In 1973, the Endangered Species Act (ESA) came into effect.  The goal of this ESA, as any kid from any public school in America could tell you, was to preserve species under threat of extinction, through various restrictions both related to the animals themselves and the environments in which they live.

The ESA created an incentive for some interesting behavior, though.  It encouraged landowners, particularly in rural areas, to “shoot, shovel, and shut-up.”  Essentially, once the government figured out there was an endangered species on the land, then the ability to farm or harvest timber or otherwise use that land was severely limited.  Since that could be financially disastrous for some landowners, it was easier to just kill off the animals, bury the evidence, and keep quiet about it, so the government was never any the wiser.  Shoot, shovel, and shut-up.

So this week, when I heard about a different ESA – Education Savings Accounts – I started thinking about the behavior that they might incentivize.  Could these ESAs bring about their own, more positive, 3 S’s?

Arizona has been the leader in ESAs, and the idea is really pretty simple.  Essentially, parents are given a portion of what the state would have spent on educating their child and allowed to spend it on whatever education they choose.  For qualifying children – kids with special needs, or in failing schools, or from poorer families, for example – this means that, if they choose to leave the public school system, they can use that money for private schools, transportation to a different school, tutoring, or even for college savings accounts.  Kids still have to be educated; it just shifts the choices about how that’s done from the state to parents.

What’s so interesting about Arizona’a model, and so different from many traditional voucher schemes, is that parents don’t have to spend the whole thing as one lump sum at a school.  A parent could choose to save half in a college account, homeschool, and use the other half for supplemental tutoring.  Or a parent could choose to send a child to a special needs school, and use part of the money to help with the additional transportation costs to get her there.  Or a parent could use the entire amount for private school tuition, even if they had to supplement with an additional amount of their own.  There are lots and lots of options.  Parents have to report how they’ve spent it, to ensure that it’s legitimate education spending, but beyond that, it’s pretty much up to parents.

And this means that there are strong incentives for parents to get the most bang for their buck.  Since they can roll over the money, or put it into savings for college, or spend it on other supplemental tutoring, then it makes sense to try to find the best value in private school, or a deal on transportation, or save for future expenses.

And so, I’m hopeful that Arizona’s ESAs will indeed bring about their own 3 S’s.  But perhaps this time, rather than a way around the law, this ESA will incentivize students and parents to shop, sharpen, and shine.