ESAs; children with disabilities; requirements

SB1704 - 572R - I Ver

REFERENCE TITLE:
ESAs; children with disabilities; requirements

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SB 1704

Introduced by

Senators
Diaz: Bravo, Fernandez, Gonzales, Hatathlie, Kuby, Miranda, Ortiz, Sears

AN
ACT

amending section 15-2402, Arizona
Revised Statutes; relating to Arizona empowerment scholarship accounts.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 15-2402, Arizona Revised
Statutes, is amended to read:

START_STATUTE
15-2402.

Arizona empowerment scholarship accounts; funds

A. Arizona empowerment scholarship accounts are
established to provide options for the education of students in this state.

B. To enroll a qualified student for an Arizona
empowerment scholarship account, the parent of the qualified student must sign
an agreement to do all of the following:

1. Use a portion of the Arizona empowerment
scholarship account monies allocated annually to provide an education for the
qualified student in at least the subjects of reading, grammar, mathematics,
social studies and science, unless the Arizona empowerment scholarship account
is allocated monies according to a transfer schedule other than quarterly
transfers pursuant to section 15-2403, subsection G.

2. Not enroll the qualified student in a school
district or charter school and release the school district from all obligations
to educate the qualified student.� This paragraph does not:

(a) Relieve the school district or charter school
that the qualified student previously attended from the obligation to conduct
an evaluation pursuant to section 15-766.

(b) Require the qualified student to withdraw from
a

any
school district or charter
school before enrolling for an Arizona empowerment scholarship account if the
qualified student withdraws from the school district or charter school before
receiving any monies in the qualified student's Arizona empowerment scholarship
account.

(c) Prevent the qualified student from applying in
advance for an Arizona empowerment scholarship account to be funded beginning
the following school year, subject to section 15-2403, subsection H.

3. Not accept a scholarship from a school tuition
organization pursuant to title 43 concurrently with an Arizona empowerment
scholarship account for the qualified student in the same year a parent signs
the agreement pursuant to this section.

4. Use monies deposited in the qualified student's
Arizona empowerment scholarship account only for the following expenses of the
qualified student:

(a) Tuition or fees at a qualified school that
requires all teaching staff and personnel who have unsupervised contact with
students to be fingerprinted.

(b) Textbooks required by a qualified school.

(c) If the qualified student meets any of the
criteria specified in section 15-2401, paragraph 7, subdivision (a), item
(i), (ii) or (iii) as determined by a school district or by an independent
third party pursuant to section 15-2403, subsection J, the qualified
student may use the following additional services:

(i) Educational therapies from a licensed or
accredited practitioner or provider, including and up to any amount not covered
by insurance if the expense is partially paid by a health insurance policy for
the qualified student.

(ii) A licensed or accredited paraprofessional or
educational aide.

(iii) Tuition for vocational and life skills
education approved by the department.

(iv) Associated goods and services that include
educational and psychological evaluations, assistive technology rentals and
braille translation goods and services approved by the department.

(d) Tutoring or teaching services provided by an
individual who is not subject to disciplinary action by the state board of
education for immoral or unprofessional conduct pursuant to section 15-505
or 15-534.04 or a facility that is accredited by a state, regional or
national accrediting organization. The department shall ensure
that
any individual who provides tutoring or teaching services
to one or more qualified students pursuant to this subdivision is not subject
to disciplinary action by the state board of education.� The department shall
also remove any individual who is subject to disciplinary action by the state
board of education from all platforms that the department provides to parents
and qualified students for the purchase of goods or educational services using
account monies.

(e) Curricula and supplementary materials.

(f) Tuition or fees for a nonpublic online learning
program.

(g) Fees for a nationally standardized norm-referenced
achievement test, an advanced placement examination or any exams related to
college or university admission.

(h) Tuition or fees at an eligible postsecondary
institution.

(i) Textbooks required by an eligible postsecondary
institution.

(j) Fees to manage the Arizona empowerment
scholarship account.

(k) Services provided by a public school, including
individual classes and extracurricular programs.

(l) Insurance or surety bond payments.

(m) Uniforms purchased from or through a qualified
school.

