School districts spend billions on AI tools amid vetting challenges

School districts navigate AI procurement with limited guidance

American school districts are pouring billions into artificial intelligence tools designed to track attendance, flag struggling students, and boost reading scores—but many administrators say they're overwhelmed by the sheer volume of choices and lack clear frameworks for evaluation.

The U.S. AI education market generated approximately $2.5 billion in revenue last year and is projected to exceed $15 billion by 2033, according to Grand View Research. Yet as districts commit thousands or millions of dollars to these purchases, the burden of vetting tools for safety, efficacy, and value falls largely on individual school systems, according to reporting first published by Stateline.

Why it matters

The rapid expansion of AI in classrooms is outpacing regulatory frameworks and district capacity to evaluate tools. With federal pandemic funding expiring and budgets tightening, districts face mounting pressure to make smart technology investments—but without standardized vetting processes, they risk purchasing ineffective tools or exposing student data to misuse. The decisions made now will shape how millions of students learn and how their information is protected.

Testing tools in real classrooms

Scott Langford, superintendent of Sumner County Schools in Tennessee, said his district approached AI adoption methodically to address plateauing middle school reading scores. The district tested Coursemojo, an AI-powered literacy platform, through a five-day micro-pilot in one sixth-grade classroom before expanding to half its sixth-grade classes.

"The market is so overwhelming for districts and for vendors," Langford told Stateline. "Most of them don't really do much that drives any kind of change for students."

The Allentown School District in Pennsylvania employs a two-phase review process with non-negotiables including student safety and data security. Superintendent Carol Birks said vendors must ensure all user-generated data remains district property and explicitly state that student information won't be sold or used to train AI models.

The vetting gap

Mark Schneider, a senior fellow at the American Enterprise Institute, said AI presents unique challenges because the industry evolves faster than districts can track. "There's always an asymmetry between what the providers know and what the districts know," he explained.

Some AI implementations have drawn legal scrutiny. Students and parents in Arizona and Kansas filed federal lawsuits challenging districts' use of Gaggle, a student-safety monitoring platform, alleging constitutional violations. In Los Angeles, the superintendent resigned after the district paid $3 million for an AI chatbot from AllHere, which later filed for bankruptcy amid fraud charges against its founder.

While most districts require vendors to sign data processing agreements and pass security reviews, many lack comprehensive AI-specific procurement guidelines. The U.S. Department of Education has provided minimal guidance on AI purchases.

State-level responses

Several states have begun filling the void. Pennsylvania's Department of Education instructs schools to understand data control, examine third-party sharing practices, and keep humans involved in grading and discipline decisions. New York City Public Schools updated its privacy review process to include AI-specific standards and prohibit using student data to train models. Chicago Public Schools released an AI Guidebook and began blocking unapproved third-party AI products from its network.

The Southern Regional Education Board published an AI procurement checklist for K-12 schools. Leslie Eaves, who co-led the organization's AI commission, cautioned that teachers should review AI-generated material before classroom use. "At the end of the day, humans are the ones who will know what's best for their schools and students," she said.

The accumulation problem

An Instructure report found districts had access to an average of 3,001 digital tools, while students and educators used only four on average. Tracy Weeks, senior director at Instructure, described the situation as "digital hoarding" that leaves teachers navigating too many platforms and districts overseeing student data across numerous vendors.

Sue Thotz of Common Sense Media argued districts are being asked to shoulder too much responsibility. She pointed to California's data privacy agreement as a model—a blanket framework that vendors sign, reducing the need for individual districts to negotiate privacy terms from scratch.

These details were first reported by Stateline, part of States Newsroom.