RSA encryption via Flask UnicodeDecodeError

I'm building a simple flask app that allows users to POST data and we return an RSA public key encrypted and base64 encoded string.

Flask App Route looks like the following

def index(eyaml_output=""):
if request.method == 'GET':
    return render_template('index.html.j2', eyaml_output=eyaml_output)
elif request.method == 'POST':
    input = request.form['eyaml_input']
    output = helpers.encrypt(input)
    eyaml_output = output

The encrypt function looks like the following

from Crypto.Cipher import PKCS1_OAEP
from Crypto.PublicKey import RSA
import base64

def encrypt(arg):
    with open('eyaml_public.key') as public_key_file:
        public_key = public_key_file.read()

    pubkey = RSA.importKey(public_key)
    cipher = PKCS1_OAEP.new(pubkey)

    output = base64.b64encode(cipher.encrypt(arg))

    return output

This all works well from command line. But when invoked within flask I get the following UnicodeDecodeError

UnicodeDecodeError: 'ascii' codec can't decode byte 0xda in position 0: ordinal not in range(128)

I've tried switching to utf-8 and get a similar error

Edit: I am testing with a python 2.7 virtualenv active. The output itself doesn't seem to matter either. Even when doing an intermediary step this fails with the same Unicode error. The problem occurs on the encrypt portion it seems and not the base64 encoding. Full stack trace below

Traceback (most recent call last):
  File "/Users/bchen/Git/Stoneridge/ansible/eyaml-ansible-
filter/flask/.venv/lib/python2.7/site-packages/flask/app.py", line 1982, in wsgi_app
    response = self.full_dispatch_request()
  File "/Users/bchen/Git/Stoneridge/ansible/eyaml-ansible-
filter/flask/.venv/lib/python2.7/site-packages/flask/app.py", line 
1614, in full_dispatch_request
    rv = self.handle_user_exception(e)
  File "/Users/bchen/Git/Stoneridge/ansible/eyaml-ansible-
filter/flask/.venv/lib/python2.7/site-packages/flask/app.py", line 1517, in handle_user_exception
    reraise(exc_type, exc_value, tb)
  File "/Users/bchen/Git/Stoneridge/ansible/eyaml-ansible-
filter/flask/.venv/lib/python2.7/site-packages/flask/app.py", line 
1612, in full_dispatch_request
    rv = self.dispatch_request()
  File "/Users/bchen/Git/Stoneridge/ansible/eyaml-ansible-
filter/flask/.venv/lib/python2.7/site-packages/flask/app.py", line 
1598, in dispatch_request
    return self.view_functions[rule.endpoint](**req.view_args)
  File "app.py", line 13, in index
    output = helpers.encrypt(input)
  File "/Users/bchen/Git/Stoneridge/ansible/eyaml-ansible-
filter/flask/helpers.py", line 12, in encrypt
    fake_output = base64.b64encode(cipher.encrypt(arg))
  File "/Users/bchen/Git/Stoneridge/ansible/eyaml-ansible-
filter/flask/.venv/lib/python2.7/site-
packages/Crypto/Cipher/PKCS1_OAEP.py", line 150, in encrypt
    db = lHash + ps + bchr(0x01) + message
UnicodeDecodeError: 'ascii' codec can't decode byte 0xda in position 0: 
ordinal not in range(128)