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NASHVILLE, Tenn. (AP) — Some Tennessee parents were accused of misspending thousands of dollars in school voucher funds while using state-issued debit cards over the past school year, a review by The Associated Press has found, and state officials say they do not know what many of those purchases were for.
The Tennessee voucher program is currently modest in scale but is set to expand under Republican leadership over the next year. The state gives families of children with certain disabilities the option of removing their students from public school and then provides a state-issued debit card loaded with tax dollars to help cover their children's private school needs.
When it's expanded, families won't be given a state-issued debit card, but will instead use a website to purchase items largely due to attempts to prevent misspending.
Ahead of the expansion, the AP reviewed letters sent by Tennessee's Department of Education alerting families of improper purchases paid with the state-issued cards between May 2018 and September 2019. The program lets families spend roughly $6,000 each year on approved private educational services.
The department does not keep a database or list of families that violate the program. The AP relied on the letters to compile and analyze the violations over the past school year.
Of the 51 letters sent out by the state, 20 simply listed “unknown” as the reason for the improper purchases because parents had failed to include receipts.
In total, the AP found that Tennessee flagged nearly $30,000 in misspent voucher funds during the 2018-2019 school year. A portion of that amount was overturned through the appeals process.
Just 36 students enrolled in the voucher program when the program launched in January 2017. That number has jumped to 137 children during the 2018-2019 school year, though thousands more are estimated to qualify.
The education agency provided the violation letters through a public records request but redacted names of the recipients, making it impossible to identify possible repeat violators or contact those who received notices. The agency also provided documents showing that a handful of the parents who had been flagged as submitting incomplete forms successfully appealed their violations.
The brief and direct letters highlight misspent funds, but do not reveal if any of the violations were particularly egregious.
In one Nov. 14, 2018, letter, the state said an $851 mystery expense violated the state’s policy because it was spent "not for the education benefit of the student enrolled in the IEA program."
Another letter sent in April announced the voucher account had been closed due to an unreported $1,456 expense on Jan. 15 and warned that the recipient would no longer be eligible to reapply in the future. However, that action was later successfully appealed after the recipient provided receipts showing the money had been spent on preapproved private school tuition.
In one case, the state denied an appeal of an Oct. 26, 2018, purchase of $1,725 after noting the recipient again failed to submit receipts showing how the money was spent. The original violation letter noted the recipient had paid for education therapy before the provider had been approved and failed to provide a receipt.
A separate appeal letter said the department had approved an appeal for an $1,899 iPad pro as a “one-time courtesy.”
The department declined to discuss any of the individual letters, citing privacy concerns.
Education Commissioner Penny Schwinn told the AP that she increased supervision over use of the state debit cards — known as the Individual Education Account program — shortly after taking over the position last year.
“It's our responsibility to make sure one plus one equals two on the balance sheet,” Schwinn said. She added that she found “a lot of opportunities for improvement" in how the program was managed.
Schwinn said she too had noticed the violations flagged by the AP and moved the program to a different department to improve oversight.
Schwinn said she would prefer that families enrolled in the IEA program move away from using debit cards in order to prevent future misspending.
Tennessee's program will be expanded to thousands more students in Nashville and Memphis beginning in the 2020-21 school year.
Currently just five states have some sort of voucher program that relies on monitoring debit cards: Arizona, Florida, Mississippi, Tennessee and North Carolina.
Nationwide, there's been a push, supported by President Donald Trump and Education Secretary Betsy DeVos, to give parents more freedom to use public school funding as they see fit for their children's education. Critics have countered that education vouchers divert critical funds from public schools. They have also pointed to problems with monitoring spending in the state's limited voucher program to bolster the case against expansion.
The program in Arizona made national headlines last year after an audit found that parents using state-issued debit cards had misspent more than $700,000 in public money.
Voucher proponents say states have gotten better since then at preventing fraudulent purchases as the push for more so-called “school choice” initiatives have popped up across GOP-controlled Statehouses.
However, for two years in a row, Tennessee education officials said in annual reports that monitoring the use of the voucher funds was one of the top challenges of implementing the Individual Education Account voucher program. Other challenges included educating account holders on state laws surrounding the program; and ensuring that expense reports and receipts were being properly submitted.