State 48’s Friday Report: JLAC Hearing and ESA Backlash
Lawmakers probe Isaac District finances, Receiver outlines Isaac Recovery Plan and ESA families react to Janelle Wood’s appointment at the Department of Education
State lawmakers convened a Joint Legislative Audit Committee (JLAC) hearing on Friday to review a series of oversight reports and audits. Among the items on the agenda, several touched on high-profile concerns previously covered by State 48 News. Notably, the committee heard testimony regarding the 120-Day Report from the court-appointed receiver overseeing the Isaac Elementary School District. The report shed light on the district’s ongoing challenges and efforts to restore financial and operational stability under state supervision.
You can view it here.
Auditor General: No Coordination With AG Yet, But Isaac Probe Could Lead to Criminal or Nonfeasance Findings
Arizona Auditor General Lindsey Perry testified that her office is not currently coordinating with the Attorney General’s Office and does not know where the investigation into the Isaac School District will ultimately lead. However, she confirmed hearing that the AG has also opened a review. Perry said her team is assessing whether potential criminal violations or claims of nonfeasance—“basically, not doing your job,” she explained—may be involved.
ABC15 previously reported that the Arizona State Board of Education met in May to address the Isaac School District’s financial crisis.
Today, state lawmakers heard directly from the district’s appointed receiver, Keith Kenny, during a legislative hearing.
The receiver confirmed the Isaac district had a negative cash balance of approximately $20M that happened over a 2-3 year period.
During the JLAC hearing, lawmakers questioned the relationship between a lease-purchase agreement entered into by the Isaac School District and the Tolleson Union High School District.
Rep. Matt Gress specifically asked whether the boyfriend of Isaac Governing Board President Patricia Jimenez had received a contract for marketing services. The receiver confirmed the contract—estimated at $88,000—had been issued but has since been canceled.
It was reported during the hearing that the Isaac School District has eliminated 26 staff positions—some of them administrative roles such as “strategists”—resulting in nearly $2 million in savings. When asked by Rep. Matt Gress about the potential impact of those cuts, the district’s state-appointed receiver said the positions were absorbed and would not affect operations.
It was stated the district previously issued performance payouts to all employees, but that policy has been revised. Under new oversight, bonuses will now be limited to staff who qualify under Arizona’s performance-based pay criteria, aligning compensation with state guidelines.
JLAC also scheduled to review the Tolleson Union High School District’s land acquisition and lease practices. The district’s decision not to appear drew attention, as legislators and members of the public raised questions about transparency and financial accountability.
During today’s Joint Legislative Audit Committee hearing, Rep. Matt Gress read a statement from Tolleson Union High School District Board President Leezah Sun explaining the district’s absence from the committee meeting.
Here’s a video of the meeting which you can view here.
We reached out to Superintendent Jeremy Calles for comment on the state’s remarks during today’s meeting. As of press time, he had not responded.
Overlooked But Reported: State 48 News Flagged Cross-District Connection That Went Unexamined — Calles Says His Role for the Isaac District Was Limited
In a January 2025 emergency meeting, state and county officials revealed the Isaac School District in Phoenix faced multi-millions in reported overspending—a financial crisis that demanded swift intervention.
Among those present in the virtual meeting was Tolleson Union High School District Superintendent Jeremy Calles, in the role of managing the consultants for Isaac, who acknowledged to the panel that he operates two consulting firms.
Then ADE Board member Jenny Clark raised questions about Superintendent Jeremy Calles’ role during that January emergency meeting.
The full emergency meeting can be found here. Here is an edited version of that conversation.
Questions resurfaced today about Jeremy Calles’ dual role as both a consultant and superintendent.
State 48 News addressed that back in January—when Calles confirmed to us on January 18th that his work for Isaac was limited in scope. This is what we reported, take a look:
Today, the receiver testified he found no indication in district records that Jeremy Calles served as a financial consultant for the Isaac district.
Committee members stated that today’s hearing will be rescheduled to a later date when representatives from the Tolleson Union High School District are available to attend.
If necessary, JLAC will compel district representatives to attend - rather than invite them - said the legislators.
BREAKING: ADE Taps Janelle Wood as ESA Outreach Coordinator
The Arizona Department of Education announced it’s officially contracted longtime school choice advocate Janelle Wood as its new ESA Outreach Coordinator, according to a statement posted Friday.
Wood, known for pushing the universal expansion of Arizona’s Empowerment Scholarship Account (ESA) program under former Gov. Doug Ducey, will now work directly with ADE to “connect with families” and provide ESA support through outreach events and social media.
State 48 News has been closely following developments within the ESA program and recently reported on concerns from parents about a lack of transparency and shifting communication from ADE officials regarding the ESA Parent Handbook.
Wood also served as the 2025–2026 ESA Parent Handbook Committee facilitator, a role in which the Department says she “did an exceptional job helping a diverse cross-section of ESA parents” revise the handbook.
ESA parent Stacey Brown had a strong reaction to Janelle Wood’s appointment:
On Facebook, reactions to the appointment of Woods as ESA Outreach Coordinator were a mixed bag. As expected, the anti-ESA crowd had plenty to say. But notably, even among ESA supporters, concerns surfaced—particularly around a potential conflict of interest.
One commenter wrote, “There is a clear conflict of interest in selecting someone who profits from and actively promotes microschools funded by ESA dollars as a vendor to serve as the ESA Outreach Coordinator. Her involvement in microschools—which likely rely heavily on universal ESA funds that consume the majority of a family’s annual allocation—calls into question her ability to serve the broader ESA community objectively. The Department of Education should have appointed a neutral party with no personal financial ties to ESA-funded programs.”
Another added simply, “Sad day for the ESA students.”
We look forward to interviewing Woods in the near future to better understand her vision for the role and to give her an opportunity to directly address these community concerns.
In a totally unrelated topic—but squarely in the “you can’t make this up” section of our newsletter—is the explosion heard around the world when President Trump and Elon Musk started fighting.
This is one of those where-were-you-when-it-happened moments.
Here is how GROK will remember it.
