PIERRE — A $4 million proposal by South Dakota Republican Gov. Kristi Noem to help students enroll in private school and other forms of alternative instruction would undermine public education by diverting state money to unaccountable entities, opponents say.

Supporters of the plan say it would allow the state to start educational reform that’s gained momentum nationwide while lowering education costs, forcing public education to innovate and offering South Dakota students tailored education to best meet their learning needs.

Noem pitched the creation of education savings accounts, or ESAs, to lawmakers at her annual budget address Tuesday in Pierre as a way to continue to “prioritize education” without cutting public education funds.

“Good education starts in the home,” Noem said. “And parents should have the tools to choose what educational path is best for their kids.”

Noem budget includes cuts, but also new school-choice program and more prison money

The program would cover about $3,000 per student annually to pay for a portion of private school tuition or curriculum for alternative education, Noem said. She hopes to expand the program eventually, but she might not be around to act on that plan. President-elect Donald Trump has picked her as his nominee to lead the federal Department of Homeland Security, which means she could resign as governor as soon as late January, elevating Lt. Gov. Larry Rhoden to serve the rest of her term. 

The program would be for “families who meet eligibility requirements,” according to information in Noem’s budget, and Noem’s spokesman said the requirements will include being low-income. Sixteen other states already allow families to use taxpayer funds for ESAs.

The proposal comes as South Dakota sees one of the highest rises in alternative instruction in the nation. Across the state, alternatively enrolled students account for about 6.5% of the school-age population, based on public, non-public and alternative enrollment data from the state Department of Education. Alternative instruction includes homeschooling and private schools that are unaccredited or accredited by an entity other than the state, such as online, hybrid and microschools.

Lawmakers and education lobbyists in Pierre are eager to learn the details about Noem’s proposed legislation – especially how the state will ensure oversight and accountability, how students are chosen for the program and how it’ll fit into the state’s ongoing expenses.

“We have homework to do,” said incoming Senate President Pro Tempore Chris Karr, R-Sioux Falls, a former member of the legislative budgeting committee who supports the school choice movement. “We have to go look at this and figure out how to implement this responsibly.”

Sandra Waltman, director of public affairs for the South Dakota Education Association, said any entity that accepts public funding should be held to the same standards as public education, such as testing requirements and anti-discrimination policies. Alternative instruction students are currently not required to take standardized tests or present a portfolio to demonstrate educational progress. Private schools aren’t obligated to serve all students, so they can deny admission and educational services, Waltman added. 

“When you’re taking those precious funds and diverting them from public schools, you’re undermining what public schools can do for students,” Waltman said. “There’s no assurance the money they’re investing in education is actually making a difference.”

Noem didn’t propose cutting public education to fund the program, but proposed a state funding increase to public education of 1.25%. The inflation rate this year is 3.2%, according to the Federal Reserve Bank of Minneapolis.

Lower-than-expected sales tax collections primarily drive the leaner $7.29 billion budget Noem proposed Tuesday, which also includes cuts to some state departments and programs.

That signals to Rob Monson, executive director of School Administrators of South Dakota, that lawmakers will challenge the feasibility of ESAs.

“Some legislators will look at public education serving over 80% of students in the state and think, ‘If we have extra money, maybe we should obligate that to a program we’re already obligated to fund instead of funding a new program with ongoing dollars,’” Monson said.

Efforts to create ESA programs failed twice in the Legislature in recent years, largely due to questions about financial feasibility, said Brookings Republican Rep. Mellissa Heermann, a member of the House Education Committee.

South Dakota must be intentional with the “small pot” of tax revenue it has to work with, Heermann said. She added that there are already school programs in place to help address students’ mental health, behavioral and learning needs.

“I don’t know that vouchers would be as impactful as other programs,” Heermann said. “The timing doesn’t feel right to me to embark on something like this when we’re already trying to reduce costs as much as possible.”

Incoming House Majority Leader Scott Odenbach, R-Spearfish, said the proposal focuses on educating students, rather than supporting a public education system that’s weighed down by overhead costs and top-heavy administrative costs. An ESA program could force local districts to decentralize, adapt and focus more on students’ education, he said.

“No entity evolves until it’s forced,” Odenbach said.