Private schools, ESAs impacting area school districts

Iowa instituted its Education Savings Accounts program effective in the 2024-25 school year.

Under the program, families receive an amount equivalent to per pupil state aid for each student they enroll in an accredited private school.

In the current school year, that amount is $7,864.

During the first two years of the program, families were required to meet certain income restrictions to qualify for an ESA, but those restrictions will disappear next year, meaning all families, regardless of wealth, can qualify to receive ESA funds. Since the first year of the ESA program, enrollment in private schools has grown by approximately 10 percent per year. The number of newly opened private schools has also grown exponentially as shown in the accompanying chart. Regardless of the relative scarcity of private schools in rural Iowa, the ESA program has the potential to further erode enrollment in area districts and, in turn, to siphon away thousands of dollars in much needed funding.

A prime example comes in Creston, where St. Malachy School has a K-8 enrollment of 147 students, 112 of which are residents in the Creston district. If all qualify as recipients of an ESA, those 112 students equate to a loss of  over $800,000 per year to the Creston public schools.

Creston, however, is not the only area school to lose students to private institutions.

Listed are the area school districts losing enrollment this year to accredited private schools.

Bedford 4 1

C. Decatur 1 1

Clarke 6 1

Corning 5 1

East Union 10 2

Interstate 35 16 6

M-St. Marys 24 6

Melcher-Dallas 2 1

Murray 1 1

Nod. Valley 11 2

Orient-Mack. 7 1

SE Warren 5 1

Winterset 17 5

If all 109 students receive ESA funding, the end result would be over $850,000 flowing out of those area public school districts.

(Statewide, 27,866 students received ESA funding in the 2024-25 school year. That number equates to just over $219 million going to private schools. Those numbers are expected to rise considerably when ESA income caps disappear for 2025-26.)

Currently, the number of accredited private school choices remains limited for students in Ringgold County. To date, neither the Mount Ayr nor Diagonal districts have lost students to private schools.

Still, with dwindling populations in rural counties, with the aging populations of rural counties, and with the advance of online education, open enrollment opportunities, and ESAs for private schools all putting increased pressure on public school enrollments, educational leaders in Ringgold County and in rural Iowa in general will face unprecedented challenges in the years to come.