Senate File 2201 - Reprinted SENATE FILE 2201 BY COMMITTEE ON EDUCATION (SUCCESSOR TO SSB 3100) (As Amended and Passed by the Senate February 10, 2026 ) A BILL FOR An Act relating to school funding by establishing the state 1 percent of growth and the categorical state percent of 2 growth for the budget year beginning July 1, 2026, modifying 3 provisions relating to property tax replacement payments, 4 the regular program state cost per pupil, funding for school 5 district budget adjustments, and school district enrollment, 6 and including effective date and applicability provisions. 7 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 8 SF 2201 (2) 91 mb/md

S.F. 2201 DIVISION I 1 STATE AND CATEGORICAL PERCENTS OF GROWTH AND PROPERTY TAX 2 REPLACEMENT PAYMENTS 3 Section 1. Section 257.8, subsections 1 and 2, Code 2026, 4 are amended to read as follows: 5 1. State percent of growth. The state percent of growth for 6 the budget year beginning July 1, 2023, is three percent. The 7 state percent of growth for the budget year beginning July 1, 8 2024, is two and one-half percent. The state percent of growth 9 for the budget year beginning July 1, 2025, is two percent. 10 The state percent of growth for the budget year beginning July 11 1, 2026, is one and seventy-five hundredths percent. The state 12 percent of growth for each subsequent budget year shall be 13 established by statute which shall be enacted within thirty 14 days of the transmission of the governor’s budget required by 15 February 1 under section 8.21 during the regular legislative 16 session beginning in the base year. 17 2. Categorical state percent of growth. The categorical 18 state percent of growth for the budget year beginning July 19 1, 2023, is three percent. The categorical state percent of 20 growth for the budget year beginning July 1, 2024, is two and 21 one-half percent. The categorical state percent of growth for 22 the budget year beginning July 1, 2025, is two percent, except 23 for calculating the appropriation to the transportation equity 24 fund under section 257.16C . The categorical state percent of 25 growth for purposes of calculating the appropriation to the 26 transportation equity fund under section 257.16C for the budget 27 year beginning July 1, 2025, is five percent. The categorical 28 state percent of growth for the budget year beginning July 29 1, 2026, is one and seventy-five hundredths percent. The 30 categorical state percent of growth for each budget year shall 31 be established by statute which shall be enacted within thirty 32 days of the transmission of the governor’s budget required by 33 February 1 under section 8.21 during the regular legislative 34 session beginning in the base year. The categorical state 35 -1- SF 2201 (2) 91 mb/md 1/ 6

S.F. 2201 percent of growth may include state percents of growth for 1 the teacher salary supplement, the professional development 2 supplement, the early intervention supplement, the teacher 3 leadership supplement, and for budget years beginning on or 4 after July 1, 2020, transportation equity aid payments under 5 section 257.16C . 6 Sec. 2. Section 257.16B, subsections 1 and 2, Code 2026, are 7 amended to read as follows: 8 1. For each fiscal year beginning on or after July 1, 2023 9 2024 , there is appropriated from the general fund of the state 10 to the department of education an amount necessary to make all 11 school district property tax replacement payments under this 12 section , as calculated in subsection 2 . 13 2. a. (1) For the budget year beginning July 1, 2023, 14 the amount of each school district’s property tax replacement 15 payment shall be the product of the school district’s weighted 16 enrollment for the budget year multiplied by the per pupil 17 property tax replacement amount for the budget year calculated 18 under subparagraph (2). 19 (2) The per pupil property tax replacement amount for the 20 budget year beginning July 1, 2023, is equal to the sum of one 21 hundred fifty-three dollars plus the difference between the 22 following: 23 (a) The regular program state cost per pupil for the budget 24 year beginning July 1, 2023, multiplied by one hundred percent 25 less the regular program foundation base per pupil percentage 26 pursuant to section 257.1 for the budget year beginning July 27 1, 2023. 28 (b) The regular program state cost per pupil for the budget 29 year beginning July 1, 2021, multiplied by one hundred percent 30 less the regular program foundation base per pupil percentage 31 pursuant to section 257.1 for the budget year beginning July 32 1, 2023. 33 b. a. (1) For the budget year beginning July 1, 2024, 34 the amount of each school district’s property tax replacement 35 -2- SF 2201 (2) 91 mb/md 2/ 6

S.F. 2201 payment shall be the product of the school district’s weighted 1 enrollment for the budget year multiplied by the per pupil 2 property tax replacement amount for the budget year calculated 3 under subparagraph (2). 4 (2) The per pupil property tax replacement amount for the 5 budget year beginning July 1, 2024, is equal to the sum of one 6 hundred fifty-three dollars plus the difference between the 7 following: 8 (a) The regular program state cost per pupil for the budget 9 year beginning July 1, 2024, multiplied by one hundred percent 10 less the regular program foundation base per pupil percentage 11 pursuant to section 257.1 for the budget year beginning July 12 1, 2024. 13 (b) The regular program state cost per pupil for the budget 14 year beginning July 1, 2021, multiplied by one hundred percent 15 less the regular program foundation base per pupil percentage 16 pursuant to section 257.1 for the budget year beginning July 17 1, 2024. 18 c. b. (1) For each the budget year beginning on or after 19 July 1, 2025, the amount of each school district’s property 20 tax replacement payment shall be the product of the school 21 district’s weighted enrollment for the budget year multiplied 22 by the per pupil property tax replacement amount for the budget 23 year calculated under subparagraph (2). 24 (2) The per pupil property tax replacement amount for 25 the budget years year beginning on or after July 1, 2025, is 26 equal to the sum of one hundred fifty-three dollars plus the 27 difference between the following: 28 (a) The regular program state cost per pupil for the budget 29 year beginning July 1, 2025, multiplied by one hundred percent 30 less the regular program foundation base per pupil percentage 31 pursuant to section 257.1 for the applicable budget year under 32 this paragraph beginning July 1, 2025 . 33 (b) The regular program state cost per pupil for the budget 34 year beginning July 1, 2021, multiplied by one hundred percent 35 -3- SF 2201 (2) 91 mb/md 3/ 6

