Universal school voucher expansion as proposed in House Bill 115 could cost the state over $100 million per year, according to Reaching Higher NH analysis
January 8th, 2025
Efforts to expand school voucher eligibility to all students, regardless of family income, could cost the state approximately $102 million in the 2025-2026 school year, according to a new study by Reaching Higher New Hampshire.
The school voucher program, known in New Hampshire as “Education Freedom Accounts” or EFAs, gives eligible families a debit account funded by taxpayer dollars to pay for private and religious school tuition, homeschooling materials, and other education related expenses.
Under current law, students are eligible if their families meet certain income requirements. However, Republican lawmakers have filed House Bill 115, which would remove the income cap limit, making all students in New Hampshire eligible to receive a school voucher.
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In the 2024-2025 school year, school vouchers will cost the state approximately $26 million. The cost has surged since the program was created in 2021, far exceeding initial state cost estimates. The majority of the cost is new state spending since over 75% of students who received a voucher were not enrolled in public schools, and therefore had to be added to the state’s funding formula.
What we don’t know
The projected cost model assumes that all of the 5,321 students currently receiving a school voucher in the 2024-2025 school year are included in the NHED’s private school and homeschool enrollment counts.
However, because of the way the voucher program is structured, it is unclear how many private and homeschooled students receive a voucher. Legally, school voucher participation is a separate enrollment category, and school voucher recipients should not be included in the counts. But, it is unclear how students are counted in practice, because the NHED does not consistently track individual student enrollment.
Private schools are not required to report voucher recipients when they file their enrollment reports. However, homeschooled students are required to report to their “participating agency,” the school district, private school, or NHED, where they file their letter of intent, within 15 days of enrolling in the voucher program. It is unclear if there are audit or compliance checks to verify the enrollment numbers.
If the enrollment figures in fact abide by state law, and no school voucher students are reported in the NHED’s data, the cost of the program would actually be $130 million per year, to include the cost of the current school voucher recipients which cost $28 million in FY2026.
Controversy surrounds New Hampshire’s school voucher program
The New Hampshire Department of Education is under growing scrutiny for refusing to provide key program data to state auditors, citing a lack of authority. The NHED contracted out the administration and management of the voucher program to the Children’s Scholarship Fund in 2021. As part of the contract, the NHED limited the data that the Fund is required to share with the agency and the state regarding key performance metrics, spending metrics, and other critical data.
The NHED performed a compliance review of 50 total voucher accounts over two years, and found that 25% of them were missing information, including unverified residency and inaccurate income reporting. The Fund will be required to pay the state back for several of the accounts that were awarded in error.
Efforts to increase transparency and tighten monitoring of the program have been killed by Republicans every year since the program’s inception.
About school vouchers in New Hampshire
New Hampshire’s school vouchers are personal accounts that can be used to pay for certain education-related expenses, including private school tuition, homeschooling expenses, tutoring, books and materials, and transportation.
Eligible families receive the base amount of state funding per student plus any additional aid for which their student qualifies (eligibility for school meals, special education services, or English Language Learner program). When participating in the program, families agree not to enroll their child full-time into their resident district school or public charter school; however, families may enroll their children into public and charter schools part-time, depending on the policies of the school.
Currently, students are eligible for participation in the program if they are eligible to enroll in a New Hampshire public school and meet the income eligibility guidelines at the time of application. Students only need to qualify in the first year of the program and do not need to meet the income eligibility guidelines in subsequent years.
Independent studies have found that outcomes for participation in similar school voucher programs in other states are, at best, mixed. However, more recent studies have suggested that these programs have had significant negative effects on student outcomes for the students who participate in them and have diverted funding from public schools. Researchers have stated that school vouchers “cause catastrophic academic harm” and have had a worse impact on student outcomes than any other policy or event in public school history, including the global pandemic.
About the model
The model uses data from the 2024-2025 homeschool and private school enrollment reports from the New Hampshire Department of Education. The model does not include students who live in New Hampshire but currently attend a private school outside of New Hampshire, although they would be eligible to receive a school voucher if these laws passed. There is no requirement that school voucher recipients attend a school in the state, and voucher funds are permitted to be used on out-of-state school tuition.
The model does not include students who may disenroll from their local public school to enroll in the school voucher program; however, the vast majority (77%) of students who have participated since the program’s inception were already enrolled in private schools or homeschool programs.
The model only includes private and homeschool students; therefore, it does not take into account the local fiscal impact of school vouchers or the cost to the state to fund phase-out grants.
While it is unlikely that all eligible students will participate in the school voucher program, it is important for lawmakers and the public to understand its full cost since there is no cap on the number of students or allocated state funds. Per state law, the state must fund every eligible school voucher request, regardless of the state’s budget; therefore, the state should take into consideration the total amount for which they would be liable under full participation.
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