Retirement Systems of Alabama (RSA) CEO David Bronner is warning state legislatures against developing education savings accounts, saying it could cut the State Education Fund's revenue by $1 billion annually.

Gov. Kay Ivey recently said creating some form of education savings account (ESA) would be a priority for her administration in the 2024 legislative session. ESAs are an option supported by many school choice advocates that allow state education dollars to follow students to whatever school they attend.

For the last two years, lawmakers have filed various school choice bills establishing ESAs. Most recently, lawmakers introduced the Parental Rights in Children's Education (PRICE) Act, which failed to make it to either floor for a vote after opposition from public education advocates and some lawmakers. Most believed the bill would remove too much money from the state's Education Trust Fund (ETF).

SEE ALSO: What could education savings accounts look like with Ivey's pledge to make school choice a priority in 2024?

In a recent edition of the Advisor, an RSA publication, Bronner cautioned lawmakers from implementing ESAs, which he called "an extreme version of school choice."

"Recently, Governor Ivey stated that she will support legislation to create education savings accounts in the next legislative session," Bronner wrote. "We do not know exactly what she intends to propose. However, a bill introduced last legislative session to create education savings accounts would have gutted public education by an estimated $657 million annually. The bill did not include any accountability for private schools and homeschooling parents; did not have protections for special needs children; and did not address the reality that many private schools clearly do not have the classroom space for thousands of additional students."

Another ESA bill filed in 2023 was House Bill 442 (HB442), also called "The Alabama Fits All Scholarship Program." HB422 would have created ESAs administered under a program manager to eligible students. The scholarship would be open to students in all non-public contexts, with certain preferential guidelines should demand outrun supply. However, the bill also requires specific reporting requirements to maintain eligibility, an unacceptable addition for many school choice advocates.

"If the Legislature creates education savings accounts, the Education Trust Fund could see a decline of over $1 billion in revenue annually," Bronner continued. "Yet, how is this supposed to help public education? If we truly care about the future of public education in Alabama and truly care about Alabama's children in a state that has the lowest taxes in America, then we should think before we leap into the unknown."

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