Arizona Education Vouchers Explained: Empowerment Scholarship Accounts and Their Impact
In 2022, Arizona made a significant move in the education sector by pioneering the largest school voucher program in the history of education. This initiative, known as the Empowerment Scholarship Account (ESA) program, aimed to provide parents with greater choice in their children's education. However, the program's implementation has sparked considerable debate and raised questions about its financial implications and overall impact on the state's education system.
The Genesis of Empowerment Scholarship Accounts
Empowerment Scholarship Accounts, also known as school vouchers, were originally created in 2011. The initial purpose was to enable students with disabilities to access specialized services and therapies that could best cater to their educational and developmental needs outside the traditional public school system. These vouchers represented an alternative method of school choice in Arizona, where parents could agree to use public funds for their child's education while taking on the responsibility for their educational path outside of public schools.
Before the universal expansion, as of April 2022, 11,775 students were actively using school vouchers. A majority of these vouchers (more than 7,000) were allocated to families with students who have special needs, and only 447 were students from D and F-rated schools.
Universal Expansion and Its Provisions
The law passed in the summer of 2022 expanded voucher eligibility to all students in Arizona, encompassing the existing 1.1 million students in traditional public and charter schools. Applications under the universal voucher program opened on August 16, 2022, and by September 5, the Arizona Department of Education (ADE) reported receiving 8,193 voucher applications, with 96% of those made under the voucher expansion.
School vouchers provide recipients with 90% of the state funding amount that would have been allocated to a public or charter school, typically around $7,000 per student. However, this amount can vary, especially for students with disabilities, where vouchers can reach upwards of $30,000. ADE reports that the average school voucher is $15,225.39, while most vouchers (53%) are in the $6,000-7,000 range. About 16% received vouchers of $20,000-29,000 and 20% received a voucher worth more than $30,000.
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The ESA Parent Handbook outlines the permissible uses of voucher funding, including tuition and fees, books, tutoring, curriculum, educational materials, testing fees, tuition and fees at a postsecondary institution, dual enrollment, uniforms, extracurricular programs or individual classes at a public school, and approved therapies. Extracurricular activities with appropriate credentials, such as horseback riding lessons, cooking classes, and woodworking, are also allowed. Supplemental materials required by a curriculum or course of study, including gardens, gym equipment, art supplies, instruments, and kitchen equipment, can also be covered. Universal voucher efforts allow parents to spend public money not just on private school tuition but also on recreational programs for their kids like ninja warrior training, trampoline park outings and ski passes, or on toys and home goods that they say they need for homeschooling purposes.
How the Program Works
In Arizona, school funding follows the student. Schools are funded based on student attendance and receive a specific amount of funding per student. If a student chooses to use a school voucher, that taxpayer funding is allocated to the student’s family to procure their own education outside of the public school system. If the student using a voucher went to a public school previously, then the school would no longer receive that funding because the student no longer goes to that school.
ADE administers the program and uses a system called ClassWallet to manage payments. Parents can use ClassWallet to get a prepaid debit card, request reimbursement or to make direct payments to the school or vendor. When using the debit card, some limitations exist for some types of vendors. Additionally, ADE has a list of unapproved expenses that users must follow.
Financial Implications and Budgetary Concerns
The universal voucher program has raised significant concerns about its financial impact on the state's budget. In 2023, Arizona faced a $1.4 billion budget shortfall, with a significant portion attributed to the increased spending on vouchers, according to the Grand Canyon Institute. Consequently, funding for various essential services was slashed, including $333 million for water infrastructure projects, tens of millions of dollars for highway expansions and repairs, and improvements to air conditioning in state prisons.
Critics of the program argue that the parents most likely to apply for these vouchers are those who were already sending their children to private schools or homeschooling. This results in new money coming out of the state budget without necessarily expanding educational opportunities for underserved students.
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Researchers analyzed student enrollment in the program, the combined cost of the earlier enacted ESA program and the new universal voucher program, and their effects on education funding in the state. This report outlines the cost estimates and calculations in detail. Students who accepted ESAs who were previously educated in private schools or homeschool environments added a new cost to the state. On average, students who were previously enrolled in district schools also generate a new, but smaller, cost to the state, while students previously enrolled in charter schools generate a small savings. Costs are estimated for each.
Between the 2021-22 and 2022-23 school years, the ESA program expanded from 12,127 to 61,689 students, a growth of 409%. Nearly all (91%) of the program’s growth came from students enrolled in the new Universal ESA program. The cost of the ESA program represents 8.8% of the $6.7 billion total Basic Student Aid funding in 2022-23.
Arguments For and Against the Expansion
Advocates for the universal voucher initiative originally claimed that it would not cost the public and might even save taxpayers money. They argue that private school parents have a right to and could be sending their children to public school at taxpayers’ expense. They also point out that the program empowers parents to make the best educational choices for their children, fostering competition and innovation in the education sector. A spokesperson for Arizona’s former Republican Gov. Doug Ducey, who signed the universal voucher program into law, said that “not only does Gov. Ducey have no regrets about ESA expansion, he considers it one of his finest achievements and a legacy accomplishment. And what he’s most thrilled about is that Arizona’s ESA expansion was followed by 11 other states doing essentially the same thing.
However, critics contend that the program exacerbates educational inequality by primarily benefiting families who already have the resources to send their children to private schools. They also raise concerns about the lack of accountability and oversight in how voucher funds are spent. There’s no public reporting of how the taxpayer dollars are spent, including a review by the Auditor General, fiscal audit, budget review by the public or governing board, or other mechanisms required for private schools or vendors to use public funds. Further, there are no qualifications required for teachers in private schools or via other providers.
Opponents also highlight the potential negative impact on public schools, which may face funding cuts as students leave to participate in the voucher program. As families choose vouchers, schools lose that funding, but they still have the same fixed expenses for their school buildings, electricity, teachers and school staff, to name a few. When students leave a public school or charter school, the money leaves those public schools. Additionally, any other state or federal funding that is generated per pupil will also be reduced.
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Challenges and Safeguards
The implementation of the universal voucher program has faced challenges, including the need for safeguards to ensure that funds are used appropriately. While there are some mechanisms in place, such as the ClassWallet system and a list of unapproved expenses, critics argue that these are minimal and operate on the back end after expenses have been incurred.
Concerns have also been raised about the lack of transparency and accountability in the program. There is no public reporting of how taxpayer dollars are spent, and there are no qualifications required for teachers in private schools or other educational providers.
Using a voucher requires having the financial means, ability to navigate the system, transportation to a private school or other provider, the ability to home school and access. For those choosing to go to private school, they have to be able to pay the full tuition and fees, plus tuition, books and other expenses. Families also need the ability to navigate the system, to meet the requirements of the ESA program and then to evaluate what private school, therapies or other education providers would best meet their child’s needs. Students also have to have transportation to the campus or other education provider. Those who choose to homeschool must have someone who can provide that homeschool instruction.
Potential Reforms and Future Outlook
As the universal voucher program enters its third year, there are ongoing debates about potential reforms to contain costs and improve accountability. However, reaching a consensus on these reforms has proven challenging.
The future of the program will likely depend on the outcome of upcoming elections and the willingness of policymakers to address the concerns raised by critics. It remains to be seen whether Arizona can find a way to balance parental choice with the need for a strong and equitable public education system.
Arizona doesn’t have a comprehensive tally of how many private schoolers and homeschoolers are out there, so it remains an open question how much higher the cost of vouchers could go and therefore how much cash should be kept on hand to fund them.
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