12News sues Treasurer Yee, Superintendent Horne for ESA spending records

PHOENIX — 12News has sued state Treasurer Kimberly Yee and Superintendent of Public Instruction Tom Horne to obtain public records regarding how tax dollars have been used to fund  Arizona’s education voucher program since it was significantly expanded in 2022.

The suit, filed in Maricopa County Superior Court, claims Yee and Horne have “delayed, denied and deflected” straightforward requests for public records in violation of the Arizona Public Records Law for Empowerment Scholarship Account records.

Yee and Horne share responsibility in managing the ESA program for more than 92,000 Arizona children, which has significantly grown and costs taxpayers more than $1 billion a year.

Each did not respond or declined to comment on the lawsuit.

The 12News’ I-Team for months has sought detailed records of what ESA parents have bought since the 2022-23 school year, but 12News is not seeking the identities of ESA children or their parents.

Former Gov. Doug Ducey and the Republican-controlled Legislature expanded ESAs, which had primarily served special needs kids, in the summer of 2022 to all Arizona families regardless of income.

That year, the program cost Arizona taxpayers $176 million.

Yee had released ESA spending records from the 2022-23 fiscal year and a few months of the following fiscal year, but has since refused to release records for all of the past two fiscal years. 

Yee, this summer, said one of the reasons she did not want to release additional ESA spending records was that they would show the names of minors who tutor or are paid to babysit. 

Horne said that was inaccurate, and Yee and her attorney, Joe Kanefield, a few days later walked back the claim that ESA funds paid for babysitting.

Those documents from 2022-23 have embarrassed ESA supporters, who had publicly said ESA funds were used on educational materials and tuition. 

However, those documents showed education dollars were spent on more than $1 million in Legos, with families buying 84 sets at more than $500 each. 12News also found that those records showed ESAs bought premium KitchenAid items like 66 high-end mixers that cost $300 to $849 each. 

ESA families get to keep all of the items they purchase at taxpayers’ expense.

As part of its request, 12News is seeking ESA spending records from 2023-24 and 2024-25, when the combined spending for those two years exceeded $1.5 billion, state records show.

Yee previously told 12News to get those records from ClassWallet, a third-party vendor, or Horne, whose office is responsible for reviewing requests from parents.

Horne told 12News to get the records from Yee.

ClassWallet, the vendor that reimburses parents through an online portal, told 12News that all of the records in question belong to the state. 

But the company is not subject to the Arizona Public Records Law because it’s a private business and would not release the documents. It referred 12News back to the two state agencies.

The suit claims Yee and Horne have concealed information that could illuminate problems with their administration of the “billion-dollar endeavor.” Further, the suit claims they have “failed to provide access to or copies of all responsive records; made unavailing excuses for withholding or redacting basic public records; and pointed fingers at each other and the contractor hired to manage the ESA accounts when 12News challenged these violations.”

12News is asking a judge to order Yee and Horne to release the records and to pay the legal fees for 12News.

12News has used Arizona’s Public Records Law, which has been in effect prior to statehood in 1901, to obtain numerous ESA records from Horne’s office. 

Those records have shown how ESA parents stockpiled public funds for college and also used ESA accounts to buy luxury items like diamond rings, Kenmore appliances and lingerie.

Those purchases have occurred since last November as Horne’s office has automatically approved all ESA requests up to $2,000.

In a different public records request, 12News in late August sought from the Department of Education all ESA approvals up to $2,000 between July 26 to Aug. 27.

Horne’s office on Tuesday refused to turn over those documents, stating ADE prepared the previous records as “part of its effort to analyze and improve our internal auditing process. …The additional data you are seeking is not something already compiled and in our possession and is not reasonably attainable.”

The lawsuit against both Republicans comes as Yee, who is term-limited from running again as Treasurer, announced in late May that she would run against Horne for his job in next year’s Republican primary. 

State Sen. Jake Hoffman, R-Queen Creek, and other far-right Republicans recruited Yee because they were upset Horne had put some limits on what could be purchased with ESA dollars.

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