How State Funds Are Helping Private Schools Expand

Two years ago, the General Assembly’s Republican majority dramatically expanded a program subsidizing private school tuition. Ever since, questions have swirled around the consequences for public schools and the state’s fiscal health. 

But the voucher change wasn’t the only provision benefiting private schools. 

In the same budget bill, Republicans gave grants to two private schools for capital projects aimed at growing their enrollment—which appears to be a first for North Carolina and perhaps the country. Lawmakers earmarked $100,000 for Carolina Christian Academy in Thomasville to remodel its preschool and $375,000 for The School of Hope in Fayetteville to buy a parcel of land for expansion.

At least one other state later made similar earmarks. ProPublica reported that Ohio lawmakers, “in an unprecedented move,” had included at least $4 million in grants to Catholic schools in their 2024 budget. The state’s Republican Senate president said the goal was to expand private school classroom space as more families use vouchers. 

The offices of North Carolina’s House Speaker Destin Hall and Senate leader Phil Berger did not respond to The Assembly’s questions about the appropriations, including whether they represent a larger effort to help grow private school capacity here. 

Both leaders supported extending the state’s Opportunity Scholarship program, which had previously served only low-income families, to any income level. More than 80,000 students now participate, receiving vouchers worth more than $432 million, according to the N.C. State Education Assistance Authority. 

The bill also upped the maximum allocation from $500,000 per fiscal year to $1 million for the program’s marketing and helping parents apply. Parents for Educational Freedom in North Carolina, a school choice advocacy group with two former legislators on the board, held the contract from October 2020 through September last year.

“Conservatives are seeing their moment to crack public funding for religious schools,” said Adam Laats, an associate professor at Binghamton University who specializes in the evolution of conservative thinking in K-12 education.

The strategy has been to “throw everything at the wall,” including appropriations that once seemed unthinkable, Laats said. 

Bringing Home the Bacon?

The appropriations to Carolina Christian Academy and The School of Hope could indicate a concerted campaign to push the bounds of education privatization or religious liberty. They could also just be simple pork barrel spending, which hit a record level in the 2023-25 budget. The Office of State Budget and Management previously told The Assembly that the state awarded nearly $5.5 billion in earmarks to more than 1,100 organizations.

The money for private school capital projects came out of the Regional Economic Development Reserve, which funded capital projects for public schools, volunteer fire departments, and at least one church. 

The budget also included $1.2 million to “support additional student enrollments” at the Emerald School of Excellence, a private high school in Charlotte aimed at children recovering from substance use and mental health disorders. That money went toward scholarships, administrator salaries, fundraising galas, and marketing, including direct mail, digital ads, and a new website, according to records from the Office of State Budget and Management.

The Hope School for Autism in Thomasville was allocated $30,000, which it planned to put toward a new HVAC system, flooring, paint, and playground equipment, according to Office of State Budget and Management records. The school’s founder, Heather Vuncannon, told budget officials last week that the renovations were more costly than expected, so that project has yet to begin. If the funds aren’t spent by June 30, they will revert to the state.

The conservative John Locke Foundation has condemned the Regional Economic Development Reserve, established in 2023, as a “pork slush fund.” “Many of the appropriations from this reserve fund are pet pork projects—local projects for which legislators can brag about ‘bringing home the bacon,’” Brian Balfour, the foundation’s vice president of research, told the Carolina Journal. 

“It’s part of a corrupt, politicized scheme,” he said. “The controller of the reserve funds can entice legislators by offering them up a slice of taxpayer pie in exchange for votes, while the legislator can buy votes from their constituents by bragging about the shiny new object they delivered to their district on the backs of state taxpayers.”

Robert Luebke, director of the foundation’s Center for Effective Education, wrote that education spending out of the fund “makes a mockery of the state’s policies and its attempts to help local districts with capital costs.”

Senate leader Berger has also expressed some disdain for how the reserve has been used. He said in a recent interview that he thought he “heard a faint oink” when he saw a House proposal to allocate $550 million to the Regional Economic Development Reserve.

Neither of the Republican legislators representing the area of Davidson County where Carolina Christian Academy is located responded to inquiries about the appropriation. 

