As education savings account (ESA) laws have been adopted by a number of states in the past few years, many observers have wondered how these work in practice. One huge area of interest is their impact on students with special needs. Well, Arizona’s status as home of the nation’s first ESA program could be instructive. Karla Phillips-Krivickas, a member of Arizona’s state board of education, has some practical wisdom to share. She is co-founder of Champions for Kids, a former Arizona education department official, and a veteran education advocate who consults with private schools on special education. Here’s what she had to say.
—Rick
Rick: How’d you get involved in special education?
Karla: I’ve been involved in education policy and reform for a few decades, but it was my journey as a mom of two kids with disabilities that really prompted me to bring my voice to special education. Honestly, I approach education policy the same now as I did before. The goal hasn’t changed. I still want to improve outcomes for kids. Despite individualized education plans, there are shocking achievement gaps. Among Arizona 3rd graders, only 16 percent of students with a disability are proficient in reading compared with 39 percent of all students. Too many people think special education services are only for “those” kids in “those” classes with “those” teachers. I’m trying to dismantle these beliefs. In Arizona, 67 percent of students receiving special education services spend most of their day in general education classes.
Rick: Arizona is home to a pioneering ESA program. What has that meant for students with special needs?
Karla: ESAs offer great options and flexibility for all families. Yet, that doesn’t make participating an easy choice, especially for the parents of a student with a disability. I don’t think we talk enough about what it takes for parents of students with disabilities to take this leap of faith and leave public school. The truth is that we do want our kids in our neighborhood schools with their brothers, sisters, neighbors, and friends. When families with a student who has a disability choose to use an ESA over a public school, they know they are leaving certain rights behind. But they are making that choice because their child is not thriving. Even with strong federal protections, so many parents have to fight tooth and nail to get what their child needs from their public schools. Choosing an ESA can be a life-changing decision, but it is often a tough one, made after years of tear-filled meetings and disappointments at their local school.
Rick: What share of ESA students in Arizona are identified as having a disability?
Karla: In Arizona, students with disabilities were the first to qualify for ESAs. Fourteen years later, 19 percent of ESA students have a disability compared with 14 percent of all public school students. Of these ESA students with a disability, most have autism. In fact, 52 percent of Arizona’s 16,553 ESA students with a disability have an autism diagnosis. This far exceeds the percentage in Arizona’s public schools, where only 12 percent of students receiving special education services have autism. Arizona’s decision to disaggregate the data by disability allows us to answer these types of important questions, so I strongly recommend that other states do the same.
Rick: How much is the ESA worth in Arizona, and is that enough to support a child with special needs?
Karla: In Arizona, 65 percent of ESA scholarships are between $7,000 and $8,000. But students with significant disabilities, such as autism or a severe intellectual disability, can receive upward of $30,000 to $40,000. The ESA value is equivalent to 90 percent of the state aid a student would receive if enrolled in a public school. Because Arizona’s school finance system is weighted by student need, the value of an ESA for a student with a disability is much greater. Now, it is impossible to say whether the current ESA amounts are sufficient. Because the system is based on school funding, and most believe the school system is underfunded, one could argue that current ESAs are not enough, either.
Rick: How are families using the ESA?
Karla: Families can use the ESA to pay tuition at private schools or put together a personalized program of tutors, therapies, or services using an ESA. While we have solid data on the types of expenditures families are making, we don’t know which belong to students with disabilities. In the third quarter of fiscal 2025, for example, over 670,000 items were processed. The three largest categories were: tutoring and teaching services; supplemental materials; and tuition, textbooks, or fees at a qualified school. Anecdotally, many families of students with disabilities seem to be home educating and creating individualized programs of materials, therapies, and other services. An entire market of providers has grown to support ESA families. And this seems to have alleviated a lot of the fear families had about educating their students at home.
Rick: How do special education’s legal obligations, like the right to a Free Appropriate Public Education (FAPE), affect the ESA program?
Karla: They don’t play a role. The right to a FAPE exists only in public schools. However, the Individuals with Disabilities Education Act (IDEA) offers supports and services for all students with disabilities, even those in private and home schools. Federal law requires that school districts set aside a proportionate share of their federal IDEA grant to provide equitable services to “parentally-placed private school students.” This group can include home-schooled students, depending on the state. It definitely includes students using an ESA or a tax-credit scholarship—though for-profit schools are not included, according to 2022 guidance from the U.S. Department of Education. It is also worth noting that the federal requirement for all school districts to identify and evaluate all children with disabilities applies even if students are in a parentally placed private school.
Rick: For those skeptical of the ESA model, are there successes you’d point to?
Karla: Yes, I would encourage folks to listen to public testimony at recent meetings of the state board of education. While you will hear frustration over administrative issues, you’ll also hear repeatedly how ESAs have changed lives. Here is a snippet of an email I recently received: “I’m a mom to five children. All five have disabilities. Each one was underserved by systems that could not see them fully. The Empowerment Scholarship Account (ESA) program changed everything for us. It gave us a chance to build what the public school could not provide.” Rick, you and I know that even the best public schools are still, by and large, traditional one-size-fits-all models. There are a lot of round pegs that cannot fit into their assigned square holes. ESAs offer hope and help to struggling families.
Rick: OK, so what concerns do you think merit attention?
Karla: Well, as you know, there is still a philosophical divide over school choice in general. But, practically speaking, the main issues are administrative in nature. I think we underestimated the manpower needed to review expenses and administer the program. In the third quarter of fiscal 2025, Arizona’s ESA program processed over 10,000 items and services purchased by ESA families per day! The Arizona education department is also required to develop a handbook covering the program’s policies and processes, which must be approved annually by the state board of education. The handbook—and some proposed policy changes—have become quite controversial. For example, there are debates over potential spending caps for certain items or how to determine if a purchase truly qualifies as an educational expense. It’s been remarkable to see how hundreds of families have organized, sent emails, and testified in person at state board meetings on these issues. I know that families are also taking their concerns to the state superintendent and the legislature. How this will all play out remains to be seen, but these families are certainly a strong constituency.
Rick: Do you have any suggestions for parents as they navigate the ESA process?
Karla: I have three main suggestions: First, seek help. There are support groups, social media groups, and nonprofits to give families information and support. Lean into these. Second, go in with your eyes wide open and have a clear understanding of the differences between what public and private schools are required to provide. Third, have a clear understanding of what expenses are allowed and keep complete and accurate records about your ESA expenditures!
Rick: What lessons should those elsewhere take from Arizona’s experience?
Karla: States need to have an open mind when it comes to what constitutes an educational expense. Traditional items like tuition, curriculum, tutors, and things serving traditional students are fairly noncontroversial. However, we have had to be more open to the needs of students with disabilities. Outlandish examples of ESA spending, from Rolex watches to dune buggies, are obviously bad. The tricky part has been determining what an educational expense actually is. From my firsthand experience with my children, I know that challenges like sensory and attention issues have to be addressed for learning to occur. A key lesson is that you should give yourselves grace. This is a new model, and we are treading new ground. Mistakes will be made, but if you keep the needs of students as your North Star, you’ll keep making progress.
