In accordance with A.R.S. §15-905(E), the FY 2026 BUDG-25 Budget Verification Letters are now published. Letters are based on the most recent BUDG-25 reports, which have been calculated using the October BSA 55 information.  These letters contain the official notification if a FY 2026 December revision is required as of the date of the letter.

• District BUDG-25 Budget Verification Letters and District BSA-55 reports are available to download from the School Finance website.

The budget verification letters are addressed to the district's governing board in care of the district superintendent. Therefore, it is the responsibility of the district to inform the district's governing board members accordingly. 

Reminder: the district's budgeted FY 2026 K-3 Reading amount is added to the district's BSL and RCL until the district is approved for the K-3 Reading support level weight by the State Board, or December 31st, whichever occurs first.

Please contact the Budget Team ([email protected]) if you have any questions.

Thank you!

$866 million in federal dollars at stake

PHOENIX – State schools chief Tom Horne says he strongly disagrees with postponing the effort to remove Diversity, Equity, and Inclusion (DEI) language from state teaching standards, saying the federal government may withhold an estimated $866 million, and this issue must be addressed immediately.  Following today’s board action, the matter will be placed on the December agenda.

Horne stated, “I respectfully but strongly disagree with the vote to postpone opening the rule-making process. The president issued an Executive Order requiring DEI language to be removed from programs funded by federal dollars. It made it abundantly clear that federal education funding is at risk if DEI language remains in education programs. Failure to comply with federal guidance may result in the loss of an estimated $866 million to Arizona schools. That is a major funding cut to our schools, and we need to begin dealing with this as soon as possible.”

He added, “Not only is the $866 million at risk, there is a philosophical issue at stake too. All people should be judged based on their character and ability, not their race or ethnicity. DEI language and programs promote the exact opposite, and they have no place in the classroom. The teaching standards, unfortunately, include DEI references, and they need to be removed.”

The teaching standards in question include references to teaching “equitably” and with a focus on “responsiveness to the cultural backgrounds and differing perspectives learners bring to the learning environment.” They also refer to understanding the “social, emotional and cultural needs of students” in the classroom.

Horne added, “These terms do not belong in teaching standards. The standards are meant to direct educators on the most effective ways to teach students' core academics. Every instructional minute is precious, and DEI efforts distract from that essential mission.”
 

The Fiscal Year 2026 Aggregated Expenditure Budget (AGD) Report for all school districts has been published and is available to download from the School Finance Reports website.

If you have any questions, please contact the School Finance Budget Team at [email protected].

Thank you!

More than 170,000 Arizona students – 16 percent - using AI tutoring

(PHOENIX) - Arizona is first in the nation in the percentage of students using Artificial Intelligence (AI) tools, according to State Superintendent of Public Instruction Tom Horne. More than 170,000 Arizona students are now using AI-powered tutoring to enhance their academic performance. That figure represents 16 percent of all public school students, and it is expected to grow.

Horne said, “Having more than 170,000 students already signed up for tutoring through Khanmigo, the premier AI education system in the country, is a significant milestone for education in Arizona. Our state has the highest rate of usage by percentage of student population among all states. That is a tremendous accomplishment.”

Last year, Horne directed the Arizona Department of Education to invest $1.5 million to help schools access Khanmigo, an AI tutoring system designed to promote active learning.

He explained, “Khanmigo does not simply provide answers.  It engages students by asking questions that guide them to discover solutions on their own. This approach delivers rigorous, individualized Socratic-style tutoring — a proven method for improving academic outcomes.”

Horne also highlighted the Department’s efforts to support educators through the Arizona Digital Educators Library (ADEL), an online AI platform designed to assist teachers in creating lesson plans and developing classroom materials aligned with Arizona’s academic standards. ADEL has enrolled over 4,000 users, along with 50 ambassadors charged with extending the reach of the platform across Arizona.

Horne concluded, “I am a strong supporter of AI as a classroom tool to assist, but not replace, educators. So far, about 4,000 educators statewide are using this system, and I encourage more teachers to sign up. It is an invaluable resource that helps educators do their jobs more effectively.”

ADE/ESS is pleased to announce that the High-Cost Child Claims have opened for the FY 2026 school year as of October 1, 2025. Respecting the amount of funding currently available for High-Cost Child Claims, ADE/ESS will ask each PEA to limit submissions to one claim per submission round, with a total of $75,000 cap per PEA for FY 2026. The cutoff date for the first submission is next Friday, October 31, 2025. If additional funding becomes available, ADE/ESS will communicate this with PEAs.

 The funding mechanisms for High-Cost Child Claims have moved from Grants Management into the ESS Vouchers Application. Please ensure your PEA staff have been given the appropriate role to access the application: ESS High Cost: PEA User. If you have any questions, please send them to the ESS Program Management inbox: [email protected].

