How Arizona’s school voucher program turned into a tax break for the wealthy

school funding

Marisol Garcia, Vice President of the Arizona Education Association, speaks during a news conference at the Arizona capitol Tuesday, June 21, 2022, in Phoenix. The Arizona Legislature on Tuesday began considering a $15.6 billion state budget package that pays down more than $1.2 billion in state debt but keeps in place most of a nearly $800 budget gimmick from the Great Recession, boosts road construction, border security and other spending but falls short of what education advocates say is needed to fund K-12 public schools. (AP Photo/Ross D. Franklin)

By Copper Courier Staff

May 20, 2024

What started out as a program to make education more accessible to students with disabilities has now ballooned in size and cost, and appears to cater to Arizona’s wealthiest residents while leaving behind the students it was originally designed to support.

As school choice advocates pull more taxpayer dollars out of public school funding and into private education, opponents argue that Arizona’s Empowerment Scholarship Accounts (ESA) program severely undermines the resources available for public education.

The program not only adds to the complexity of education policy, it comes with a hefty price tag.

Estimated nearly $1B over budget

The controversial program currently allows any of the state’s 1.2 million K-12 students to pay for private schools using tax dollars allocated for the education budget. In 2024, ESA vouchers, originally estimated to cost $64 million for the fiscal year, are now set to reach more than $900 million.

With an impending revenue shortfall on the horizon, Gov. Katie Hobbs released her budget proposal in January. One reform in Hobbs’ budget would be to reinstate the requirement that students attend public school for 100 days to qualify for ESA vouchers. This alone would disqualify anywhere from 30,000 to 50,000 students currently using vouchers, effectively cutting the cost of the program in half.

“We are cutting out the wasteful taxpayer spending while making critical investments that will help middle class families buy a home, expand access to childcare, make prescription drugs more affordable, and protect disabled Arizonans and seniors.” wrote Hobbs in her proposal.

Hobbs’ budget cuts also included ending prior-year voucher eligibility, which, if approved, would save the state an estimated $244 million. Republican leaders quickly rejected the budget, calling it “unserious” and “dead on arrival.”

While lawmakers debate the vouchers’ financial implications for the state, ESA program critics have pointed out concerns about the financial sustainability of Arizona’s public schools and the further widening of an already present education gap.

Where school choice programs began

But how did a program originally designed to create opportunity for Arizona’s students and save money move so far off target?

When legislatures founded the first Student Tuition Organization in 1998 it established scholarships for any student in the state to help families cover only the cost of tuition; it then added a category specifically for any student with disabilities.

Later, in 2011, the ESA was created solely for students with disabilities. This resulted in two types of school choice programs for qualified students to access privatized or special needs education.

Since its creation, the program has undergone a series of expansions, and attempts to expand it universally were made as early as 2017, when legislators passed a bill to remove most requirements that students had to meet in order to qualify for subsidized education.

Save Our Schools Arizona (SOSA), a nonpartisan community organization, launched a successful referendum campaign to stop voucher expansion. Sixty-five percent of voters voted in favor of Prop 305, stopping voucher expansion in its tracks.

Four years later, Republicans in the legislature tried again. They passed House Bill 2853—signed into law in 2022 by former Gov. Doug Ducey—which effectively allowed all students in Arizona access to a private or homeschool education. This means Arizona families who don’t want their children to attend public schools can use the vouchers for any educational expense.

Efforts to repeal this expansion failed, and the resulting explosion in voucher enrollment has resulted in a severe deficit in the state budget.

“In a nutshell, this bill will siphon upwards of $1 billion from public schools every single year to unaccountable private academies, micro-schools, and homeschools,” said SOSA Executive Director Beth Lewis. “And we simply can’t let that happen.”

Vouchers not only provide tuition for any student in the state, they also cover the cost for educational services outside of tuition such as school supplies, uniforms, tutoring, college entrance exams, and more.

Equity and access challenges

Despite proponents’ claims that school vouchers promote equity and access to quality education, many critics argue that the program exacerbates existing inequalities. Wealthy families are often better positioned to take advantage of school vouchers beyond the cost of tuition, while working-class families and those lacking access to transportation or information about alternative schooling options are left behind.

Although the vouchers provide nearly $7,000 per student annually, many have noted that the average cost of private school in Arizona is $12,560. This coverage gap is easily bridged by affluent families—many of whom had already been paying the full tuition cost before voucher access was expanded—and now receive subsidized tuition that was originally meant to assist students from lower-income communities, failing schools, or students with disabilities who need special care.

“There’s a voucher gap. It’s not designed for working-class families,” said Lewis. “Because most of the quality private schools cost $15,000-$20,000 a year.”

Recent reports have also found that nearly 45% of ESA recipients live in the wealthiest zip codes in the state. Conversely, students with disabilities, who were the original beneficiaries of the program, represent a declining proportion of ESA vouchers.

Local organizations like SOSA have also raised concerns that the voucher program does not include accountability measures for schools that use it, such as standardized testing or recording demographic information on voucher recipients and their families.

There is also very little transparency around how the funds are distributed, which has already led to abuse of the program. In February of this year, five former state employees were indicted for defrauding the system by creating fake student profiles, diverting at least $600,000 away from the program.

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CATEGORIES: EDUCATION

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