Senate File 94 S-3001 Amend Senate File 94 as follows: 1 1. By striking everything after the enacting clause and 2 inserting: 3 < DIVISION I 4 SHORT TITLE 5 Section 1. SHORT TITLE. This Act shall be known and may be 6 cited as the “Students First Act”. 7 DIVISION II 8 EDUCATION SAVINGS ACCOUNT PROGRAM 9 Sec. 2. Section 256.9, Code 2023, is amended by adding the 10 following new subsection: 11 NEW SUBSECTION . 66. Adopt rules relating to the 12 administration of, and applications for, the education savings 13 account program pursuant to section 257.11B, including but not 14 limited to application processing timelines and information 15 required to be submitted by a parent or guardian. 16 Sec. 3. Section 257.10, subsection 9, paragraph c, 17 subparagraph (1), Code 2023, is amended to read as follows: 18 (1) The unadjusted teacher salary supplement district cost 19 is the teacher salary supplement district cost per pupil for 20 each school district for a budget year multiplied by the sum 21 of the budget enrollment for that school district plus the 22 number of resident pupils in the school district that received 23 an education savings account payment under section 257.11B for 24 the base year . 25 Sec. 4. Section 257.10, subsection 10, paragraph c, 26 subparagraph (1), Code 2023, is amended to read as follows: 27 (1) The unadjusted professional development supplement 28 district cost is the professional development supplement 29 district cost per pupil for each school district for a budget 30 year multiplied by the sum of the budget enrollment for that 31 school district plus the number of resident pupils in the 32 school district that received an education savings account 33 payment under section 257.11B for the base year . 34 Sec. 5. Section 257.10, subsection 11, paragraph c, 35 -1- SF 94.38 (2) 90 md/jh 1/ 12 #1.

subparagraph (1), Code 2023, is amended to read as follows: 1 (1) The unadjusted early intervention supplement district 2 cost is the early intervention supplement district cost per 3 pupil for each school district for a budget year multiplied 4 by the sum of the budget enrollment for that school district 5 plus the number of resident pupils in the school district that 6 received an education savings account payment under section 7 257.11B for the base year . 8 Sec. 6. Section 257.10, subsection 12, paragraph c, 9 subparagraph (1), Code 2023, is amended to read as follows: 10 (1) The unadjusted teacher leadership supplement district 11 cost is the teacher leadership supplement district cost per 12 pupil for each school district for a budget year multiplied 13 by the sum of the budget enrollment for that school district 14 plus the number of resident pupils in the school district that 15 received an education savings account payment under section 16 257.11B for the base year . 17 Sec. 7. NEW SECTION . 257.11B Education savings account 18 program. 19 1. For purposes of this section: 20 a. “Nonpublic school” means the same as defined in section 21 285.16. 22 b. (1) “Qualified educational expenses” includes tuition 23 and fees at a nonpublic school, textbooks, fees or payments for 24 educational therapies, including tutoring or cognitive skills 25 training, curriculum fees, software, and materials for a course 26 of study for a specific subject matter or grade level, tuition 27 or fees for nonpublic online education programs, tuition for 28 vocational and life skills education approved by the department 29 of education, education materials and services for pupils with 30 disabilities from an accredited provider, including the cost of 31 paraprofessionals and assistants who are trained in accordance 32 with state law, standardized test fees, and advanced placement 33 examinations or examinations related to postsecondary education 34 admission or credentialing. 35 -2- SF 94.38 (2) 90 md/jh 2/ 12

