Iowa's Area Education Agencies (AEAs) are funded through the school aid formula with funding generated at the school district level through a mix of State aid and property tax. Since the AEAs have no taxing authority, each school district generates property taxes for the AEAs through the school levy rate. In essence, the State aid and property tax funding flows from the school district to the AEA. However, school districts do not pay the AEAs directly; instead the Department of Management adjusts school district payments to account for the AEA funding amount.
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