Iowa Senate Bill SSB1053

Iowa 2025-2026 Regular Session

• Introduced: 1/28/25
• Refer: 1/28/25

Caption

A bill for an act relating to school funding by establishing the state percent of growth and the categorical state percent of growth for the budget year beginning July 1, 2025, modifying provisions relating to the property tax replacement payments, and including effective date provisions.(See SF 167.)

Impact

The bill also modifies how property tax replacement payments to school districts are calculated. From July 1, 2025, each school district's property tax replacement payment will become a function of its weighted enrollment and the per pupil property tax replacement amount. This amount is calculated with a base of $153, plus a formula involving the regular program state cost per pupil, thereby linking funding more closely to enrollment figures and maintaining inflation adjustments.

Summary

Senate Study Bill 1053 (SSB1053) focuses on establishing the state percent of growth and the categorical state percent of growth for school funding in Iowa starting from the budget year beginning July 1, 2025. Specifically, the bill sets the state percent of growth to 2 percent for the specified budget year, which is instrumental in calculating supplemental state aid as part of the state's school foundation program. This measure is intended to refine the financial resources allocated to education, ensuring that schools receive adequate funding based on consistent growth rates.

Contention

The main points of contention surrounding SSB1053 include the adequacy of the established growth rates and the methods for property tax replacement payments, which have been scrutinized for potentially disadvantaging smaller or less affluent school districts. Critics argue that the set rates may not sufficiently address the varying needs across different school districts, particularly those that are already struggling to provide adequate educational resources. Proponents counter that the legislation brings much-needed clarity and stability to school funding, thereby fostering improved financial planning for educational institutions.

Broad implications

If enacted, SSB1053 would significantly impact Iowa's education funding landscape, ensuring a more systematic approach to growth rates and property tax replacement calculations. It also enforces a sense of predictability that schools can rely on as they plan their budgets, thus influencing local governments' fiscal strategies and engagement with education funding.