Reynolds not concerned by private schools raising tuition because of ESA program

Gov. Kim Reynolds said Thursday she has no problem with the private schools that raised tuition after the enactment of her Educational Savings Account program, aimed at helping more families afford non-public education.

Reynolds spoke with reporters about education and other topics Thursday during a recording of “Iowa Press” at Iowa PBS.

Her number one priority for the 2023 legislative session was passing a private school scholarship program, funded with taxpayer dollars. After failing in previous years, she reached her goal in less than three weeks, signing the program into law Jan. 24.

In the months following, the governor and the state officials began work to make the accounts accessible for use in the 2023-2024 school year. In February, Reynolds announced that Odyssey, a New York-based education technology company, would administer the program for Iowa.

During the first year of the program, ESAs can be set up for current public K-12 students, incoming kindergarteners and current private school students with family incomes of 300% or below the federal poverty line. Iowa families will be able to create accounts of about $7,600 in state funds to use on private school tuition and associated costs.

Several Iowa private schools announced their plans to raise tuition after the program was signed into law. Holy Family Catholic School in Dubuque raised tuition to be able to receive more of the available government money, with no increased cost to the families using ESA funds. Tuition for Wahlert Catholic High School students is $6,590 for the current school year — in 2023-2024, high school tuition will grow to $7,400. Students who aren’t Catholic will have a tuition of $8,600, and Catholic students whose parishes do not support Holy Family will pay $7,825 in tuition annually — both cases where an ESA would not cover the full cost of attendance.

Several other eastern Iowa private schools plan to raise tuition in the upcoming year, the Telegraph Herald reported. Des Moines area Catholic schools also plan to raise tuition by up to 10% in the 2023-2024 school year, Axios reported. Tuition at Dowling Catholic, for example, is growing from $9,500 to $9,588 plus fees for parish-participating students, and from $12,500 to $13,416 for non-Catholic families.

Reynolds said she is not concerned about private schools raising tuition, saying that private institutions are facing the same increased costs in education that public schools are.

“All schools are experiencing increased costs, we’ve had our public schools talk about it too, Reynolds told reporters. “And that’s why every year we look at a state supplemental aid payment, because we recognize that there are increased costs. We’ll monitor it but they’ll be able to use their foundation, the tuition tax credits, as well as the ESA.”

Private school teachers in Iowa often make less than public school teachers, Reynolds said, and tuition increases could go toward teacher salaries. The ESA program will allow private schools to be “a little bit more competitive” in hiring teachers, she said.

Iowa public school teachers still make less than the national average, according to data from the National Education Association, with Iowa teachers making an average of $59,581. Reynolds said this gap was why she introduced the provision in the ESA program allowing public schools to put unused categorical funds toward increasing teacher salaries.

Public education advocates and Democrats said the program will take needed funding away from Iowa’s public K-12 schools. Public school districts will lose the “per-pupil” funding through State Supplemental Aid when a student enrolls in a private school using an ESA, but school districts will receive roughly $1,200 for each student living in the district who attends a private school.

Reynolds said in discussions with rural public school administrators and teachers, the biggest asks were on “flexibility” measures, which lawmakers passed through Senate File 391, allowing schools to make changes including dropping some foreign language and arts class requirements and letting teachers instruct multiple sequential subjects simultaneously in one classroom.

Reynolds said she plans to continue working during the interim and next year on “Chapter 12,” Iowa’s school standards, as well as looking at ways to better support the bottom 5% of Iowa’s public school districts — especially on improving literacy.

“Stay tuned,” Reynolds said. “There’ll be more to come next year, I’m really excited to work on that over the interim.”

The ESA program is expected to cost the state roughly $107 million in the upcoming fiscal year. In the program’s second year, the income threshold will rise to 400% for families with current private school students, in addition to covering all current public school students and incoming kindergartners. In year three onward, all students will be eligible for an ESA.

Once fully phased in, the program is estimated to cost $345 million annually. Reynolds said she does not see the state playing a role in setting new requirements for private school staffing, but that her team is following the implementation process closely to see if they need to make any changes.

“Anytime you pass transformative legislation like we just did, a lot of times, there’s clean-up that needs to happen in the follow-up years,” Reynolds said. “And so we’ll continue to monitor that.”

The state will begin accepting ESA applications May 31, according to the Iowa Department of Education. Applications will be due June 30.