(n) If the qualified student meets the criteria
specified in section 15-2401, paragraph 7, subdivision (a), item (i),
(ii) or (iii) and if the qualified student is in the second year prior to the
final year of a contract executed pursuant to this article, costs associated
with an annual education plan conducted by an independent evaluation
team. The department shall prescribe minimum qualifications for
independent evaluation teams pursuant to this subdivision and factors that
teams must use to determine whether the qualified student shall be eligible to
continue to receive monies pursuant to this article through the school year in
which the qualified student reaches twenty-two years of
age. An independent evaluation team that provides an annual
education plan pursuant to this subdivision shall submit a written report that
summarizes the results of the evaluation to the parent of the qualified student
and to the department on or before July 31. The written report
submitted by the independent evaluation team is valid for one
year. If the department determines that the qualified student meets
the eligibility criteria prescribed in the annual education plan, the qualified
student is eligible to continue to receive monies pursuant to this article until
the qualified student reaches twenty-two years of age, subject to annual
review. A parent may appeal the department's decision pursuant to
title 41, chapter 6, article 10. As an addendum to a qualified
student's final-year contract, the department shall provide the following
written information to the parent of the qualified student:

(i) That the
qualified student will not be eligible to continue to receive monies pursuant
to this article unless the results of an annual education plan conducted
pursuant to this subdivision demonstrate that the qualified student meets the eligibility
criteria prescribed in the annual education plan.

(ii) That the parent is entitled to obtain an annual
education plan pursuant to this subdivision to determine whether the qualified
student meets the eligibility criteria prescribed in the annual education plan.

(iii) A list of independent evaluation teams that
meet the minimum qualifications prescribed by the department pursuant to this
subdivision.

(o) Public transportation services in this state,
including a commuter pass for the qualified student, or transportation network
services as defined in section 28-9551 between the qualified student's
residence and a qualified school in which the qualified student is enrolled.

(p) Computer hardware and technological devices
primarily used for an educational purpose. For the purposes of this
subdivision, "computer hardware and technological devices":

(i) Includes calculators, personal computers,
laptops, tablet devices, microscopes, telescopes and printers.

(ii) Does not include entertainment and other
primarily noneducational devices, including televisions, telephones, video game
consoles and accessories, and home theatre and audio equipment.

5. Not file an affidavit of intent to homeschool
pursuant to section 15-802, subsection B, paragraph 2 or 3.

6. Not use monies deposited in the qualified
student's account for any of the following:

(a) Computer hardware or other technological
devices, except as otherwise allowed under paragraph 4, subdivision (c) or (p)
of this subsection.

(b) Transportation of the pupil, except for
transportation services described in paragraph 4, subdivision (o) of this
subsection.

C. In exchange for the parent's agreement pursuant
to subsection B of this section, the department shall transfer from the monies
that would otherwise be allocated to a recipient's prior school district, or if
the child is currently eligible to attend a preschool program for children with
disabilities, a kindergarten program or any of grades one through twelve, the
monies that the department determines would otherwise be allocated to a
recipient's expected school district of attendance, to the treasurer for
deposit into an Arizona empowerment scholarship account an amount that is
equivalent to ninety percent of the sum of the base support level and
additional assistance prescribed in sections 15-185 and 15-943 for
that particular student if that student were attending a charter school.

D. The department of
education empowerment scholarship account fund is established consisting of
monies appropriated by the legislature. The department shall
administer the fund. Monies in the fund are subject to legislative
appropriation. Monies in the fund shall be used for the department's
costs in administering Arizona empowerment scholarship accounts under this
chapter. Monies in the fund are exempt from the provisions of
section 35-190 relating to lapsing of appropriations. If the
number of Arizona empowerment scholarship accounts significantly increases
after fiscal year 2020-2021, the department may request an increase in
the amount appropriated to the fund in any subsequent fiscal year in the budget
estimate submitted pursuant to section 35-113. The department
shall list monies in the fund as a separate line item in its budget estimate.

