Every year, a horde of school district officials and their lobbyists come before the state legislature, rattling their tin cups, begging for more money for their supposedly underfunded schools. They tell sob stories about crumbling buildings and underpaid teachers who had to pay for school supplies from their own pockets. Their schools, they say, are financially starved.
Hogwash.
School bureaucrats don’t want you to know it, but school spending is at an all-time high, and Arizona’s school districts are sitting on more than $20 billion in cash reserves and buildings they don’t need while student achievement craters. A new report from the Common Sense Institute (CSI) reveals the shocking scope of waste plaguing our traditional public school system, and it’s time taxpayers demanded answers.
The numbers are staggering. As has been documented, Arizona’s school districts are already hoarding $7.8 billion in cash reserves, up $1 billion since the prior fiscal year. Now we learn they’re also sitting on $12.2 billion worth of excess real estate—78 million square feet of unused and underutilized space that could house 630,000 additional students. Combined, that’s over $20 billion in resources that could be put to better use serving Arizona’s children.
Since 2019, district school enrollment has declined 5% statewide, yet these same districts increased their building space by 3% and boosted capital spending by a jaw-dropping 67% to $8.9 billion. As CSI has documented, districts have added 499 new buildings while losing 47,500 students. This isn’t just inefficient, it’s fiscally reckless.
The massive spending on new buildings might be justifiable if schools were overcrowded or expecting a huge influx of new students, but they’re not. In fact, Arizona’s district schools are already significantly overbuilt, operating at just 67% capacity while charter schools run at 95% capacity and private schools at 75%. CSI estimates that the excess space in district schools could accommodate 630,000 additional students—nearly half the current statewide district school enrollment.
The excess capacity comes at an enormous cost. CSI estimates that the market value of excess district space alone—$12.2 billion—could fund a decade of capital expenditures. Alternatively, eliminating maintenance costs for unused space would save taxpayers $1 billion annually. That’s real money that could reduce taxes, improve education, or address Arizona’s other pressing needs.
There are plenty of willing buyers. Indeed, the fastest-growing school systems—charters and private schools chosen by increasing numbers of Arizona families—struggle to find adequate facilities. Yet school districts often go to incredible lengths to avoid selling buildings to them, such as when Tucson Unified School District sold an unused building for 25% less than what a Christian school had offered, just so that a “competitor” wouldn’t have it.
In response to such cases, Gov. Doug Ducey signed a law requiring school districts to sell buildings to the highest bidder, even if it’s a private or charter school. Now, rather than comply, school districts are just letting their underutilized space languish and forcing the taxpayers to pay the bill.
The wastefulness is also a slap in the face to teachers and students alike.
As we noted previously, the districts have enough cash reserves to raise the average teacher pay from $64,420 to more than $80,000 for 10 years and still have funds left over. If they sold off all their underutilized space, they could raise the average teacher pay to $100,000 for a decade and still have billions left over.
There is no evidence that spending on buildings is contributing to student learning. As the buildings have gone up, math scores have gone down, plummeting 25% since 2019. As CSI documents, the lowest-performing schools have the most excess space, operating at just 19% capacity, while high-performing schools run at 70% capacity.
This isn’t about helping kids learn; it’s about protecting a bloated bureaucracy that puts institutional self-interest above student needs.
Fixing the problem will require realigning incentives. CSI recommends more transparency—including a “Facilities Condition Index” that would give policymakers and the public objective information about the quality of existing school facilities—and more state oversight of severely underutilized facilities. In the meantime, any funding requests from the school districts should be greeted by state lawmakers with a healthy dose of skepticism.
Arizona’s children deserve better than a $20 billion monument to government inefficiency. They deserve a system that puts their education first, not one that hoards resources while performance plummets. If local officials can’t or won’t deliver, then state lawmakers will have to step in.
