Arizona’s Empowerment Scholarship Account program is reshaping the education landscape by offering families public funds to pay for private school tuition, homeschooling, tutoring and other educational expenses.
Touted as a win for school choice, the program is under scrutiny for its ballooning cost, oversight challenges and impact on public schools.
What is the ESA program?
Launched in 2011, the ESA program initially served students with disabilities. It has since expanded, funded by reallocating state education funds that would have otherwise been designated for a student's attendance at a public school, most significantly in 2022, when House Bill 2853 made Arizona the first state to offer ESA funds to all K-12 students, regardless of income or school type.
Today, ESA funds can range from approximately $7,000 to more than $30,000 per student annually, depending on eligibility and grade level.
By February 2025, 83,819 students were enrolled in the ESA program. That number has risen to 87,414 by March 17. The program's budget is expected to exceed $1 billion for the fiscal year beginning July 1, 2025.
Support and criticism
Supporters argue ESAs give parents the freedom to tailor education to their children’s unique needs, especially in cases where traditional public schools fall short.
“It’s important to have as much choice as possible,” Superintendent of Public Instruction Tom Horne said in a recent press statement. “Even a good school doesn't necessarily meet everyone's needs. Under ESAs, families can find a school that meets the needs of each child.”
These funds can also be applied towards homeschooling options as well as private schools.
Gilbert parent Sydney Jackson has three children enrolled in three different educational systems.
“Our daughter is in a charter school and EVIT for a medical assistant program, our youngest is in public school, and our oldest prefers hands-on learning through homeschooling,” she said. “The ESA program lets us meet each child where they are.”
Critics argue ESA expansion is siphoning funds from an already underfunded public school system.
“Every dollar that goes to a private school through ESAs is a dollar that could have gone toward teacher salaries or classroom resources,” said a teacher in the East Valley, who requested anonymity because of their district’s policy on speaking to the media.
A recent report from Education Forward Arizona, a nonpartisan group, reports ESA vouchers are funded entirely through the state’s general fund and divert resources from public services including education, health care and infrastructure.
“In Arizona, school funding follows the student. Schools are funded based on student attendance and receive a specific amount of funding per student…If the student never went to a public school, the funds come out of education funding in the state’s general fund.”
How are funds allocated?
Arizona's ESA program provides eligible families — including all K–12 students residing in the state, as well as students with disabilities, children of military families, those attending underperforming schools, and students living on tribal lands — with 90% of the state funds that would have been allocated to their child's public school education.
These funds are distributed quarterly and can be used for a range of educational expenses, including private school tuition, homeschooling materials, tutoring, and educational therapies.
To manage and access these funds, the Arizona Department of Education utilizes ClassWallet, a digital platform that allows parents to make direct payments to approved vendors and educational institutions. Upon approval into the ESA program, parents receive access to a virtual account within ClassWallet. Through this platform, they can pay for approved educational expenses directly, ensuring transparency and accountability in fund usage.
Parents are required to submit quarterly expense reports detailing how ESA funds have been used. This process ensures all expenditures align with the program’s guidelines and provides oversight by the Arizona Department of Education.
By expanding eligibility to nearly all Arizona families and implementing clear financial controls, the ESA program is designed to offer flexibility in educational choice while maintaining strict accountability to prevent misuse of taxpayer funds.
Oversight concerns
With growth has come instances of fraud and abuse. In February, five individuals, including former Arizona Department of Education employees, were indicted for creating fake students and pocketing ESA funds. In a separate case, out-of-state applicants submitted false documents to collect more than $110,000 in ESA money.
On Feb. 13, Arizona Attorney General Kris Mayes announced the sentencing of Jadakah Johnson, 21, and Raymond Johnson Jr., 20, both of Phoenix, who fraudulently obtained ESA funds. Each received three years’ supervised probation and ordered to pay $196,526 in restitution.
To address oversight, Horne hired an experienced auditor and investigator to root out fraud and improve compliance.
“As a former Arizona attorney general, I am determined to eliminate fraud within the ESA program,” Horne stated in a press release. “These positions did not exist under my predecessor (Kathy Hoffman).”
Still, critics question whether these measures are enough. A backlog of ESA reimbursement requests continues to grow, and watchdogs are calling for broader reforms.
Who’s left behind?
Civil rights groups are especially concerned about the impact on students with disabilities. To participate in ESAs, families must waive their rights under the Individuals with Disabilities Education Act, including access to free appropriate public education, individualized education programs and procedural safeguards, per Arizona state law.
“In Arizona, ‘choice’ schools were shown to cherry-pick their students,” SOSAz officials noted in a recent report. “Low-income students, special needs students and children of color are statistically less likely to be chosen, leading to a system of haves and have-nots.”
A 2023 U.S. Government Accountability Office report found similar voucher programs in other states offered less oversight and transparency for special education services, raising questions about whether students’ needs are truly met once they exit public schools.
The financial picture
K-12 education remains the largest allocation in Arizona’s state budget, receiving $4.2 billion from the state’s $9.8 billion general fund portion of the overall $16.2 billion budget for 2025.
Despite that, public schools continue to report shortages in teachers, classroom supplies and basic services. But, more than that is how students are left behind.
According to an EdBuild Report entitled, 23 Billion, “Voucher schools are sapping funding from public schools and often exclude the neediest students. Arizona has the most inequitable school funding in the country, providing $7,613 less per child in ‘nonwhite’ districts than white districts.”
Arizona Gov. Katie Hobbs has been outspoken in her support for public education. In her 2025 State of the State address, she said, “The best way to ensure we have a strong, thriving economy is by acting decisively to support our public K-12 schools. From Page to Douglas, more than 90 percent of our K-12 students go to public schools. That’s why our path forward demands bipartisan solutions to create and sustain the world-class schools our children and parents deserve.”
Despite the program’s expansion, Katie Hobbs has repeatedly pushed to limit ESA vouchers, arguing that unchecked growth could undermine public education.
What comes next?
Hobbs has proposed increased financial oversight for the ESA program, while lawmakers consider revisions to eligibility requirements and funding limits. Meanwhile, Horne remains focused on enforcement.
However, to improve Arizona’s ESA program, the state should begin to increase transparency through real-time audits, approved vendor lists, and a public spending dashboard, while prioritizing funds for students who need them most — such as those with disabilities or from low-income families.
Requiring standardized testing and annual progress reports would ensure academic accountability, and a stabilization fund could protect public schools from sudden financial loss. By encouraging innovation within public education and building trust through clear reporting and parent education, Arizona can create a more equitable, effective system that supports both school choice and public schools.
Educators, families and taxpayers wait to see how the state will resolve the tension between education freedom and equitable access.
Editor’s note: A grant from the Arizona Local News Foundation made this story possible. The foundation awarded 15 newsrooms to pay for solutions-focused education reporters for two years. Please send your comments to AzOpinions@iniusa.org. We are committed to publishing a wide variety of reader opinions, as long as they meet our Civility Guidelines.
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