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North Dakota Senate Bill SB2400

North Dakota 2025-2026 Regular Session

North Dakota Senate Bill SB2400 Compare Versions

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1-25.1334.04007
2-Title.06000
3-Adopted by the House Education
4-Committee
1+25.1334.05000
52 Sixty-ninth
6-April 2, 2025
73 Legislative Assembly
84 of North Dakota
95 Introduced by
106 Senators Axtman, Hogue, Sickler, Myrdal
117 Representatives Bosch, M. Ruby
128 (Approved by the Delayed Bills Committee)
13-A BILL for an Act to create and enact a new section to chapter 12.1-23 and chapter to
14-title 15.115.1-27.1 of the North Dakota Century Code, relating to the creation of a criminal
15-offense for the misuse of education savings account funds and the establishment of the
16-education savings account program; to amend and reenact section 15.1-20-02 of the North
17-Dakota Century Code, relating to exceptions to compulsory school attendance; to provide a
18-penalty; to provide a continuingan appropriation; and to provide ana continuing appropriation.
9+A BILL for an Act to create and enact a new chapter to title 15.1 of the North Dakota Century
10+Code, relating to the establishment of the education savings account program; and to provide
11+an appropriation.
1912 BE IT ENACTED BY THE LEGISLATIVE ASSEMBLY OF NORTH DAKOTA:
20-SECTION 1. A new section to chapter 12.1-23 of the North Dakota Century Code is created
21-and enacted as follows:
22- Misuse of education savings account funds - Penalty.
23- 1. A person is guilty of an offense under this section if the person:
24- a. Spends the funds in an education savings account for an expense the person
25-knows is not a qualified education expense; or
26- b. Intentionally fails to provide an eligible student with the educational services
27-funded by the education savings account.
28- 2. An offense under this section is:
29- a. A class A felony if the value of the funds spent or the educational services not
30-provided exceeds fifty thousand dollars;
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13+SECTION 1. A new chapter to title 15.1 of the North Dakota Century Code is created and
14+enacted as follows:
15+Definitions.
16+As used in this chapter:
17+1."Eligible student" means an elementary or secondary student attending public school
18+or private school or receiving home education who is a resident of this state and
19+eligible to attend a public school, including a student who has received a scholarship
20+under the education savings account program, if the student has not graduated from
21+high school or reached twenty - one years of age.
22+2."Parent" means parent or legal guardian.
23+3."Qualified educational expenses" means:
24+a.Tuition and fees at a nonpublic school;
25+b.Textbooks, fees, or payments for educational therapies, including tutoring or
26+cognitive skills training;
27+c.Curriculum fees, software, and materials for a course of study for a specific
28+subject matter or grade level;
29+d.Tuition or fees for nonpublic online education programs;
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3231 REENGROSSED SENATE BILL NO. 2400
3332 SECOND ENGROSSMENT
34-PROPOSED AMENDMENTS TO
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54- b. A class B felony if the value of the funds spent or the educational services not
55-provided exceeds ten thousand dollars but does not exceed fifty thousand
56-dollars;
57- c. A class C felony if the value of the funds spent or the educational services not
58-provided exceeds one thousand dollars but does not exceed ten thousand
59-dollars;
60- d. A class A misdemeanor if the value of the funds spent or the educational services
61-not provided exceeds five hundred dollars but does not exceed one thousand
62-dollars; or
63- e. A class B misdemeanor in all other cases.
64- SECTION 2. A new chapter to title 15.1 of the North Dakota Century Code is created and
65-enacted as follows:
66-SECTION 2. Chapter 15.1-27.1 of the North Dakota Century Code is created and enacted
67-as follows:
68-15.1-27.1-01. Definitions.
69-As used in this chapter:
70-1."Education service provider" means a person approved to provide qualified education
71-services. The term does not include a participating school or a parent supervising
72-home education in accordance with chapter 15.1 - 23 .
73-2."Eligible student" means an elementary or secondary student who is a resident of this
74-state and eligible to attend a public school, including a student who has received a
75-scholarship under the education savings account program, if the student has not
76-graduated from high school or reached twenty - one years of age.
77-3."Parent" means parent or legal guardian.
78-4."Participating school" means a nonpublic school providing education to elementary
79-students, secondary students, or both, which has notified the administrator of the
80-school's intention to participate in the education savings account program and comply
81-with the education savings account program requirements.
