Bill Text: TX SB1178 | 2015-2016 | 84th Legislature | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Relating to an interim study on an education savings account program.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Engrossed - Dead) 2015-05-14 - Referred to Public Education [SB1178 Detail]
Download: Texas-2015-SB1178-Introduced.html
Bill Title: Relating to an interim study on an education savings account program.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Engrossed - Dead) 2015-05-14 - Referred to Public Education [SB1178 Detail]
Download: Texas-2015-SB1178-Introduced.html
2015S0381-1 03/04/15 | ||
By: Huffines | S.B. No. 1178 |
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relating to establishing an education savings account program. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Chapter 29, Education Code, is amended by adding | ||
Subchapter J to read as follows: | ||
SUBCHAPTER J. EDUCATION SAVINGS ACCOUNT PROGRAM | ||
Sec. 29.351. DEFINITIONS. In this subchapter: | ||
(1) "Account" means an education savings account | ||
established under the program. | ||
(2) "Child with a disability" means a child who is | ||
eligible to participate in a school district's special education | ||
program under Section 29.003. | ||
(3) "Curriculum" means a complete course of study for | ||
a particular content area or grade level. | ||
(4) "Financial institution" means a bank, credit | ||
union, savings bank, or savings and loan association organized | ||
under the laws of this state or another state or under federal law | ||
that has its main office or a branch office in this state. The term | ||
does not include any institution the deposits of which are not | ||
insured by the Federal Deposit Insurance Corporation or the | ||
National Credit Union Administration. | ||
(5) "Institution of higher education" means: | ||
(A) an accredited public senior college, | ||
university, community college, state college, technical institute, | ||
or junior college or the equivalent located in this state; | ||
(B) a private or independent institution of | ||
higher education as defined by Section 61.003; or | ||
(C) a career school or college as defined by | ||
Section 132.001. | ||
(6) "Instructional material" has the meaning assigned | ||
by Section 31.002. | ||
(7) "Parent" means a resident of this state who is a | ||
natural or adoptive parent, managing or possessory conservator, | ||
legal guardian, custodian, or other person with legal authority to | ||
act on behalf of a child. | ||
(8) "Participating private school" means a private | ||
school located in this state that has notified the agency of its | ||
intention to participate in the program and comply with the | ||
program's requirements. | ||
(9) "Program" means the education savings account | ||
program created under this subchapter. | ||
(10) "Program participant" means a child accepted into | ||
the program and the child's parent. | ||
Sec. 29.352. ESTABLISHMENT OF PROGRAM. (a) The | ||
commissioner shall establish and administer the education savings | ||
account program to provide funding to pay approved | ||
education-related expenses of eligible students. The parent of a | ||
child participating in the program may choose an education method | ||
that best serves the child's needs, whether by private school, | ||
private tutor, homeschooling, or another approved option. | ||
(b) The annual number of new participants in the program is | ||
limited to one-half of one percent of the total number of students | ||
in average daily attendance in grades 1 through 12 in the state | ||
during the previous school year. In the event that applicants | ||
exceed available spots in any given year, the agency shall give | ||
preference to any applicant who is a child with a disability or who | ||
is educationally disadvantaged. | ||
(c) The agency shall make information about the program | ||
readily available to the public through various sources, including | ||
the agency's Internet website. The agency shall make special | ||
efforts to ensure that parents of a child with a disability or a | ||
child who is educationally disadvantaged are made aware of the | ||
program. | ||
Sec. 29.353. ELIGIBLE CHILD. (a) A child is eligible to | ||
participate in the program if the child: | ||
(1) is eligible to attend school under Section 25.001; | ||
and | ||
(2) was enrolled in a public school district during | ||
the preceding school year or is enrolling in first grade for the | ||
first time. | ||
(b) After a child establishes eligibility under Subsection | ||
(a) and begins participating in the program, the child is eligible | ||
to continue in the program, regardless of whether the child | ||
continues to meet the requirements of Subsection (a), until the | ||
earlier of the date on which the child graduates from high school or | ||
the child's 21st birthday, unless the child: | ||
(1) enrolls in a public school district or | ||
