one student from a “failing” public school. Those 103 schools enrolled 3,399 students using tax credit scholarships. In other words, in those 103 schools that enrolled at least one student zoned to attend a “failing” public school, 29% of scholarship recipients were zoned to attend a “failing” public school.
Fifty of the 153 schools didn’t enroll any students who were zoned to attend a “failing” public school. Altogether, those 50 enrolled only 618 scholarship students overall.
How many scholarship students met income eligibility guidelines?
For the annual reporting period, 3,897, or 94%, of the 4,127 scholarships were awarded to students who met income eligibility guidelines, meaning the student would qualify for free or reduced-price meals if they attended a public school because their family income did not exceed 185% of the federal poverty level (FPL).
For a family of four, the FPL was $44,862.50 for the 2015-2016 school year and $44,955 for the 2016-2017 school year.
How many students were enrolled in a public school the year before they received the scholarship?
Here’s another murky area. The AAA mandates that not more than 25% of first-time scholarship recipients be enrolled in a private school the year prior to receiving the scholarship. But once the student is in the scholarship system, the student is no longer a “first-time” recipient. SGOs are only required to report this piece of data on first-time recipients.
Here’s what the numbers show:
- 742, or 18%, of the 4,127 recipients were first-time scholarship recipients,
- 384, or 52%, of those first-time recipients were continuously enrolled in a public school the prior academic year,
- 172, or 23%, of those first-time recipients were continuously enrolled in a private school the prior academic year,
- Therefore, according to the report, 77% of first-time recipients were not enrolled in a private school the prior academic year.
What is unclear is where the other 186 students were continuously enrolled the prior academic year. If they weren’t enrolled in public school and they weren’t enrolled in private school, where were they enrolled?
In mid-October, the ALSDE will release Spring 2016 ACT Aspire scores for public school students in grades 3 through 8. No additional information about test results for scholarship recipients will be available until September 2018.
In December, the ALSDE will roll out A-F letter grades for all 1,500-plus public schools in Alabama. Private schools receiving scholarship recipients will not receive any grade.
The next round of public schools deemed “failing” will be evident when the school grades are released in December.
Alabama’s 140 state legislators will meet again on February 7, 2017. We know they will try to find one system of accountability for public schools.
Whether they will seek additional accountability from private schools receiving scholarship students has not been mentioned, though some school officials have begun asking questions about why private schools escape the same scrutiny that public schools receive, particularly when otherwise-public money (as some have deemed the contributions to SGOs) is being used for those students’ education.
Here’s the four SGOs’ Annual Reports aggregated in one spreadsheet (Excel file).