(2) “Qualified educational expenses” shall be limited to 1 the items described in subparagraph (1) and rules adopted 2 by the department to implement this section and does not 3 include transportation costs for the pupil, the cost of food 4 or refreshments consumed by the pupil, the cost of clothing 5 for the pupil, or the cost of disposable materials, including 6 but not limited to paper, notebooks, pencils, pens, and art 7 supplies. 8 c. “Resident” means the same as defined in section 282.1, 9 subsection 2. 10 2. a. (1) For the school budget year beginning July 11 1, 2023, the following pupils who attend a nonpublic school 12 for that school budget year shall be eligible to receive an 13 education savings account payment: 14 (a) A resident pupil who is eligible to enroll in 15 kindergarten. 16 (b) A resident pupil who is eligible to enroll in grades one 17 through twelve and was not enrolled in a nonpublic school for 18 the school year immediately preceding the school year for which 19 the education savings account payment is requested. 20 (c) A resident pupil who is eligible to enroll in grades 21 one through twelve and was enrolled in a nonpublic school year 22 immediately preceding the school year for which the education 23 savings account payment is requested if the pupil’s household 24 has an annual income less than or equal to three hundred 25 percent of the most recently revised poverty income guidelines 26 published by the United States department of health and human 27 services. 28 (2) For the school budget year beginning July 1, 2024, the 29 following pupils who attend a nonpublic school for that school 30 budget year shall be eligible to receive an education savings 31 account payment: 32 (a) A resident pupil who is eligible to enroll in 33 kindergarten. 34 (b) A resident pupil who is eligible to enroll in grades one 35 -3- SF 94.38 (2) 90 md/jh 3/ 12

through twelve and was not enrolled in a nonpublic school for 1 the school year immediately preceding the school year for which 2 the education savings account payment is requested. 3 (c) A resident pupil who is eligible to enroll in grades one 4 through twelve and was enrolled in a nonpublic school for the 5 school year immediately preceding the school year for which the 6 education savings account payment is requested if the pupil’s 7 household has an annual income less than or equal to four 8 hundred percent of the most recently revised poverty income 9 guidelines published by the United States department of health 10 and human services. 11 (d) A resident pupil who received an education savings 12 account payment in the immediately preceding school budget 13 year. 14 (3) For school budget years beginning on or after July 15 1, 2025, resident pupils eligible to enroll in kindergarten 16 through grade twelve who attend a nonpublic school for the 17 applicable school budget year shall be eligible to receive an 18 education savings account payment. 19 b. Education savings account payments shall be made 20 available to parents and guardians in the manner authorized 21 under subsection 5 for the payment of qualified educational 22 expenses as provided in this section. Parents and guardians 23 shall first use education savings account payments for all 24 qualified educational expenses that are tuition and fees for 25 which the parent or guardian is responsible for payment at the 26 pupil’s nonpublic school prior to using the education savings 27 account for other qualified educational expenses. 28 3. a. On or after January 1, but on or before June 30, 29 preceding the school year for which the education savings 30 account payment is requested, the parent or guardian of an 31 eligible pupil may request an education savings account payment 32 by submitting an application to the department of education. 33 b. Within thirty days following submission of an 34 application, the department of education or third-party entity 35 -4- SF 94.38 (2) 90 md/jh 4/ 12

shall notify the parent or guardian of each pupil approved 1 for the following school year and specify the amount of the 2 education savings account payment for the pupil, if known at 3 the time of the notice. As soon as practical following the 4 processing of all applications, the department of education or 5 third-party entity shall determine the number of pupils in each 6 school district approved for the school budget year and provide 7 such information to the department of management. 8 c. Education savings account payments shall only be approved 9 for one school year and applications must be submitted annually 10 for payments in subsequent school years. 11 4. Each education savings account payment shall be equal to 12 the regular program state cost per pupil for the same school 13 budget year. 14 5. An education savings account fund is created in 15 the state treasury under the control of the department of 16 education consisting of moneys appropriated to the department 17 of education for the purpose of providing education savings 18 account payments under this section. For the fiscal year 19 commencing July 1, 2023, and each succeeding fiscal year, 20 there is appropriated from the general fund of the state 21 to the department of education to be credited to the fund 22 the amount necessary to pay all education savings account 23 payments approved for that fiscal year. The director of the 24 department of education has all powers necessary to carry out 25 and effectuate the purposes, objectives, and provisions of this 26 section pertaining to the fund, including the power to do all 27 of the following: 28 a. Make and enter into contracts with a third-party entity 29 necessary for the administration of the program. 30 b. Procure insurance against any loss in connection with the 31 assets of the fund or require a surety bond. 32 c. Contract with a qualified firm, including but not limited 33 to the third-party entity under paragraph “a” , to allocate 34 funds from each pupil’s account for the payment of qualified 35 -5- SF 94.38 (2) 90 md/jh 5/ 12

