PHOENIX — The fight over funding to administer the state’s voucher program may be spilling over into court.
A notice of claim, the legal precursor to litigation, was filed Thursday against the state Department of Education by two conservative legal organizations on behalf of a parent who claims she was not provided with the funding she was promised for her son for the second quarter of the year.
According to attorneys from the Liberty Justice Center and the Goldwater Institute, state officials told the woman, identified only as K.K., they would not provide the cash unless the receipts for what was spent in the prior quarter were submitted and approved.
“ADE has failed, however, to ensure it has adequate staff and procedures to ensure the timely review and expense reports,” the claim states. “As a result, families like K.K’s have not received their second-quarter funding through no fault of their own.”
That, the attorneys say, is a breach of the state’s contract with the woman.
Agency spokesman Richie Taylor said this claim “is baseless, no merit.”
“They were funded a week before we received this lawsuit claim,” he said, though he acknowledged that came after the deadline.
“The reason she was delayed is she submitted an expense report incorrectly,” Taylor said. “We had to reject it, and then we worked with her to get it approved.”
Daniel Suhr, of the Liberty Justice Center, said the fact remains that the woman, who home-schools her child, did not get the money she needed on time. That resulted in her being unable to pay a music tutor as well as the curriculum subscriptions she needed.
Complicating matters, the claim states, is that Arizona law requires any eligible expenses to be paid strictly from the state-issued debit card. That means parents who use their own dollars to keep the services coming while they await new state funding for the card cannot get reimbursed.
As to any errors in the request for funding, Suhr said the fact remains that the Department of Education has insufficient staff to work with parents and get them corrected if necessary, long before the payment is due.
“Unfortunately, what’s happened both for this family and for dozens of families is they submitted their receipts on time, but the department did not follow through on its end of the bargain,” he said.
Taylor acknowledged the Department of Education has been running behind in processing both applications for vouchers, formally known as empowerment scholarship accounts, as well as auditing the spending reports.
He said the blame lies with the fact that the Legislature has not given the agency sufficient dollars to do the job. So now state schools chief Kathy Hoffman is asking for the full $4.4 million for the coming year that she says is supposed to be provided.
Suhr said the budget problems still do not excuse the Department of Education for failing to live up to its obligation to fund parents on time to pay their bills.
“This is Kathy Hoffman’s agency,” he said. “And she needs to own the decisions of her management team.”
Suhr said it’s the same for any other state official who has to complete a statutorily mandated task by a certain deadline. He said it’s up to that person to do whatever is necessary, including moving around funds, to get the job done.
State lawmakers first approved the voucher program in 2011, providing state dollars to eligible parents who send their children to private and parochial schools. But it also is available to parents who also hire tutors to supplement their private schools as well as those who choose to home-school their children, with dollars available for education-related expenses.
About 6,500 students now get vouchers. The base amount is about $5,400, though students with special needs can get funding at much higher levels.
The amount of time and effort needed for oversight, Taylor said, is based on how the parents use their allocations.
“The large majority of them use their funds to pay straight tuition at a private school,” he said. “There’s no question about what the funds are being spent on.”
Taylor said these expense reports are easy to review and audits do not take a lot of time.
“Where it gets very dicey and tricky is these home-schooling parents who have lots of different variables and different expenses every month,” he said. “They are more complex and require more time to go through to check for compliance,” especially to ensure that the expenditures are for items that the law says can be covered.
That gets to the funding issue.
Taylor said the department has 10 staffers plus two managers who do not only the audits but also are responsible for reviewing and processing applications from parents who want vouchers,
“We are barely treading water,” he said.
“We’re keeping our head above it,” Taylor continued. “But given the amount of staff and the limited resources that we have, there will be situations like this where deadlines are missed.”
He pointed out that Arizona law entitles his agency to 4 percent of the total amount administered in vouchers. That, said Taylor, would come out to about $4.4 million this coming school year and allow the department to hire an additional 20 staffers.
What the agency got this year was closer to $1.3 million.
Gov. Doug Ducey, who will present his budget to lawmakers in January, told Capitol Media Services last month he was aware of the issue.
“I know that there are resources necessary,” he said, promising to “work closely with the superintendent so we can fix this issue.”
But the governor, who has been a supporter of vouchers, would not commit to providing the dollars that Hoffman says are necessary to properly administer the program.
The last word on funding would have to come from the Legislature.
Last month, members of the Joint Legislative Audit Committee voted to seek a review of where the money is going now.
That report is due in April. And some committee members said their views on requests for additional dollars could depend on whether the audit shows that the existing dollars are being spent properly and efficiently.
Not all students are eligible for vouchers.
It originally was enacted as a program solely for students with special needs who could not get the education they needed at traditional public schools.
Since that time, however, legislative supporters have incrementally widened the eligibility to the point where it also includes children in foster care, children of military families, youngsters living on reservations and students attending schools that are rated D or F.
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