Official State Data: Arizona ESA Program Most Accountable, Successful in Government

Arizona’s Empowerment Scholarship Account (ESA) program is now helping over 100,000 students access the best education opportunities in this state—and doing so for roughly half the cost per child of the state’s public district school system, which spends over $16,000 per kid per year.

Now, official state records show it is also one of the most efficient and accountable programs serving Arizona taxpayers.

According to official data from the Arizona Department of Education (ADE), the rate of unallowed spending in the program is just 2%, meaning 98% of ESA funds are used as intended.

Even more impressively, ADE reports that “actual fraud or egregious purchases” made through the program are even lower: just 0.3%.

As ADE’s documentation makes clear, recent media reports suggesting higher rates of unallowed spending are not only wildly inaccurate, but based on an almost unpardonably poor interpretation of state records by organizations such as 12News.

As ADE reports:  “A ridiculous figure of 20% fraud has been circulating concerning ESA purchases which resulted from a total misinterpretation of data that we provided to Channel 12. The 20% figure represented program participants that ADE had selected for risk-based auditing.  It had nothing to do with fraud.”

Moreover, the “unallowed” spending reported by outlets like 12news include hundreds of purchases that were deemed “unallowable” simply for failing to include arbitrarily required documentation, including for purchases like a poster of the periodic table of elements, National Geographic publications on rocks and minerals for kids, and world history books.

As ADE likewise noted: “The submission of a purchase that is deemed unallowable does not constitute fraud.  Most are innocent mistakes, such as an error in a form that must be resubmitted, or educational items that are not on the allowable list but that the user could have in good faith believed were permitted. Some examples would be backpacks, lunch boxes and water bottles.”

In comparison to the ESA program’s actual extremely low rates of unallowed spending, the official error rate of the SNAP (food stamps) program in Arizona is approximately 9%, which is projected by state officials to cost Arizona taxpayers $185 million a year.

It’s also worth observing that just 52 cents of every dollar sent to Arizona district schools now makes it to classroom instruction according to the state auditor general.   Among the many uses of those funds outside the classroom: a $500,000 trip to Las Vegas by a school district that promptly cut bus services for students; a district spending $4,000 per person to send staff to Napa, California for a conference featuring wine tastings, a district spending $18,500 on “membership dues and for staff to attend golf tournaments,” and more.

While many public schools fail to steward their financial resources for the benefit of students, the ESA program is allowing thousands of parents to do right by their children and ensure they have access to best education possible, all at a lower cost to taxpayers and with a higher degree of accountability and transparency than is found even in the public school system.

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