Acknowledgments: This blog post would not have been possible without the intellectual contribution and data analysis conducted by Joanna LeFebvre and Katja Krieger.

All children deserve to attend welcoming and well-funded schools where they can learn and grow, regardless of race, disability, or income. But funding for public schools, where nearly 90% of all U.S. students learn, is at a near crisis point. The Trump administration’s goals, which are taken right out of Project 2025, seem to be to defund public education to the point that it doesn’t work, then offer private school vouchers as a solution to a manufactured problem. In this post, we highlight five ways public education is on fire in the United States and the damage this will do to students’ abilities to learn and thrive. Instead of cutting funds, lawmakers should invest in public schools, one of the best tools we still have to build a prosperous, equitable country.

Alarm level 1: COVID-19 relief funding for public schools is winding down. In some cases, the administration is ending it prematurely

This academic year (2024–2025) marks the end of the financial support schools were receiving to address the impacts of the COVID-19 crisis, the Elementary and Secondary Schools Emergency Relief III funds (ESSER III). The COVID-19 pandemic, and the changing learning environments that ensued, meant that schools needed funds to address the significant academic, social, emotional, physical, and mental health needs of their students. This funding was distributed in recent years with the last distribution, ESSER III, worth a total of $122 billion allocated to districts around the country. Many students, especially those living in poverty, have not recovered from pandemic-related learning loss. The end of this funding means that districts will now have fewer resources to help students get back on track. Rigorous research has demonstrated that this federal aid to public schools was highly successful, with measurable improvements to student outcomes in states and districts where more aid was spent. Taking the educational challenges imposed by the pandemic seriously would mean recognizing the high value this aid has provided.

However, in late March, the Trump administration canceled extensions that had been granted to states to spend remaining ESSER funds. Effectively, districts are losing out on the funding allocated to them in the form of COVID-19 relief funds. Canceled extensions represent almost $3 billion in lost funding that had already been committed to tutoring services, reading interventions, building improvements, and more. Clawing back these funds jeopardizes improved academic outcomes for many students and their ability to learn in healthy and safe environments. The administration’s refusal to reimburse school districts for funding that has already been spent could force them to cut teaching and other staff positions to make up the cost, ultimately harming students.

Alarm level 2: The administration is lawlessly dismantling the Department of Education and attacking inclusive schools

The winding down and clawing back of ESSER funding are simultaneously occurring at a time when President Trump signed executive orders to (1) dismantle the Department of Education and “return the funding to the states” and (2) regulate curriculum taught in the more than 13,000 public schools in the country.

One order directed Secretary of Education Linda McMahon to shut down several functions of the Department of Education (ED) and send them back to the states. Prior to this order, the White House had directed the ED to lay off 1,300 employees, a directive that is currently in litigation. The other order resulted in a “Dear Colleague letter” from Secretary McMahon demanding that states certify that they will not engage in “illegal DEI practices” as a condition of receiving the federal funds (This order is also currently in litigation.). As it stands, much of the Department of Education funding goes directly to state and local school systems. The ED provides targeted funding to public schools for special education through the Individuals with Disabilities Education Act and supports high-poverty districts through Title I grants. These grants make up for shortfalls in funding that high-poverty districts experience when they get funding from local sources.

To be clear, closing the Department of Education, and reappropriating major funding programs requires an act of Congress, and it is local school districts who have control over what is taught in schools—not federal regulators. Thus, while these executive orders have the potential to inflict a lot of damage, it’s unclear whether these orders can proceed without running afoul of federal laws. If these orders result in delays in funding distributions or outright cuts, students could experience declines in academic achievement, exacerbating existing racial and income disparities and limiting students’ long-term opportunities. If President Trump acts outside of his authority to slash the agencies’ work, the guardrails will essentially be pulled off this funding, which is extremely effective at redistributing funds based on district need. President Trump says he’ll return money to states for them to distribute it, potentially creating a situation where states have to compete for funds. This would create a patchwork in public funding for public schools, one in which some districts risk falling even further behind.

Alarm level 3: Lawmakers are pushing a mounting wave of voucher programs, an increasingly large cost to state-funded education

While many school districts struggle to maintain basic education funding, school privatization efforts are continuing throughout the country, and states like Arizona, Florida, and Ohio are notorious for the budget-breaking cost of universal voucher programs.

Figure A shows the current cost of voucher programs as a share of K–12 education funding in states where over 5% of the budget is currently going to school voucher programs. In the current school year (fiscal year 2025), voucher costs make up anywhere from 5% for states with early voucher programs to upwards of 25% of the entire public education budget for states with mature programs.

Because statewide private school voucher programs are funded with state dollars, voucher spending is shown as a proportion of state education funding rather than state and local funding. On average, about 46% of funding for K–12 schools comes from state revenue sources. In states with voucher programs, private schools divert state dollars that could otherwise be available to public schools. For now, local funding for public schools is protected from diversion to voucher programs, although some states with voucher programs are also threatening this source of public school funding by cutting or eliminating property taxes.

