Arizona is expanding private school vouchers. Here’s what we know so far

Yana Kunichoff
Arizona Republic

The Arizona Legislature just passed the largest school voucher program in the nation, a move that opens the door for all Arizona students to use public funding to finance private school. 

An expansion of Empowerment Scholarship Account vouchers means that all students who reside in the state and could enroll in a public school are eligible to get public funding to pay for private school tuition, online curriculums or tutors.

Fewer than 12,000 students currently receive vouchers.

The voucher expansion comes after a legislative agreement that promised $1 billion in new money for K-12 education in next year's budget, with $526 million more for base funding, to sweeten the deal.

It also puts Arizona, once again, at the forefront of the movement that supporters say gives parents the option to select the best school for their children.

The conservative Goldwater Institute called the passage of the program it developed "a major victory for families" to ensure school choice.  

Critics have argued it only will deepen segregation in education and allow affluent families a way to use public funds outside of the public school system.

"We are not investing enough in our students to support two separate systems," said Sen. Christine Marsh, D-Phoenix, in explaining her opposition to the bill. 

Public education advocates held strident and outraged protests at legislative hearings in the weeks leading up to the vote, shouting "Shame! Shame!" and blanketing the Capitol lawn with red signs saying "NO NEW VOUCHERS." 

But with key Republican opponents changing course in the final discussions, after years of opposing voucher expansion, the effort has moved ahead. 

House Bill 2853, which expands the state's voucher program to all Arizona schoolchildren, passed the Senate Friday. It now heads to Gov. Doug Ducey's desk, where he is expected to sign the bill into law. 

The imminent expansion has raised a host of questions about the ESA program: who uses the ESA program, how has it grown, and do we know how students perform in their new placements? 

And what happens next?

Here's what we know so far: 

What are school vouchers?

Save Our Schools planted these signs on the Capitol lawn to urge lawmakers to reject universal vouchers. The bills were planted strategically to catch the eye of certain lawmakers.

School vouchers are a tuition payment system that currently allows students initially enrolled in a public school to take a portion of the funding with them to pay for tuition at a private school or toward an online curriculum or other education supports.

In short, the program lets students opt out of the public school system and take public funding with them to a private school.  

Who is eligible? What will change? 

Under the current program, most students must have attended a public school or charter for at least 45 days before they become eligible to apply for an ESA. 

Under the expansion, all Arizona students, regardless of whether they have attended a district school in the past, would be eligible for ESA funding. 

All homeschooled students also will be eligible for the program.

The Joint Legislative Budget Committee estimates about 50,000 current private school students and 35,000 homeschooled students who do not currently take part in the program would become eligible under the bill.  

Currently, applications are submitted to the Arizona Department of Education, which oversees the program. Eligible students receive up to 90% of the funding that would have gone to the student’s school district or charter school if they had remained enrolled in the public school system.

That money, most often accessed through the third party provider ClassWallet, can then be spent on private school tuition, tutoring or supplemental education needs like curriculums. 

However, the ESA program does not guarantee students access to the private school of their choice. 

The bill could increase general education fund costs by $33.4 million in fiscal year 2023, $64.5 million in fiscal year 2024, and $125.4 million in fiscal year 2025, according to a legislative budget analysis.

The bill also is expected to impact public school enrollment. 

More:Arizona Legislature ignores voters (again), offers sweet private-school voucher deal

Who is in the program now? 

An Arizona flag themed cowboy boot holds an American flag and an Arizona flag on the desk of state Sen. Kelly Townsend (R-D16).

When the ESA program was first signed into law by then-governor Jan Brewer in 2011, it was only for students with disabilities. 

A decade later, its eligibility has grown: children of active-duty military parents; students on a Native American reservation; students who are legally blind, deaf or hard of hearing; and those who attend a D- or F-rated school can all take part in the program. 

The number of students in the program has grown as well. In fiscal year 2012, the first full year of the program, 144 students were enrolled. In April this year, there were 11,775 active ESA students. 

In the most recent data compiled by the Arizona Department of Education and shared with the state board, 60%, or 7,094 students, are in the special needs category.

Another 16% of students in ESAs are siblings, and 11% of students have eligibility because they are in a military family. 

The smallest categories are students who are legally blind or deaf (0.4%), formerly in the ESA program (1%) and residing on a Native American reservation (3.4%). 

Where did ESA students go to school before?

A review of what schools students were affiliated with before the ESA program shows many came from large districts.  

Of the 11,775 students in the program, according to the third quarterly report from the Department of Education to the state board, here are the Arizona districts that saw the largest number of students join the ESA program: 

  • Tucson Unified School District - 829 students 
  • Mesa Public Schools - 806 students 
  • Chandler Unified School District - 451 students 
  • Deer Valley Unified School District - 415 students 
  • Gilbert Public Schools - 398 students 
  • Peoria Unified School District - 362 students 
  • Yuma Elementary School District - 361 students 
  • Dysart Unified School District - 354 students 
  • EdKey Sequoia Choice Schools - 351 students 
  • Paradise Valley Unified School District - 337 students 
  • Scottsdale Unified School District - 289 students 

An Arizona Republic investigation from 2017 found that students were using the voucher program at the time to leave higher-performing districts in more-affluent areas.