82-5."Qualified educational expenses" means:
83-a.Tuition and fees at a nonpublic school;
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116-b.Textbooks, fees, or payments for educational therapies, including tutoring or
117-cognitive skills training;
118-c.Curriculum fees, software, and materials for a course of study for a specific
119-subject matter or grade level;
120-d.Tuition or fees for nonpublic online education programs;
12155 e.Tuition for vocational and life skills education approved by the superintendent of
12256 education;
12357 f.Education materials and services for students with disabilities from an accredited
12458 provider, including the cost of paraprofessionals and assistants who are trained in
12559 accordance with state law;
12660 g.Standardized test fees and advanced placement examinations or examinations
12761 related to postsecondary education admission or credentialing;
12862 h.Tuition or fees for dual-credit courses;
12963 i.Meals served to students in school buildings;
13064 j.Mental health assistance;
13165 k.Medical appointments necessary for educational benefit;
13266 l.Educational camps; and
13367 m.Qualified expenses as adopted by the superintendent of public instruction in
13468 administrative rules.
135-15.1-27.1-02. Education savings account fund - Establishment - Continuing
136-appropriation.
137-There is created in the state treasury an education savings account fund. The fund consists
138-of moneys appropriated to the superintendent of public instruction for the education savings
139-account program. Moneys in the fund are appropriated on a continuing basis for education
140-savings accounts.
141-15.1-27.1-03. Superintendent of public instruction - Administrator - Duties.
69+Superintendent of public instruction - Administrator - Account deposits - Federal
70+educational choice program.
14271 1.The superintendent of public instruction is the education savings account program
143-administrator, and shall:
144-a.Annually inform eligible students and parents of the schools participating in the
145-education savings account program ; .
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178-b.Create a standard application form a parent of an eligible student may submit to
179-establish the student's eligibility for the education savings account program. The
180-superintendent shall ensure the application is readily available to interested
181-families through various sources, including the department's website ; .
182-c.Execute a multimedia marketing program targeting eligible families, particularly
183-families below the state's median household income, informing the families about
184-the education savings account program and how to apply ; .
185-d.Establish a web and phone-based support system providing parents with
186-education savings account program application support and ongoing account
187-maintenance support ; .
188-e.Reduce potential waste, fraud, and abuse, and ensure that any technology
189-platform used for the program meets the state's highest security requirements,
190-including compliance ; and .
191-f.Report evidence of the misuse of education savings account funds to law
192-enforcement.
193- g. Inform the parent of a student with a disability under the Individuals with
194-Disabilities Education Act of 1990 [Pub. L. 91-230; 84 Stat. 121; 20 U.S.C. 1400
195-et seq.] if the parent spends the funds in the student's education savings account
196-on tuition or fees at a nonpublic school, the services received from the nonpublic
197-school constitute a parental placement and the protections under the Individuals
198-with Disabilities Education Act of 1990 no longer apply to the student.
199- h. Adopt rules to implement this chapter.
200-2.The superintendent of public instruction may:
201-a.Make and enter a contract with a third-party entity to administer and audit the
202-program, including allocating funds from each eligible student 's account for the
203-payment of qualified educational expenses by the eligible student 's parent ; .
204-b.Conduct audits or other reviews necessary to properly administer the program ;
205-and .
206-c.Bar a participating school or education service provider from the education
207-savings account program, if the superintendent determines the participating
208-school or education provider has:
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72+administrator.
73+2.For an eligible student , the superintendent of public instruction shall establish an
74+individual account for the eligible student and deposit any payment the student is
75+entitled to into the eligible student 's individual account no later than July fifteenth of
76+each year. The funds must be available immediately for the payment of qualified
77+educational expenses incurred by the parent for the eligible student during the fiscal
78+year.
79+3.Beginning with the school budget year beginning July 1, 2026, for each school year,
80+an eligible student :
81+a.Shall receive an education savings account payment of one thousand dollars , if
82+the eligible student 's household has an annual income less than or equal to three
83+hundred percent of the most recently revised poverty income guidelines
84+published by the United States department of health and human services; and
85+b.May receive any federal scholarship for educational choice.
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242-(1)Routinely failed to comply with the accountability standards established
243-under this chapter; or
244-(2)Failed to provide the eligible student with the educational services funded by
245-the education savings account.
246-15.1-27.1-04. Enrollment - Account deposits.
247-1.From January first to June thirtieth immediately preceding the school year for which
248-the education savings account payment is requested, the parent of an eligible student
249-may request an education savings account payment by submitting an application to
250-the superintendent of public instruction.
251-2.Within thirty days of submission of an application, the superintendent of public
252-instruction or third-party entity shall notify the parent whether the eligible student is
253-approved for the following school year and specify the amount of the education
254-savings account payment for the eligible student , if known at the time of the notice.