educational expenses by the pupil’s parent or guardian. 1 d. Require the qualified firm under paragraph “c” to 2 offer the department of education the capability of automated 3 clearinghouse transactions, electronic commerce transactions, 4 reimbursement transactions, and debit card payments in order to 5 meet the diverse needs of participating parents and guardians 6 to pay for qualified educational expenses. The director of 7 the department of education shall determine which transaction 8 capabilities will be available to participating parents and 9 guardians. 10 e. Reduce the possibility of waste, fraud, and abuse, 11 and ensure that any technology platform used for the program 12 meets the state’s highest security requirements, including 13 compliance. 14 f. Conduct audits or other reviews necessary to properly 15 administer the program. 16 g. Adopt rules for the administration of the fund and 17 accounts within the fund. 18 6. a. For each pupil approved for an education savings 19 account payment, the department of education or third-party 20 entity shall establish an individual account for that pupil 21 in the education savings account fund. The amount of the 22 pupil’s education savings account payment shall be deposited 23 into the pupil’s individual account on July 15 or thirty days 24 following submission of the application, whichever is later, 25 and such amount shall be immediately available for the payment 26 of qualified educational expenses incurred by the parent or 27 guardian for the pupil during that fiscal year using a payment 28 method authorized under subsection 5. 29 b. A nonpublic school or other provider of qualified 30 educational expenses that accepts payment from a parent or 31 guardian using funds from a pupil’s individual account in the 32 fund shall not refund, rebate, or share any portion of such 33 payment with the parent, guardian, or pupil. 34 c. Moneys remaining in a pupil’s individual account 35 -6- SF 94.38 (2) 90 md/jh 6/ 12

upon conclusion of the fiscal year shall remain in the 1 pupil’s individual account for the payment of qualified 2 educational expenses in future fiscal years during which the 3 pupil participates in the program until the pupil becomes 4 ineligible under the program or until the remaining amounts are 5 transferred to the state general fund under subsection 8. 6 7. A person who makes a false claim for the purpose of 7 obtaining an education savings account payment or who knowingly 8 receives the payment or makes a payment from an individual 9 account within the fund without being legally entitled to do 10 so is guilty of a fraudulent practice under chapter 714. The 11 false claim for an education savings account or a payment from 12 an individual account shall be disallowed. The department of 13 education or third-party entity shall also close the pupil’s 14 individual account in the fund and transfer any remaining 15 moneys in the account for deposit in the general fund of the 16 state. If the improperly obtained amounts have been disbursed 17 from the applicable individual account, the department of 18 education or third-party entity shall recover such amounts 19 from the parent or guardian, including by initiating legal 20 proceedings to recover such amounts, if necessary. A parent or 21 guardian who commits a fraudulent practice under this section 22 is prohibited from participating in the education savings 23 account program in the future. 24 8. Moneys remaining in a pupil’s individual account when the 25 pupil graduates from high school or turns twenty years of age, 26 whichever occurs first, shall be transferred by the department 27 of education for deposit in the general fund of the state. 28 9. a. A parent may appeal to the state board of education 29 any administrative decision the department of education or 30 third-party entity makes pursuant to this section, including 31 but not limited to determinations of eligibility, allowable 32 expenses, and removal from the program. The department or 33 third-party entity shall notify the parent or guardian in 34 writing of the appeal process at the same time the department 35 -7- SF 94.38 (2) 90 md/jh 7/ 12

