Arizona taxpayers covering $20 million ESA voucher tab for extracurriculars

PHOENIX — A 12News I-Team investigation has found that nearly $20 million in tax dollars was spent on activities outside the classroom, such as private swim and dance lessons for kids in the rapidly growing Empowerment Scholarship program for students in homes and private schools the past three years.

12News exclusively obtained the records from state Schools Chief Tom Horne’s office through a public records request. 

Those documents showed payments to more than 6,000 vendors and private schools since Arizona’s rapidly growing universal voucher law took effect in 2022. 

State Treasurer Kimberly Yee, whose office administers and provides general supervision and oversight of the ESA program, refused to release other recent records to 12News on how hundreds of millions of tax dollars are being spent to reimburse parents and how much unused voucher money is being put into college savings accounts for ESA children. She said her office does not have those records, even though her office previously released similar documents from 2022-2024.

Yee is challenging Horne next year for his elected position.

12News, the past few months, has examined numerous records and found the ESA program has primarily benefited wealthy Arizona families while financially hurting high-performing school districts and charter schools. The program has limited oversight and regulation, though Horne’s office has tried to crack down on luxurious purchases like a $16,000 cello and Rolex watch.

Now, 12News has additional records from Horne’s office that show taxpayers are covering activities for kids that public school families pay for themselves. 

Nearly $20 million was spent on just eight extra-curricular activities for kids getting vouchers. 12News found:

• $6.8 million was spent on private music lessons, including $1 million for piano lessons.
• $2.8 million was spent on swimming lessons.
• $2.8 million was spent on math tutoring.
• $1.9 million was spent on gymnastics.
• $1.6 million was spent on dance.
• $1.3 million was spent on fitness.
• $1.1 million was spent on horseback riding.
• $1 million was spent on martial arts.

The investigation comes a year after 12News reported that more than $1 million in ESA funds were spent on Lego sets.

“It’s unjust. It’s not what our tax dollars are supposed to fund,” said State Rep. Nancy Gutierrez, D-Tucson.

Gutierrez, a longtime Tucson public school teacher just laid off in part because of the rapid cost of vouchers, said she was stunned by 12News’ findings.

“Public schools serve every student, no matter where they come from, how much money their parents make, what background they are, or even their immigration status,” she said. “We are tasked with teaching everyone, and we can’t do that if millions of dollars are going to kids who have already afforded their tuition at a private school.”

Gutierrez, part of the state budget negotiations, said Gov. Katie Hobbs, a fellow Democrat, tried to implement a $200,000 income cap for a voucher, which can be used for private school tuition. 

The proposed income cap was more than double the state’s median household income.

“I think if you’re making over $200,000 or even over $100,000, then if you choose to pay for or to have your child in private school, then you can afford that tuition,” she said. “I do not think that we should be subsidizing rich people’s tuition.”

RELATED: Colorado City schools face funding challenges amid voucher surge

State law currently has no income caps for empowerment scholarships, which will cost taxpayers at least $1 billion this upcoming school year. Empowerment scholarships, which primarily helped kids with special needs, cost $176 million in fiscal 2022, just before the universal expansion for everyone.

Republicans who control the Legislature said there would be no changes to the program.

“We are protecting ESAs,” said state Sen. John Kavanagh, R-Fountain Hills. “We are not going to be reducing qualifications for it. So, there will be no change in ESAs.”

Kavanagh is the key budget writer in the Senate, and the stance is similar in the House with budget writer David Livingston.

Livingston, R-Peoria, also downplayed the I-Team’s findings that millions of tax dollars were spent on ESA extracurricular activities.

“I think we’ve seen major fraud at a number of big school districts that’s tens of millions of dollars,” he said. “So, if you want to talk about piano here or Lego here, that’s fine, but it’s not the big stuff.”

Currently, the number of students in the ESA program is just more than 92,000, with almost 6,500 new students enrolled for this upcoming school year.

Those students compose less than one-tenth of all school-age kids in Arizona.

RELATED: The 12News I-Team looked into which zip codes are receiving the most school vouchers. Here’s what the data showed.