One of them—state Sen. Steve Jarvis—is an alumnus of the school and also pledged to match donations up to $250,000 in a capital campaign for a multipurpose building, according to a 2022 letter posted on its website. Jarvis previously sponsored concerts to benefit the school, according to The (Lexington) Dispatch.

Fayetteville legislators didn’t take credit for The School of Hope earmark, either. Democratic state Sen. Val Applewhite did not respond to The Assembly’s questions. Neither did state Rep. Diane Wheatley, a Republican who represents the Fayetteville area.

Democratic state Rep. Charles Smith, whose district includes the school, said he did not request the appropriation, though he has visited the school and said he appreciates its unique mission to serve students with autism. 

“Given Ft. Bragg’s status as a compassionate care military base, many military families with kids diagnosed with Autism request transfer here,” Smith said in an email. “For those military families, The School of Hope provides an option for their children’s education, specifically tailored to their needs. Moreover, because of their limited space, The School of Hope has had to turn families away in recent years.” 

Room to Grow

The School of Hope is currently located in a two-story cinder block building owned by Second Baptist Church. The 1.2 acres it bought with state funds will facilitate an ambitious expansion plan.

The school’s principal, Amy Sparks, said that she plans to open a new elementary wing on the land purchased in April. Modular units the school bought three years ago will be combined into a new 7,200-square-foot building with eight classrooms and office space that Sparks hopes will open in January. A parent with a construction company has committed to doing the work, she said.

In the next expansion phase, Sparks intends to add a gymnasium and sensory room. Then, a life skills center. The school already runs the Skyhawk Cafe, a snack counter that helps students learn to interact with the public, as well as consumer math and responsibility.

Sparks said she tried to secure a bank loan to finance the expansion, but lenders turned her down, noting that the school lacked land and sufficient income. Then, she said, state Rep. Wheatley stepped in to help with state funding: “I had many talks with her about how we were growing, but we had nowhere for people to go.” 

The School of Hope now serves 73 students, up from 5 at its founding in 2017, Sparks said. To accommodate them all, staff use dividers to form makeshift classrooms in the lunch room. Demand for the school—which was recently accredited by Cognia, Sparks said—still exceeds open spots. Parents send children from as far away as Goldsboro. 

Carla Jones, one of those Wayne County parents, is sending her 19-year-old son to his fourth year at The School of Hope. The progress her son has made in reading and social skills makes the hourlong commute worth it, she said. 

“The previous school, he did not want to go,” Jones said. “Now, he loves to go to school.” She attributed the change in his attitude to the compassion and specialized knowledge of The School of Hope’s staff, many of whom have a family member with autism. Sparks founded the school in memory of her son, Jarred, who had autism.

Like almost all families sending their children to The School of Hope, Jones receives state funding through the Opportunity Scholarship program. The voucher’s value depends on a family’s income. Jones said her family receives a voucher worth about $4,000, plus about $17,000 through ESA+, a state program benefitting children with disabilities. The funding covers the roughly $13,000 she owes in tuition in addition to a transportation service that her son, plus two other students from Wayne County, use to get to Fayetteville, Jones said.

Sparks, a former public school teacher, has been a prominent promoter of the Opportunity Scholarship program. She has helped to lobby legislators, and her students sang at an event on the Halifax Mall in Raleigh in January of last year to celebrate North Carolina’s adoption of “universal school choice,” as proponents have dubbed vouchers without income requirements.

“Without these programs,” she has said, “there would be no School of Hope.”

‘We Must Build!’

Black, the president of Carolina Christian Academy, has also described big plans for his school’s growth.

In a 2022 letter posted to the school website, he said that enrollment had increased from around 40 to 140 in three years. “As we continue to grow in the academy, with an anticipated enrollment of around 200 next fall (2023/2024 school year), we must build!”

He asked for donations to add a large multipurpose building to the 26-acre campus that is perhaps best known for the live nativity that students help produce with neighboring Faith Community Chapel every Christmas.

Black said he intended to develop a Christian-based sports program, upgrade the baseball field, expand the music program, and develop a Bible catechism to teach preschool through high school students key Christian doctrine in a question-and-answer format. 

