Arizona classroom spending share falls to lowest level in two decades

A new report from Arizona Capitol Media Services reveals the percentage of education dollars that end up in the classroom has slipped again.

According to new figures from the Arizona Auditor General’s Office, 52.1 cents of every dollar spent in the 2024-2025 school year end up in instruction. As a budget category, instruction mainly involves salaries and benefits for teachers, aides and substitutes plus general instruction supplies, field trips and athletics.

That’s a decrease from 2023-2024 spending, where 52.6 cents of every dollar went into instruction. It’s also the lowest report in two decades.

In Yuma and La Paz counties, public school districts are spending less. The latest figures place Wellton Elementary School District at the top with 52.4% of 2025 spending in instruction followed by Parker Unified School District with 51.1%.

The Auditor General’s report is especially significant as it comes at a time when Republican legislators are looking to put a measure on the November ballot to require schools to reach 60 cents per every dollar.

If passed, HCR 2007 does include some time to catch up to that amount, but the measure would direct districts to increase spending by at least a nickel each year. Should they fail to meet those goals, public school districts may lose certain state funds.

Here are the latest figures for Yuma and La Paz counties’ public school districts:

Source: Arizona Auditor General's Office

Fixed Costs, Evolving Trends

Chuck Essigs, lobbyist for the Arizona Association of School Business Officials, told Capitol Media Services that the numbers aren’t surprising; they represent the fiscal realities of not just fixed costs, but also a declining enrollment. The situation is also complicated, he said, by the fact that Arizona spends far less than the national average on education.

That's not just his assessment. It's backed by reports from the Education Data Initiative and Forbes. The newest report also puts Arizona’s per-student spending at $14,639 compared with the national average of $19,132.

Essigs said certain costs remain fixed — or increase even faster than teacher salaries.

So, for example, the new report shows actual instructional spending is about $30 higher per student than it was a year before. But plant services are up by $59 per student. That includes utilities, and Essigs said electric companies in Arizona are not giving schools a break.

The situation, however, could be changing.

Enrollment in public schools, which peaked at nearly 932,000 in 2008, is now down by 92,000, resulting in a commensurate reduction in state aid which is based on attendance. That’s forcing some districts to close schools which should reduce the need to heat and cool those buildings.

In Yuma and La Paz counties specifically, there’s not been a lot of discussion indicating this may happen. The main exception to this has been Quartzsite Elementary, which received a recommendation from the Auditor General’s Office in 2020 to consolidate its operations into one campus. As of March 2026, only the Ehrenberg Elementary campus is open for students.

According to Essigs, however, there are other factors — things that just cost a certain amount, regardless of how much schools are being given.

"Things like food service,'' he said. "It doesn't cost less to feed kids in Arizona.''

The same goes for transportation.

"You still need to have buses,'' he said. "So instead of having 50 kids on that bus, you have 40 kids on that bus. It still uses the same amount of fuel, you still have to have the bus drivers.''

The new report also points out that while the overall number of students in public schools is declining, the number of students receiving special education services has increased, particularly for autism. And that can cause an increase in the category of instructional support — something that doesn't count toward that 60% goal for instruction — because it includes counselors, audiologists, speech pathologists, nurses and social workers.

Such support costs increased by $33 per student last year.

There were other costs that also increased — costs that some lawmakers say can be reduced.

Administration, on average, took up 10.4 cents of every dollar of state spending. That’s also up by $33 per student.

The report also says that there were 59 students for every administrator. That's down from 60 the prior year — and 62 the year before that.

All that is acknowledged in the report, however, which says that looking at pure percentages of each dollar spent paints only a partial picture.

"For example, a district's overall spending might increase, but its percentage spent on an operational area may decrease if the dollars per student spent on that area stay the same or even increase,'' Essigs said.

The Case for a 60% Mandate

Rep. Matt Gress (R-District 4), who introduced HCR 2007, said he isn’t buying the argument that there isn't enough money going into schools to reach that goal.

He said the Edunomics Lab at Georgetown University has a report which looks at education spending in Arizona between 2014 and 2024.

"How is it that we increase K-12 spending by 57%, certainly higher than the rate of inflation, and yet instructional spending went down?'' he asked. "It doesn't make any sense to me.''

And Gress has his own views on the growth of the cost of support services -- 2.7% in the past year versus 0.4% for instruction.

