Education savings account (ESA) programs offer families greater flexibility and control over their children’s education, but they require a well-functioning administrative infrastructure to succeed. When the Arkansas Department of Education’s (ADE) technology platform was determined unable to effectively administer the state’s Education Freedom Account (EFA) program, the department quickly recognized the need for a solution and reached out to The Reform Alliance. The organization graciously agreed to support ADE in maintaining program continuity for families. This case study highlights the collaborative effort between ADE and The Reform Alliance, the challenges faced, the rapid response required, and the lessons learned, emphasizing the need for states to have contingency plans in place for ESA administration.
Background: The Reform Alliance and the EFA Program
The Reform Alliance is a non-profit organization dedicated to expanding educational opportunities for Arkansas students. Since its inception, the organization has played a vital role in advocating for and implementing school choice initiatives. The EFA program, designed to provide financial support for families seeking alternative education options, encountered significant administrative hurdles when the chosen technology provider was unable to deliver an end-to-end management system. This left families without timely access to critical educational funds.
Challenges and Immediate Consequences
The technology provider’s platform did not meet the needs of families; particularly, the platform struggled to support the expanded eligibility of homeschool and micro-school students. The consequences were immediate and severe:
- Families left without funding: Parents could not access program funds to purchase essential educational materials, delaying educational experiences and curriculum start dates.
- Vendors left unpaid: Private schools and service providers faced financial instability as payments faced delays.
- A growing crisis of trust: Parents and educators were on the brink of losing confidence in the program, leading to increased frustration and complaints.
- Operational breakdowns: The technology provider’s inability to adapt to payment disbursement complexities led to backlogs and confusion, exacerbating the issue.
The Reform Alliance’s Intervention
Recognizing the urgency of the situation, ADE proactively reached out to The Reform Alliance to explore emergency solutions while the department worked toward a longer-term fix. The Reform Alliance responded swiftly and partnered closely with ADE to implement a temporary but effective workaround by:
- Utilizing its own funds: The organization leveraged its reserves to front more than $350,000 in educational expenses for more than 1,000 students while awaiting reimbursement from ADE.
- Creating a streamlined purchasing system: Through Google Forms, direct vendor payments, and manual approvals, the team established an emergency process to procure necessary educational materials.
- Establishing strong lines of communication: The Reform Alliance worked closely with ADE officials and stakeholders to ensure that administrative hurdles did not delay relief efforts.
- Implementing fraud prevention measures: The team worked with ADE to verify all requests, ensuring funds were used appropriately without unnecessary delays.
- Providing direct support to families: A dedicated helpline and outreach campaign were launched to assist parents in navigating the workaround system.
Key Lessons Learned
- Contingency Planning is Essential: States must have backup systems, policies and procedures in place to ensure ESA funds remain accessible even if the primary technology solution fails.
- Early Vendor Vetting and Piloting: ESA administrators should rigorously evaluate vendors, requiring demonstrations of functionality and small-scale pilot programs before full implementation.
- Overcommunication is Crucial: Regular, proactive updates can prevent misinformation and alleviate frustrations from parents and service providers.
- Non-Governmental Organizations Can Be Key Partners: Advocacy groups and non-profits with established relationships in the education sector can provide critical stop-gap solutions when state agencies face administrative challenges.
- Fraud Prevention Must Be Balanced with Accessibility: While accountability measures are necessary, overly stringent or vague rules (e.g., defining purchases as “reasonable”) can create unnecessary barriers for families.
- Data-Driven Decision-Making is Critical: Real-time tracking of expenditures and request trends can help administrators anticipate needs and respond effectively.
Recommendations for States
To prevent similar disruptions, states implementing ESA programs should consider the following best practices:
- Develop a Continuity Plan: Identify alternative administrative pathways in case of vendor failure, including partnerships with trusted education organizations.
- Conduct Rigorous Vendor Selection: Require potential technology providers to not only demonstrate their capabilities but also provide access to a test environment that showcases the experience of families, provides and administrators before contract approval.
- Monitor Early Performance Metrics: Set up reporting structures that analyze response times, payment success rates, and customer complaints to detect operational failures early.
- Standardize a Transparent Communication Plan: Ensure families and vendors receive clear and timely information about program processes and potential changes.
- Leverage Established Networks: Identify and engage with advocacy groups or non-profits that can provide operational support if needed.
- Test and Refine Payment Systems: Implement controlled rollouts and stress tests before launching the full program. Soft launches and initial pilot testing can help provide early insights that could trigger additional contingency planning.
- Develop Clear Fraud Prevention and Compliance Measures: Ensure safeguards are in place without making the system overly burdensome for families.
Conclusion
The experience of the Arkansas Department of Education and The Reform Alliance serves as a cautionary tale and a model for proactive planning. ESA programs are powerful tools for educational choice, but without robust contingency plans among many other support structures as outlined throughout the ESA Implementation Roadmap, programs risk failing the very families they aim to serve. By learning from Arkansas’ experience, other states can implement stronger safeguards to ensure ESA programs operate smoothly, even in the face of administrative setbacks.
States considering ESA programs must not only focus on policy design but also on execution. By proactively developing vendor vetting processes, communication strategies, and contingency frameworks, they can prevent costly disruptions and build sustainable, parent-focused educational choice programs.
