By Matthew Ladner & Jason Bedrick
A man with a beam in his own eye should certainly address that before seeking out motes in others’ eyes. School-choice critics obsessed with the motes in Arizona’s popular Empowerment Scholarship Accounts program would do well to heed that advice, especially when there is a gigantic beam in the public school system.
Arizona’s school district lobbyists and their media/political allies have been criticizing Arizona’s ESA program for having $440 million in funds that families have yet to utilize—equivalent to about $5,000 per each of the nearly 85,000 students in the program. Meanwhile, Arizona school districts continue to carry growing financial balances of unspent funds—north of $7.8 billion, or $7,000 per student—which dwarf those in the ESA program.
There is no ESA scandal here. Balances accumulate for a variety of reasons, including delays in state processing of payments, but also because families economize during the K–8 years to better afford more expensive high-school education costs. That’s exactly how the ESA program is supposed to work.
ESA families receive less funding per pupil (90% of the state funding and none of the local or federal K–12 funds) but more flexibility, allowing families to use ESA funds for private school tuition, college course work, tutoring, special education therapies, and more. Because of the lack of local funding in the ESA program, the state can fund almost two ESA students for the cost of the average district student. They’re called “education savings accounts” for a reason, as parents should carefully consider the value of each purchase they make.
Lawmakers designed the ESA from the outset to allow parents to carry forward funds from one year to the next, which encourages them to use the funds wisely. Private school tuition, for instance, is significantly higher for high-school students than for students in elementary and middle school. The rollover feature allows parents of younger students to financially prepare for such expenses.
From the outset, the ESA program has also allowed parents to use unspent funds on post-secondary tuition and books for a prescribed period after high-school graduation. After the period elapses, account balances revert to the state treasury, and the Treasurer’s office generates interest income, which in the meantime goes to the state general fund.
Account balances have grown in large part because the Arizona Department of Education has tens of thousands of reimbursement requests pending in addition to other cumbersome payment problems. Attorney General Kris Mayes, an opponent of the ESA program, ordered ESA families to attach a curriculum to a substantial number of purchases. By design, this requirement slowed the expense approval and reimbursement.
Parents have sued to put a stop to the absurd bureaucratic requirement, and the irony of choice opponents both causing and complaining about account balances deserves notice. In other words, if the Arizona Attorney General Kris Mayes ends her unnecessary burdening of ESA families, then account balances will shrink.
Meanwhile, Arizona school districts had unused funds of $7,853,198,187 at the end of the end of the 2024 fiscal year. This was over a billion dollars more than the previous year and has grown further since. This level of unspent funds is approximately 5.5 times the size of Arizona’s rainy-day fund, and many times larger than unused ESA balances.
One could do a great deal with $7.8 billion. If districts had distributed $7.8 billion to the state’s 48,000 district teachers in the form of a one-time bonus, they would receive an average of $162,500. Alternatively, the districts could pay out the funds over 10 years and raise the average teacher pay from $64,420 to more than $80,000 and still have funds leftover.
Despite record levels of per-pupil spending, Arizona school districts displayed the lowest levels of academic achievement in their history in the 2024 Nation’s Report Card. The district treasure hoard of cash may be benefiting someone, but the list does not appear to include students.
Arizona districts both spent and hoarded enormous funds, had allied policymakers slow ESA reimbursements, and then complained that ESA families failed to spend their funds fast enough. Unlike ESA balances, this doesn’t add up.
Matthew Ladner is a Senior Advisor for education policy implementation and Jason Bedrick is a Research Fellow at the Heritage Foundation’s Center for Education Policy.
I smell a tax increase no matter what..
Our Attorney General does not approve of the ESA program. Sorry AG Mayes, but it was passed by the AZ Legislature and the voters.
So, isn’t it interesting that AG Mayes spends so much time and effort scrutinizing ESA payments to parents who are attempting to claim some of their education tax dollars to send their children to real schools with educational programs they approve of instead of State schools where the education is determined by the School District bureaucrats. Apparently, AG Mayes feels no need to apply any scrutiny to Arizona School districts hoarding billions of our tax dollars. Or to School District Administrations that create a vast pool of funds ripe for misappropriation. I think that those School Districts might just be a field of inquiry for the AG that would yield results of greater value to the people of Arizona than the bureaucratic rigamarole she has added to the ESA program.
