by Matthew Holloway | Dec 26, 2024 | Education, News
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.
by Matthew Holloway | Dec 20, 2024 | News
By Matthew Holloway |
According to a recent letter from the Goldwater Institute, Governor Katie Hobbs’ administration has imposed a regime of regulation that has ground the development of new home construction in the fast-growing areas of Maricopa County to a halt. Now, the organization is challenging the validity of the newly established rules.
A press release this week from Goldwater stated that the action conducted by the Arizona Department of Water Resources (ADWR), which lacks the approval of the Arizona legislature or a formal regulatory approval process, is “driving up housing costs for all Arizonans and threatens to stifle economic growth in our state.”
Goldwater went on to characterize the ADWR’s move as “one of the most significant bureaucratic overreaches in Arizona’s history.” In its letter to the agency, it urged leaders to reverse course.
Jon Riches, Goldwater’s Vice President for Litigation, explained in his letter:
“ADWR has imposed two AMA-Wide rules that have prevented HBACA (Home Builders Association of Central Arizona) members from obtaining Certificates of Assured Water Supply. The first of these invalid rules provides that, if groundwater modeling predicts that a well may not be able to fully satisfy projected demand in any location within the Phoenix AMA Model domain within the next 100 years, then there is no groundwater available throughout the entire model domain (‘AMAWide Unmet Demand Rule’). The second invalid rule provides that if modeling predicts that depth-to-water will exceed 1,000 feet in any location within the Phoenix AMA in the next 100 years, then there is no physical availability of water anywhere within the Phoenix AMA model domain (‘AMA-Wide Depth-to-Water Rule’).”
Goldwater noted that the AMA-Wide Unmet Demand Rule doesn’t exist under Arizona law and was not adopted through the legal rulemaking process. It argued that under previous rulings in Arizona courts, the policies are “rules” and are legally subject to Administrative Procedure Act’s (“APA”) rulemaking process. Specifically, it cites “an agency policy as a rule subject to the Administrative Procedures Act’s rulemaking process as one that ‘is generally applicable, and … implements, interprets or prescribes law or policy, or describes the procedure or practice requirements of an agency.’”
Furthermore, the rule was reportedly created under what Goldwater refers to as a “flawed concept,” the eponymous “unmet demand,” which establishes that if a groundwater shortage is projected by models at any location within a given management area, then zero groundwater across that area will be considered available for any use.
“The model further compounds this issue by arbitrarily placing wells throughout the management area that do not move over the course of 100 years, far in excess of the life expectancy of most wells,” Goldwater writes.
”If water in a hypothetical well is projected to dip below a certain depth in the East Valley, the agency declares a water shortage for developments in entirely unrelated areas like the West Valley.”
In the release, the Goldwater Institute expressed concern that the Hobbs administration took this action unilaterally, effectively defying both the legislative and judicial branches of the Arizona government in what amounts to a massive overreach of her executive authority.
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.
by Daniel Stefanski | Dec 17, 2024 | Education, News
By Daniel Stefanski |
Amid an increased flurry of attacks on Arizona’s school choice opportunities, a prominent organization is countering with the facts.
Citizens For Free Enterprise responded to another derogatory statement about Arizona’s historic Empowerment Scholarship Account (ESA) azprogram from the state’s Democrat Governor, Katie Hobbs. Earlier this week, Hobbs posted, “ESAs are rife with waste, fraud and abuse, and this will only make it worse. This empowers bad actors who are spending taxpayer dollars on ski passes, luxury car driving lessons, and grand pianos. We need accountability and transparency for this almost billion dollar program.”
Hobbs was reacting to a recent news story about the Arizona Department of Education’s new policy to automatically approve a vast majority of outstanding reimbursement requests from parents in the program, which was announced by Republican Superintendent of Public Instruction, Tom Horne, at a Board of Education meeting.
The response from Citizens For Free Enterprise 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.”
Others weighed in on the governor’s attack ahead of the 57th State Legislature, starting in January. State Representative Travis Grantham said, “I wish Democrats cared this much about government waste across the board. Why do they only care about it when it’s privatized and / or it gives the citizenry more choices?”
Fellow legislator Austin Smith added, “Not only was Katie Hobbs education agenda rejected; she lost seats in the house and senate. Bold move Cotton, let’s see if it pays off.”
Not everyone was opposed to Hobbs’ statement. Democrat State Representative Oscar De Los Santos replied, “From forging documents to scam taxpayers to abusing funds for luxury items, the private school voucher program is filled with waste, fraud, and abuse. Every Arizonan should be outraged. The DOGE committees should take a look at this disaster.”
Matthew Ladner, a school choice advocate, weighed in on De Los Santos’ statements, saying, “The waste, fraud and abuse in the ESA program is a small fraction of programs you support. If you’d like to eliminate all the programs with ESA level or higher abuse you will make Ron Paul a very happy man!”
In addition to its statement, Citizens For Free Enterprise shared a document of facts from the Common Sense Institute Arizona (CSI) to counter the myth that “ESA’s are subject to rampant fraud and abuse.” On that document, CSI highlighted that there was more than $2 billion of “Medicaid billing fraud in Arizona revealed by a single investigation into pandemic-era relaxed program standards,” and that “Arizona’s share of estimated pandemic-era fraudulent U.S. Unemployment Insurance payments” was $2.3 billion. On the flip side, according to CSI, “the sum-total of all specific, public allegations of ESA fraud …identified to-date, since universal eligibility expansion” was just around $650,000 – a far cry from the fraud in other state programs and handouts.
CSI concluded that “there are specific statutory requirements governing the use of ESA monies – including guidelines on permissible expenditures and a requirement that ADE conduct random and regular audits to ensure compliance. Within that framework, the program has been able to run well, especially compared to similar programs.”
While officials and organizations may have again successfully pushed back on Demcorats’ renewed, false detractions of the ESA program, Horne’s handling of this significant portion of the department he was entrusted to oversee continues to present major headaches for Republicans and school choice proponents. Since Horne’s first ESA Director, Christine Accurso, left the office last summer, he has been faced with a rising number of reimbursement requests and other issues that he has struggled to address with his team. Horne also capitulated to Democrat Attorney General Kris Mayes earlier this year, when she challenged him about the lack of “curriculum” attached to certain requests, adding additional regulations for parents to comply with the attorney general’s threats. Horne’s backsliding here came after he had repeatedly stood up to Mayes and Hobbs’ saber-rattling against the school choice program.
Additionally, Horne recently blamed a number of external factors, including Arizona state legislators, for the skyrocketing number of unfulfilled reimbursement requests. In a November press conference, Horne noted a fix to the ESA program that allowed parents to bypass ClassWallet to obtain reimbursements, stating, “Somebody went to the Legislature last year and got them to pass a bill saying they could do it by reimbursement… We’ve asked the Legislature, in the future, ‘Please ask us before you pass something so we can tell you what the consequences will be.’”
While the program has continued to grow over the past two years, Arizona Education Department officials have failed to satisfactorily explain why the processes put in place by Accurso before her departure were unable to suffice for smooth management and processing of reimbursements and other factors of ESA program oversight and delivery going forward. Accurso was able to save the program from massive and glaring issues created by Horne’s Democrat predecessor, adding staff to her team and reducing the backlogs to almost nothing, while accounting for an exponential increase in students and families realizing the benefits of ESAs.
Daniel Stefanski is a reporter for AZ Free News. You can send him news tips using this link.
by Matthew Holloway | Dec 15, 2024 | News
By Matthew Holloway |
The State of Arizona has engaged in legal battle against a Saudi Arabian firm: Fondomonte Arizona, LLC., on allegations that the agribusiness has violated public nuisance law by aggressively pumping groundwater from the Ranegras Plain Basin of La Paz County. The move could signal a split between Democrats Attorney General Kris Mayes and Governor Katie Hobbs whose chief campaign advisor is partnered with a lobbyist for the Saudi company.
Announcing the lawsuit on Wednesday, Mayes said the company, which enjoys a strong lobbying connection to Democrat Gov. Katie Hobbs, does not have “the right to endanger an entire community’s health and safety for its own gain,” according to KJZZ. She added, “The law is clear on that point.”
Mayes said the consequences are immediate and visible. She cited that the firm has operated in the Ranegras basin since 2014 and has several wells that pump up to 4,000 gallons of water per minute. She also shared that in 2023, it used approximately 31,196-acre feet of water.
“Fondomonte came to Arizona to extract water at an unreasonable and excessive rate because doing so was banned in its home country – another arid desert with limited water,” the lawsuit claims. “Fondomonte is taking advantage of Arizona’s failure to protect its precious groundwater resource.”
The Saudi firm called Mayes’ allegations “totally unfounded,” according to spokesman Barrett Marson.
“We believe the attorney general is setting a dangerous precedent attempting to penalize farming and the wider agricultural industry within the state of Arizona. The company complies with all state and local regulations.”
The amount of water drawn by the alfalfa farms is reportedly enough to serve approximately 93,000 single family homes. Neighboring wells serving homes less than a mile away went dry about five years ago. Mayes noted that the well for the Friendship Baptist Church a little under two miles away ran dry in 2017.
“The land is literally sinking in La Paz County with as much as 9.8 inches of subsidence documented in the immediate vicinity of Fondomonte’s farms,” she told reporters adding that under the nuisance law, action can be taken. However the AG pointed to what she described as the Arizona legislature’s failure to regulate the water use of corporate farms outside active management areas. “They have been completely AWOL when it comes to addressing rural Arizona’s water needs and these situations where people are being harmed,” she said, according to the outlet.
According to the Associated Press, Mayes said, “While laws regulating groundwater pumping could have prevented this situation, the legislature’s inaction has allowed the crisis to grow. When the legislature fails to protect our most basic resources, the attorney general must step in.”
Republican La Paz County Supervisor Holly Irwin praised the move, while castigating Arizona lawmakers for failing to weigh in. “That is why we are seeing foreign companies come over to these areas, purchase land and pump water out so that they can supplement their alfalfa and send it back home,” said Holly.
“Attorney General Kris Mayes is the first one who has stepped up and done anything about it. I know my constituents will be thrilled that somebody’s actually paying attention to the real problems here, which are wells that are going dry, the land subsidence that we’ve seen, and the concern that we have for the future of our basin.”
In March, Fondomonte was reportedly stripped of the ability to use Arizona’s water resources when the State Land Department inspected the company’s land leases in western Arizona’s Butler Valley and determined they were no longer irrigating in the area. The company allegedly pumped over 5.3 billion gallons of groundwater in Butler Valley throughout 2022, stopping after Gov. Hobbs canceled their leases on its thousands of acres of land in October according to The Center Square.
Mayes said in a statement at the time, “The Arizona Attorney General’s Office worked closely with Governor Hobbs’ administration on these inspections, which confirmed what we have suspected — Fondomonte has been in violation of its leases for many years.”
However, she was critical of the delayed reaction. “And while today’s announcement is commendable, it should have been taken by state government much earlier. The failure to act sooner underscores the need for greater oversight and accountability in the management of our state’s most vital resource.”
As reported by AZ Free News in July, Chad Guzmán, who co-manages the lobbying firm Fillmore Strategy with Hobbs’ senior campaign advisor, Joe Wolf, is now working as a lobbyist for Fondomonte. The move came after Fondomente enlisted Guzmán’s company, Signal Peak Consulting, according to a Fondomonte spokesman. Wolf referred to the development as a “nothingburger” at the time, telling the Arizona Republic the he is no longer paid by the Hobbs campaign and has no business dealings with Fondomonte.
Speculation is rife that Mayes could seek to challenge Hobbs in the 2026 Democrat Primary for the Governor’s office, though the Arizona Capitol Times reported in November that Mayes said she is looking at running for a second term as AG in 2026. Stacey Barchenger, state politics reporter at the Arizona Republic, confirmed to KJZZ’s Laren Gilger a day later that she had reached out to Mayes who indicated she intends to seek re-election as Attorney General. Despite these assurances, the outlet noted that the groundwater controversy has proven to be a high-profile dispute between the two Democrats.
With Hobbs’ favorability ratings critically low, the divide on groundwater, an issue that often garners bipartisan support for regulation, could prove to be a wedge issue in 2026 that places Mayes in a position to challenge Hobbs on equal footing, despite the Governor’s hefty $3 million war chest.
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.
by Daniel Stefanski | Dec 12, 2024 | Education, News
By Daniel Stefanski |
An influential Arizona Republican lawmaker is combating arguments from an anti-school choice organization.
This week, Senate President Warren Petersen responded to a post from Save Our Schools AZ, which highlighted a local media report about school closures in town. Save Our Schools AZ wrote, “Last night, the Roosevelt school board voted to shutter 5 neighborhood public schools due to major budget deficits caused by chronic lack of funding from the state legislature and universal ESA vouchers.”
Petersen retorted, “First of all it is mostly a declining student population not ESAs or the funding which has doubled over the last 12 years (now 15k/student). Second if someone who receives half your funding is putting you out of business you might want to make some changes.”
The east valley lawmaker then reposted one of his earlier communications about ESA funding to help bolster his point. He stated, “District vs. Charter vs. ESA Funding from all sources. District = $14,857 per student. Charter = $12,510 per student. ESA = $7,700 per student.”
Continuing with this education theme, Petersen stated, “The Republican-led Legislature has always supported K-12 public education. We have dramatically increased funding over the last decade and are now at $14,857 total funding per student. We support empowering parents to make the best educational choices for their kids, whether sending them to public, charter, or private schools.”
Petersen added, “The statement being pushed that ESAs are taking money from district schools is false. The reason some districts are closing a handful of public schools represents a decline in the number of students attending these schools and a decline in enrollment. Public schools thrive based on how they’re administering programs and curriculum. Failure in this area results in families seeking schools that are excelling in these areas to meet their families’ needs.”
Save Our Schools also shared a report of more potential school closures – this time in the Cave Creek Unified School District. The account wrote, “The Cave Creek district is considering shuttering schools. ‘Cave Creek officials are blaming the expansion of AZ’s voucher program, which allows all school-aged kids across AZ to use public money for private school tuition or homeschool expenses, for part of their hardships.’”
The escalating debate between the Republican leader and the anti-school choice organization comes just weeks before the start of the new legislative session, where the issue will surely be discussed increasingly between the opposing sides. In the two years of Arizona’s divided government, Republicans have held the line when it comes to safeguarding school choice, while Democrats, led by Governor Katie Hobbs, have unsuccessfully tried to whittle away at the state’s historic opportunities for families. Petersen has managed to force Hobbs to back off of her repeated promises to reduce Arizona school choice freedoms on a number of occasions, including in both of the past budgets negotiated between the Governor’s Office and Republican legislative leadership. He will continue to engage in this role over the next two years as he returns as his chamber’s leader.
Daniel Stefanski is a reporter for AZ Free News. You can send him news tips using this link.
