School choice has turned out to be a key focus of South Dakota’s 2025 Legislative Session. So far, two bills have been introduced to establish an Education Savings Account (ESA) program that would empower parents to choose the best education pathway for their children, HB1009 and HB1020. Education Savings Accounts are accounts the state deposits money into for families to spend on a variety of educational expenses, such as tuition, tutoring, textbooks, uniforms, and more, depending on the specifics of the program. These programs allow parents to build an education plan that best suits their child’s individual needs, which will ultimately produce better results for South Dakota’s educational system as a whole.
Opponents of school choice have routinely argued that ESAs are costly, “unsustainable,” and would “bankrupt” states that implemented them. That couldn’t be further from the truth. School choice in Arizona is a story of overwhelming success.
Arizona has been a trailblazer for school choice since 2011, when it became the first state to create an ESA program. The program was initially limited to students with disabilities but was expanded in 2013 to include a small number of other recipients. In 2022, Arizona became the first state to establish a universal school voucher program in which every single student in the state could apply for an Educational Savings Account.
“The typical ESA student receives about $7,500 annually from Arizona taxpayers, compared to the more than $12,000 per pupil that Arizonans give public schools through their state and local taxes alone,” Research Fellow Jason Bedrick and Senior Fellow Corey DeAngelis of The Heritage Foundation wrote, explaining that the program saves taxpayers thousands of dollars per student who switches from public school to ESAs.
In fact, after the ESA program was implemented, “Arizona enjoyed a massive overall state budget surplus one year, and a net savings in its state education funding formula (which includes ESAs) compared to what it budgeted the second.”
Arizona isn’t the only state that has witnessed incredible economic results from implementing school choice programs. A new report from EdChoice’s Fiscal Research & Education Center (FREC) analyzed 48 school choice programs in 25 states and D.C., including five Education Savings Account programs, 22 school voucher programs, and 21 tax-credit scholarship programs.
EdChoice estimated that the 48 programs generated a cumulative net fiscal benefit for state and local taxpayers of an estimated $19.4 billion to $45.6 billion. The report notes that because each of the programs had been operating for no less than five years by FY 2022, “the fiscal benefits are likely closer to the high-end estimate of $45.6 billion.” The report also found that the cumulative net fiscal benefits of each student equates to $3,300 to $7,800 per program participant. For every dollar spent, EdChoice estimates a benefit between $1.70 and $2.64.
The school choice question in South Dakota is not how much ESAs will cost the state, but how much we could save. Hopefully, with the passage of HB1020, we can find out.
