Press Release: Legislative Hearing Exposes Mismanagement and Chaos Surrounding Voucher Programs

FOR IMMEDIATE RELEASE: 

August 10, 2023

Legislative Hearing Exposes Mismanagement and Chaos Surrounding Voucher Programs

Interim Finance Committee votes against redirecting $3.2 million in emergency Covid funds for vouchers after granting organizations revealed they have $18 million in reserves.

Las Vegas, NV – Last night’s legislative hearing on redirecting Covid relief funds to  Nevada’s Opportunity Scholarship private school voucher program shed light on the program’s inaccurate numbers, disorderly reporting requirements, and unaccountable processing system. It also made clear that the blame for alleged financial shortfalls in the program have been misdirected towards the legislature. After almost 12 hours of public testimony, a presentation by the Governor’s office, and questions directed to scholarship granting organizations (SGO’s), members of the Interim Finance Committee uncovered the false narrative behind the public outcry from voucher proponents.

Rewatch the hearing here at 1:03

After failing to directly request an extension of expiring one-time program funding during the legislative session, the Governor’s office requested the Interim Finance Committee redirect $3.2 million in Covid funds to pay for Opportunity Scholarships, despite the fact that there are more than $18 million held in reserves by the scholarship granting organizations. This prompted Senator Nguyen (D-clark county) and others to call this a “manufactured crisis.” Additionally, contrary to claims by voucher proponents, it was revealed that the number of potentially impacted students was greatly exaggerated. Rather than 600 students as initially stated, the actual number was roughly half that and even that figure may take into account more students than are actually affected.

Legislators expressed additional discomfort with the proposal because the numbers presented by the granting organizations did not match numbers they reported to the Nevada Department of Education, exposing the program’s chaos and lack of accountability. 

Additionally, it was discovered that some of the scholarship organizations had inflated their estimates (of students potentially losing their scholarship) by including non-recipient siblings of current scholarship recipients, further distorting the true number. 

Legislators also uncovered that many of the SGO’s could not tell if their applications were new or current students in the program, as many students “shop around” and apply for various scholarships with no central processing to track or identify the number of applicants who are also current recipients.

There was shared acknowledgement at the meeting that this issue was not the result of any action from the legislature, as there were no cuts in funding for voucher programs, despite the misleading narrative presented to the media by lobbyists and voucher proponents 

The Opportunity Scholarship allocation was renewed and fully funded this session, but a one-time appropriation from 2019 expired. Yet, not one bill was introduced by voucher proponents to extend the sunset for this specific allocation during the legislative session, instead voucher proponents focused on dramatically increasing the income eligibility by 200% for a family of 4 making $150,000. All the while, one scholarship granting organization was simply hoarding millions of dollars and failing to disperse vouchers to families.

“This hearing has confirmed that this voucher program is poorly managed, unaccountable, and does not serve the needs of low-income families,” said Amanda Morgan, Executive Director of Educate Nevada Now, “What is worse, voucher proponents told hundreds of families that lawmakers were causing them to lose scholarships, while instead it was the shady business practices of the granting organizations that ultimately caused this chaos. They cynically weaponized families and students to score political points.” 

Perhaps most shocking, despite concerns about the 2019 voucher appropriation expiring, the Governor’s Office allowed one single organization to take the entire $6.6 million allocation in a first-come first-served process, to have a total of $13 million when accounting for funds they simply held rather than disbursed. It was discovered that the lobbyist from AAA Scholarships Foundation, Denise Lasher, (who is also an employee of American Federation for Children, the same organization that led press conferences that spread misinformation to the media), had taken all the funds for their out-of-state organization. This organization has committed to renewing funding forrefunding its current students along with 100 new students, while many students funded through other SGO’s will not be renewed.

“This was definitely a manufactured crisis,” said IFC chair Danielle Monroe-Moreno (D-Clark County), “When you see the change was made the day after sine die to change how the access of these funds (are distributed), and someone was on a plane to be the first one at the door knowing how much money was available and asking for all of it and then some.”

“So much of this mirrors what we see in other state voucher programs, lack of accountability and clarity, money unaccounted for and meddling from out-of-state dark money organizations to push their agendas,” said Morgan.

Despite pleas from Legislators for AAA Foundation to use millions in reserves to help support potentially affected voucher students, it was not clear whether they were willing to do that stating that they have to be prudent in using one-time funds for on-going expenses like vouchers. This despite the fact that the same organization was lobbying to use the one-time Covid dollars to fund these left-out students.

Ultimately, the Interim Finance Committee voted against the measure 15-7 in a party-line vote, with Democrats voting against the measure.

“Legislators made clear that they do not want to hurt students currently in the program, but knowing that money is available to fund them they made the tough decision to vote against this allocation request,” said Morgan, “It is clear that voucher proponents have misled the media and families about the number of students affected, and the program’s granting organizations have provided conflicting numbers that raise further concerns about the program’s lack of transparency. One thing is clear, however, this voucher program should not be extended.”

Read ENN’s hearing testimony here.

###