The seventh post in a series, here we address the sixth most common myth we hear about school choice in Iowa:
Myth Number 6: Iowa already gives private schools millions of dollars.
Iowa doesn’t give any Iowa private school any dollars directly. The state provides money to public school districts to provide students in grades K-12 transportation and a very small amount of textbook and technology funding. These products and services are owned by the public school district.
The state allows donors to claim a tax credit and parents to receive tuition help from those private dollars utilizing the Educational Opportunities Act (or “School Tuition Organization” or STO program). These dollars are private dollars, a deferral of revenue from the state, and saves the state tens of millions of dollars each year according to the Iowa Department of Revenue. The state utilizes federal title dollars through public districts and AEAs to serve nonpublic school students in our private schools.
Iowa also has a personal tuition and textbook tax credit that helps some families offset tuition and fees if they itemize. This program is for public and private school parents and approximately 70% of claims are public school families receiving a tax credit for fees paid for their public school students.
There isn’t a program where the state writes a check to a private school. The state has chosen to make small investments in individual students through these programs and federal title funding is mandated under federal law and the money ends at the public school. These public schools and AEAs also take a small percentage (5-10%) of that money for “administrative” costs, meaning that public schools currently profit off of services provided to nonpublic school students not being educated in their own classrooms. Between the millions in savings each year via the STO tax credit program and the administrative costs held back by public school districts; private schools are able to retain some students who may otherwise not be able to make it work without those services but at tremendous savings to the state and with public schools making money too.
Even our proposed universal ESA program would not directly fund private schools. It would provide a portion of funds that would have gone to the public school for that student to his/her parents to use at a private school or other approved expenses. We are asking for Iowa to fund students – not any one institution, including any of ours.
Interested in diving into all ten myths? You can read the full article here. Be sure to sign up for our newsletter to stay up to date on the latest developments in our effort to ensure every child has access to the educational environment that best meets their needs.