Goldwater Institute Sues Arizona Department of Education over Mishandling Educational Choice Program

January 7, 2020
By Timothy Sandefur

The Goldwater Institute today filed a lawsuit against the Arizona Department of Education on behalf of several families who participate in the state’s Empowerment Scholarship Account program and have suffered from the Department’s mishandling of that program.

As we explained in a letter to the Department last month, its policy of requiring parents to have their prior quarterly expense reports approved before they get the funding to which they’re entitled—an approval that takes weeks or even months to receive—violates state law. So does the Department’s creation of its ESA Handbook, which includes dozens of rules that parents must follow to participate in the program—but which was written without following the procedures required by the Arizona Administrative Procedure Act.

That Act requires agencies to go through a process whenever they create new rules—a process that includes extensive input from the public. The Department must first publish its proposed rules, and allow both written and spoken input from citizens and organizations that might be affected by those rules. It must also provide information about how the rule will affect the public, and submit information to the Governor’s Regulatory Review Commission, for its review.

But the Department did none of these things. It simply adopted the Handbook without consulting the public. Its Handbook therefore contains scores of rules that parents must follow that were adopted without any public comment or the approval by other agencies that the law requires. Making this problem even worse, the Department regularly changes the Handbook—altering its rules arbitrarily from one year to the next—again without following the laws that require public involvement.

Back in 2017, we raised these concerns in a letter to the office of the Attorney General. Their answer was that the Handbook is just a set of explanations, not rules that parents are required to follow. But that’s not true: the law defines a rule as “an agency statement of general applicability that implements, interprets or prescribes law or policy, or describes the procedure or practice requirements of an agency.” That’s obviously what the Handbook does—and parents are routinely told to follow it.

Worse still, the Department itself often seems unable to make sense of its own rules. Its implementation of the ESA program is constantly changing, resulting in unpredictable and arbitrary outcomes. Parents who ask the Department if an expenditure will be approved are sometimes told “yes” and sometimes “no,” without no clear justification for the difference in treatment. Some parents who have been told that an expense is not proper have learned that other parents were approved for the same expense—and upon asking the Department for an explanation, have had the original refusal reversed. In these and other ways, the Department’s implementation of the ESA program has proven arbitrary and confusing.

A few days ago, the Department replied to our December letter with a letter of its own in which it failed to answer any of our concerns, but merely reiterated its insistence that parents satisfy its illegal, time-consuming pre-approval process—a process that’s so slow, parents are sometimes forced to remove their kids from classes, due to the Department’s failure to make good on its legal obligation to provide funding—or even to pay out of their own pockets for tutoring services. When they do that, they can’t be reimbursed from their ESA accounts. And, as for the Handbook, the Department gave no legal justification for fashioning these rules without following the legally required procedures. This leaves Goldwater’s clients no choice but to file suit.

You can read more about our case here.

Timothy Sandefur is the Vice President for Litigation at the Goldwater Institute.