notifies the parent or guardian of the administrative decision. 1 The state board of education shall establish the appeals 2 process consistent with chapter 17A and shall post such appeal 3 process information on the state board of education’s internet 4 site. 5 b. The state board of education shall refer cases of 6 substantial misuse of education savings account program funds 7 to the attorney general for the purpose of collection or for 8 the purpose of a criminal investigation if the state board of 9 education obtains evidence of fraudulent use of an account. 10 10. a. This section shall not be construed to authorize 11 the state or any political subdivision of the state to exercise 12 authority over any nonpublic school or construed to require a 13 nonpublic school to modify its academic standards for admission 14 or educational program in order to receive payment from a 15 parent or guardian using funds from a pupil’s account in the 16 education savings account fund. 17 b. This section shall not be construed to expand the 18 authority of the state or any political subdivision of the 19 state to impose regulations upon any nonpublic school that are 20 not necessary to implement this section. 21 c. A nonpublic school that accepts payment from a parent or 22 guardian using funds from a pupil’s account in the education 23 savings account fund is not an agent of this state or of a 24 political subdivision of this state. 25 d. Rules adopted by the department of education to implement 26 this section that impose an undue burden on a nonpublic school 27 are invalid. 28 e. A nonpublic school that accepts payment from a parent or 29 guardian using funds from a pupil’s account in the education 30 savings account fund shall be given the maximum freedom 31 possible to provide for the educational needs of the school’s 32 students, consistent with state and federal law. 33 11. a. Each pupil participating in the education savings 34 account program is required to take all applicable state and 35 -8- SF 94.38 (2) 90 md/jh 8/ 12

federally required student assessments and the results of 1 those assessments shall be provided to the pupil’s parents or 2 guardians and reported to the department of education. 3 b. The department of education shall compile all such 4 reported assessment results in order to analyze student 5 proficiency and academic progress among those pupils 6 participating in the program, including analysis of graduation 7 rates, proficiency, and progress based on grade level, 8 gender, race, and household income level. The results of the 9 department’s analysis shall be included in the annual condition 10 of education report. 11 Sec. 8. Section 422.7, Code 2023, is amended by adding the 12 following new subsection: 13 NEW SUBSECTION . 44. Subtract, to the extent included, the 14 amount of an education savings account payment under section 15 257.11B received by the taxpayer for payment of qualified 16 educational expenses. 17 Sec. 9. EMERGENCY RULES. The department of education 18 may adopt emergency rules under section 17A.4, subsection 3, 19 and section 17A.5, subsection 2, paragraph “b”, to implement 20 the provisions of the section of this Act enacting section 21 256.9, subsection 66, and section 257.11B, and the rules shall 22 be effective immediately upon filing unless a later date is 23 specified in the rules. Any rules adopted in accordance with 24 this section shall also be published as a notice of intended 25 action as provided in section 17A.4. 26 Sec. 10. EFFECTIVE DATE. This division of this Act, being 27 deemed of immediate importance, takes effect upon enactment. 28 Sec. 11. RETROACTIVE APPLICABILITY. The following applies 29 retroactively to tax years beginning on or after January 1, 30 2023: 31 The section of this division of this Act enacting section 32 422.7, subsection 44. 33 DIVISION III 34 SCHOOL DISTRICT CATEGORICAL FUNDING 35 -9- SF 94.38 (2) 90 md/jh 9/ 12

