Iowa legislators have approved a K-12 education funding bill that increases state aid to public schools while protecting property taxpayers. Iowa Gov. Kim Reynolds signed the bill (Senate File 2201) into law on Feb. 26.

The bill continues the funding mechanism that ensures any increases resulting from state supplemental aid are paid for by the state, instead of being shared by the state and property taxpayers, saving property taxpayers $146 million this year - an increase of $8.7 million compared to the previous fiscal year. This funding mechanism has been in place since 2013 and cumulatively has resulted in more than $1 billion in property tax savings. Farm Bureau supports this funding mechanism, which protects property taxpayers.

 The Legislature also took the unprecedented step to fund the K-12 school budget guarantee from the state’s general fund instead of from property taxes in affected school districts. The budget guarantee, which is part of the school funding formula, ensures that school districts receive at least 1% growth from the previous year’s budget despite having declining enrollment. This provision provides $42.2 million in property tax savings for 199 qualifying school districts. Farm Bureau has long-standing policy supporting the budget guarantee being funded by the state instead of property taxes.

 The school funding formula, which establishes funding levels for Iowa’s K-12 schools, relies on a combination of funding from the state’s general fund, comprised primarily of sales and income taxes, and from local property taxes. Decisions made by the Legislature each year impact how much of that education budget is funded by the state and how much is funded by local property taxes.

The bill also includes $33.3 million for the Transportation Equity Fund, an increase of $600,000, which gives additional funding to schools with high per-pupil transportation costs. Farm Bureau supports increased state funding for transportation costs.