Understanding the Cost of Universal School Vouchers: An Analysis of Arizona’s Empowerment Scholarship Account Program

In the 2022–23 school year, Arizona began implementation of a “universal voucher” program through which all school-age students are eligible for a voucher, and families can use public funding to underwrite private or homeschool education for their children. Universal vouchers in Arizona are an expansion of the existing Empowerment Scholarship Account (ESA) program, which was targeted to students with special education needs or in specific circumstances (e.g., child of a military employee, living on a reservation, attending a low-rated school). Reported program costs of the expanded program have varied widely and often do not provide a clear explanation for the figures used.

To better understand this program’s impact on Arizona public schools, researchers undertook a financial review of the expanded Arizona ESA program using publicly available data from the state budget, which details total state expenditures and student enrollment; Arizona Department of Education (ADE) quarterly reports to the State Board of Education, which detail the number of ESA applications received, approved, and denied; and ADE enrollment figures.

Researchers analyzed student enrollment in the program, the combined cost of the earlier enacted ESA program and the new universal voucher program, and their effects on education funding in the state. Because the costs of the new ESA program are paid for through the state’s Basic Student Aid formula, the increased costs for this program will compete with public school funding unless the legislature increases the funding level sufficiently to account for the cost of the new students being covered.

This report outlines the cost estimates and calculations in detail. Findings include the following:

• Students who accepted ESAs who were previously educated in private schools or homeschool environments added a new cost to the state. On average, students who were previously enrolled in district schools also generate a new, but smaller, cost to the state, while students previously enrolled in charter schools generate a small savings. Costs are estimated for each. There may be some variability in these costs depending on students’ previous eligibility for supplementary funding (e.g., through household income or English learner status).
• Between the 2021–22 and 2022–23 school years, the ESA program expanded from 12,127 to 61,689 students, a growth of 409%. Nearly all (91%) of the program’s growth came from students enrolled in the new Universal ESA program. Of the students taking advantage of the new Universal ESA, the large majority (71.2%) did not previously attend a public school, thus adding new costs to the state education budget.
• While English learners represent 9.2% of public school students in the state, in 2022–23 only 188 enrolled in the ESA program (0.6%).
• About 2.4% of Arizona’s school-age children took advantage of the ESA program in 2022–23, at a total cost of $587.5 million, which is a $398.7 million (211%) increase over the cost of the more targeted voucher the previous year.
• The cost of the ESA program represents 8.8% of the $6.7 billion total Basic Student Aid funding in 2022–23. Based on data posted on the Arizona Department of Education’s website, the number of students using the voucher increased by 10,739 students (17.4%) in the 2023–24 school year. The increased enrollment has resulted in a total cost of the ESA program of at least $708.5 million.

Understanding the Cost of Universal School Vouchers: An Analysis of Arizona’s Empowerment Scholarship Account Program by Michael Griffith and Dion Burns is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

This research was supported by the W. K. Kellogg Foundation and the Raikes Foundation. Core operating support for the Learning Policy Institute is provided by the Heising-Simons Foundation, William and Flora Hewlett Foundation, Raikes Foundation, Sandler Foundation, Skyline Foundation, and MacKenzie Scott. The ideas voiced here are those of the authors and not those of our funders.