Iowa has increased K-12 funding since recession, but some lawmakers aren't celebrating

Report sparks partisan debate, with Democrats saying state can do better

A cursive alphabet in a Coolidge Elementary School classroom in Cedar Rapids on Wednesday, May 28, 2014. (Liz Martin/The Gazette)
A cursive alphabet in a Coolidge Elementary School classroom in Cedar Rapids on Wednesday, May 28, 2014. (Liz Martin/The Gazette)

CEDAR RAPIDS — A new report on how states are emerging from the “lost decade” of missed economic and revenue growth 10 years after the Great Recession has Iowa legislative Republicans crowing about their support for K-12 schools.

Democrats are not joining that chorus of self-praise, pointing instead at their data showing GOP control of state government has shortchanged Iowa schools.

In an analysis of how states are recovering from the recession, which cost them at least $283 billion in lost tax revenue, the Pew Charitable Trusts found that tax revenue rose in all but five states in the third quarter of 2018. In Iowa, revenues were 10.7 percent higher. That means the state had nearly 11 cents more in purchasing power for every $1 it had collected during its recession-era peak a decade earlier, after adjusting for inflation and averaging across four quarters to smooth seasonal fluctuations.

Although nearly half the states are spending less than they did a decade ago, Iowa is spending nearly 5 percent more today than before the recession when adjusted for inflation, according to Pew. While the increase is not evenly spread throughout the state budget, majority Republicans are pointing to a large bump in K-12 school funding — an annual flashpoint in the budget process.

Education funding down nationwide

Iowa’s 27 percent increase in K-12 funding is second only to North Dakota, according to Pew. Across the country, K-12 education funding by states is down nationally and in 29 states since the recession, according to Pew.

The increase in K-12 funding in Iowa demonstrates the commitment Republicans — who have controlled both chambers of the Legislature and the governor’s office since 2011 — have made to K-12 education, said House Appropriations Committee Chairman Pat Grassley, R-New Hartford.

For fiscal 2020, the state is spending nearly $3.3 billion, or 45 percent, of the general fund budget on K-12 education. That’s an increase of almost $81.5 million over the current year, according to the nonpartisan Legislative Services Agency.

Republicans, Grassley added, showed their commitment to K-12 education in recent years when they de-appropriated funding because revenues did not meet expectations.


“We protected K-12. That shows that education is not only a priority, but we can show with our actions that we followed through with that commitment,” he said.

‘We’re still losing,’ one lawmaker says

Rep. Ras Smith of Waterloo, the ranking Democrat on the House Education Committee, thinks the growth looks good only in comparison to states that aren’t doing as much.

“We didn’t do a good job for a long time, so these numbers don’t mean it’s sufficient,” he said. “The numbers show we’re doing better than other places, but it doesn’t mean they’re doing a great job either.”

The Pew comparison, Smith said, only shows “we’re not losing the race as badly anybody else, but we’re still losing.”

Grassley believes Iowa is winning because it has the nation’s highest high school graduation rate and is second and third, respectively, for ACT and SAT college entrance exam scores.

“It’s not only that we continue to increase funding in K-12 education on the front end, but we’re seeing results on the back end,” Grassley said.

However, Sen. Herman Quirmbach, D-Ames, who taught economics at Iowa State University, isn’t sure Pew is working off the right numbers. His own analysis shows growth in per-pupil spending was 0.09 percent from fiscal years 2008 to 2016.

During the six years Democrats had a Senate majority and Republicans controlled the House, the growth was 1.5 percent, Quirmbach said.

“At least it was positive,” he said, adding that since Republicans took majorities in both chambers there has been a decline of 2.24 percent. Only in the fiscal 2020 budget is K-12 funding “even a tad over inflation.”


The Pew numbers showing a 27 percent increase in K-12 funding “are highly inconsistent with the allowable growth data from the same period,” Quirmbach said.

His assumption is that Pew repeated a mistake made by the Center for Budget and Policy Priorities. When the name of the school infrastructure sales tax changed from SILO to SAVE it was counted as an increase in state aid. The name changed, but the tax remained the same. SAVE currently generates about $537 million a year, Quirmbach said, “so that error, if it happened, could be large enough to explain the discrepancy.”

A spokeswoman for Pew said it analysis “only looks at how much states spend on K-12 education — in other words, the dollars that schools receive from states.”

K-12 funding part of the picture

Quirmbach and Smith also pointed out that K-12 funding is just one part of the picture. Pew found that state support for public higher education fell 28 percent during the post-recession decade.

“Certainly the minus 28 percent in per-student real — inflation-adjusted — spending on higher education is pathetic and goes a long way to explaining the significant increases in tuition and student debt over the decade,” Quirmbach said. Iowa is tied with New Hampshire for the eighth lowest state support for higher education.

Illinois leads that category with a 32 percent increase followed by North Dakota’s 21 percent increase. In higher ed support. Overall, state funding for higher education is 13 percent below its prerecession level.

Grassley didn’t comment on the higher education numbers, but said he’s frustrated by Democrats’ unwillingness to acknowledge the funding increases for K-12.

“I’m beginning to think that based on these other results from independent groups it’s a purely partisan argument that because we’re Republicans we’re not supposed to do well when it comes to the issue of funding education,” Grassley said. “You can spin the numbers and do all of the other things you want, but you can’t dispute 45 percent of the budget, you can’t dispute graduation rates and some of those other things.”

For more on the condition of states’ fiscal situations, visit

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