"Schools have spent money on everything but the classroom,'' he said.

Nor is Gress buying arguments that transportation costs, up 2.7% year over year, really can't be controlled because districts still need to run buses. He instead looks at data — not in the Auditor General's report — which he says show total ridership is down 44%.

"You lost nearly half your ridership,'' Gress said. "And you're telling me that there were enough bus routes that were just fixed that not only did we maintain them, we actually increased the spending on them? I'm having a hard time wrapping my head around that concept.''

According to Essigs, all that ignores what the new report says about an increasing number of special needs students. He explained those students are the ones who ride on smaller buses, which can transport only a few students at a time, but still require drivers and still require fuel.

That still leaves the data, including in the report, that finds Arizona near the bottom of all states in what it provides in aid.

"I'm not going to dispute the per-pupil costs,'' Gress said. But he said that, in some ways, that's irrelevant to academic performance.

"Mississippi was able to make not only gains but read third grade reading, compared to some states like Massachusetts and California while spending drastically less per pupil,'' Gress said.

Still, that Education Data Initiative report shows Mississippi spending more than Arizona on a per student basis.

Gress remains unconvinced, saying that the scores in standardized tests given to third and eighth graders in Arizona have fallen which "suggests to me that monies are not being prioritized correctly.”

Looking Beyond the Percentages

What the report also shows is that the average teacher in Arizona earns $65,613, up less than 1% from the prior year. That also compares with $48,472 in 2017.Yuma and La Paz generally fall behind that average. In 2025, the average teacher salary in Yuma County was $58,893.78. In La Paz County, the average teacher salary that year was $55,927.83.

But the report also notes that some of the difference in this average can come from districts where more experienced — and better paid — teachers have left the profession and were replaced by more recent graduates.

For example, in 2017, the report showed 19% of teachers were in their first three years. That number is now 21%. That was reflected in the other side of the equation, with 79% of teachers in the profession for at least four years versus 71% in 2017.

Yuma and La Paz track closely with the state average. In Yuma County, an average 20% of teachers were in their first three years last year. In La Paz County, an average 21.5% were.

One other set of numbers also can provide a different perspective: Costs in Arizona versus the rest of the nation.

Figures for 2023 — the most recent available for national comparison — show schools across the country spent 11.6 cents of every dollar for administration. The Arizona figure was 10.3 cents.

And the disparity becomes even more stark in actual dollars, with Arizona schools spending an average of $1,207 per student on administrative costs versus the national average of $1,923.

The report also shows, on a pure-dollar basis, Arizona spends less than the nation as a whole on a per-student basis on most other categories, including plant operations, transportation, food services and instructional support.

Only in the area of equipment — including furniture, vehicles, technology-related hardware and noninstructional software — is state spending on a per-student basis higher.

The Next Funding Fight

Aside from the proposed ballot measure to force instructional spending up to 60% in each district, the report also comes as lawmakers are wrestling with finding ways to restart a program to get more dollars into the classroom.

The original plan approved by voters in 2015 as Proposition 123 tapped into what have been considered excess earnings by the state land trust, generating roughly an extra $3.5 billion over a 10-year period.

That authorization to tap the trust fund expired last year, however.

Lawmakers have absorbed the cost into their regular budget, so there has been no loss to schools. But there is a desire by many from both parties to restart the withdrawals to create more dollars or, at the very least, free up that $300 million a year for other state priorities.

Any renewal would have to go back before voters. But before it gets that far, the differences between what the political parties want have to be worked out.

Republican legislators, including Gress, want to earmark all the extra cash to provide an estimated $4,000 increase in teacher salaries, something that would have an immediate impact on the percentage of total funds that end up in the classroom.

Gov. Katie Hobbs, however, wants to give schools more flexibility with the extra dollars, including using the cash not just for teacher pay but also support staff. She also wants to provide dollars for school capital and safety improvements.

And there's another hurdle.

Some Republicans, Gress included, say they won't vote to put a renewed Prop 123 on the ballot unless it includes something else. That includes enshrining into the Arizona Constitution the right for parents to get vouchers of tax dollars to send their children to private or parochial schools or to home school their children.

That right to vouchers exists now — but only because it was put into state law by prior Republican-controlled legislatures. And that means the law can be repealed away if Democrats gain control of the House and Senate and keep the governor's office.

Reporting for this article is supported by a grant from the Arizona Local News Foundation.