NC to offer debit cards for disabled students’ tuition. Fraud was found in Arizona’s program

Sen. Michael Lee
Sen. Michael Lee N&O file photo

Taxpayer money will be loaded onto debit cards for families to pay disabled children’s private-school tuition and other education expenses under a new state plan.

Supporters say these education savings accounts, which give parents $9,000 a year, open more options to disabled children. Critics say the system is ripe for fraud and provides no assurances that students will receive a good education.

Five other states have laws allowing education savings accounts, according to EdChoice, a pro-school-choice group. In one of them, Nevada, its legislature put no money into the savings accounts this year.

The provision allowing for the education accounts in North Carolina is included in the state budget the legislature is expected to approve this week.

The state already has taxpayer-funded grants for special-needs students that pay up to $8,000 a year and a voucher program paying up to $4,200 a year for children whose families meet income guidelines.

Eligible families could receive both of those grants as well as the new $9,000 savings account, said Darrell Allison, executive director of Parents for Education Freedom, a group that worked to get all three programs.

“That’s a family getting over $21,000 for the education of their children,” he said.

The savings accounts will be open to more children than the grants for special-needs students, said Sen. Michael Lee, a New Hanover Republican who sponsored a bill this year that would have established the savings accounts.

“We need to provide opportunities for all children to reach their potential,” he said.

To qualify for the $8,000 grants, students must need special education. The $9,000-a-year savings accounts are open to children who have disabilities even if they don’t need special instruction.

Students would also be able to use the savings account money to attend private school part time if they are enrolled part time in public school, Allison said. The guidelines are “trying to give parents the opportunity to have that customized education” for children with special needs, he said.

Arizona was the first state to use education savings accounts. An audit there last year found that some parents were using the money for purchases that had nothing to do with education.

In one instance, a parent spent $300 at a grocery store, according to the audit. Two parents spent $3,600 on books and other educational materials, then returned those items for store gift cards they used to buy a snow globe, a sock monkey, a Walking Dead board game and other items.

Parents who ran private schools used the accounts to pay themselves, the audit found. The Arizona law did not explicitly prohibit that practice.

The Arizona audit found $102,600 misspent over six months.

The legislature has not taken steps to let the public know whether school-choice programs are working, said Kristopher Nordstrom, an education policy consultant with the N.C. Justice Center, a left-leaning public policy organization.

“What we see consistently with these voucher programs is the lack of any accountability,” he said.

“There has been a real reluctance for policymakers to have any sort of accountability that would provide taxpayers a check to see if a program is working or not and give parents an opportunity to know if these options are working for their children,” he said.

Allison said the state had a chance to learn from Arizona’s missteps. The program is starting out small: $450,000 this year for administration and $3 million next year, when money will start going to families. Parents would be required to file expense reports every three months.

The legislature has another year to fine-tune the program if needed, he said. “The real ramp-up is the 18-19 school year.”

Andrea Verykoukis, spokeswoman for Public Schools First NC, said a change as significant as education savings accounts should have stood on its own and been debated in a committee meeting, rather than folded into the budget.

The organization opposes education savings accounts.

“We don’t think they protect kids,” she said. “It’s not an appropriate way to make legislation.”

Lynn Bonner: 919-829-4821, @Lynn_Bonner