open-enrollment charter school; | ||
(2) changes residences and is no longer entitled under | ||
Section 25.001 to attend school in the school district under which | ||
the child's eligibility was established; or | ||
(3) is declared ineligible for the program by order of | ||
the commissioner. | ||
Sec. 29.354. AGREEMENT REQUIRED. Before an eligible child | ||
may receive funding under this subchapter, a parent of the child | ||
must agree in writing: | ||
(1) to provide an education for the child that | ||
includes, at a minimum, the subjects of reading, grammar, | ||
mathematics, social studies, and science; | ||
(2) to spend program funding only on qualified | ||
education expenses described by Section 29.356; | ||
(3) to ensure that the child is annually administered | ||
the appropriate assessment instruments under Section 29.358; | ||
(4) to immediately notify the agency if the child | ||
enrolls in a public school district or open-enrollment charter | ||
school; and | ||
(5) to inform the agency of the child's graduation from | ||
high school. | ||
Sec. 29.355. AMOUNT OF PAYMENT; FINANCING. (a) A child | ||
participating in the program shall receive annual funding equal to | ||
80 percent of the total average per student funding amount in the | ||
school district the child would otherwise attend, based on that | ||
district's funding during the preceding school year. | ||
(b) Notwithstanding Subsection (a), a child participating | ||
in the program who is a child with a disability or who is | ||
educationally disadvantaged shall receive annual funding equal to | ||
100 percent of the total average per student funding amount in the | ||
school district the child would otherwise attend, based on that | ||
district's funding during the preceding school year. | ||
(c) The agency shall contract with an independent third | ||
party for the purpose of determining if a child participating in the | ||
program is a child with a disability or is educationally | ||
disadvantaged. | ||
(d) A child who participates in the program is included in | ||
determining the average daily attendance under Section 42.005 of | ||
the school district the child would otherwise attend. The amount of | ||
program funding received by the child shall be subtracted from the | ||
state funding payable to the school district. | ||
Sec. 29.356. QUALIFIED EDUCATION EXPENSES; AGENCY | ||
APPROVAL. (a) Program funding may only be used to pay the | ||
following qualified education expenses incurred by a program | ||
participant: | ||
(1) tuition and fees at a participating private | ||
school; | ||
(2) the purchase of textbooks required by a | ||
participating private school; | ||
(3) the purchase of a curriculum; | ||
(4) the purchase of instructional material; | ||
(5) tuition or fees for an online educational course | ||
or program; | ||
(6) professional fees of a private tutor or teaching | ||
service; | ||
(7) for a child with a disability, professional fees | ||
of a practitioner or provider of educational therapies or services; | ||
(8) fees for a nationally standardized | ||
norm-referenced achievement test or examination, an advanced | ||
placement examination or similar examination, or any examination | ||
related to college or university admission; | ||
(9) tuition and fees at an institution of higher | ||
education; | ||
(10) the purchase of textbooks required by an | ||
institution of higher education; | ||
(11) contributions to a qualified tuition program | ||
established for the child that meets the requirements of Section | ||
529, Internal Revenue Code of 1986; and | ||
(12) professional fees of a financial institution that | ||
manages the participant's account. | ||
(b) Education-related expenses that do not qualify under | ||
Subsection (a) and that may not be paid with program funding | ||
include: | ||
(1) computer hardware or other technological devices; | ||
(2) transportation; | ||
(3) consumable educational supplies including paper, | ||
pens, pencils, folders, and notebooks; | ||
(4) food; and | ||
(5) before-school or after-school child care and child | ||
care during school holidays and vacations. | ||
(c) All expense payments made from an account established | ||
under this subchapter must be approved by the agency and may be made | ||
only to a participating private school, institution of higher | ||
education, private tutor, vendor, or other provider of education | ||
services that has been approved by the agency. | ||
(d) A participating private school, institution of higher | ||
education, private tutor, vendor, or other provider of education | ||
services under this subchapter must provide program participants | ||
with a receipt for each qualifying education expense charged by the | ||
school, institution, tutor, vendor, or provider. | ||
(e) Nothing in this subchapter shall be construed to | ||
prohibit or limit the ability of a program participant to pay, with | ||
nonprogram funding, the costs of educational courses, materials, | ||
