Surrounded by school-choice advocates and private school students, Iowa Gov. Kim Reynolds signed an expansive private school education assistance bill into law on Tuesday.
The bill is the culmination of a 3-year effort and notches an early victory in the governor's top legislative priorities of the session.
All public school students and thousands of private school students now are eligible to receive a $7,600 education savings account to pay for tuition and other expenses at a private school. The program is expected to cost $107 million in the first year. By fiscal year 2027, the money will be open to all students in public and private schools, regardless of income, and is expected to cost $345 million.
It was the first bill of the legislative session to be signed into law after a flurry of activity over the first two weeks to advance it to Reynolds’ desk.
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“For the first time, we’re funding students instead of a system,” Reynolds said. “We’re rejecting the idea that the answer to improving education is simply throwing more money into the same system.”
Opponents of the law say it will siphon money out of public schools, fund non-accountable private institutions, and argue private schools could turn away students with disabilities or families whose values don’t align with theirs.
In hours of floor debate Monday night, Democrats told stories of students with disabilities who were turned away from private schools and said much of the money would go to wealthy families who already pay for private school.
The bill passed in both the House and the Senate on Monday night and early Tuesday morning. It passed 55-45 in the House, where all Democrats and nine Republicans voted against it. In the Senate, it passed 31-18. Three Republicans joined all present Democrats in voting against it. Democratic Sen. Tony Bisignano of Des Moines was not present.
“The bill will divert essential funds from 92 percent of our student population and send the funds to just a select population of students admitted into private schools,” Iowa State Education Association President Mike Beranek said in a statement. “Tonight, some legislators ignored the wishes of most Iowans and voted to spend taxpayer money on private interests.”
Reynolds said the program is not at odds with public schools. She acknowledged the vast majority of students are expected to remain in public schools and said the bill will allow school districts more freedom to use their state funds.
“Public schools are the foundation of our educational system,” Reynolds said. “And for most families, they’ll continue to be the option of choice. But they aren’t the only choice. And for some families, a different path may be better for their children.”
Public school districts will receive about $1,200 for each student living in that district who is enrolled in a private school. The law also allows schools to use unspent categorical funding designated for other purposes to increase teacher salaries. Supporters say that change will give public schools more flexibility on how to spend state dollars.
“I was trying to figure out, how can we provide them flexibility … especially in rural Iowa, to be able to increase salaries so that we can be competitive?” Reynolds told reporters after signing the bill. “What we saw when we were looking at that was over $100 million in unspent funding.”
Supporters celebrate passage
Trish Wilger, the executive director of Iowa Alliance for Choice in Education, said she was excited to see the bill signed into law. Wilger’s organization was advocating for a universal education savings account system before the legislative session began.
“We worked on it so long and so hard that it doesn’t seem quite real yet, but I’m just thrilled for the opportunities it’s going to bring to Iowa families,” she said.
The law will provide choice for parents who want to send their children to a nonpublic school but don’t have the financial ability to do so, Wilger said, as well as parents with children in private school who are struggling to afford it.
Wilger acknowledged some families with high incomes may apply for the money, but she said it mirrors the public school system, in which students receive the same services, regardless of income.
“We feel that this is a similar kind of scenario, where the funding is following the student and not going to the institution,” she said.
Dan Zylstra, the head of schools for Pella Christian Schools, argued that the law will not have a negative impact on rural schools. He was a superintendent at a public school in Indiana, which has a more limited private school scholarship program, and he said that program did not hurt public schools.
“School choice did not decimate my rural public school district,” he said. “A few students drove 30 miles to the closest Christian school … but the vast majority of students and families loved and stayed in our school.”
But not everyone in the Capitol was in support on Tuesday morning. During Reynolds’ remarks in the rotunda, Sen. Claire Celsi, a Democrat from West Des Moines, yelled “nobody wants vouchers” and “rural Iowa doesn’t want vouchers” from the second floor of the Capitol.
Reynolds said the state will release a request for proposals on Tuesday for a third-party company to administer the state program. Parents will be able to sign up for updates on a new state website that will go online Tuesday.
Similar to Iowa’s “529” College Savings Iowa plan, the accounts will be created in the state treasury under the control of the Iowa Department of Education and administered by a third party.
The company administering Arizona’s program, ClassWallet, has faced criticism for lax oversight. A 2018 audit of the program found $700,000 had been spent on non-approved expenses.
“We’re going to continue to make sure that we have accountability and oversight as we’re working on the RFP,” Reynolds told reporters. “We want to make sure that we do have transparency and accountability in place.”