Arizona Headed for Major K-12 Iceberg, but Solutions Exist

April 28, 2020
By Matt Beienburg

The state of Arizona now faces a projected $1.1 billion shortfall in the coming year, and it may be about to get a lot worse—but not because of the coronavirus.

Arizona’s emergency education legislation passed with bipartisan support, 90-0, with several excellent policy provisions—its authors deserve credit and our appreciation for the swift and effective policy response. But the state may be about to witness the law of unintended consequences, as one provision in the bill is primed to detonate upon the state’s already fragile financial position. 

According to the new law: “For fiscal year 2020-2021, a public school student who takes an online course during June or July 2020 may generate up to a total of 1.25 average daily membership”—that is, an extra 25% of formula funding from the state, meaning over $1,500 per student.   

As I’ve written earlier, the logic here is sound and well-meaning: First, students whose instruction has been disrupted this spring might benefit from more intensive education over the summer. Second, this provision would shield district and charter schools from financial loss if their students enroll in online learning from another provider over the summer. (Typically, the schools would see their funding retroactively reduced, as the students’ formula funding would get divvied up between their regular school and the online summer school.)

But in trying to plug these holes, the legislation may be about to break the dam. That’s because public schools throughout the state are now incentivized to enroll as many students in an online summer course as humanly possible in order to earn the extra $1,500+ per kid.  Consider the state’s largest district, Mesa Public Schools, for example, which has 63,000 students and already declared, “For the summer of 2020, current Mesa Public Schools students can take up to two semester-length courses through [Mesa Distance Learning Program] at no cost.” No cost to the parents, that is, but at a very real cost to the state.

In the most extreme case, if all 1.1 million students statewide were directed to an online course, that would total well over a billion dollars. But if even a fraction of schools signed up their kids, the state would find itself on the hook for hundreds of millions of new dollars it simply doesn’t have.

The legislation also specifies no minimum requirements around the online courses necessary to trigger the additional funding, meaning students need not seriously engage with or actually master any content to trigger the extra dollars.

Moreover, Arizona students will have just spent two months learning via online public school instruction. We should think carefully before spending truckloads to simply send them back for another two months of it—especially when the students who are falling behind now may be the least likely to actually benefit.

Indeed, for low-income or rural students lacking internet access, for example, the decision to fund (exclusively) online learning would essentially lock them out of supplemental educational resources. Especially if services are able to partially reopen over the next two months, many of these students could probably benefit more from help paying for tutors, books, offline software, etc.

To be clear, Arizona should notbe locking families out of online educational options either—the way other states have, such as by freezing online charter enrollment in order to protect district enrollment levels. 

But at the same time, the state should be pursuing a twofold strategy to 1.) maximize funding flexibility to ensure solutions best help individual students, while 2.) curbing unnecessary state spending on superfluous programs—regardless of whether they’re offered by a district or charter. 

Right now, parents have little to lose by signing up their student for supplemental online learning through a district or charter, regardless of its quality. (They also have no other state subsidized options.) But if the money that’s funding those programs were actually given to the parents along with more choices on how it could be spent, for example, suddenly those families would be a lot more likely to sign up for a program only if they thought it worth spending the money in their account. 

A smaller, targeted, program similar to an education savings account—but one that could be used to pay not only for private (online or offline) learning, but also for supplemental online public instruction—could achieve this, and it would offer a policy solution drawing on politically diverse ideals.

Coupled with reforms to Arizona’s public school funding formula for part-time online instruction—such as adopting completion based funding, and/or requiring online providers to post their academic ratings from the State Board of Education and/or the state charter board prominently on their websites—these solutions could help Arizona better achieve its goals: providing educational opportunity to students, promoting quality and accountability of instruction, and responsibly stewarding taxpayer resources.

Matt Beienburg is the Director of Education Policy at the Goldwater Institute.