supplies, or services not covered by the program. | ||
Sec. 29.357. APPLICATION FOR PROGRAM. (a) From May 1 to | ||
July 1 of each year, a parent may apply for participation in the | ||
program on behalf of the parent's child for the following school | ||
year. | ||
(b) The agency shall use a standardized application form to | ||
determine a child's eligibility for the program. The agency shall | ||
make the application form readily available to interested parents | ||
through various sources, including the agency's Internet website. | ||
(c) The agency shall provide to each applicant, and annually | ||
to each program participant, a publication that describes the | ||
operation of the program, including the type of expenses covered by | ||
the program, expense reporting requirements, a list of private | ||
schools participating in the program, and a description of the | ||
responsibilities of program participants and the agency. | ||
Sec. 29.358. ACHIEVEMENT TESTING. (a) Each child | ||
participating in the program shall be annually administered the | ||
appropriate grade-level state assessment instruments, or | ||
nationally standardized norm-referenced achievement tests, in math | ||
and language arts. However, a child with a disability for whom | ||
standardized testing is not appropriate is not subject to this | ||
subsection. | ||
(b) The results of all assessment instruments or tests | ||
administered under this section shall be reported to the agency in | ||
the manner required by the agency. The agency shall ensure that | ||
results may be efficiently reported in a manner that complies with | ||
student privacy laws and that allows aggregation of data by grade | ||
level, gender, race, family income level, and number of years of | ||
participation in the program. | ||
(c) The agency shall publish the achievement test results, | ||
associated learning gains, and program graduation rates on the | ||
agency's Internet website. | ||
(d) A student's failure to demonstrate satisfactory | ||
academic progress, as determined under commissioner rule, may | ||
constitute grounds for the commissioner to declare the student | ||
ineligible for the program. | ||
Sec. 29.359. ACCREDITATION. (a) A participating private | ||
school must be accredited by a private organization recognized by | ||
the commissioner before it may accept students under the program. | ||
(b) A private tutor or teaching service, or a practitioner | ||
or provider of educational therapies or services for a child with a | ||
disability, must be licensed or accredited by a regional or | ||
national accrediting organization recognized by the commissioner | ||
before it may accept students under the program. | ||
Sec. 29.360. ADMINISTRATION OF ACCOUNTS. (a) The agency | ||
shall contract with a financial institution to establish and manage | ||
accounts under the program. The institution shall establish an | ||
account for each child participating in the program. Program | ||
participants may access their account by using a debit card or | ||
online payment service. | ||
(b) Funding under the program shall be transferred to each | ||
participant's account in quarterly installments of equal amount to | ||
be made on or before the 25th day of August, November, February, and | ||
May. | ||
(c) The agency may deduct from each installment of funds an | ||
amount, not to exceed three percent, to cover the agency's cost of | ||
overseeing accounts and administering the program. | ||
(d) The agency shall establish, based on market rates, | ||
reasonable fees that may be charged by a financial institution that | ||
manages accounts under the program. | ||
Sec. 29.361. EXPENSE REPORTING. (a) On or before | ||
quarterly deadlines established by the agency, program | ||
participants must submit an expense report to the agency detailing | ||
all transactions made on the participant's account during the | ||
reporting quarter. Only expenses incurred during the reporting | ||
quarter may be approved by the agency. | ||
(b) An expense report must include: | ||
(1) receipts and invoices documenting all | ||
transactions made on the account; and | ||
(2) a quarterly statement of account provided to the | ||
participant by the financial institution that manages the account. | ||
(c) The agency shall disallow any expense that is not a | ||
qualified education expense under Section 29.356 or for which | ||
documentation is incomplete. For each disallowed transaction, the | ||
agency shall request repayment in full from the program | ||
participant. Pending repayment, no additional program funding may | ||
be transferred to the participant's account. If repayment is not | ||
made on or before the 30th day after the request for repayment is | ||
made, the commissioner shall close the account. | ||
(d) A program participant may request agency approval of an | ||
expense that was not preapproved by the agency. An approval request | ||