Wow, greedy power-hungry nouveau dictators, who want to deny other’s options, mismanage the sole “alternative”? I’m flabbergasted … [/sarc]
ESAs have limited if any checks and balances. It’s a travesty at what is allowed to occur in the name of “parents rights” and our GOP. Esas have been voted down 0-17 in EVERY state and yet our all-knowing R legislation seems to think they decide what is best for all taxpayers and educational monies. Don’t preach about hoarding public school monies. DVUSD is counting every PENNY to stretch educational dollars. Dr Finch and I pray together every morning for God to continue to give him wisdom to weather this culture. We even ask for supernatural FUTURE insight that can only come from God for what is to come. And before the knives comes out, yes he receives the highest salary in our system. And YES, we have a Fico of 850 and bow the knee to Jesus Christ and HIS teachings of proper stewardship. We know how to budget, tithe, gifts and offerings, carry no debt sans a mortgage and proper accountability of what has been entrusted to us. It begins at the top. Az is 49th in educational funding for our public ed children. Our GOP places minimal to zero value on our children in the ENTIRE United States. It’s ungodly and it’s unjust. And I don’t care if I am the only ultra conservative Baptist Christian Republican to call it out- because our public school children deserve to be championed. *You do realize unscrupulous parents are being allowed to raid the ESAs and then dropping their kids off at public schools? An extra mouth to feed with no funding!!! Keep ESAs, just rein them in for Pete’s sakes! #VoucherReform
Need more money for the schools you say? A HUGE reduction in school superintendent salaries would be the best place to start! Ridiculously overpaid figurehead bureaucrats who essentially do NOTHING practical for improving the schools. People rant about overpaid corporate CEO’s (and often rightly so), no different with school district superintendents. Arizona legislature tries to pass bills/laws to specifically raise teacher pay, and the actual TEACHER’S UNION orders the Demorats to vote it down because then they can’t have control of where the money goes, meaning central office and pet projects instead of teachers. Yes, ESA’s need more restrictions/guidelines and hard crack-downs on those that misuse the system (even when done “within the rules”). But spare us the “we don’t get enough money to spend” garbage……….it all goes to useless administrative bloat instead of where it should go!
If I am paying for property taxes I want the most of my taxpayer money. So if I choose to drop of my kids at the public school but utilize ESA for tutoring because one needs help at math and the school is failing him, and extra curricular school activities for another because I work late, than so be it. Or maybe I don’t like the fact teachers and administration don’t know what a male or female so I don’t want to risk my kids exposing to their nonsense. So I may have to shop around for more Godly options, including religious or private schooling.
Having laws mandating school attendance while paying for it but not allowing any options is tyranny. ESA is not perfect, but far better than restricting your kids to the tyranny of only one public school option.
Need more money for the schools you say? A HUGE reduction in school superintendent salaries would be the best place to start! Ridiculously overpaid figurehead bureaucrats who essentially do NOTHING practical for improving the schools. People rant about overpaid corporate CEO’s (and often rightly so), no different with school district superintendents. Arizona legislature tries to pass bills/laws to specifically raise teacher pay, and the actual TEACHER’S UNION orders the Democrats to vote it down because then they can’t have control of where the money goes, meaning central office and pet projects instead of teachers. Yes, ESA’s need more restrictions/guidelines and hard crack-downs on those that misuse the system (even when done “within the rules”). But spare us the “we don’t get enough money to spend” lie……….it all goes to useless administrative bloat instead of where it should go!
doesn’t all of government run operations function in this manner? If they had a bed they’d be stashing there
What is wrong with Mayes? We’ve got to get rid of the haters of liberty. If more teachers thought for themselves they could band together and demand better pay…oh wait they already did through RED FOR ED! What a joke that was.
When I was working as a nurse, we had performance evaluations every six months! If your performance didn’t match your job description & your final result was not in compliance, guess what, no raise, or you got disciplinary action to improve or leave! As usual we see the thieves at the top criticizing something that works! Mayes and govt education’s greed for power is showing again!
Need more money for the schools you say? A HUGE reduction in school superintendent salaries would be the best place to start! Ridiculously overpaid figurehead bureaucrats who essentially do NOTHING practical for improving the schools. People rant about overpaid corporate CEO’s (and often rightly so), no different with school district superintendents. Arizona legislature tries to pass bills/laws to specifically raise teacher pay, and the actual TEACHER’S UNION orders the Democrats to vote it down because then they can’t have control of where the money goes, meaning central office and pet projects instead of teachers. Yes, ESA’s need more restrictions/guidelines and hard crack-downs on those that misuse the system (even when done “within the rules”). But spare us the “we don’t get enough money to spend” lie……….it all goes to useless administrative bloat instead of where it should go!
What will Arizona School Districts do when the 30% of seats filled by illegals disappear?