Iowa Code section 321.178 provides that "every public school district in Iowa shall offer or make available to all students residing in the school district or Iowa students attending a nonpublic school in the district an approved course in driver education." More districts are looking into contracting with a private provider to provide driver education to their students. One issue that arises is how to deal with students who are eligible for full or partial waiver of the fee for the course. A district is obliged to honor the waiver, even if the district uses a private provider as the means by which the course is offered to students. New Family Educational Rights and Privacy Act (FERPA) regulations now allow a district to disclose education records to contractors used by a district to perform a service or function of the district. A district must list a driver education provider (such as Drivetek or AutoPilots) in its annual FERPA notice to parents so that parents are aware that the district will be releasing a child’s eligibility for a full or partial waiver of school fees to the driver education provider. The notice should also make it clear that if a parent opts out of this disclosure, the parent will be expected to pay 100 percent of the cost of the driver education course. If the notice includes this information, the third party private provider may now be given the names of students who qualify for the fee waiver. The district must have the driver education provider sign an assurance that the provider will not re-disclose this confidential information to anyone. In the alternative (and for districts that neglect to change their annual FERPA notice), the district remains solely responsible for collecting the payments from students.