Iowa enrollment and ESAs, 2024-25
Where students with vouchers are coming from, and where that money could have gone
The overall news about Iowa’s public school enrollment in 2024-25 is the same as it’s been for a quarter-century and more: Small schools are getting smaller, and suburban schools are getting bigger. The certified enrollment of 480,665.4 for public schools is the lowest since 2014, but higher than years during the Great Recession.
Now, however, two other factors need to be studied as well: High inflation and the increase in attendance at private schools, an effect of public money diverted there via education savings accounts.
Certified enrollment is a value that takes into account supplementary weighing, which is why totals have decimal points. This is the number used for determining state aid and is about 1% higher than actual statewide head count. Using these values:
Diagonal keeps on keeping on as the smallest school in the state and the smallest with a high school. The second-smallest, Orient-Macksburg, will only exist on paper next year. Only half of the 20 smallest districts have their own high school.
The average district size is 1479 (Fairfield), but the median district size is 674.7 (IKM-Manning).
The 30 largest of the 325 overall districts account for half the state’s total public enrollment.
Education savings accounts and state aid
The Legislative Services Agency’s fiscal note on the ESA bill when it was signed into law in 2023 estimated that ESAs would support about 14,000 students in 2023-24 (fiscal year 2024) and 20,000 in FY25. The real numbers turned out to be 16,757 and 27,866. This will grow again in the upcoming school year, when income restrictions for ESA eligibility are lifted.
In 2023-24, the state cost per pupil was $7,635, a 3% increase from the previous year. Multiplying that amount times the number of students who used ESAs that year resulted in $128 million going to private schools, above the LSA’s estimate of $106.9 million.
In 2024-25, the state cost per pupil was $7,826, a 2.5% increase. Multiplying that amount times the number of students who used ESAs resulted in $218 million going to private schools, above the LSA’s estimate of $156.3 million. The substantial difference is due to the 40% higher use of ESAs than estimated.
But what if that money had gone to public schools instead? The $218 million is small when matched against the $3.85 billion in state funding for public schools in fiscal year 2025. Once distributed, however, that $218 million would have resulted in $450.86 more per public pupil than in 2023-24. That’s a nearly 5.8% increase from the actual amount received, or an 8.4% increase overall.
When a student goes to a private school, an amount known as categorical state aid stays with the public school. But it’s only a fraction, approximately one-sixth of a full share. It’s also in addition to the full share the student took to the private school, so the overall cost to the state increases.
Proposed increase no match for inflation
At press time, the Legislature had blown through its self-imposed school aid deadline — again. The Senate passed a flat 2% increase for FY26, while the House wants 2.25% with an additional $10 as part of a slow equalization of district costs per pupil. The difference is about $30 per pupil, but below/above the $8,000 mark.
Either way, if 40,000 students use ESAs next year, that equates to about $320 million of public money going to private schools. That amount divided by 480,000 public school students would result in an 8.5% increase from FY25.
If 2020’s per-pupil funding of $7,048 had been indexed to inflation, state aid for FY26 would be $8,667 — a 23% increase over six years. If the total state aid amount for FY24 had included the amount given to private schools that year, and FY25 increased from there by 2% plus the amount given to private schools that year, legislative negotiations for FY26 would have started from a level of $8,493 per pupil.
But that’s nowhere near the case. Instead, over the first three years of the program, private schools could be in line for three-quarters of a billion dollars of state money. If the $320 million estimate mentioned earlier holds true, and the Legislature’s overall budget ends up near what the governor has proposed, approximately 3.4% of state expenditures will go to ESAs.
A drastic splash of students in the funding pool
“We’re putting an end to the notion that competition is a zero-sum game,” Gov. Kim Reynolds said in January 2023, when the ESA bill was introduced and rammed through both legislative chambers in 24 hours, in time for her to sign it into law during National School Choice Week.
She was right, in a way. It’s worse than that. Small schools continue to make up a decreasing portion of overall enrollment and many are now losing students through ESAs.
For the upcoming school year, once ESAs are factored in, the Legislature is likely to do something it hasn’t done since the last Baby Boomers were in high school: Portion out money for more than 510,000 students. Certified public enrollment in 1996-97 topped out just above the half-million mark, and was slightly higher than the 2024-25 public+ESA total. The number in sight is 518,525 in 1981, from the middle of a terrifying 20-year plunge after the state’s 1969 peak.
It’s true that every year for a decade, the Legislature has voted for tens of millions more taxpayer dollars to go to education. Now, though, many of those doing that voting believe Don Bosco and Dowling are just as entitled to state revenue as Diagonal and Decorah. There will be around 8% more mouths to feed from a state revenue pot that hasn’t been bubbling over — and public schools lose out.
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Excellent, detailed report, telling us what many missives have already stated: Iowa is diverting a growing percentage of its K-12 educational dollars to private schools, accelerating declining attendance at public schools and rising attendance at private, even though DOLLARS PER STUDENT to public schools is increasing. What is missing in all these laments, including this one, is "What's to be done about it?" Options--
1. Bad: Kill the ESA program? Good luck, given the lamentable political incompetence of Iowa D's.
2. Better: Require private ESA admissions to be subject to same criteria as public; i.e., take all willing comers, likely requiring a lottery to be fair? Sounds great, but would require legislation and bilateral support.
3. Best: Acknowledge the competition and rise to meet it like every other enterprise in America. Competition sharpens your game, forces one to meet the needs of your clients (students/families, not teachers/administrators), and display a detailed description of your final product--the high school graduate in all his/her dimensions--and follow the outcome of each. Hire administrators with outside-the-box ideas, energy and enthusiasm. The public schools have enormous built-in advantages over private--wake up to them and use them. End the wailing and start the work.
Great reporting! THANKS