By Tamra Farah |

Arizona’s Empowerment Scholarship Account (ESA) program, launched in 2011, empowers families to tailor their children’s education with state funds. The 2025-2026 school year covers private school tuition, tutoring, and therapies, averaging $7,000 – $8,000 per student.

While the program serves over 93,000 students, that number is only a fraction of its possible reach. Bureaucratic inefficiencies and government red tape currently hinder broader access and limit the benefits of ESAs. The approval of the 2025-26 ESA Parent Handbook could have fixed this, but as critics pointed out, the handbook’s restrictive guidelines and manual review processes create more bureaucratic obstacles.

Now, it’s time to examine some of the key aspects of the ESA Program. We need real change, including adopting best practices from other states to streamline operations, better serve families, and extend this opportunity to more Arizona children. 

ESA Application Process

The ESA program provides eligibility to any Arizona child from kindergarten through 12th grade, including preschoolers with disabilities, as outlined in the 2025-26 ESA Parent Handbook and A.R.S. §15-240. Families apply via the Arizona Department of Education’s (ADE) online portal, submitting proof of residency and, for students with disabilities, an IEP or 504 Plan.

Approvals are typically granted within 30 days. Approved families sign a contract to use funds for educational expenses and to forgo public school enrollment. Quarterly tuition deposits are managed through ClassWallet, requiring allocation to core subjects like reading and math, with receipt submission to ensure compliance. Non-compliance risks account suspension, balancing flexibility with accountability. 

ClassWallet and Financial Management

ClassWallet simplifies ESA fund management through the ESA Applicant Portal, allowing parents to monitor balances and make transactions. It offers four spending options: the Marketplace, with pre-approved items like textbooks; Pay Vendor, for payments to providers such as private schools; the Debit Card, which requires receipt validation for purchases like school supplies; and Reimbursement, for out-of-pocket costs after review.

Marketplace purchases are automatically deducted, like a math workbook, are automatically deducted, streamlining routine expenses. However, non-Marketplace transactions require manual review as mandated by the 2025-26 handbook, which causes inefficiencies and frustrates parents.

Manual Review Staffing Strain

The 2025-26 handbook requires a manual review for non-Marketplace items, a detailed and staff-intensive process. Items like custom curricula, tutoring from unregistered providers, computer hardware, therapies for students with disabilities, debit card purchases, public school fees, and expensive items such as a $500 musical instrument must be verified for educational relevance. This includes providing specific documentation for IEP students and detailed invoices.

With more than 93,000 students, that could mean up to 186,000 reviews annually taking 46,608 staff hours. That would require at least 23 full-time ADE employees, thereby straining resources. These reviews, mandated by A.R.S. §15-2403(B), caused delays for 77% of parents, according to a 2024 Heritage Foundation report, which fuels perceptions of bureaucratic inefficiency. 

The 2025-26 Handbook Controversy

The latest handbook’s approval by the Arizona State Board of Education (SBE) with an 8-1 vote sparked controversy over its compliance with state law. Critics, including parent Angela Faber, argued that its restrictive approval process, requiring additional documentation for disability-related expenses, violates A.R.S. §15-2402(B)(4), which permits funds for therapies and assistive technology.

Republican lawmakers criticized “overly restrictive cost guidelines,” such as a removed $16,000 cap on items like cellos, claiming the handbook defied a legislative warning. Still, no formal directive is documented, making the accusation speculative. The ADE asserts compliance with A.A.C. R7-2-1503 and A.R.S. §15-231(B), with a 30-day appeal period for denied expenses to ensure recourse. Despite revisions, late draft postings limited public review and increased debate. A 2023 report showed 96% of ESA funds supported academic goals, highlighting the program’s potential when managed effectively.

Lessons from Other States

Expanding ClassWallet’s Marketplace to include more pre-approved items could decrease manual reviews by 20–30% to improve the handbook’s inefficiencies. Implementing a machine-learning system for routine approvals, modeled on Florida’s Family Empowerment Scholarship or Tennessee’s Individualized Education Account, would simplify processing. Reinstating debit cards with Merchant Category Code restrictions and adopting risk-based audits could reduce review volume by 40%. Better parental education through tutorials could lower errors, easing administrative burdens.

Potential Leadership Change: Horne vs. Yee

Amid the handbook concerns, Superintendent Tom Horne may face Treasurer Kimberly Yee in the Republican primary for Arizona Superintendent of Public Instruction.  During his tenure, Horne has advanced educational initiatives by eliminating the Kindergarten Entry Assessment to reduce teacher workload and expanded school safety with 565 new officers. As Arizona State Treasurer, Kimberly Yee has championed government transparency by pushing for easily accessible online budgets, with the Arizona Treasury website providing clear information on taxpayer spending, enhancing public accountability. Yee has also prioritized financial literacy for high school courses and a Financial Literacy Fund to educate students, seniors, and vulnerable populations. Voters are urged to select the leader in 2026 who is most qualified and prepared to improve upon the administratively challenged ESA program.  Check out my previous column for more information about the Horne and Yee matchup.

Conclusion: Strengthening a National Model

The ESA program’s flexibility for over 93,000 students makes it a national leader, but the 2025-26 handbook’s manual reviews and controversial approval process show administrative challenges. Arizona can improve operations while keeping accountability by increasing transparency and adopting automation, learning from Florida and Tennessee. 

For more details, visit https://www.azed.gov/esa or call (602) 364-1969. Be aware of potential staff availability constraints.

Tamra Farah leads AmericanStrategies.org. She brings twenty years of experience in public policy and politics as a journalist, focusing on protecting individual liberty and advocating for limited government. She has worked with ten local, state, and federal candidates and organizations, such as Americans for Prosperity, FreedomWorks, Moms for America, and Arizona Women of Action. Farah has regularly appeared on conservative radio, television, and print media.