under this subsection is only effective if: | ||
(1) made in writing using the proper form provided by | ||
the agency; and | ||
(2) submitted to the agency before or concurrently | ||
with the submission of the relevant expense report. | ||
(e) Repeated violations of expense reporting requirements | ||
by a program participant, whether intentional or unintentional, may | ||
constitute grounds for the commissioner to declare the participant | ||
ineligible for the program. | ||
Sec. 29.362. AUDITING OF ACCOUNT. The agency shall audit | ||
accounts as needed to ensure compliance with applicable law and the | ||
requirements of the program. At a minimum, the agency shall conduct | ||
one random audit of each account annually. In auditing an account, | ||
the agency may require that a program participant provide further | ||
information and documentation regarding any transaction on the | ||
participant's account. | ||
Sec. 29.363. SUSPENSION OF ACCOUNT. The commissioner shall | ||
suspend the account of any program participant who fails to comply | ||
with applicable law or a requirement of the program, including the | ||
terms of an agreement under Section 29.354, or who commits a | ||
substantial misuse of program funds. The commissioner shall notify | ||
the participant in writing that the account has been suspended and | ||
that no further transactions will be allowed on or disbursements | ||
made from the account. The notification must specify the grounds | ||
for the suspension and state that the participant has 10 business | ||
days to respond and take any corrective action ordered by the | ||
commissioner. Following the expiration of the 10-day period, the | ||
commissioner shall: | ||
(1) order permanent closure of the suspended account | ||
and declare the participant ineligible for the program; | ||
(2) order temporary reinstatement of the account, | ||
conditioned on the performance of specified action by the | ||
participant; or | ||
(3) order full reinstatement of the account. | ||
Sec. 29.364. TUITION AND FEES; REFUND PROHIBITED. (a) A | ||
participating private school may not: | ||
(1) charge a child participating in the program that | ||
attends the school a tuition amount greater than the standard | ||
tuition rate at the school; or | ||
(2) assess any additional charge, other than a fee | ||
that the board of trustees of a school district is authorized to | ||
charge under Section 11.158, for providing an educational program | ||
or service to the child. | ||
(b) A participating private school, institution of higher | ||
education, private tutor, vendor, or other provider of education | ||
services under this subchapter may not in any manner refund to, | ||
credit to, share with, or rebate to a program participant, or any | ||
person on behalf of a participant, any program funds paid or owed by | ||
the participant to the school, institution, tutor, vendor, or | ||
provider. | ||
Sec. 29.365. REFERRAL TO THE ATTORNEY GENERAL. If the | ||
agency obtains evidence of fraudulent use of an account, the | ||
commissioner may refer the case to the attorney general for | ||
investigation and prosecution. | ||
Sec. 29.366. SCHOOL ADMISSIONS. (a) A participating | ||
private school may not refuse to enroll a child participating in the | ||
program on the basis of the child's residence, race, national | ||
origin, ethnic background, religion, disability, or academic | ||
achievement. | ||
(b) A participating private school may refuse to enroll a | ||
child participating in the program if the child: | ||
(1) has been expelled from a public or private school | ||
at any time; or | ||
(2) has a criminal record. | ||
(c) A participating private school may not consider the | ||
athletic ability of a child participating in the program in any | ||
admissions process relating to the child. | ||
(d) A participating private school may give admissions | ||
preference to a currently enrolled child participating in the | ||
program to achieve continuity and to siblings of a currently | ||
enrolled child or children residing in the same household as a | ||
currently enrolled child for the convenience of the parents of | ||
those children. | ||
Sec. 29.367. PROVIDER ACCOUNTABILITY. (a) A | ||
participating private school must: | ||
(1) comply with all applicable state or federal health | ||
and safety laws; | ||
(2) hold a valid occupancy permit, if required by the | ||
political subdivision in which the school is located; and | ||
(3) certify to the agency that the school has complied | ||
with the conditions imposed by Section 29.366 and this section. | ||
(b) A participating private school must conduct a criminal | ||
background check on each school employee or prospective employee. | ||
The school shall terminate or exclude from employment any person: | ||
(1) ineligible under state law to work at the school; | ||
and | ||
(2) who, in the judgment of the school's management, | ||
