Iowa would offer building financing for charter and private schools

The Iowa Finance Authority would run school building loan funds and could issue bonds, a form of borrowing, for building projects. Charter schools and accredited private schools could use financing to buy, build, or improve school buildings. Loans would depend on available money. No fixed starting amount is specified. Repayments, interest, and earnings would stay in the loan funds. Unused money would remain available in the next fiscal year. Bonds could be repaid from designated school payments, donations, and program funds. Iowa and local governments would not be responsible for repayment. The authority could also make agreements to help schools obtain cash or credit. Program bonds and their interest would be exempt from Iowa taxes. The personal income tax provision for program bonds would apply retroactively to tax years beginning on or after January 1, 2026.

Charter school payments would include teacher salary funding. Qualifying schools and employees would participate in Iowa’s public employee retirement system. Charter students could join qualifying sports in their home or neighboring district. Boards approved under the founding group–state board model would receive local school agency status for federal funding at all their schools. Retirement coverage would require the charter school to meet federal participation requirements. At closure, school assets would cover payroll and retirement debts before other creditors. For home-district sports, the charter school must not have offered the sport during the two immediately preceding school years or have another agreement covering it. For neighboring-district sports, neither the charter school nor the home district could have offered the sport during those two school years. The reach of the separate sports-sharing restriction is unclear. Sports participation would require an agreement between schools. Students would follow district participation and conduct rules and pay any fee, capped at the fee for district students. The charter school funding formula would apply to school budget years beginning on or after July 1, 2026.

School districts would sign agreements when community preschool providers request them. Preschool and private school rules would face limits on government authority. These provisions cover community providers in Iowa’s voluntary preschool program for four-year-olds and private schools under the independent accreditation provisions. Preschool agreements would cover high-quality instruction in an approved local program and could not cap the number of eligible children served. These provisions would not authorize government control over providers or require changes to admission standards or educational programs. Regulations would have to be necessary to carry out the relevant education provisions. Rules imposing an undue burden would be invalid. Providers and private schools would have the greatest possible freedom to meet students’ needs while following state and federal law.

Parents or guardians could apply in the fall for a semester payment through an education savings account, which pays approved school expenses. Parents and guardians of eligible private school students could apply January 1 through June 30 for a school year, or October 15 through November 15 before the requested semester. The student must qualify for the program for private school students. Fall applicants would receive 50 percent of the annual state per-student amount if approved. Approval would cover one school year or one semester. Families would need to apply annually for later school years. The education department or its administrator would notify approved applicants within 30 days and state the payment amount if known. Approved fall payments would be deposited within 30 days of application. Full-year payments would arrive July 15 or 30 days after application, whichever is later. Deposited money would immediately cover approved expenses for that fiscal year.

The Iowa Department of Education would convene and support a task force to study required teacher training and teaching license renewal. The study would cover training required by Iowa law and requirements for renewing a teaching license. Recommendations would need to identify changes to state law that could make training and license renewal schedules more manageable. Task force members or the organizations they represent would pay their own expenses. The task force would submit findings and recommendations to the legislature on or before December 31, 2026.