Sec. 12. Section 257.10, subsection 9, paragraph d, Code 1 2023, is amended to read as follows: 2 d. For the budget year beginning July 1, 2009, the use 3 of the funds calculated under this subsection shall comply 4 with the requirements of chapter 284 and shall be distributed 5 to teachers pursuant to section 284.3A . For the budget year 6 beginning July 1, 2010, and succeeding budget years, the use 7 of the funds calculated under this subsection or available for 8 use as provided in subsection 10, paragraph “d” , subsection 12, 9 paragraph “d” , or section 257.46, subsection 3, shall comply 10 with the requirements of chapter 284 and shall be distributed 11 to teachers pursuant to section 284.3A and shall comply with 12 the requirements of chapter 284 related to such distribution 13 under section 284.3A . 14 Sec. 13. Section 257.10, subsection 10, paragraph d, Code 15 2023, is amended to read as follows: 16 d. The use of the funds calculated under this subsection 17 and any amount designated for professional development purposes 18 from the school district’s flexibility account under section 19 298A.2, subsection 2 , shall comply with the requirements of 20 chapter 284 . If all professional development requirements of 21 chapter 284 are met and funds received under this subsection 22 remain unexpended and unobligated at the end of a fiscal year 23 beginning on or after July 1, 2017, the school district may 24 transfer all or a portion of such unexpended and unobligated 25 funds for deposit in the school district’s flexibility account 26 established under section 298A.2, subsection 2 . At the end 27 of a fiscal year beginning on or after July 1, 2022, the 28 school district may use all or a portion of funds under this 29 subsection for the purposes authorized under subsection 9, 30 paragraph “d” . 31 Sec. 14. Section 257.10, subsection 12, paragraph d, Code 32 2023, is amended to read as follows: 33 d. For Except as otherwise allowed under this paragraph, 34 for the budget year beginning July 1, 2014, and succeeding 35 -10- SF 94.38 (2) 90 md/jh 10/ 12

budget years, the use of the funds calculated under this 1 subsection shall comply with the requirements of chapter 284 2 and shall be distributed to teachers pursuant to section 3 284.15 . The funds shall be used only to increase the payment 4 for a teacher assigned to a leadership role pursuant to a 5 framework or comparable system approved pursuant to section 6 284.15 ; to increase the percentages of teachers assigned to 7 leadership roles; to increase the minimum teacher starting 8 salary to thirty-three thousand five hundred dollars; to 9 cover the costs for the time mentor and lead teachers are not 10 providing instruction to students in a classroom; for coverage 11 of a classroom when an initial or career teacher is observing 12 or co-teaching with a teacher assigned to a leadership role; 13 for professional development time to learn best practices 14 associated with the career pathways leadership process; and for 15 other costs associated with a framework or comparable system 16 approved by the department of education under section 284.15 17 with the goals of improving instruction and elevating the 18 quality of teaching and student learning. If all requirements 19 for the school district for the use of funds calculated 20 under this subsection are met and funds received under this 21 subsection remain unexpended and unobligated at the end of a 22 fiscal year beginning on or after July 1, 2020, the school 23 district may transfer all or a portion of such unexpended 24 and unobligated funds for deposit in the school district’s 25 flexibility account established under section 298A.2, 26 subsection 2 . At the end of a fiscal year beginning on or after 27 July 1, 2022, school districts may use all or a portion of 28 funds under this subsection for the purposes authorized under 29 subsection 9, paragraph “d” , and, notwithstanding any provision 30 of law to the contrary, school districts shall not be required 31 to participate in or comply with section 284.15 in order to 32 continue to receive funding under this subsection. 33 Sec. 15. Section 257.46, subsection 3, Code 2023, is amended 34 to read as follows: 35 -11- SF 94.38 (2) 90 md/jh 11/ 12

3. If any portion of the gifted and talented program budget 1 remains unexpended at the end of the budget year, the remainder 2 shall be carried over to the subsequent budget year and added 3 to the gifted and talented program budget for that year. At 4 the end of a fiscal year beginning on or after July 1, 2022, 5 the school district may use all or a portion of funds for the 6 purposes authorized under subsection 9, paragraph “d” . 7 Sec. 16. Section 284.15, subsection 7, Code 2023, is amended 8 to read as follows: 9 7. The department shall establish criteria and a process 10 for application and approval of the framework established 11 under subsection 1 , and for comparable systems that meet the 12 requirements of section 284.16 or 284.17 , which a school 13 district may implement pursuant to subsection 6 in order to 14 receive teacher leadership supplement foundation aid calculated 15 under section 257.10, subsection 12 . 16 Sec. 17. EFFECTIVE DATE. This division of this Act, being 17 deemed of immediate importance, takes effect upon enactment. > 18 2. Title page, line 3, after < supplements > by inserting < and 19 supplementary weighting > 20 ______________________________ AMY SINCLAIR -12- SF 94.38 (2) 90 md/jh 12/ 12 #2.