255-3.For an eligible student approved for an education savings account payment, the
256-superintendent of public instruction or third-party entity shall establish an individual
257-account for the eligible student in the education savings account fund and deposit the
258-payment into the eligible student 's individual account within thirty days following
259-submission of the application, but in any case no later than July fifteenth. The funds
260-must be available immediately for the payment of qualified educational expenses
261-incurred by the parent for the eligible student during the fiscal year.
262-4.A nonpublic participating school or other provider of qualified educational
263-expenses education service provider accepting payment from a parent using funds
264-from an eligible student 's individual account in the fund may not refund, rebate, or
265-share any portion of the payment with the parent or eligible student .
266-5.Moneys remaining in an eligible student 's individual account upon conclusion of the
267-fiscal year must be returned to the education savings account fund.
268-6.Beginning with the school budget year beginning July 1, 2026, for each school year,
269-an eligible student who:
270-a.Attends Is enrolled full-time in and attends a public school is eligible to receive an
271-education savings account payment of five hundred one thousand dollars.
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119+4.Notwithstanding any other provision of this chapter, the superintendent of public
120+instruction, parents, and eligible students shall comply with any federal law or rule
121+upon which receiving a federal scholarship for educational choice is contingent. The
122+education savings accounts under this chapter may be used to facilitate any federal
123+educational choice program.
124+SECTION 2. APPROPRIATION - SUPERINTENDENT OF PUBLIC INSTRUCTION -
125+EDUCATION SAVINGS ACCOUNT PROGRAM. There is appropriated out of any moneys in
126+the general fund in the state treasury, not otherwise appropriated, the sum of $3,000,000, or so
127+much of the sum as may be necessary, to the superintendent of public instruction for the
128+purpose of administering the education savings account program, for the biennium beginning
129+July 1, 2025, and ending June 30, 2027.
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304-b.Is enrolled full-time in and attends a nonpublic participating school , or who
305-participates in a home education program subject to subsection 9 and is enrolled
306-in courses at the center for distance education, is eligible to receive an education
307-savings account payment of:
308-(1)Three thousand five hundred dollars, if the eligible student 's household has
309-an annual income less than or equal to three hundred percent of the most
310-recently revised poverty income guidelines published by the United States
311-department of health and human services.
312-(2)Two thousand dollars, if the eligible student 's household has an annual
313-income greater than three hundred percent and less than or equal to five
314-hundred percent of the most recently revised poverty income guidelines
315-published by the United States department of health and human services.
316-(3)Five hundred O ne thousand dollars, if the eligible student does not qualify
317-under paragraph 1 or 2.
318-c.Participates in a home education program in accordance with chapter 15.1 - 23,
319-subject to subsection 9 is eligible to receive an education savings account
320-payment of five hundred one thousand dollars.
321- d. Attends a nonpublic school that is not a participating school is eligible to receive
322-an education savings account payment of five hundred dollars.
323-7.Education savings account payments may be approved for one school year and
324-applications must be submitted annually for payments in subsequent school years.
325-8.Funds deposited in an education savings account are not taxable income to the parent
326-or eligible student .
327- 9. A parent who submits an application for an education savings account for an eligible
328-student, which is approved by the superintendent of public instruction, may not file a
329-statement of intent under section 15.1 - 23 - 02. If a statement of intent is on file at the
330-time the application is approved, the approval of the application constitutes revocation
331-of the statement of intent. This chapter and related rules do not apply to a home
332-education student who is not participating in the program under this chapter.
333-15.1-27.1-05. Participating schools - Accountability standards - Autonomy .
334-1.A participating school shall:
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368-a.Comply with all health and safety laws or codes that apply to nonpublic schools.
369- b. Hold a valid occupancy permit if required by the city in which the school is
370-located.
371- c. Certify the school complies with the nondiscrimination policies under 42 U.S.C.
372-1981.
373- d. Conduct criminal background checks on employees.
374- e. Exclude from employment any individual who:
375- (1) Is not permitted by state law to work in a nonpublic school; or
376- (2) Might reasonably pose a threat to the safety of eligible student s.
377- f. b . Provide a parent with a receipt for all qualifying expenses at the school.
378-g. c . Demonstrate the school's financial viability, if the school will receive fifty thousand
379-dollars or more during the school year, by filing with the superintendent of public
380-instruction before the start of the school year:
381-(1)A surety bond payable to the state in an amount equal to the aggregate
382-amount of funds from education savings accounts the participating school
383-expects to receive; or
384-(2)Financial information demonstrating the school is able to pay an aggregate
385-amount equal to the amount of the funds from education savings accounts
386-the participating school expects to receive.