At what schools do ESA holders use their funds? 

Of the 250 schools that received payment from ESA account holders through ClassWallet, the financial vendor, 58% were schools whose affiliations were with Catholic, Lutheran, Jewish or Islamic religious faiths, according to data from ClassWallet shared by the Department of Education. 

Specific numbers on how many students attend each school was not immediately available from the Department of Education, in part because of how ClassWallet retains the information, and because parents may pay for some but not full services at a given institution. 

How much is the voucher for private school?

What each family receives from the program can vary from less than $3,000 to more than $30,000. 

The majority of students (5,363) in the ESA program get funding in the $6,000-$6,999 range. Special education students are likely to receive more funding in the program, which could be upwards of $30,000. 

The amount awarded to families in total has grown since the program begun as well, to $168 million in fiscal year 2021 from $1.6 million in fiscal year 2012. 

The Arizona state Senate convenes late in the evening to vote on bills before wrapping up for the day in the Arizona Senate chambers in Phoenix on June 23, 2022.

How else can the money be used? 

A less commonly mentioned part of the ESA program is that it allows parents to spend educational funds on educational programs, curriculums or tutoring services and uniforms. And while the department does not have a list of approved schools, vendors or providers, a list of approved items on the department’s webpage offers a look into what expenses are allowed. 

Those funding requests may be available in the ClassWallet Marketplace, to purchase directly in that platform, or families can purchase through their ClassWallet debit card. ClassWallet is the third-party system the state uses to manage ESA funds for families. 

A look at a list of allowable items breaks expense categories into curriculum, educational materials, reading books and online private programs. 

An Advanced Dissection Kit, from a website called Home Science Tools, comes with nine preserved animal specimens and is funded under the supplemental expense category.  A homeschool curriculum from Ramsey Education, which focuses on financial literacy, and a Bible Truths Online curriculum were all approved. 

A Bounceland Inflatable Castle Bounce Bouncer also was approved. Acupuncture services, climbing equipment and gym equipment were not. 

How much accountability is built in to the program? 

ESA parent Pamela Lang has spent years trying to find a private school placement for her son with intellectual disabilities because he was not able to get the complicated care he needed in the public school system.

“Without the ESA program, it would be impossible to pay for everything he needs,” Lang said. 

But the program can’t guarantee entrance into a private school, even if it funds tuition. Lang said private school after private school has refused to enroll her son, citing a lack of space. At schools that did enroll him, they often failed to meet his needs. 

“I couldn't find any way to spend the education dollars,” said Lang, who worries now that a universal expansion of the ESA program may make it even harder to find a spot in a private school willing to meet her son’s needs. 

But Lang’s experience, of struggling to find the needed educational supports for her son even under the auspices of the ESA program, won’t be reflected in any of the program’s data, nor can the state offer any recourse. 

That’s because, as dictated by statute, the state does not collect any performance data on ESA students, how long they remain in their new learning models, the race and socioeconomic background of students and how often families have to supplement tuition with their own funds. 

When ESA families are not able to access private schools, they have little recourse because the Arizona Department of Education has no regulatory authority over private schools, nor is there any requirement for private schools to publicly share enrollment information. 

That’s been an area of concern for some. 

Chuck Essigs, director of government relations at the Arizona Association of School Business Officials, said that when parents are deciding whether to send their child to a district or charter school, they have access to test scores or other measures to evaluate schools. 

“They have some assistance in making the right choice,” said Essigs. “With the majority of private schools, they have none.”

While testing data that would be shared with parents was suggested in the initial ESA proposal, the current expansion is moving forward without a significant change in accountability measures. 

In this June 1, 2020 file photo, Kristina Washington, special education staff member at Desert Heights Preparatory Academy, walks past a series of desks and chairs at the school in Phoenix, returning to her classroom for only the second time since the coronavirus outbreak closed schools.

What do special education parents say about the program?

Some special education parents, the first group that had access to ESA dollars, say the program has been a lifeline. Sarah Blank said she pulled her oldest son out of a West Valley public school after his Individualized Education Plan was violated. With the help of ESA dollars, she has been homeschooling all three of her children, two of whom qualify through the disability category, through the pandemic. 

“I want to separate the program from the administration. As a family, we are so thankful and so grateful for the program, my children are thriving,” she said. Blank's concerns with the administration of the program include that the department is not responsive to parent concerns. 

Karla Phillips-Krivickas, the founder of Think Inclusion and a state board member, said she overwhelmingly hears from parents who came to the ESA system because they were not able to get the special education services they needed and are grateful to have the option of ESAs.

“We are not talking about what is prompting these parents to leave public schools,” said Phillips-Krivickas, speaking as an advocate. 

