An Iowa family used an ESA for private school. Then they were rejected
By Samantha Hernandez, Des Moines Register
For two years, a northwest Iowa couple applied for and received an education savings account to send their two children to private school.
The couple, who are legal Iowa residents but not U.S. citizens, used the taxpayer-funded program to help pay to send their two daughters to a Christian school in line with the family’s faith.
They planned to send the girls back for the 2025-26 school year, applying for an ESA (Education Savings Account) grant to send them to Western Christian High School in Hull — exercising the school choice option Iowa Republicans, including Gov. Kim Reynolds, embraced and made law.
But this time, the family’s application was denied.
Being Iowa residents, as the ESA law requires, wasn’t sufficient, the Iowa Department of Education decided, because the mother is in the United States on a non-permanent visa. The ESA law contains no mention of immigration status.
The Register is not naming family members because they feared publicity about their case could lead to harassment and jeopardize their immigration status.
On appeal, administrative law judge Thomas Augustine sided with the state. But he said if immigration status is going to be included in determining ESA eligibility, that should made legally clear.
Ideally, the requirements for determining “eligibility for foreign nationals would be codified or go through the rulemaking process instead of relying on the somewhat vague” Iowa law related to residency, Augustine wrote.
Private school and education savings account advocates said they were surprised by the state’s denial, saying it was the first time they had seen immigration status used to disqualify applicants.
The Iowa Attorney General’s Office said the case is unique and it would be a mistake to draw broader conclusions from the denial. The Iowa Department of Education didn’t respond to the Des Moines Register’s questions regarding the case, despite multiple requests.
But for the family who lost their ESA, “it was a disappointing and frustrating experience, especially given the reason they gave for denying the scholarship,” the mother told the Register in an email.
“They kept questioning our legal residency in this country, even though my family has legal status and lives here without any issues.”
Family’s South Dakota zip code flagged twice
The family, originally from Mexico, has lived in Iowa for about seven years, obtaining visas to stay in the U.S. The Register interviewed them in Spanish, and translated their responses to English.
The father told the Register he has legally lived and worked in Iowa since 2017. In 2019, he moved his wife and children to the U.S. so he wouldn’t miss out on their childhood.
The children attended private schools in Iowa since about 2021, according to their parents.
In 2023, the Republican-controlled Legislature passed House File 68, the law that created education savings accounts, and private school staff encouraged the couple to apply ahead of the 2023-24 school year for their daughters.
The law allows the per-pupil state funding that would have otherwise gone to a child’s public school to be used to cover private school expenses including tuition and fees. For the coming 2026-27 school year, families will receive up to $8,148 to put toward private school expenses.
The state awarded the family ESAs for the 2023-24 and 2024-25 school years.
Odyssey, the company hired to manage the scholarship program, flagged their application because their Iowa address is so close to the state border that it had a South Dakota zip code. Their application was eventually approved.
Odyssey flagged the family a third time on their 2025-26 school year application for the same issue.
The couple shared emails with the Register showing Odyssey was working with them to verify their Iowa residency. In past years, the couple sent a letter from their landlord and other proof to show they lived in the state.
But the third time, Odyssey employees asked the family for additional verification beyond what was provided previously.
“The application and documents were escalated to the state, but it was determined that your residency could not be verified ” the July 29, 2025, letter from an Odyssey employee to the father states. The father of the family’s out-of-state, limited term driver’s license and one of the daughter’s limited-term Iowa license were cited as reasons for the rejection.
The information provided “indicates non-residency and, unfortunately, results in automatic denial.”
The mother submitted her own temporary Iowa driver’s license, which showed their Iowa address, in an attempt to clear up the residency issue.
But that, in turn, raised another red flag — her temporary visa status.
“(That’s) when they told me, ‘You are sending me a license from a person who is not a legal resident in this country,’” she told the Register.
ESAs open to Iowa residents
Iowa’s ESA law only requires that applicants are state residents.
During the 2023-24 and 2024-25 school years, the ESA program had income restrictions. The income cap was lifted for the 2025-26 school year.
During the 2025-26 school year, more than 41,044 private school students — about 99% of students in accredited private schools — received an education savings account totaling about $327.9 million.
Neither the ESA law nor the state Department of Education’s FAQ page mention an applicant’s immigration status as a potential impediment to receiving an education savings account.
Augustine, the administrative law judge, noted as much in his decision. And he wrote there was no question the family lives in Iowa and intends to make a home in the state.
“Again, there is no legal authority that explicitly says non-permanent or non-indefinite visa holders are ineligible for ESAs,” he wrote. “The language of the law is clear: ESA eligibility hinges on residence, not immigration status. Therefore, this judge disagrees with the department’s contention that non-permanent or non-indefinite visa holders are categorically ineligible for the ESA program under the governing statutes.”
However, because the mother would need to apply for a visa renewal before the school year ended, the family could not ensure their daughters would complete the school year, allowing the state to reject the application, the judge ruled.
In his decision, Augustine acknowledged the mother’s visa eventually was extended to August 2026 — after the ESA application deadline had passed.
He also noted the Iowa Department of Education’s director is tasked with reducing “waste, fraud, and abuse.” This includes being a good steward of ESA funds.
“There is no guarantee that a visa extension will always be granted,” the judge wrote. “… It is reasonable for the Department to ensure an ESA is not paid out when there is no guarantee an applicant can legally remain through the school year, let alone the first semester.”
The proper standard for awarding an ESA should be whether the “applicant can provide a showing of a legal right to remain in the U.S. through the end of the school year for which the ESA is requested.”
“It would certainly be clearer if a statute or regulation plainly indicated that non-permanent and non-indefinite foreign national visa holders are ineligible for ESAs, as the department contends,” he wrote.
The judge and the Iowa Department of Education determined the family should not have been awarded ESAs for the prior two school years either.
The education department did not provide the Register any policy it has written pertaining to ESA eligibility for non-permanent or non-indefinite visa holders.
Nor did it respond to questions pertaining to how many applications may have been denied under similar circumstances.
‘Faith is very important for us’
The family’s denial was a surprise to Iowa private school and education saving account advocates the Register contacted.
“This is the first time I’ve heard of something like this,” said Tom Chapman, executive director of the Iowa Catholic Conference.
The Iowa Attorney General’s office, which represented the state during the appeal process, warned against looking at Augustine’s ruling too broadly.
“This case is highly fact-specific; any attempt to apply it to a larger group of people is speculative and could infringe on the rights of future ESA applicants,” said Jen Green, spokesperson for the Attorney General’s office in a statement to the Register.
The couple, discouraged by the process, has chosen not to appeal the judge’s ruling to district court.
If the family’s immigration status changes in the future, they would consider reapplying for the program.
The law “leaves too much room for subjectivity, which creates uncertainty and can give the impression that it lacks legality or clarity in its application,” the mother said in an email.
Hundreds of miles from the state Capitol and the debate around who should receive an ESA, the children finished up the academic year at the Christian school they love — aided by school officials who worked with the family to make sure they could stay through the year.
“Faith is very important for us,” the mother said.
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