Proposition 174 (The Voucher Initiative)

On November 2, 1993, Californians will face their most important education decision since the state's formation. Ballot Proposition 174, if enacted, will amend the state constitution and establish "scholarships" redeemable by parents for their children's kindergarten through 12th grade schooling.

If this ballot measure passes, public schools will continue to exist, as will today's many kinds of private schools. However, alongside of these two conventional schooling alternatives will be a third choice, "scholarship redeeming schools."

These new schools will be paid for, or at least financially subsidized, by public funds. However, these scholarship schools may well have privately selected governing boards. They may be religiously oriented. Does this make them public or private schools?

We do not know the answer to this question. Ultimately such a determination may be a matter for the courts, the legislature, or simply a matter of no consequence.

There are many additional unknowns regarding the operation of the proposed voucher plan and its possible effects, both good and bad. However, in this paper we make an effort to reduce some of the uncertainty on at least one dimension by addressing questions about public costs and possible public cost savings.

Our principal question here is ''what are the financial consequences of the proposed voucher plan?"