387- d. Administer state tests and assessments and comply with requirements in
388-accordance with sections 15.1 - 21 - 08, 15.1 - 21 - 09, and 15.1 - 21 - 10.
389-2. a. An eligible student using education savings account program funds for tuition
390-payments at a participating school shall take required state tests and assessments in
391-accordance with section 15.1 - 21 - 08 . This subsection does not apply to an eligible
392-student participating in a home education program subject to subsection 9 of section
393-15.1 - 27.1 - 04 who is enrolled in courses at the center for distance education .
394-b. 3. The superintendent of public instruction shall :
395- a. Shall compile and publish assessment results in accordance with sections
396-15.1 - 21 - 09 and 15.1 - 21 - 10.
397- c. The superintendent of public instruction shall
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430- b. Shall administer an annual parental satisfaction survey requesting each parent of
431-an eligible student receiving an education savings account program payment to
432-indicate the number of years the child has participated in the education savings
433-account program and express the parent's:
434-(1)Satisfaction with the education savings account program ; and .
435-(2)Opinions on other topics, items, or issues that may indicate the
436-effectiveness of the education savings account program.
437- c. May apply to a federal agency for supplemental funds for this program and may
438-create other education savings account programs in accordance with
439-requirements identified in a federal grant . The department of public instruction
440-may adopt rules to implement this subdivision . If there is a conflict between a
441-provision of this chapter and rules adopted to receive a federal grant under this
442-subdivision, the rules supersede this chapter.
443-3. 4. A participating school or education service provider is autonomous and not an agent of
444-the state or federal government. The superintendent may not regulate the educational
445-program of a participating school or education service provider that accepts funds from
446-an education savings account. The creation of the education savings account program
447-does not expand the regulatory authority of the state, its officers, or a school district
448-beyond the regulations necessary to enforce the requirements of the education
449-savings account program.
450-SECTION 3. AMENDMENT. Section 15.1-20-02 of the North Dakota Century Code is
451-amended and reenacted as follows:
452-15.1-20-02. Compulsory attendance - Exceptions.
453-1.Section 15.1-20-01 does not apply if the person having responsibility for the child
454-demonstrates to the satisfaction of the school board that:
455-a.The child is in attendance for the same length of time at an approved nonpublic
456-school;.
457-b.The child has completed high school;.
458-c.The child is necessary to the support of the child's family;.
459-d.A multidisciplinary team including the child's school district superintendent, the
460-director of the child's special education unit, the child's classroom teacher, the
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494-child's physician, and the child's parent has determined that the child has a
495-disability that renders attendance or participation in a regular or special education
496-program inexpedient or impracticable;.
497-e.The child is receiving home education; or under chapter 15.1 - 23.
498-f.The child is a military-connected student engaging in virtual instruction under
499-section 15.1-07-37 at the educational entity of the gaining or losing military
500-installation, a student with a medical condition unable to physically attend school,
501-or a student moving out of state and virtual instruction is allowed by the gaining
502-or losing educational entity.
503- g. The child is participating in a home education program and is participating in the
504-education savings account program under chapter 15.1 - 27.1 .
505-2.The period of virtual instruction under subdivision f of subsection 1 may not extend
506-beyond the current school year.
507-3.A decision by the board of a school district under subsection 1 is appealable to the
508-district court.
509-SECTION 4. APPROPRIATION - SUPERINTENDENT OF PUBLIC INSTRUCTION -
510-EDUCATION SAVINGS ACCOUNT PROGRAM. There is appropriated out of any moneys in
511-the general fund in the state treasury, not otherwise appropriated, the sum of $3,000,000, or so
512-much of the sum as may be necessary, to the superintendent of public instruction for the
513-purpose of administering the education savings account program, for the biennium beginning
514-July 1, 2025, and ending June 30, 2027.
515-SECTION 5. APPROPRIATION - SUPERINTENDENT OF PUBLIC INSTRUCTION -
516-EDUCATION SAVINGS ACCOUNT PROGRAM - LEGAL DEFENSE. There is appropriated out
517-of any moneys in the general fund in the state treasury, not otherwise appropriated, the sum of
518-$3,000,000, or so much of the sum as may be necessary, to the superintendent of public
519-instruction for the purpose of defending any lawsuit related to the education savings account
520-program under chapter 15.1-27.1, in which the state is a defendant, for the biennium beginning
521-July 1, 2025, and ending June 30, 2027.
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