ESA money pays underage babysitters, tutors, Arizona treasurer says

PHOENIX — An attorney for the Arizona State Treasurer Kimberly Yee says ESA funds are paying for “minors” to tutor and babysit.

The statement by attorney Joseph Kanefield came in a July 25th letter to 12News regarding ongoing records requests. 12News is requesting financial records that reflect hundreds of millions of dollars in reimbursements to ESA parents for their payments to vendors. 

Yee has released a portion of the records requested, but even those records are redacted to conceal the names of businesses and vendors that benefited from ESA payments.

While explaining Yee’s position, Kanefield wrote:

“The Treasurer has redacted this information to protect the PII (privacy) of program participants, including the identities of individuals and minor children who provided services that would have categorized them as a ‘vendor’ (i.e., tutoring, babysitting services, etc.)”

To what extent minors have received ESA payments for tutoring or babysitting services is not known. Yee and her attorney did not respond to requests Monday for more details. 

Asked for comment by 12News, a spokesperson for Governor Katie Hobbs said their office was still gathering information about the statement from Yee’s attorney. State Senate President Warren Petersen (R) and House Speaker Steve Montenegro (R) did not respond to requests for comment.

The fact that ESA funds could pay vendors under 18 years old highlights how Arizona tax dollars are spent more broadly through the growing private school voucher program, compared to public schools.

Arizona law allows individuals under 18 years old to be ESA vendors or tutors because it does not have a minimum age requirement. The ESA handbook only requires tutors to have a high school or homeschool diploma. Parents decide what equates to a homeschool diploma. 

“This type of grey area showcases why this legislature needs to take accountability more seriously for a billion-dollar program,” said Marisol Garcia, President of the Arizona Education Association.

Arizona House Minority Leader Nancy Gutierrez (D) said she was surprised to learn that minors could be paid as vendors or tutors and wants future legislation to prohibit it. Gutierrez and her fellow Democrats have pushed for more restrictions on ESAs.

“If I wanted to hire a 17-year-old to tutor my 15-year-old in Algebra, I could do that with my own money,” Gutierrez said. “Should that money come from the state? Absolutely not.”

Gutierrez said there is no way for the state to ensure underage tutors–or babysitters for that matter–are qualified or safe.

“If I’m paid as a public-school teacher, I have an obligation to be fingerprint checked, have my teaching credentials, and have oversight from the state. Who is deciding if that minor is qualified to provide this service? No one.”

12News is in a legal dispute with the Arizona Department of Education and State Treasurer in an effort to get a full accounting of how hundreds of millions of taxpayer dollars are being spent in the ESA program.

State law designates those two agencies as ESA administrators.  

A spokesperson for Superintendent Tom Horne confirmed it is permissible to pay an underage tutor. He questioned how Yee’s attorney was able to make the claim about babysitters.

“The Treasurer’s office is fabricating information. ESA vendor information does not even have the person’s age, and babysitting services are not an allowable expense,” said Doug Nick. “The Treasurer also claims not to have access to reimbursement and other financial records, yet by some miracle, they can redact those records.”

Words like “babysit” and “supervise” are not explicitly listed as prohibited or allowed in the ESA handbook. However, the handbook prohibits “daycare fees.”

One longtime ESA reform advocate alleges that ESA guidelines may make it easier for ESA parents to justify paying family members as tutors or babysitters.

“Broadening of purchase categories started when the ESA handbook was revised early in 2023 by the American Federation for Children,” said Kathy Boltz, parent of an ESA special needs student since 2017. “Now, family members like grandparents and uncles can be paid with ESA funds, including siblings. That was not always the case.”

Yee previously released 2023 reimbursement records (partially redacted) that showed dollar amounts but not vendor names. In regard to reimbursement records for 2024 and 2025, Yee said she does not have access to those records at all because they remain in possession of the third-party vendor ClassWallet.

In the letter to 12News on Friday, Yee’s attorney claimed Yee does not have “financial oversight or any other statutory, administrative, or audit authority over the ESA program.”

State law said both the Department of Education and the State Treasurer “shall administer” the fund. Yee’s attorney claimed Yee’s previous records release for 2023 was “voluntary”, and her office is not in possession of 2024 and 2025 records.

“The Treasurer’s position is that the office will produce all public records as required by the PRL (public records law), but will not facilitate the production of information that is not within the office’s legal custody or control,” Kanefield wrote. “Facilitating the production of records outside the possession and control of the Treasurer’s Office would expose the Treasurer to potential liability for exceeding the office’s powers and duties and potentially damage the office’s relationships with its numerous vendors and other third parties.”

Gutierrez said Yee is damaging trust with the public by not ensuring all ESA vendor reimbursement records are available for examination.

“For our state treasurer to say that she’s not obligated to really do due diligence over how these funds are spent, and that she happens to be running to be the next State Superintendent, I find that baffling,” Gutierrez said. “I have huge concerns with her saying it’s not her obligation.”

Earlier this year, Yee announced her plan to run for fellow Republican Horne’s seat.

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