Arizona Democrats Plan ESA School Voucher Restrictions Modeled On Failed Proposition 212

Arizona’s incoming Democratic legislative majority plans to pursue changes to the Empowerment Scholarship Account program modeled on Proposition 212, an initiative that sought income limits and spending restrictions before failing to qualify for November’s ballot.

House Majority Leader-elect Nancy Gutierrez (D-LD18) told the Arizona Capitol Times that Democrats would begin with a proposal similar to the initiative and continue discussions with education stakeholders. The November 6 report did not identify a bill number or finalized text.

Gov. Katie Hobbs included ESA changes in her prepared remarks for a November 4 victory rally. She pledged to address what she described as waste, fraud, and abuse in the program while delivering $1 billion to public schools without raising taxes. The remarks did not specify how that funding would be financed or which ESA restrictions she would seek.

Arizona’s universal ESA expansion was enacted through HB 2853, Chapter 388 of the 2022 session laws. Then-House Majority Leader Ben Toma (R-LD22) sponsored the legislation, which extended eligibility beginning in the 2022–2023 school year to Arizona residents eligible for public school kindergarten through 12th grade, or preschool programs for children with disabilities, who did not otherwise qualify.

The enacted law authorizes specified educational expenses, including private school tuition, textbooks, tutoring, and curricula. Participating parents agree to provide instruction in required subjects and comply with restrictions on concurrent public school enrollment. Additional eligible services are available for qualifying students with disabilities.

Proposition 212’s filed text, titled the Protect Education Act, proposed limiting eligibility under the universal expansion beginning in the 2027–2028 school year. Its $150,000 annual family income ceiling would have been based on federal adjusted gross income, with annual adjustments and authority for lawmakers to establish a lower limit. Students qualifying under the separate eligibility categories that preceded universal expansion, including students with disabilities, would have been exempt from that cap.

The initiative, filed as I-09-2026, also proposed prohibitions on noneducational and luxury purchases, registration requirements for participating schools and tutoring providers, and accreditation or testing requirements for schools, with exceptions for schools serving only qualifying students with disabilities.

Unspent, unencumbered funds allocated in prior fiscal years generally would have returned to the state each July. Qualifying students with disabilities would have received an additional year before those funds were reclaimed.

The sponsoring committee, Protect Education, Accountability Now, led an effort backed by the Arizona Education Association and Save Our Schools Arizona. As the California Globe reported in August, the Arizona Supreme Court upheld the treatment of duplicate petition signatures that proved decisive to the qualification dispute. Supporters subsequently acknowledged the initiative would fall short of reaching the ballot.

The campaign’s failure followed more than $7.2 million in spending and the submission of 421,451 petition signatures, according to the Globe’s August reporting. Following signature reviews and litigation, the valid total was projected to fall to approximately 245,000—roughly 11,000 short of the 255,949 required, AZ Free News reported. 

Superintendent-elect Teresa Leyba Ruiz has outlined administrative changes through her published campaign platform. Those proposals include ending automatic approval of ESA expenditures of $2,000 or less, creating a public dashboard showing expenditures, and establishing stronger audit procedures. Ruiz also proposed an automated system intended to ensure purchases serve educational purposes.

Ruiz declined to endorse a particular income cap in her interview with the Capitol Times, saying lawmakers would determine eligibility policy. Incoming House Minority Leader Steve Montenegro (R-LD29) told the outlet that protecting parental choice would remain a Republican priority alongside accountability for public spending.

“House Republicans have worked hard to lower taxes, expand school choice, demand better results from our schools, and support law enforcement,” Montenegro said in a November 6 statement announcing his upcoming role as Minority Leader. “Those accomplishments are worth defending, and we have no intention of standing by while they are dismantled.”

“If the new majority wants to raise taxes, restrict parents’ choices, weaken public safety, or undo reforms that have made Arizona stronger, they should expect a fight,” he added, noting that GOP leaders would also work with Democrats when opportunities arise to act in the state’s best interests.

Democratic leaders have not specified which provisions of Proposition 212 would appear in their eventual legislation or whether they would seek to restore eligibility rules that preceded the 2022 expansion, according to the November 6 report.