New Mexico 2025 Regular Session

New Mexico House Bill HB387 Compare Versions

Only one version of the bill is available at this time.
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2828 HOUSE BILL 387
2929 57
3030 TH LEGISLATURE
3131 -
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3333 STATE
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3535 OF
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3939 MEXICO
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4242 FIRST SESSION
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4545 2025
4646 INTRODUCED BY
4747 Rebecca Dow and Luis M. Terrazas and Jimmy G. Mason
4848 and Rod Montoya
4949 AN ACT
5050 RELATING TO EDUCATION; ENACTING THE EDUCATION OPPORTUNITY
5151 ACCOUNT ACT; PROVIDING POWERS AND DUTIES; PROVIDING FOR
5252 EDUCATION OPPORTUNITY ACCOUNTS; PROVIDING ALLOWABLE USES;
5353 PROVIDING PROCEDURES AND APPLICATION REQUIREMENTS FOR PARENTS
5454 AND EDUCATION SERVICE PROVIDERS; CREATING A REVIEW COMMISSION;
5555 MAKING APPROPRIATIONS.
5656 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
5757 SECTION 1. A new section of the Public School Code is
5858 enacted to read:
5959 "[NEW MATERIAL] SHORT TITLE.--This act may be cited as the
6060 "Education Opportunity Account Act"."
6161 SECTION 2. A new section of the Public School Code is
6262 enacted to read:
6363 "[NEW MATERIAL] DEFINITIONS.--As used in the Education
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9191 Opportunity Account Act:
9292 A. "curriculum" means a complete course of study
9393 for a particular primary or secondary content area or grade
9494 level;
9595 B. "education" means a primary or secondary
9696 education;
9797 C. "education opportunity account" means the
9898 account into which money is deposited by the department to pay
9999 for qualifying education expenses of a participating student;
100100 D. "education service provider" means a private
101101 school located in New Mexico that is qualified to provide
102102 educational goods and services to participating students and
103103 that receives payments from education opportunity accounts;
104104 provided that "education service provider" does not mean an
105105 online school;
106106 E. "eligible student" means a school-age person who
107107 is a resident of New Mexico, who has not received a high school
108108 diploma or a high school equivalency credential and who is
109109 eligible for enrollment or re-enrollment in a public school;
110110 F. "participating student" means a student who is
111111 participating in the program; and
112112 G. "program" means the education opportunity
113113 account program."
114114 SECTION 3. A new section of the Public School Code is
115115 enacted to read:
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144144 "[NEW MATERIAL] EDUCATION OPPORTUNITY ACCOUNT PROGRAM--
145145 CREATED--FUNDING USES.--
146146 A. The "education opportunity account program" is
147147 created in the department to allow the department, in contract
148148 with parents of participating students, to pay for private
149149 school and other eligible expenses through "education
150150 opportunity accounts". The department:
151151 (1) shall establish education opportunity
152152 accounts for students who qualify for the program;
153153 (2) shall determine the amount each
154154 participating student is eligible to receive, which amount is
155155 equal to the average amount spent by school districts and
156156 charter schools on public school students in the same grade,
157157 weighted by special education and at-risk program units, if
158158 applicable; provided that a participating student shall not
159159 receive more than the student's qualifying educational
160160 expenses;
161161 (3) shall make monthly deposits into each
162162 education opportunity account; and
163163 (4) may contract for financial management
164164 services for education opportunity accounts.
165165 B. Money in a participating student's education
166166 opportunity account shall be used by the department, in
167167 contract with parents of participating students, only in
168168 accordance with the provisions of the Education Opportunity
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197197 Account Act and only for the following qualifying education
198198 expenses:
199199 (1) tuition and fees at a private elementary
200200 or secondary school that teaches, among other courses, reading,
201201 language arts, mathematics, science and social studies
202202 appropriate for the grade level of the participating student;
203203 (2) tutoring services provided by a qualified
204204 person;
205205 (3) textbooks and other instructional
206206 materials, including computer hardware and software, required
207207 by the education service provider to deliver education to the
208208 participating student;
209209 (4) fees for nationally standardized
210210 assessments, advanced placement examination fees and other
211211 assessments required by the education service provider;
212212 (5) tuition or fees for summer and after-
213213 school elementary or secondary programs;
214214 (6) public transportation to and from school;
215215 and
216216 (7) other educational charges approved by the
217217 department.
218218 C. The department and the parent of a participating
219219 student shall enter into an annual contract that specifies what
220220 qualifying education expenses will be purchased each semester
221221 or other term, the cost of the educational services to be
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250250 provided and by whom the educational services will be provided.
251251 The department shall not deposit into an education opportunity
252252 account more than the combined cost of educational services
253253 provided to the participating student in that year. A parent
254254 shall not pay more for educational services than the parent of
255255 a similarly situated school-age person pays. Money in an
256256 education opportunity account shall not be refunded, rebated or
257257 shared with a parent or participating student in any manner. A
258258 refund or rebate for educational services purchased through an
259259 education opportunity account shall be credited directly to
260260 that account. A parent may make payments for the cost of
261261 educational services not covered by an education opportunity
262262 account, but in no case shall a parent deposit personal funds
263263 into a participating student's account.
264264 D. Money in a participating student's education
265265 opportunity account shall be issued at the direction of the
266266 participating student's parent to an education service
267267 provider, in the name of the student.