E. The state treasurer empowerment scholarship
account fund is established consisting of monies appropriated by the
legislature. The state treasurer shall administer the fund.� Monies
in the fund shall be used for the state treasurer's costs in administering the
Arizona empowerment scholarship accounts under this chapter. If the
number of Arizona empowerment scholarship accounts significantly increases
after fiscal year 2020-2021, the state treasurer may request an increase
in the amount appropriated to the fund in any subsequent fiscal year in the
budget estimate submitted pursuant to section 35-113. Monies
in the fund are subject to legislative appropriation.� Monies in the fund are
exempt from the provisions of section 35-190 relating to lapsing of
appropriations.� The state treasurer shall list monies in the fund as a
separate line item in its budget estimate.

F. A parent must renew the qualified student's
Arizona empowerment scholarship account on an annual basis. The
department of education shall verify that the parent's child is a qualified
student as defined in section 15-2401 or 15-2401.01 in the year for
which the parent seeks to renew the Arizona empowerment scholarship account.� This
subsection does not require the department to annually verify the child's
disability for the purpose of section 15-2401, paragraph 7, subdivision (a),
item (i), (ii) or (iii), if applicable.

G. Notwithstanding any changes to the student's
multidisciplinary evaluation team plan, a student who has previously qualified
for an Arizona empowerment scholarship account remains eligible to apply for
renewal until the student finishes high school.

H. If a parent does not renew the qualified
student's Arizona empowerment scholarship account for a period of three
academic years, the department shall notify the parent that the qualified
student's account will be closed in sixty calendar days. The
notification must be sent through certified mail, email and telephone, if
applicable.� The parent has sixty calendar days to renew the qualified
student's Arizona empowerment scholarship account. If the parent
chooses not to renew or does not respond in sixty calendar days, the department
shall close the account and any remaining monies shall be returned to the
state.

I. A signed agreement
under this section constitutes school attendance required by section 15-802.

J.
notwithstanding
section 15-2404, a qualified school or a provider of services that receives
monies from an Arizona empowerment scholarship account pursuant to this article
is subject to the following requirements:

1.
A
qualified school or a provider of services purchased pursuant to subsection B,
paragraph 4 of this section may not share, refund or rebate any Arizona
empowerment scholarship account monies with the parent or qualified student in
any manner.

2. BEFORE a PARENT PAYS TUITION OR
FEES FROM AN ARIZONA EMPOWERMENT SCHOLARSHIP ACCOUNT TO a QUALIFIED SCHOOL, the
qualified school shall nOTIFY IN WRITING THE PARENT OF A PROSPECTIVE STUDENT
WHO MEETS THE CRITERIA OF QUALIFIED STUDENT PRESCRIBED IN SECTION 15-2401,
PARAGRAPH 7, SUBDIVISION (
a
), ITEM (
i
), (
ii
) OR (
iii
) OF THE
INDIVIDUAL SPECIAL EDUCATION SERVICES AND EDUCATIONAL THERAPIES THAT THE
QUALIFIED SCHOOL WILL PROVIDE TO THE STUDENT. THE NOTIFICATION
PRESCRIBED IN THIS PARAGRAPH IS NOT REQUIRED IN SUBSEQUENT YEARS OF ENROLLMENT
AT THE SAME QUALIFIED SCHOOL.

3. A qualified school shall provide
all accommodations and services that are required under a qualified student's
individualized education program or section 504 plan, If applicable, unless the
qualified student's parent or the qualified student waives in writing the
accommodations or services. If the qualified school fails to either
provide the accommodations and services or obtain a written waiver pursuant to
this paragraph, the qualified student may transfer out of the qualified school
and is entitled to a refund for the portion of the school year for which the
qualified student paid tuition and fees but did not attend the qualified
school.

K. Notwithstanding subsection H of this section, on
the qualified student's graduation from a postsecondary institution or after
any period of four consecutive years after high school graduation in which the
student is not enrolled in an eligible postsecondary institution, but not
before this time as long as the account holder continues using a portion of
account monies for allowable expenses each year and is in good standing, the
qualified student's Arizona empowerment scholarship account shall be closed and
any remaining monies shall be returned to the state.

L. Monies received pursuant to this article do not
constitute taxable income to the parent of the qualified student.
END_STATUTE