Children's school travel mode is changing, especially away from walking and bicycling and towards private automobiles. Simultaneously we see warning signs from a public health standpoint as children are becoming less active. It has been suggested that walking and bicycling to or from school could help shift this trend, moving it towards greater activity, and researchers are therefore exploring choices of school-trip mode in relation to the pedestrian friendliness of the built environment. Mode-choice models are generally framed as multinomial logit (MNL) models. However, the limitations of MNL models can cause unrealistic effects when walking and bicycling are included with motorized modes. In this paper the focus is on accounting for individual-specific heterogeneity, since different children or families may have very different tastes or tolerances, such as travel time, when it comes to choosing between driving a private automobile, taking the school bus, bicycling, or walking to or from school. The results show that such heterogeneity exists, and that it is more important for nonmotorized modes than for the motorized modes. The results show that accounting for correlation across modes leads to more realistic marginal rates of substitution (cross-elasticities) across modes - in particular, an increase in the walking distance negatively affects the probability both of walking and of bicycling.