Arizona Gov. Katie Hobbs has asked Arizona Superintendent of Public Instruction Tom Horne to reverse his plan to automatically reimburse many purchases made under the state’s education voucher program.
“Your proposed actions only create greater opportunity for further fraud, waste, and abuse in this nearly $1 billion program,” Hobbs wrote in a letter Tuesday. She said Horne’s chosen course of action was a “complete dereliction” of the Arizona Department of Education’s “responsibility to ensure the appropriate use of public funds.”
Last week, Horne announced that his Department of Education would automatically reimburse education voucher purchases for $2,000 or less and review them later.
The announcement followed parent complaints of long wait times for reimbursements from the Empowerment Scholarship Account program, which allows Arizona children not enrolled in public school to use public funds for private school tuition, homeschool expenses and other educational purchases.
Horne said the automatic reimbursement plan would reduce the backlog from 89,000 reimbursement requests to 4,000. He blamed the delays on inadequate staffing amid the program’s rapid expansion and a recent directive from Attorney General Kris Mayes to ensure homeschool purchases are tied to curricula.
Hobbs, a Democrat who has been critical of the education voucher program, said in her letter that Horne, a Republican who has been a voucher program booster, was creating “significant opportunity” for abuse.
“By refusing to review 85,000 purchases, you are presumably allowing up to $170 million of taxpayer dollars to be spent without proper oversight,” Hobbs wrote.
In response, Horne issued a statement Thursday noting that Hobbs signed a bill this year that allowed for “risk-based auditing procedures” in the voucher program. He also said Hobbs contributed to the backlog problem by signing a bill that allows private school tuition to be paid via reimbursement. Before, private school tuition had to be paid via ClassWallet, a third-party payment processor that can be used for pre-approved vendors.
“The ESA program is among the most accountable program(s) in the State,” Horne wrote in the statement.
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Horne has previously said that the Education Department could not automatically reimburse all voucher purchases because it would risk paying for “outlandish expenses, such as $5,000 for a gold Rolex watch, $25,000 for a golf simulator, and other examples that would have totally undermined the credibility of ESAs with the public.”
In Hobbs’ letter, she said that his automatic reimbursement plan contradicts what she described as his “desire to prevent expenses that are clearly not educational … by allowing single purchases in excess of 25% of the median ESA award without any review by ADE staff.” The median annual award amount per student is around $7,400.
Horne announced the process change a week after an Arizona grand jury indicted two out-of-state residents on suspicion of defrauding the voucher program. Prosecutors from the Attorney General’s Office said the pair faked dozens of children to obtain voucher dollars that they used for their own living expenses. Hobbs, in her letter, also cited examples from a 2023 ABC15 investigation into the program, which found that families had used ESA funding for luxury car driving lessons, ski passes and pianos.
“Given the multiple indictments for ESA fraud that have been issued this past year … as well as the pattern of excessive purchases … I urge you to reconsider this new policy,” Hobbs told Horne.
The Education Department said last week that if a purchase was later found to be inappropriate or fraudulent, the account holder could voluntarily repay the department, the department could sweep the voucher recipient’s account for funds or the department could forward the case to the Attorney General’s Office for collection.
Hobbs described the plan as “deeply troubling” and told the Education Department to reconsider and “propose a solution to administering the ESA program that does not give a blank check for even more rampant fraud.”
Reach the reporter at mparrish@arizonarepublic.com.
This article originally appeared on Arizona Republic: Hobbs asks Horne to reverse automatic voucher reimbursement plan