Last week the Arizona State Legislature expanded the state’s landmark educational savings account (ESA) program, officially called Empowerment Scholarship Accounts.
Under this program, which was launched in 2011, Arizona parents who choose not to enroll their children in government schools inform the state. In turn, the state deposits 90 percent of what it would have spent to educate those children into tax-free ESAs instead. Parents can use those funds for approved education expenses such as private school tuition, online classes, or tutoring. Even better, any remaining funds can be used to help pay for college.
Previously, ESA eligibility was limited to public school children with special needs, attending failing public schools, in foster care, or from military families. Under the expansion (SB1363) children eligible to attend kindergarten may now participate. Additionally, the program expressly makes public charter school students eligible to have up to 90 percent of their state per-pupil funding deposited into an ESA if their parents prefer a non-public school option.
On the downside, through 2019 the program has been capped at 0.5 percent of total district and charter public school enrollment from the previous year—about 5,000 students. The program served just over 300 students this school year, up from slightly more than 100 the previous school year. If most parents are happy with their children's current public school, then a cap is unecessary; however, if a significant portion of parents are dissatified, then a cap is unjust.
As with virtually every other Arizona parental choice program (three tax-credit scholarship programs), opponents had tried to stop the ESA program before it could start. Earlier this month a Phoenix appeals court ruled that program funding would continue as the challenge is litigated. Additionally, the expansion was passed with bi-partisan support. As Sen. Barbara McGuire (D-Arizona 8th District) explained:
This ESA expansion bill is a valuable tool to help Arizona families…From the beginning, I recognized the importance of giving children options when it comes to learning. They all have different needs and learn differently. The options provided by SB 1363 will enable more Arizona children to succeed.