Administrators cite ‘complex’ issues with burgeoning Florida school vouchers

Orlando Sentinel | By Ryan Dailey | December 14, 2023 

TALLAHASSEE — As groups that administer Florida’s school vouchers deal with what one official called “the most complex set of programs” in the United States, lawmakers are looking at bringing in more scholarship funding organizations.

The Legislature and Gov. Ron DeSantis in March approved a law (HB 1) that massively expanded voucher programs, in part by eliminating income eligibility requirements. Making the administration of the programs more complicated, vouchers can now be used for a range of purchases beyond private school tuition.

Members of the House Choice & Innovation Subcommittee on Wednesday heard from a panel of leaders of the state’s two scholarship-funding organizations, Step Up for Students and AAA Scholarship Foundation. Step Up for Students administers the vast majority of Florida’s vouchers, with AAA handling a smaller portion.

John Kirtley, founder and chairman of Step Up for Students, said the expansion of programs and the much wider range of uses of vouchers has made administering them harder to do.

“The bottom line is, Florida is wonderful because we have a Legislature and a Department of Education that is very much in favor of parents having more empowerment, more flexibility. But that very much makes things more challenging,” said Kirtley, adding that Florida has “the most complex set of programs in the country.”

Problems emerged this year related to late payments to private schools that participate in the programs.

Kirtley said Step Up for Students has “worked as hard as we can to correct those problems.”

“Even if you get 99 percent of it right, the 1 percent, those are real people, those are real schools,” Kirtley told the House panel.

Across all of the programs, vouchers for 377,482 students had been funded through Dec. 1, a presentation by the education department said. That compares to less than 250,000 vouchers in the past school year.

The expansion also has led to the hiring of more people. Part of Step Up for Students described as its “customer experience organization” has grown to more than 300 employees to keep up with demand, an increase from 70 employees in the past year.

Amid the growing pains, lawmakers are looking at the possibility of adding scholarship funding organizations. Rep. Spencer Roach, R-North Fort Myers, asked the state’s head of school choice how lawmakers could potentially attract new organizations.

“What would you recommend that the Legislature could do or should do to incentivize more SFOs (scholarship funding organizations) to come into the state of Florida?” Roach asked.

Adam Emerson, executive director of the Department of Education’s Office of School Choice, replied that lawmakers could look at increasing an administrative fee paid to scholarship funding organizations. State law requires that administrative expenses may not exceed 3% of the total amount of all scholarships funded by an organization.

“In other states where there are scholarship funding organizations that do this work, the administrative fee can vary from 3 percent to 10 percent. It’s those levels that the Legislature would want to set to encourage” companies to come to the state, Emerson replied.

The education department is reviewing an application from a company interested in becoming Florida’s newest scholarship funding organization, Emerson told the panel. He said the company is called Merit.

Merit, according to its website, provides “software and services for ESA (education savings account), microgrant, and tax credit programs” and has worked with states such as Ohio, Kansas and Oklahoma.