HB334INTRODUCED
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D7LUTT-1
By Representatives Garrett, Collins
RFD: Ways and Means Education
First Read: 18-Apr-23
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5 D7LUTT-1 04/13/2023 KMS (L)cr 2023-483
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SYNOPSIS:
This bill creates the Students with Unique Needs
(SUN) Education Scholarship Account Act and Program.
This bill would allow parents to use funds
deposited in education scholarship accounts of eligible
students, to provide an individualized education
program for their children.
A BILL
TO BE ENTITLED
AN ACT
To create the Students with Unique Needs (SUN)
Education Scholarship Account Act and Program; to allow
parents to use funds in an education scholarship account to
provide an individualized education program for their
children.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. This act shall be known and may be cited as
the Students with Unique Needs (SUN) Education Scholarship
Account Act.
Section 2. As used in this act, the following terms
shall have the following meanings:
(1) EDUCATION SERVICE PROVIDER. A licensed and
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accredited program or service providing educational services
for students and approved by the State Department of
Education.
(2) ELIGIBLE STUDENT. A student under 19 years of age
who was enrolled in and attended a public K-12 school in this
state during the previous school year, except as otherwise
provided in paragraph a., and who is any of the following:
a. The child of a parent who is a member of the Armed
Forces of the United States, who is on active duty or was
killed in the line of duty, and who may or may not have been
enrolled in or attended a public K-12 school in the state
during the previous school year.
b. A student who has an individual education plan or
504 accommodation issued according to Section 504 of the
Rehabilitation Act of 1973, including, but not limited to, a
student who has an intellectual disability or is speech or
language impaired, deaf or hard of hearing, visually impaired,
dual sensory impaired, physically impaired, emotionally
handicapped, specific learning disabled, autistic, or
hospitalized or home bound because of illness or disability.
c. A foster child who has achieved permanency through
adoption or guardianship.
d. Homeless and lacks fixed, regular, and adequate
housing.
(3) PARENT. A resident of this state who is the parent,
guardian, custodian, or other individual with authority to act
on behalf of a child.
(4) PARTICIPATING SCHOOL. A private school that
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provides education to K-12 students and has notified the State
Department of Education of its intention to participate in the
program and comply with the requirements of the program.
(5) PRIVATE TUTORING. Tutoring services provided by
tutors who are accredited by a regional or national
accrediting organization.
(6) PROGRAM. The Students with Unique Needs (SUN)
Education Scholarship Program.
(7) RESIDENT SCHOOL DISTRICT. The public school
district in which the student resides.
Section 3. (a) The Students with Unique Needs (SUN)
Education Scholarship Account Program is created and shall be
implemented commencing with the 2024-2025 school year. To
participate in the program, the parent of an eligible student
shall sign an agreement to do all of the following:
(1) Provide an education for the eligible student in at
least the subjects of reading, grammar, mathematics, social
studies, science, and computer science.
(2) Refrain from enrolling the eligible student in a
charter school.
(3) Refrain from enrolling or participating in the
educational scholarship program provided through the Alabama
Accountability Act of 2013.
(4) Refrain from enrolling in a public school unless it
is for specific contracted services pursuant to subdivision
(b)(8).
(b) Each parent participating in the program shall
agree to use the funds in his or her eligible student's
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education scholarship account for the following qualifying
expenses:
(1) Tuition and fees at a participating school.
(2) Textbooks required by a participating school.
(3) Payments for private tutoring.
(4) Payments for the purchase of curricula or
instructional materials.
(5) Tuition and fees for an approved nonpublic online
learning program.
(6) Fees for statewide assessments, advanced placement
examinations, or related courses, fees associated with
state-recognized industry examinations, and any examinations
related to college or university admission.
(7) Education services for students with disabilities
from a licensed or accredited practitioner or education
service provider.
(8) Contracted services provided by a public school
district including specific classroom instruction.
(c) The amount the state shall deposit into an
education scholarship account for a participating eligible
student shall be 95 percent of the gross state Foundation
Program cost-per-student for a public K-12 student during the
applicable tax year.