 High-Cost Child Claims Quick Reference Guide

Under Section 616 of the Individuals with Disabilities Education Act of 2004 (IDEA 2004), State Education Agencies are required to make a determination for all Public Education Agencies (PEAs) on the PEA’s performance in the implementation of special education. Each PEA’s federal fiscal year (FFY) 2024 (FY 2025) determination is now available for review through ADE Connect and posted on the website.

Please visit Arizona's PEA Determinations Website for information on the notification letter, scoring criteria, and public results.

For questions regarding PEA Determinations, please email the ESS Operations Inbox.

BUDG-25 reports for all school districts have been posted to the School Finance website.  FY 2026 October BUDG-25 reports have been calculated using the FY 2026 October BSA-55 information.

District BUDG-25 and BSA-55 reports are available to download from this School Finance website.

Please contact the Budget Team ([email protected]) if you have any questions.

Thank you!

UA and ASU in talks

PHOENIX - State schools chief Tom Horne, who is also a member of the Arizona Board of Regents, says the Trump administration’s Compact for Academic Excellence in Higher Education is aligned with his philosophy of fighting against racial entitlements, and he is pleased that the University of Arizona and Arizona State University are in talks about implementing the agreement.

Horne stated, “Since I took on the Tucson Unified district in 2008 to end the racially divisive ‘Ethnic Studies’ program, I have been fighting against racial entitlements. People should be judged on their character and merit, not the color of their skin. The Trump administration’s federal compact for universities shares that same goal, and I am pleased that universities, including the University of Arizona and Arizona State University, are in discussions with the President on enshrining those principles in their schools. Reports that the U of A has rejected this compact are untrue.”

He explained, “The U of A president has sent a letter to U.S. Education Secretary Linda McMahon explicitly stating that the university shares the administration’s ‘vision of continuing to strengthen our higher education system for the betterment of the country – a vision rooted in a merit-based pursuit of excellence that directly or indirectly benefits all Americans.’ He has further stated, ‘We have much common ground with the ideas your administration is advancing on changes that would benefit American higher education and our nation at large,’ and ‘We welcome the opportunity to engage other universities, higher education associations, members of Congress, and your administration to advance and implement our principles in alignment with the national interest.’ Those statements clearly are not a rejection of the compact and I am confident that UA and ASU will consider these important principles in good faith.”

 DATA MANAGEMENT ALERT

October 1 Data Collection Phase II Trainings for FY 2026

Annually, the Arizona Department of Education (ADE) is required to report special education (SPED) data to the federal government. The October 1 Data Collection (ODC) is part of that process and is required by all Public Education Agencies (PEAs). ODC has three phases:  

1. Child Count Verification and Personnel  
2. Child Count Reconciliation 
3. Child Count Non-Reconciliation (if applicable)  

During Phase II, PEAs must submit and reconcile student-level data for students with disabilities participating in a Special Education program over the October 1 child count date through AzEDS. The primary goal of Phase II is to ensure that these students align with the verification count submitted during Phase I.  

ESS Data Management is excited to offer training opportunities to assist with Phase II, including an in-person workshop and a live webinar! Listed below is the schedule for the ODC Phase II training. Please note that registration is required. Click the link on the date that best fits your schedule to register. 

Online Training via Microsoft Teams:  

Date                                                                  Time 

Thursday, November 13th, 2025,       10:00 am – 12:00 pm

Please email ESS Data Management with any questions.

The Arizona Department of Education, Exceptional Student Services (ADE/ESS), recognizes the uncertainty that recent federal reductions in force within the U.S. Department of Education’s Office of Special Education Programs may bring to education leaders across the state. We want to acknowledge the concern these national changes may cause and provide reassurance and clarity regarding Arizona’s unwavering commitment to children and youth with disabilities.

There have been no changes to the Individuals with Disabilities Education Act or its implementing regulations. State Education and Public Education Agencies remain fully responsible for upholding all federal and state special education requirements. This includes ensuring every eligible child receives a free and appropriate public education in the least restrictive environment, conducting timely evaluations, safeguarding procedural rights, and maintaining all assurances tied to federal special education funding.

While administrative shifts may be occurring at the federal level, the rights of Arizona’s students with disabilities—and the responsibilities of our schools—remain firmly intact.

ADE/ESS is closely monitoring these developments and actively collaborating with the National Association of State Directors of Special Education and other national partners to stay informed and responsive. Our priority is to maintain timely updates, technical assistance, and support to ensure continuity and compliance during this time.

We deeply value the dedication of Arizona’s special education professionals—teachers, administrators, support staff, and service providers—who continue to serve our students and families with compassion, consistency, and excellence. Your work is vital to our shared mission: ensuring that every child with a disability in Arizona can access the services and supports they need to learn, grow, and thrive.

If you have questions or need clarification, please don’t hesitate to contact our office. ADE/ESS will continue communicating updates as they become available and stands ready to support you.