State agencies block Auditor Sand during review of private school voucher program

The State Auditor is raising the alarm, saying state government is stonewalling his office over details on the state’s private school voucher program.

Iowa State Auditor Rob Sand said he has concerns about the $104 million school voucher program. According to an annual audit released this week, multiple state agencies refused to provide documentation about the program’s basic financial controls. 

“The bottom line is this: This administration won’t let us audit the controls on $100 million of your tax money going out to the voucher program. That program is likely to grow to over $300 million next year,” Sand said. “And we cannot say that it has appropriate and reasonable controls for waste and abuse.”

The program lets Iowans use tax money to pay for private school expenses like tuition, and it is expected to grow to $340 million in the future. Even in just the last year, Iowa has seen growth in the number of students using taxpayer funds to pay for their private school education. For the 2024-2025 school year, 27,866 students used these educational savings accounts or ESAs. That’s up 66% from the previous academic year (16,757 in 2023-2024). 

Yet several state agencies declined to work with the auditor on several fronts of the annual audit, according to the report. They argued that Sand—the state’s sole elected statewide Democrat—is biased against the program. They used this as part justification for withholding information Sand said is key to making sure taxpayer dollars are being spent correctly.

“The statutory requirement and the mission of this office is to shine a light on how the state spends your money, to hold government agencies and lawmakers accountable, and to help prevent waste, and abuse. We can’t do that when the governor gives her approval to hiding documents and thumbing their nose at transparency for Iowans,” Sand said. 

“They are demanding, in essence, that you shorten Ronald Reagan’s ‘Trust but verify’ to ‘Trust. No questions asked.’”

Odyssey, a private company that administers the program on behalf of the Iowa Department of Education, is responsible for distributing the education funds to eligible families. For the first two years, there has been an income cap to participate in the program. But the Auditor said it was not clear from the audit whether Odyssey was verifying each participant’s eligibility for accessing the money or whether the department had adequate oversight over this verification process.

The Iowa Department of Education responded to the report claiming it had processes in place to track the money flowing through the program but that Sand’s review of the program was “outside the scope” of an annual audit. 

Sand argued that the size of the program meant that it was subject to annual audit. He also cited two Iowa Supreme Court precedents establishing the auditor’s authority to examine controls over contracts like the one for the program during annual audits.