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December 2012 Policy Study, Number 12-13


Education Savings Account:

A Path to Give All Children an Effective Education and Prepare Them for Life





[1] Mike Ross, “Education or Bust,” The Daily, March 11, 2012, See also Yahoo! News, “Should parents do jail time for ‘stealing’ an education?,” March 13, 2012,

[2] See Lachlan Cartwright and Yoav Gonen, “Kindergarten Cops,” New York Post, March 31, 2011,; B. A. Birch, “Residency Fraud in D.C. Schools Tough to Identify, Police,” Education News, October 10, 2011,; James Vaznis, “Residency Fraud at Top Schools Vexes City,” The Boston Globe, April 23, 2010, councilor_seeks_tighter

_residency_rules_for_exam_schools/; and Eddy Ramírez, “Schools Crack Down on Boundary Hopping,” U.S. News and World Report, March 2, 2009,

[3] Under Arizona law, the accounts are called “Empowerment Scholarship Accounts.” See Arizona State Legislature, Fiftieth Legislature, First Regular Session, S.B. 1553,

[4] Dan Lips, “Education Savings Accounts: A Vehicle for School Choice,” Goldwater Institute Policy Report No. 207, November 15, 2005,

[5] Matthew Ladner and Nick Dranias, “Education Savings Accounts: Giving Parents Control of Their Children’s Education” (Goldwater Institute Policy Brief No. 11–01, January 29, 2011).

[6] Ibid. See also Jay P. Greene and Marcus A. Winters, “The Effect of Special Education Vouchers on Public School Achievement: Evidence from Florida’s McKay Scholarship Program” (Manhattan Institute Civic Report No. 52, April 2008),
[7] Greg Forster, A Win-Win Solution: The Empirical Evidence on School Vouchers (Indianapolis, IN: The Friedman Foundation for Educational Choice, 2011),
[8]Matthew M. Chingos and Paul E. Peterson, “The Effects of School Vouchers on College Enrollment: Experimental Evidence from New York City” (Brown Center on Education Policy at The Brookings Institution and the Harvard Program on Education Policy and Governance at the Harvard Kennedy School, August 2012), %20chingos/Impacts_of_School_Vouchers_FINAL.pdf.

[9] Quinn Cummings, “My Education in Home Schooling,” The Wall Street Journal, July 27, 2012,

[10] See Khan Academy,
[11] Jonathan Butcher, “Ghost Busters: How to Save $125 Million a Year in Arizona’s Education Budget” (Goldwater Institute Policy Report No. 246, May 21, 2012),
[12] Arizona State Legislature, Fiftieth Legislature, First Regular Session, S.B. 1553,
[13] Arizona State Legislature, Fiftieth Legislature, Second Regular Session, H.B. 2622,

[14] In addition, this legislation created a protective measure for home-school families that are not using an account that exempts such families from current and future rules for any families that have education savings accounts.
[15] See Arizona Department of Education, “Empowerment Scholarship Accounts,” at; and author’s e-mail communication with the Arizona Department of Education on September 4, 2012.
[16] The department approves merchant codes, which are the codes that vendors use to process credit card transactions.
[17] School Choice Indiana, “Indiana Claims Title of Nation’s Biggest First-Year Voucher Program Ever,” news release, November 3, 2011,’s-biggest-first-year-voucher-program-ever/.
[18] Stephanie Banchero, “School Vouchers Gain Ground,” Wall Street Journal, April 11, 2012,
[19] Jonathan Butcher, “Ghost Busters.”
[20] Arizona Revised Statutes, 15–185,
[21] See the group “ESAAZ,”
[22] Steven Malanga, “How to Stop Medicaid Fraud,” City Journal, Spring 2006,
[23] Arizona Health Care Cost Containment System, “Fraud, Abuse, or Abuse of a Member,”
[24] U.S. General Accounting Office, “Food Assistance: Efforts to Control Fraud and Abuse in the WIC Program Can Be Strengthened,” August 1999, p. 8,
[25] With education savings accounts, the relationship between a parent and the state is similar to that of the state and a private contractor, where the state is contracting out the job of educating a child. Since surety bonds are readily available for public contracts, bonding vehicles that would suit a savings account program likely already exist.
[26] National Notary Association, “Arizona: Select Your Insurance,”
[27] U.S. Small Business Administration, “Surety Bonds,”
[28] The National Commission on Excellence in Education, a Nation at Risk, April 1983,; Council on Foreign Relations, “U.S. Education Reform and National Security,” March 2012, p. ix,



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