Horne, Hobbs at odds at plan to trim ESA imbursement backlog using risk-based auditing

PHOENIX — Arizona Gov. Katie Hobbs is urging state Superintendent of Public Instruction Tom Horne to reconsider his decision to use risk-based auditing to dissipate a hefty backlog of empowerment scholarship accounts (ESA) requests.

Horne said using risk-based auditing, a method that would automatically approve ESA expenditures under $2,000, is a necessary practice under state law. Hobbs said recent cases of fraud could leave $170 million in ESA spending unchecked.

“Allowing these expenses to go unchecked creates an environment ripe for fraud, waste and abuse of public funds,” Hobbs said in a statement.

I am calling on Superintendent Horne to reconsider this irresponsible decision, conduct proper oversight and make sure working class Arizonans do not foot the bill for excessive spending on grand pianos, ski passes and luxury car driving lessons.”

How many ESA imbursement requests are there in Arizona?

The Arizona Department of Education (ADE) has a backlog of over 89,000 reimbursement requests.

Horne said the bill signed by Hobbs has slowed down the reimbursement process. He said ADE got them out within 30 days last year, significantly less than the 100 days this year he called “unacceptable.”

Eliminating the bill would be a solution in the future, Horne added.

“We had to solve a problem in major part created by the governor,” Horne told KTAR News 92.3 FM on Thursday. “And we solved it with a solution that is specifically authorized by a bill that she signed. So, we think she had to read what she signs.”

Recent examples of ESA issues include two people from out of state who were indicted for allegedly defrauding the Arizona system out of over $100,000 and three former ADE employees accused of using funds for personal use.

KTAR News 92.3 FM’s Balin Overstolz-McNair contributed to this report.

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