But the school’s ambition stretches well beyond rural Davidson County. Carolina Christian Global Academy plans to start offering Christian education in China, Black said.

The multipurpose building is now complete, as are the preschool renovations. Last October, a school employee submitted paperwork to the Office of State Budget and Management indicating that the funds had been spent. 

“Our expected results are taking shape,” Emily Vasquez wrote. “We have increased our enrollment. The renovations are turning the facility into a lovely learning environment.”

As the first day of school approached this year, the academy posted on Facebook that it had a limited number of open spots. Kindergarten through fourth grade were full, it said. The post noted that Opportunity Scholarships were still available. 

Carolina Christian Academy’s receipts from vouchers grew from about $358,000 in the 2022-23 school year to $843,000 last year.

Another Avenue

Lawmakers used another pot of money to benefit the state’s top recipient of voucher funding.

The 2023-25 budget allocated $5 million to the city of Sanford to extend a sewer line to Grace Christian School and a nearby fire department.

The school’s leaders said that they had lobbied for that money in a prospectus for a planned $98 million expansion.

The plan calls for two new buildings with more than three dozen classrooms each, a new stadium, and multiple athletic fields on 20 acres of newly purchased land.

Grace Christian School has taken in more Opportunity Scholarship money than any other school in the state for the past three academic years. It received nearly $10.5 million over that period, about $3 million more than the next-highest school. 

Opponents of the rapid expansion of school choice in North Carolina say that directing millions in state funding to private schools will inevitably come at a cost to public education.

“Our schools are facing urgent needs from crumbling buildings, failing HVAC systems, and classrooms stretched to the breaking point,” said Tamika Walker Kelly, president of the North Carolina Association of Educators. “Yet instead of meeting these responsibilities, public dollars are being siphoned off to build private school infrastructure. That is not just disheartening, it’s a failure to invest in our future.”

House Speaker Hall contends that Republican lawmakers have not abandoned public schools and don’t intend to. “Expanding opportunity and supporting our teachers are not competing goals,” Hall said in his response to Gov. Josh Stein’s State of the State Address earlier this year. 

But the state’s budget is expected to get tighter, with tax cuts shrinking revenue and the federal government pulling back from its historical role in helping to fund disaster recovery. With large budget shortfalls projected, the General Assembly has appropriated sharply escalating amounts for vouchers. The allocation to the Opportunity Scholarship Grant Reserve Fund is set to increase from $625 million in fiscal year 2025-26 to $825 million in 2032-33.

‘Public Purposes Only’

The North Carolina Constitution requires that taxpayer funds go to “public purposes only.” 

In 2014, the state Supreme Court took up a challenge to the Opportunity Scholarships that partially turned on the interpretation of that phrase. 

The decision broke along partisan lines. Then-Chief Justice Mark Martin, writing for the Republican majority, found that the scholarships satisfied the requirement because the “ultimate beneficiary of providing these children additional educational opportunities is our collective citizenry.”

He dismissed challengers’ contention that the voucher program accomplishes no public purpose because it allows funding for educational scholarships to schools that may discriminate based on religion on the grounds that the challengers lacked standing.

The U.S. Supreme Court has since ruled that religious schools cannot be excluded from state voucher programs and that a church cannot be denied “an otherwise available public benefit on account of its religious status.” 

But state grants for religious schools’ capital projects could raise additional legal questions.

“It’s unconstitutional for government bodies to provide grants to religious institutions if those grants would support the religious activities of those institutions,” said Alex Luchenitser, the associate vice president and associate legal director of Americans United for Separation of Church and State.

That means paying for the construction, maintenance, or renovation of facilities where religious instruction takes place is prohibited, he said.

Following ProPublica’s revelation that Ohio’s legislature had awarded grants for private schools’ capital projects, Luchenitser wrote a letter to that state’s budget staff demanding that they cancel the grants or restrict use of the money to facilities where no religious instruction would occur. 

He is now scrutinizing North Carolina’s appropriations.

The General Assembly has yet to reach a budget deal for the next two years. When they do, they are expected to release a committee report that includes a new list of grantees.