NCPA - National Center for Policy Analysis

Education Savings Accounts in Arizona

January 7, 2014

Education Savings Accounts give parents a wide range of educational choices, says Jonathan Butcher, education director at the Goldwater Institute.

Education Savings Accounts were signed into law in Arizona in 2011, and special needs children attending public school were eligible to apply. The following year, children in public schools that received a "D" or "F" in the state report card system became eligible for the accounts, as did military children and those adopted from Arizona's foster care system. With this expansion, more than 1 in 5 Arizona public school children became eligible for the accounts.

  • Public funds are transferred to private bank accounts so that parents can pay for educational services.
  • The accounts not only cover private school tuition, but they can be used for homeschooling materials, textbooks, online classes and educational therapy. Leftover funds can be saved and used for college.
  • Unlike vouchers or tax credits (which allow parents to choose between schools), education savings accounts give parents a choice not just in where their child is educated, but how their child is educated.

The Goldwater Institute conducted a focus group study of 18 parents using the program and found that 94 percent of participants were "very satisfied" with the savings accounts, while 6 percent were "somewhat satisfied."

When the law establishing the accounts was passed, an Arizona teachers union and school boards association filed suit in Niehaus v. Huppenthal, claiming that the savings accounts violated the state constitution, which prohibits public money from being used for private or religious purposes. The suit was successfully defended in the Arizona Court of Appeals, but the union and school boards have appealed the decision to the Arizona Supreme Court.

More than 760 Arizona children are using education savings accounts in the 2013-2014 school year.

Source: Jonathan Butcher, "A New Day for School Choice: Education Savings Accounts Turn 3 Years Old," Goldwater Institute, December 16, 2013.


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