Arizona's controversial ESA program under fire from both sides as new lawsuit lands

The ESA program uses taxpayer funds to support over 75,000 students in private schools.

PUBLISHED SEP 25, 2024

Established in 2011, the ESA program initially targeted specific student groups, including children with disabilities.

Phoenix, Arizona: A lawsuit has been filed against Arizona Attorney General Kris Mayes, challenging her recent enforcement of stricter rules for the state's Empowerment Scholarship Accounts (ESA) program.

The ESA program, which uses taxpayer funds to support over 75,000 students in private schools or homeschooling, is at the center of a legal dispute over new regulations requiring more detailed documentation from parents to prevent misuse of funds.

As the above table shows, in Q3 of 2024, 75% of the students using ESA fall into the K-12 Universal category. (Source: ESA Quarterly Report, Arizona Dept of Education)

Mayes’s office claims these new rules are essential to ensure taxpayers' dollars are being used appropriately for educational purposes. Parents are now required to provide evidence that all supplemental materials purchased are directly tied to specific curricula.

Opponents, however, claim these new regulations place undue burdens on families, many of whom are already stretched thin.

The lawsuit alleges that Mayes’s crackdown violates state law and places unnecessary hardships on families participating in the ESA program. Supporters of the program argue that parents should have the freedom to determine what materials are educationally appropriate for their children without excessive oversight from the state.

Chart showing the reasons why ESA applications have been denied in Q3 2024. (Source: ESA Quarterly Report, Arizona Dept of Education)

What is the ESA Program, and how does it work?

Arizona's Empowerment Scholarship Accounts (ESA) program is one of the largest school voucher programs in the US, allowing families to use public funds for private education and other educational expenses. Established in 2011, the program initially targeted specific student groups, including children with disabilities, but over the years, it has been expanded to include a broader range of students.

Families who enroll their children in the ESA program receive a portion of the state funds that would have otherwise been allocated for their child's public school education. The amount typically ranges between 90-100% of what the state would have spent per pupil in a public school. This money is deposited into an account that parents can use for a variety of educational expenses.

According to the rankings, Arizona, Alabama, New Mexico, Oklahoma and Idaho are the worst states.

Originally, the ESA program was limited to specific student groups, such as students with disabilities, children in foster care, children living on Native American reservations, children of active-duty military members, and students assigned to failing schools. However, as of 2022, the program was expanded to all K-12 students in Arizona, making it a universal voucher program. Now, any family, regardless of income, can apply for an ESA to fund their child’s education outside the public school system. Funds are typically managed through a prepaid debit card, and parents are required to report their spending to ensure it aligns with approved educational expenses.

What can parents use ESA funds for?

Private school tuition and fees

Online education programs

Tutoring services

Educational therapies (e.g., for students with special needs)

Curriculum and materials

Standardized testing fees

College entrance exams and prep courses

College tuition (in some cases)

How is this impacting public schools?

One of the main points of debate surrounding the ESA program is its impact on public school funding. Critics argue that it diverts resources from public schools, particularly in low-income and rural areas. Proponents believe it provides families with greater educational choice and competition, potentially driving improvements in both public and private education systems.

The program has faced several legal challenges over the years, mainly from opponents who argue that it violates the separation of church and state, as ESA funds can be used at religious schools. However, courts have generally upheld the program, emphasizing the funds go directly to families, who then make independent choices about where to spend them.