(d) A participating school, private tutor, or other
education service provider may not refund, rebate, or share
any portion of a student's education scholarship account with
a parent or the student in any manner. The funds in an
education scholarship account may only be used for qualifying
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expenses.
(g) Funds received pursuant to this section may not be
considered taxable income of a parent.
(h) Eligible students who were previously enrolled in
the program shall have priority for renewal in the program.
Section 4. The program shall be limited to 500 students
for the 2024-2025 school year, with new enrollment limited to
500 additional students each school year thereafter. Subject
to appropriations from the Education Trust Fund, the education
scholarship account of a student shall be funded according to
subsection (c) of Section 3.
Section 5. (a) The Department of Revenue shall adopt
rules as necessary for the administration of the program.
(b) The Department of Revenue shall establish education
scholarship accounts for eligible students by doing all of the
following:
(1) Receiving applications and determining student
eligibility in accordance with this section. Upon receipt of
an application, the Department of Revenue shall provide to the
State Department of Education information relating to the
student which will allow the State Department of Education to
include the student for funding.
(2) Establishing and maintaining separate accounts for
each eligible student.
(3) Verifying qualifying expenditures.
(4) Returning any unused funds to the State Department
of Education when a student is no longer eligible for an
education scholarship account. The funds returned to the State
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Department of Education shall be allocated to the resident
school district of the student.
(c) Program payments made pursuant to this section
shall continue until a participating student enrolls in a
public school or graduates from high school. Purchasing
contracted services from a public school system pursuant to
subdivision (b)(8) of Section 3 does not constitute
enrollment.
(d) The Department of Revenue shall receive five
percent of funds not deposited into an education scholarship
account pursuant to subsection (c) of Section 3, as costs for
administering the program.
(e) Participating schools and education service
providers shall submit reports quarterly to the Department of
Revenue detailing the number of students participating,
services provided, and other information requested by the
Department of Revenue.
(f) To avoid duplicate payments, the Department of
Revenue shall compare the list of participating students with
the public school enrollment lists provided by the State
Department of Education before each program payment is made.
(g) The Department of Revenue shall conduct or contract
for the auditing of individual education scholarship accounts.
At a minimum, the Department of Revenue shall conduct random
audits of education scholarship accounts annually and, if a
misuse of funds in an education scholarship account is
discovered, may prohibit further participation by the parent
in the program.
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(h) If evidence of fraudulent use of an account is
found, the Department of Revenue shall refer the case to local
or state law enforcement agencies for further investigation.
Section 6. (a) The State Department of Education shall
do all of the following:
(1) Create, or contract for the creation of, a standard
application form for parents of eligible students to submit to
the Department of Revenue to establish their student's
eligibility for the program and ensure the form is readily
available through various sources, including the Internet.
(2) Provide to parents of participating students a
written explanation of qualifying expenses, their
responsibilities under the program, and the duties and
responsibilities of the State Department of Education.
(3) Maintain and routinely update the list of approved
education service providers on the State Department of
Education website.
(4) Comply with all student privacy laws.
(5) Collect test results.
(6) Provide test results, associated learning gains,
and graduation rates to the public on the State Department of
Education website commencing with the fourth year of test and
graduation related data collection. The information shall be
aggregated by the grade level, gender, family income level,
number of years of participation in the program, and race of
the student.
(7) Provide graduation rates to the public on the State
Department of Education website commencing with the fourth
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year of test and test related data collection.
Section 7. (a) To ensure that funds are spent
appropriately, the Department of Revenue shall adopt rules and
policies necessary for the auditing of education scholarship
accounts.
(b)(1) The Department of Revenue shall develop a system
for the payment of benefits including, but not limited to,
allowing private schools and education service providers to
invoice the Department of Revenue for qualified expenses or
allowing the parent or guardian who submitted the program
application to seek reimbursement for qualified expenses.
(2) The Department of Revenue may make direct payments
to private schools and education service providers or
reimbursement to the parent or guardian who submitted the
program application pursuant to a check, warrant, electronic
funds transfer, or any other means of payment deemed by the
Department of Revenue to be commercially viable or cost
effective. The system shall provide maximum flexibility to
parents by facilitating requests for preapproval of and
reimbursements for qualifying expenses.
