Iowa’s public K-12 schools are currently facing a number of funding challenges, with potential vouchers being a major concern that could divert funds to private schools. One of the key indicators of funding trends in the state is Supplemental State Aid (SSA), a metric that describes the percentage increase in the per-pupil cost limit in school budgets. Over the last eight years, the SSA percentage has been on a downward trend, from 4% in FY2006-10 to an average of 1.8%. In FY2018, lawmakers set the value of this metric at its second-lowest level in 15 years, at 1.11%. This trend has made it difficult for Iowa’s K-12 schools to provide the necessary resources to their students.
To have a responsible debate on school funding, several issues need to be addressed. The SSA level for FY2019 needs to be set so that schools can prepare and publish budgets to meet an April deadline. Some projections suggest this could be as low as zero growth, which would force many districts with declining enrollment to raise property taxes for one year, as the state formula provides. Second, the penny sales tax for school infrastructure is due to expire in 2029, and schools have sought an extension to permit bonding against those revenues, but lawmakers have not acted. Third, the formula falls short of full equity across the state, and this issue is expected to continue being kicked down the road. Finally, the big issue of private-school subsidies, such as vouchers or so-called “Education Savings Accounts,” is expected in this session. Vouchers would cause a tremendous diversion of dollars to private schools when public education has already been held back.
Governor Kim Reynolds has promoted an isolated figure from a report by a respected national organization to claim Iowa is doing more for schools than the report itself suggests. The same report shows Iowa state-and-local per-pupil spending growth at a much smaller 4.9% over the period. The Governor focuses on state-only funding, but Iowa school budgets are not solely state-funded, but a mix of state, local, and federal funding. Therefore, to compare education spending across years, it is important to set aside the variable of facility and equipment spending and look at formula funding for districts’ regular education program. This apples-to-apples comparison focuses not only on what the state spends on education but also on the larger and defining matter of state policy: what the state permits school boards to spend.
In conclusion, Iowa’s public K-12 schools are currently facing a number of funding challenges, and potential vouchers could divert funds to private schools. The per-pupil cost figure, adjusted annually by SSA, is trending downward. It is important for lawmakers to address these issues, such as the level of SSA for FY2019, the expiration of the penny sales tax for school infrastructure, and the formula’s equity across the state. Furthermore, a fair comparison of education spending should focus on formula funding for districts’ regular education program rather than on what the state spends on education.
