By Matthew Holloway |
Earlier this month, Gov. Katie Hobbs sent a letter to Superintendent of Public Instruction Tom Horne, rebuking him for the implementation of a risk-based auditing approach to approving Empowerment Scholarship Account (ESA) program reimbursements. A few days later, Horne responded by suggesting that Hobbs “should start reading what she signs.”
In a statement, Horne reminded the Democrat governor that the process the Arizona Department of Education (ADE) is now employing is explicitly called for under a bill she signed into law herself. He notes further that Hobbs is also directly responsible for creating the situation that necessitated the change when she signed a bill permitting private school tuition to be paid under reimbursement rather than the previous third-party vendor.
The move has come as a backlog of reimbursement requests for the ESA program has exceeded 85,000. The Department of Education, unable to utilize third party provider Class Wallet, which was previously the procedure, will now automatically approve the requests up to $2,000 and then audit them after the fact.
In the initial letter to Horne, Hobbs pointed to recent indictments and allegations of fraud and abuse of the ESA program and claimed that the implementation of the risk-based auditing approach “is a complete dereliction of the ADE’s responsibility to ensure the appropriate use of public funds.”
Horne replied in a statement saying:
“The method we are instituting, known as risk-based auditing, is specifically provided for in the budget statute that the Governor signed last session. Maybe she should start reading what she signs.
Equally startling, is that she herself created the problem we are trying to solve by signing a bill to permit private school tuition to be paid under the reimbursement method, rather than going through our vendor, Class Wallet, which was previously required. This played a major role in increasing the delays and reimbursements from 30 days a year ago to over 100 days now.
The Governor played a major role in creating a problem that we now must solve by using a method provided for in a Bill that she signed.
Part of the problem appears to be that staff in the Governor’s office are slow learners.”
In a press release, Horne referred to Arizona Law under A.R.S. 15-2403 (B), which explicitly permits this method stating, “The department, in consultation with the office of the auditor general, shall develop risk-based auditing procedures for audits conducted pursuant to this subsection.”
The Superintendent also stressed the accountability of the program saying, “The ESA program is among the most accountable programs in the State. It’s responsible for demonstrating accountability through reporting that is required by statute, rules, and ad hoc requests from seven government agencies and bodies, including: Governor’s Office; Legislative Leadership; Joint Legislative Budget Committee; Attorney General’s Office (multiple units); Auditor General’s Office (multiple divisions); State Board of Education and the State Ombudsman.”
As previously reported by AZ Free News, Hobbs was recently fact-checked by Citizens For Free Enterprise, who publicly criticized her for attacking the ESA program. The group stated, “FACT CHECK: Arizona’s universal school choice program is a model of accountability, transparency, and security, according to CSI Institute Arizona. The over 83,000 Arizona families using ESAs just want the best for their children – and Katie Hobbs should stop attacking them.”
Matthew Holloway is a senior reporter for AZ Free News. Follow him on X for his latest stories, or email tips to Matthew@azfreenews.com.