(3) The Department of Revenue may also provide, by
rule, for the payment of education service providers on a
quarterly or annual basis.
(c) The Department of Revenue shall adopt a process for
removing private school education service providers that
defraud parents and for referring cases of fraud to law
enforcement.
(d) The Department of Revenue shall establish or
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contract for the establishment of an online anonymous fraud
reporting service.
(e) The Department of Revenue shall establish or
contract for the establishment of an anonymous telephone
hotline for fraud reporting.
Section 8. (a) The Department of Revenue shall be
subject to the Alabama Administrative Procedure Act, Chapter
22, Title 41, Code of Alabama 1975, and shall ensure that fair
processes exist to determine whether an intentional or
substantial misuse of the program funds have occurred.
(b) The Department of Revenue shall conduct or contract
for audits of education service providers or any other
recipients of education scholarship account funds where there
is evidence of misuse of funds or other violations of the
program.
(c) The Department of Revenue may bar a private school,
an education service provider, or other recipient of education
scholarship account funds from accepting payments from
education scholarship accounts if the Department of Revenue
determines the private school has done any of the following:
(1) Misrepresented information, obtained education
scholarship account funds by fraud, or failed to refund any
over payments in a timely manner.
(2) Failed to provide an eligible student with the
educational services funded by the education scholarship
account.
(3) Routinely failed to comply with the accountability
standards established in this act.
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(d) If a participating school or education services
provider is barred from the program, the State Department of
Education shall notify eligible students and their parents of
the decision as soon as practicable. The State Department of
Education shall coordinate the prohibition to coincide with
the end of the academic school year. Parents, participating
students, education service providers, and other recipients of
education scholarship account funds may make an administrative
appeal of the Department of Revenue decision.
Section 9. (a) To ensure that each student is treated
fairly and kept safe, all participating schools and education
service providers shall do all of the following:
(1) Comply with all health and safety laws or codes
that apply to private schools.
(2) Comply with the same financial and academic
accountability requirements of a public school system.
(3) Hold a valid occupancy permit if required by the
municipality where the school is located.
(4) Certify that the school complies with the
nondiscrimination policies set forth in 42 U.S.C. § 1981.
(5) Comply with the Alabama Child Protection Act of
1999, Chapter 22A of Title 16, Code of Alabama 1975.
(b) To ensure that funds are spent appropriately, all
participating schools shall do the following:
(1) Provide parents with a receipt for all qualifying
expenses at the school.
(2) Demonstrate financial viability by showing that any
funds that may be provided from an education scholarship
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account may be repaid by doing all of the following:
a. Filing with the Department of Revenue prior to the
start of the school year a surety bond payable to the state in
an amount equal to the aggregate amount of the funds from
education scholarship accounts expected to be paid during the
school year from eligible students admitted at the
participating school.
b. Filing with the Department of Revenue prior to the
start of the school year financial information that
demonstrates the school has the ability to pay an aggregate
amount equal to the amount of the funds from education
scholarship accounts expected to be paid during the school
year to eligible students admitted to the participating
school.
(c) In order to allow parents and taxpayers to measure
the achievements of the program, parents shall ensure all of
the following:
(1) Each year their eligible student takes the state
achievement test at their resident school district. Students
with disabilities for whom standardized testing is not
appropriate, as outlined in their individualized education
plan, are exempt from this requirement.
(2) Provide the results of these tests to the
Department of Revenue on an annual basis, beginning with the
first year of testing.
(3) That student information is reported in a way which
allows the State Department of Education to aggregate data as
required by this act.
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(4) Inform the State Department of Education of an
eligible student's graduation from high school.
Section 10. The resident school district shall provide
a participating school or education service provider that has
admitted an eligible student under the program with the
complete copy of the eligible student's school records, while
complying with the Family Educational Rights and Privacy Act
of 1974, 20 U.S.C. § 1232g.
Section 11. Nothing in this act shall alter, amend, or
limit the application of the Alabama High School Athletic
Association's constitution and bylaws to member schools.
Section 12. This act shall become effective on the
first day of the third month following its passage and
approval by the Governor, or its otherwise becoming law.
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