The Effects of the California Voucher Initiative on Public Expenditures for Education

Executive Summary

by Michael Shires, Cathy Krop, C. Peter Rydell, Stephen J. Carroll

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This report is an executive summary of RAND/MR-364-LE, which summarizes the findings of an analysis of the fiscal effects of Proposition 174, a school-voucher initiative that appeared on the California November 1993 ballot. Although the proposition was defeated, school voucher plans are under discussion in several other states and may be revisited in California. Hence, the results of this analysis may be relevant to future policy debates in California and elsewhere. The authors found that the fiscal effects of the initiative were highly uncertain. If Proposition 174 had passed, the state, the courts, parents, and private schools would have been confronted with choices. Their responses to these choices would have determined the initiative's fiscal effects. Furthermore, the range of possible choices would have produced a wide range of outcomes. The report also found that, absent any changes in the rules instituted through Propositions 98 and 111, the state faces a significant fiscal crisis as mandated K-12 expenditures rise to 43 percent of General Fund revenues in 2002-2003.

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