A story in the Courier-Mail this morning regarding Ironside State School in St Lucia, Brisbane reinforces Independent Schools Queensland head David Robertson’s argument for reforming school funding arrangements (see QEW post), as it appears parents are very willing to pay to send their children to high-performing State Schools such as Ironside. But this high willingness to pay does not provide the Education Department with additional funds; instead it benefits local property owners. The Courier-Mail reports:
Ironside State School is one of Brisbane’s most sought after primary schools.
Consistently ranked as one of the top performing academic facilities in the city, it is little wonder the school was forced to introduce a catchment zone around St Lucia in a bid to cap student numbers…
…DJ Arnold Real Estate owner David Arnold said Ironside State School was one of the biggest drawcards for families who moved into the area.
“We find people come here to rent to secure their children’s enrolment,” he said.
“That’s a big thing.”
The State Government is rightly interested in value capture regarding the benefits created by proposed new infrastructure investments such as Cross River Rail. It should also consider capturing part of the value created by existing infrastructure, including high-performing state schools such as Ironside State School and Brisbane State High, which drive up rents and hence property values in their catchment areas. Relevant policy measures would include the proposals advanced by David Robertson last week (e.g. a means-tested school voucher scheme) and the replacement of the inefficient stamp duty tax regime with land tax.
Ironically, parents can end up paying similar amounts to private school tuition fees, through higher rents or property prices, so they can live in high-performing school catchments, as demonstrated by Ian Davidoff and Andrew Leigh, then at the Treasury and ANU respectively, in an excellent 2007 paper regarding the impact of Canberra public schools on the local property market: