Administration and oversight of a controversial school voucher program could soon be stripped from the Arizona Department of Education and transferred to the state Treasurer’s Office, in part because the new Republican state treasurer supports the program and the new Democratic superintendent of public instruction is a critic.
The proposal by Sen. David Livingston, R-Peoria, comes as a Democrat takes the helm of the Department of Education for the first time in more than 20 years. Newly elected Superintendent of Public Instruction Kathy Hoffman is not a fan of the Empowerment Scholarship Account program, and was a vocal opponent of a proposal to dramatically expand the program that voters rejected in November. The ESA program provides voucher-style funding to parents who pull their children from public schools.
Senate Bill 1320 would transfer oversight of the ESA program to the Treasurer’s Office. Livingston said the Department of Education has had problems in administering the program, and that it has had a lot of turnover among staff who oversee ESAs. He said he believes the Treasurer’s Office would do a better job.
The Treasurer’s Office is now occupied by Kimberly Yee, a Republican. But Livingston said the issue isn’t a partisan one, noting that Hoffman’s predecessor, Republican Diane Douglas, wasn’t a huge fan of the voucher program, either.
Livingston suggested that support for the ESA program is more important than partisan affiliation. And Yee, who served in the state Senate prior to her election as treasurer, voted to create and expand ESAs.
“I don’t think it matters if it’s an R or a D. But if somebody loves the program, it’s a lot easier to manage it well. And I think the department of the treasury is a reasonable place to have that be done. And I think, frankly, the Department of Education has other things in K-12 that they can focus on and make a bigger difference,” Livingston said.
Livingston’s wife, Tracy Livingston, was defeated in the Republican primary for superintendent of public instruction last year.
As a state legislator, Yee was an enthusiastic supporter of ESAs. In 2017, she voted in favor of a massive expansion of the program, which voters later rejected after it was sent to the November 2018 ballot via citizen referendum.
Yee’s office had no position or comment on the bill.
Stefan Swiat, a spokesman for the Department of Education, said the agency will likely oppose SB 1320. He called the bill “unnecessary,” and noted that the Treasurer’s Office would still have to work with the department to get needed information from students’ parents.
“This sort of just creates an extra layer of bureaucracy,” Swiat said.
The Senate Finance Committee, of which Livingston is vice chairman, will hear the bill on Feb. 13.
Among the duties that the Treasurer’s Office would absorb under SB 1320 are approving applications for students, monitoring compliance with the program, approving curriculum and conducting annual audits of the ESA program.
The Department of Education has 11 full-time employees who oversee ESAs, one of whom will be leaving the department soon, according to Swiat. By contrast, the Treasurer’s Office has just 28 full-time employees in total, including Yee herself. Two other positions are currently vacant, said spokesman Dave Cherry.
Livingston said the Treasurer’s Office will receive additional funding for new employees if the Legislature transfers ESA oversight duty from the Department of Education. And he said he believes the Treasurer’s Office will be able to do the same job better with about half as many employees.
That flies in the face of previous complaints from the Department of Education. During her time as superintendent, Douglas opined that the Legislature did not provide enough funding for oversight and administration. Under state law, 5 percent of the funding for the program goes into a separate fund that the Department of Education can use to administer ESAs. But that money is subject to legislative appropriation, and lawmakers have never given the department authority to use the full amount.
Douglas blamed that lack of funding for misspending within the program.
Swiat said Hoffman shares those concerns, and believes the Legislature should release the nearly $6 million in the ESA fund. He said the department’s lack of authority to access that money has prevented it from hiring additional employees to administer and oversee the ESA program. There are about 5,600 students currently enrolled in the program, and Swiat said the department expects that number to jump to about 6,500 by the end of the fiscal year.
Swiat seemed skeptical of Livingston’s claim that the ESA program could be properly administered with half as many employees.
“I would love to hear his ideas on how to do that, because currently we’re at 11 full-time staff. I’d love to hear how we could do that with five or six. That would very helpful,” he said.
Dawn Penich-Thacker, spokeswoman for Save Our Schools Arizona, which led the successful campaign against ESA expansion in 2017-18, said if Livingston is concerned about the administration of the program, he should push to release the money in the department’s ESA fund.
Penich-Thacker said it’s “laughable” that a Treasurer’s Office employee would be able to help parents with things like determining the best educational therapy programs for their disabled children. She said she sees no reason to take the program from education experts and put it under the aegis of the Treasurer’s Office.
“I haven’t seen him describe in any cogent way why accountants should be in charge of children’s education,” Penich-Thacker said. “That does not make any sense to us. An education program should be within the hands of educators. And the treasury should focus on what it’s good at.”
Livingston’s bill isn’t the first proposal of the 2019 session that would divest the Department of Education of some authority over the ESA program. But it’s far more extensive than another bill from Rep. Mark Finchem, R-Oro Valley. Finchem’s proposal, House Bill 2022, would give the Treasurer’s Office exclusive authority to choose the vendors that provide financial services for the ESA program.