Vouchers degrade the quality of education for students who use them

Time and time again research has shown that vouchers harm academic outcomes. Causal studies across three states and Washington, D.C., demonstrate negative effects on test scores for students who use a voucher to switch from public to private school. These test score declines can persist over two years or more and are comparable or worse than declines due to COVID-19 and Hurricane Katrina. Meanwhile, students who leave private schools and return to public schools have experienced increased academic achievement. While some may argue that test scores from the National Assessment of Educational Progress indicate that private school students fare better academically than their public school peers, this is more a reflection of the parents’ socioeconomic status and education level than the impact of private schooling on students. Research also suggests vouchers do not reliably improve high school graduation and college attendance rates. Because of these reasons, lawmakers looking to improve student outcomes should not pursue vouchers.

School vouchers have costs for students who remain in public school

In addition to the direct costs that the state incurs for school vouchers, school districts experience an additional cost when they lose students to private school: the cost of providing the same level of education for fewer students in public education. This cost is entirely borne by the students who remain in public education, even though they affirmatively did not make the choice to take up vouchers. When students leave public schools with a voucher, the school districts must still pay the same amount for costs that can’t immediately adjust to declines in enrollment, such as cooling/heating and utilities. These required payments for a district’s fixed costs mean that districts will have even less to spend on the costs that can adjust due to changes in enrollment. What this means is that public school students who remain in public school will have less funding allocated to them for adjustable costs like teaching, curriculum development, and pupil support services due to other students taking up voucher programs. (To calculate this cost for your district, see EPI’s fiscal externality calculator).

Alarm level 4: National voucher proposals threaten public schools throughout the country

Beyond state voucher programs, Congress is considering national voucher proposals. This would enlarge the scope of vouchers beyond Republican-controlled states. The Educational Choice for Children Act, or ECCA, (H.R. 817, S.292) is a proposal to create a national voucher program. The program would divert over $10 billion per year in tax dollars to private schools and families who homeschool. The bill would do this by establishing a new dollar-for-dollar tax credit for individuals and corporations that make charitable contributions to organizations that give scholarships— or vouchers—for students to attend private schools. Donors who give corporate stocks would receive more back in tax cuts than the after-tax value of the stocks if they had sold them. 

Beyond vouchers harming student educational outcomes, the program itself would be extremely expensive. The bill proposes that Congress allocate $10 billion in tax credits for the voucher programs. But that doesn’t even account for the cost of voucher programs to public schools. The sponsors of the bill estimate that ECCA would provide vouchers for 2 million students. Given that at least two-thirds of students who take up vouchers previously attended private school, we can estimate that 666,667 voucher recipients will come from public school, which is about 1.4% of total public school students. Using our fiscal externality calculator, we estimate that students who remain in public schools would lose an average of $151 per pupil, and public school systems would lose a total of $6.225 billion dollars due to a national voucher scheme.

Alarm level 5: Tax cuts reduce available revenue for public schools

Many states are following a recent trend of reducing revenue available for schools through sweeping tax cuts. Corporate and personal income tax revenue represents about half of state tax revenue, which, in turn, funds about half of K–12 education budgets. From 2021 through 2024, 28 states passed personal or corporate income tax cuts, which will result in hundreds of billions of dollars in lost revenue by 2028, and more states are considering or have passed income tax cuts in 2025. At the same time, some states are cutting and attempting to eliminate property taxes, which account for over a third of revenue for K–12 education on average. States that want to invest in opportunity and long-term economic prosperity and to help their students continue recovering from pandemic-related learning loss should reverse this harmful trend.

Conclusion: What would happen if we boosted public school funding instead?

Given the real and damaging threats to public school funding, we conclude by asking what students actually need to succeed. Growing evidence over the last decade shows that public schooling in the United States simply needs more resources to deliver even better student achievement—not some radical disruption in how it is delivered and by what institutions.

For example, research has shown that school finance reforms between 1972 and 2010 led to a 10% increase in school spending for 12 years, which increased high school graduation rates, wages and family incomes in adulthood for children from districts with the spending increase. Others have similarly found that a $1,000 increase in per-pupil spending for low-income districts would reduce the test score gap between low- and high-income school districts within a state by nearly 40% of the baseline gap.

Increasing funding, rather than withholding federal aid or using public dollars to pay for private schooling, is the path forward for public schools. Public schools have fallen short in many communities because of lawmakers’ choices to underfund them. But the only education system that can fulfill the promise of equal opportunity for all children, regardless of race, disability, or income, is a fully funded system of public schools. Lawmakers interested in building prosperous communities should invest in public schools rather than defunding and privatizing them.