may pose a threat to the safety of students at the school. | ||
(c) The agency may declare a participating private school, | ||
institution of higher education, private tutor, vendor, or other | ||
provider of education services ineligible for the program if, after | ||
notice and hearing, the agency finds that the school, institution, | ||
tutor, vendor, or provider has: | ||
(1) failed to comply with applicable law or the | ||
requirements of the program; or | ||
(2) failed to provide a child participating in the | ||
program with promised educational services. | ||
(d) If the agency makes a declaration of ineligibility under | ||
Subsection (c), it shall: | ||
(1) immediately notify program participants of the | ||
declaration of ineligibility; and | ||
(2) disapprove any account expenditure made to the | ||
school, institution, tutor, vendor, or provider after the date of | ||
the declaration of ineligibility. | ||
(e) Establishment of the program does not expand the | ||
regulatory authority of the agency or any school district to impose | ||
additional regulation on a private school, private tutor, or other | ||
provider of private education services under the program beyond | ||
what is necessary to enforce the requirements of the program. | ||
Neither the agency nor any school district may in any way regulate | ||
the educational program of a private school, private tutor, or | ||
other provider of private education services under the program. | ||
Sec. 29.368. BOND REQUIRED. (a) Except as provided by | ||
Subsection (c), prior to the start of each school year, a | ||
participating private school that anticipates receiving $50,000 or | ||
more in tuition and fees from students participating in the program | ||
during the school year must file a corporate surety bond with the | ||
commissioner in an amount equal to the total amount of the | ||
anticipated tuition and fees. | ||
(b) A bond issued under Subsection (a) must be: | ||
(1) issued in a form approved by the commissioner; | ||
(2) issued by a company authorized to do business in | ||
this state; | ||
(3) payable to the state to be used only for repayment | ||
of any funds received by the school under the program; | ||
(4) conditioned on the compliance of the school and | ||
its officers, agents, and employees with this subchapter and rules | ||
adopted under this subchapter; and | ||
(5) issued for a period corresponding to the school | ||
year. | ||
(c) The commissioner may waive the bond filing requirement | ||
under Subsection (a) for any participating private school that | ||
provides to the agency financial information demonstrating, to the | ||
commissioner's satisfaction, that the school has the ability to | ||
repay the total amount of tuition and fees the school anticipates | ||
receiving from students participating in the program during the | ||
school year. | ||
Sec. 29.369. STUDENT RECORDS. The school district that a | ||
child participating in the program would otherwise attend shall | ||
provide to the child's parent or, if applicable, to a participating | ||
private school the child attends, a complete copy of the child's | ||
school records. This subsection does not require or authorize the | ||
release of information except in conformity with the Family | ||
Educational Rights and Privacy Act of 1974 (20 U.S.C. Section | ||
1232g). | ||
Sec. 29.370. ANNUAL SURVEY. The agency shall annually | ||
request that a parent of each child participating in the program | ||
complete a written survey that solicits the parent's: | ||
(1) overall level of satisfaction with the program; | ||
and | ||
(2) opinion on specified topics and issues relevant to | ||
the effectiveness of the program. | ||
SECTION 2. This Act applies beginning with the 2015-2016 | ||
school year. | ||
SECTION 3. Not later than 45 days after the effective date | ||
of this Act, the commissioner of education, the State Board of | ||
Education, the commissioner of higher education, and the | ||
comptroller of public accounts shall adopt rules, procedures, and | ||
forms necessary to implement the education savings account program | ||
under Subchapter J, Chapter 29, Education Code, as added by this | ||
Act, and to: | ||
(1) calculate annually the savings to the state from | ||
the implementation of the program; and | ||
(2) prevent fraud in financial transactions under the | ||
program, including measures to permit anonymous fraud reporting by | ||
telephone hotline or online communication. | ||
SECTION 4. (a) Except as provided by Subsection (b) of | ||
this section: | ||
(1) this Act takes effect immediately if it receives a | ||
vote of two-thirds of all the members elected to each house, as | ||
provided by Section 39, Article III, Texas Constitution; and | ||
(2) if this Act does not receive the vote necessary for | ||
immediate effect, this Act takes effect September 1, 2015. | ||
(b) Section 29.358(c), Education Code, as added by this Act, | ||
takes effect September 1, 2018. |