S.F. 2201 less the regular program foundation base per pupil percentage 1 pursuant to section 257.1 for the applicable budget year under 2 this paragraph beginning July 1, 2025 . 3 c. (1) For each budget year beginning on or after July 4 1, 2026, the amount of each school district’s property 5 tax replacement payment shall be the product of the school 6 district’s weighted enrollment for the budget year multiplied 7 by the per pupil property tax replacement amount for the budget 8 year calculated under subparagraph (2). 9 (2) The per pupil property tax replacement amount for budget 10 years beginning on or after July 1, 2026, is equal to the sum 11 of one hundred fifty-three dollars plus the difference between 12 the following: 13 (a) The regular program state cost per pupil for the budget 14 year beginning July 1, 2026, multiplied by one hundred percent 15 less the regular program foundation base per pupil percentage 16 pursuant to section 257.1 for the applicable budget year under 17 this paragraph. 18 (b) The regular program state cost per pupil for the budget 19 year beginning July 1, 2021, multiplied by one hundred percent 20 less the regular program foundation base per pupil percentage 21 pursuant to section 257.1 for the applicable budget year under 22 this paragraph. 23 Sec. 3. EFFECTIVE DATE. This division of this Act, being 24 deemed of immediate importance, takes effect upon enactment. 25 DIVISION II 26 STATE COST PER PUPIL 27 Sec. 4. Section 257.9, subsection 2, paragraph i, Code 2026, 28 is amended to read as follows: 29 i. For the budget year beginning July 1, 2026, and 30 succeeding budget years, the regular program state cost per 31 pupil for a budget year is the regular program state cost per 32 pupil for the base year plus the regular program supplemental 33 state aid for the budget year , plus five dollars . 34 Sec. 5. Section 257.9, subsection 2, Code 2026, is amended 35 -4- SF 2201 (2) 91 mb/md 4/ 6

S.F. 2201 by adding the following new paragraph: 1 NEW PARAGRAPH . j. For the budget year beginning July 1, 2 2027, and succeeding budget years, the regular program state 3 cost per pupil for a budget year is the regular program state 4 cost per pupil for the base year plus the regular program 5 supplemental state aid for the budget year. 6 Sec. 6. EFFECTIVE DATE. This division of this Act, being 7 deemed of immediate importance, takes effect upon enactment. 8 DIVISION III 9 SCHOOL DISTRICT BUDGET ADJUSTMENT —— FY 2026-2027 10 Sec. 7. SCHOOL DISTRICT BUDGET ADJUSTMENT —— FY 2026-2027. 11 1. For the school budget year beginning July 1, 2026, the 12 department of management shall add the amount of the school 13 district’s budget adjustment under section 257.14, if any, to 14 the combined foundation base under section 257.1, subsection 15 2, for the budget year. 16 2. For the school budget year beginning July 1, 2026, 17 a school district’s budget adjustment under section 257.14 18 shall be funded by state foundation aid resulting from the 19 calculation under subsection 1 and shall not be funded through 20 school district property taxes. 21 Sec. 8. EFFECTIVE DATE. This division of this Act, being 22 deemed of immediate importance, takes effect upon enactment. 23 DIVISION IV 24 SCHOOL DISTRICT ENROLLMENT 25 Sec. 9. Section 257.6, subsection 2, Code 2026, is amended 26 to read as follows: 27 2. Basic enrollment. Basic enrollment for a budget year 28 is the average of a district’s actual enrollment for the base 29 year and the district’s adjusted enrollment for the base 30 year . Basic enrollment for the base year is the average of 31 a district’s actual enrollment for the year preceding the 32 base year and the district’s adjusted enrollment for the year 33 preceding the base year . 34 Sec. 10. Section 257.6, Code 2026, is amended by adding the 35 -5- SF 2201 (2) 91 mb/md 5/ 6

S.F. 2201 following new subsection: 1 NEW SUBSECTION . 7. Adjusted enrollment. 2 a. Adjusted enrollment is determined annually on January 3 15, or the third Monday in January if January 15 falls on 4 a Saturday or Sunday, and includes the same categories of 5 pupils used to determine actual enrollment under subsection 1, 6 paragraph “a” . 7 b. A school district shall certify its adjusted enrollment 8 to the department of education by February 15 of each year, and 9 the department shall promptly forward the information to the 10 department of management. 11 c. The department of management shall adjust the basic 12 enrollment of the school district for the audit year based upon 13 reports filed under section 11.6, and shall further adjust the 14 budget of the second year succeeding the audit year for the 15 property tax and state aid portions of the reported differences 16 in such enrollments for the year succeeding the audit year. 17 Sec. 11. APPLICABILITY. This division of this Act applies 18 to enrollment determinations occurring on or after July 1, 19 2026, used for school budget years beginning on or after July 20 1, 2027. 21 -6- SF 2201 (2) 91 mb/md 6/ 6