Based on negative press coverage in other states, a common claim made about Iowa’s Students First ESA program by critics is that parents could use the money for amusement park tickets or a family vacation.
No, they can’t.
ESA funds are restricted to accredited nonpublic school tuition, fees, and a defined list of eligible educational expenses.
Parents do not receive the money as cash or on a debit card. Funds are made available through the ESA portal administered by Odyssey, and participating nonpublic schools charge tuition and fees directly through that portal.
Half of the annual funds become available July 15 for fall tuition and fees. The other half becomes available December 1 for spring tuition and fees. Tuition and fees must be paid first.
Only after those costs are covered may any remaining balance be used for other eligible expenses. Those purchases must be made through the Odyssey Marketplace. Purchases made outside the marketplace are ineligible and will not be reimbursed.
The approved list includes expenses such as textbooks, certain software and computers, educational therapy, standardized testing, vocational education, and materials required for specific courses. Even those purchases are subject to restrictions. The state’s guidance lists 11 categories that may require additional verification when billed by a vendor, including documentation such as a class schedule, syllabus, or written verification from a school or approved provider.
The guidance also specifically excludes transportation, food, camps, childcare, non-school classes, clothing, household items, video games, and numerous other personal expenses. Amusement park tickets, airfare, hotel rooms, meals, and other vacation costs are not eligible.
Iowa parents can use ESA funds for tuition and a limited range of approved educational expenses. They cannot use them to pay for a family vacation or a trip to Adventureland.