What rights and protections do special education students have in private schools? 

Special education advocates also worry that special education ESA students lose some rights when they leave public schools. 

When students move to a private school, they do not have the same protections under the federal law that governs special education, also known as the Individuals with Disabilities Education Act. 

“Public schools are required to provide a free and appropriate public education to a student with a disability,”  said Christopher Tiffany, executive director of Raising Special Kids. “When a family opts out of public education, those protections no longer apply.” 

While students may be required to submit their Individualized Education Plans as part of an application for the ESA program, advocates say a private school system is not legally required to meet those needs. 

“Once a student leaves the public school system to accept an ESA, there is no requirement that the private school provides all the needs identified in an IEP,” said Department of Education spokesperson Richie Taylor. 

Students who are homeschooled or in non-profit private schools may be eligible to receive some services from a public school district as well. 

Public education advocates, including Save Our Schools Arizona, have raised concerns that the ESA program in general, and particularly as it grows, could further drain money from schools already struggling to meet students' basic needs. 

And while ESAs offered some special education parents a way to get their needs met, it left behind tens of thousand of other students with disabilities, critics say.  (6,732 students with disabilities are in ESA programs. Arizona has 145,084 students with disabilities in district and charter schools, according to recent enrollment data.)

With more students applying for ESA dollars under a universal expansion, special education families in particular worry they could be left out. 

"Can we trust ... that our kids' critical needs won't be reduced and shortchanged because there are so many more hands in the pot now?" ESA parent Lang asked. 

Chris Rhode, elections analyst for the Arizona Secretary of State, holds stamped paperwork for a new ESA initiative to limit school vouchers on Feb. 26, 2020, at the Arizona state Capitol in Phoenix.

What concerns do parents have with the program?

Each month, a handful of parents testify about the ESA program during public comment at the State Board of Education, which is charged with overseeing the appeals process for the Arizona Department of Education’s administrative decisions around the ESAs. 

They share concerns about how the department has handled parent complaints and difficulties and delays with ClassWallet, the third party payment system. 

More:House vote puts Arizona on cusp of largest school voucher program in the US

“The reason that parents go to the state board every month and write in comments is because we don't have a true mechanism for feedback,” Blank said. “We are the ones that are educating our children so we know what our children need.” 

The Arizona auditor general, in a 2020 review of the ESA program, said the department needed 21 staff members to adequately address its workload. At the time, 13 full time positions were allocated for the ESA program.

In its response, the Arizona Department of Education said that when Kathy Hoffman took office in 2019, there were nearly 37,000 expense reports from previous years that had gone unreviewed. 

Last session, the Legislature allocated funding for 26 full-time positions for the ESA program. Under the expansion, the bill appropriates $2.2 million for 26 additional positions to staff the ESA program. 

In its most recent quarterly report, the Department of Education noted that it offered a place for parent feedback through its ESA Parent Advisory Council, written comments, electronic surveys and town hall meetings. 

What about financial oversight? 

A state audit found that more than $102,000 in ESA funds were misspent during a six-month period, from August 2015 to January 2016, in addition to other improper purchases, as well as spotty oversight.

The examples cited by auditors include parents who kept the state's money after enrolling their children in public school, parents who bought items that are not allowed under the program, such as snow globes and sock monkeys, and parents who didn't submit required expense reports to the Arizona Department of Education.

What does the research say? 

Experts say research on the success of voucher programs is mixed because findings have been both positive and negative, with smaller studies more likely to find smaller, positive effects, while larger studies finding larger, negative effects, said Indiana University education policy professor Christopher Lubienski. 

In particular, research on programs that are most similar to what Arizona is proposing under its universal expansion have found negative impacts as the program is expanded, even when studies were done by voucher proponents. 

In Chile, which has had a universal voucher program since 1981, the number of students in public schools declined markedly and schools became more likely to be separated by family wealth. In 2008, the government put limits on the voucher program, and research found student test scores improved

A Chalkbeat review of research on vouchers found that programs in Indiana, Louisiana, Ohio, and Washington D.C. lowered student achievement on state tests, and had either a neutral or positive impact on whether students went on to graduate from college.

Have opponents gone to court? 

Arizona’s effort to expand school vouchers has seen some challenges. One effort was struck down by a court in 2009 on the basis that it provided state aid to private schools, and a broad expansion was voted down through a public referendum in 2018. 

Other states have seen court battles over vouchers as well. 

More than 100 public school districts in Ohio sued the state in January over its EdChoice program, which they argue is taking money that should go to schools accessible to all students. 

Vermont’s voucher system is a defendant in a court case in which a national nonprofit law firm argued its system, in which towns would pay for students to attend other schools, is not broadly available to students around the state.

Complicating a future consideration of any Arizona-based lawsuits, the Supreme Court recently ruled that states can’t restrict religious schools from accessing public funding over their religious focus. The case was over a voucher program in Maine.

Reach the reporter at ykunichoff@arizonarepublic.com and follow her on Twitter @yanazure.