268268 E. If an education service provider requires
269269 partial payment of tuition or fees prior to the start of the
270270 academic year to reserve space for a participating student
271271 admitted to the education service provider, such partial
272272 payment may be paid by the department prior to the start of the
273273 school year in which the education opportunity account is
274274 awarded and deducted in an equitable manner from subsequent
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303303 monthly account deposits to ensure that adequate funds remain
304304 available throughout the school year; provided that if the
305305 participating student does not attend the education service
306306 provider to which partial payment was made, the partial payment
307307 shall be returned to the department by the education service
308308 provider for credit to the account.
309309 F. Funds deposited in an education opportunity
310310 account shall not constitute taxable income for state tax
311311 purposes of the parent or the participating student.
312312 G. Except as provided in Subsection H of this
313313 section, any unexpended or unencumbered balance in an education
314314 opportunity account may remain in the account until one of the
315315 following occurs, at which time the department shall close the
316316 account and the unexpended or unencumbered balance shall revert
317317 to the general fund:
318318 (1) the parent withdraws the participating
319319 student from the program;
320320 (2) the student graduates from high school; or
321321 (3) the account is closed by the department
322322 because of misuse of funds as determined by the department.
323323 H. The department shall revert unexpended or
324324 unencumbered balances every two years unless it waives the
325325 reversion of a specific education opportunity account for
326326 extenuating circumstances.
327327 I. Nothing in the Education Opportunity Account Act
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356356 shall be construed to require a participating student to be
357357 enrolled only in a private school, but the participating
358358 student must be in compliance with the Attendance for Success
359359 Act."
360360 SECTION 4. A new section of the Public School Code is
361361 enacted to read:
362362 "[NEW MATERIAL] EDUCATION OPPORTUNITY ACCOUNT--APPLICATION
363363 PROCESS--RENEWAL--SUSPENSION.--
364364 A. A parent may apply to the department to
365365 establish an education opportunity account for an eligible
366366 student.
367367 B. The department shall accept and approve
368368 applications year-round and shall establish procedures and
369369 rules for approving applications in an expeditious manner.
370370 C. The department shall create a standard form that
371371 parents shall submit to establish a student's eligibility for
372372 the program and shall ensure that the application is publicly
373373 available and may be submitted through various sources,
374374 including the internet.
375375 D. The department shall approve an application for
376376 an education opportunity account if:
377377 (1) the parent submits an application for an
378378 education opportunity account in accordance with the
379379 application procedures established by the department;
380380 (2) the student, on whose behalf the parent is
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409409 applying, is an eligible student;
410410 (3) funds are available for the program or the
411411 education opportunity account; and
412412 (4) the parent signs a contract with the
413413 department agreeing:
414414 (a) to provide an education for the
415415 participating student in at least the subjects of reading,
416416 language arts, mathematics, science and social studies;
417417 (b) not to enroll the student as a
418418 full-time student in a public school while participating in the
419419 program;
420420 (c) to use the funds in the education
421421 opportunity account only for qualifying education expenses to
422422 educate the student; and
423423 (d) to comply with the rules and
424424 requirements of the program.
425425 E. The department shall annually renew a student's
426426 education opportunity account if funds are available.
427427 F. Upon notice to the department, a participating
428428 student may choose to stop receiving education opportunity
429429 account funding and enroll full time in a public school.
430430 Enrolling as a full-time student in a public school shall
431431 result in the immediate suspension of payment of additional
432432 funds into the student's education opportunity account;
433433 provided that, for education opportunity accounts that have
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462462 been open for at least one full school year, the department may
463463 allow an education opportunity account to remain open and
464464 active for the parent to pay qualifying education expenses to
465465 educate the student from money remaining in the account. The
466466 department shall revert unexpended or unencumbered balances in
467467 a student's education opportunity account and close the
468468 education opportunity account at the beginning of the next
469469 school year if the student is enrolled in a public school.
470470 G. If an eligible student decides to return to the
471471 program, payments into the student's education opportunity
472472 account may resume if the education opportunity account is
473473 still open and active. A new education opportunity account may
474474 be established if the student's education opportunity account
475475 is closed.
476476 H. The department may adopt rules to provide the
477477 least disruptive process for a student who chooses to stop
478478 participating in the program and enroll full time in a public
479479 school."
480480 SECTION 5. A new section of the Public School Code is
481481 enacted to read:
482482 "[NEW MATERIAL] ADDITIONAL POWERS AND DUTIES--ALLOWABLE
483483 USES OF FUNDS--EDUCATION SERVICE PROVIDERS.--
484484 A. The department shall:
485485 (1) maintain an updated list of qualified
486486 education service providers and ensure that the list is
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515515 publicly available through various sources, including the
516516 internet;
517517 (2) provide parents with a written explanation
518518 of the allowable uses of education opportunity account funds,
519519 the responsibilities of parents in ensuring the education of
520520 their children, the duties of the department and the role of
521521 any private financial management firms or other private
522522 organizations that the department may contract with to
523523 administer the program or any aspect of the program;
524524 (3) ensure that parents of students with
525525 disabilities receive notice that participation in the program
526526 is a parental placement pursuant to the federal Individuals
527527 with Disabilities Education Act, along with an explanation of
528528 the rights that parentally placed students may possess under
529529 federal law and any applicable state laws and rules;
530530 (4) implement a commercially viable, cost-
531531 effective and user-friendly system for processing payments for
532532 services from an education opportunity account to an education
533533 service provider by electronic or online funds transfer;
534534 provided that the department:
535535 (a) provides flexibility to parents by
536536 facilitating direct payments to education service providers as
537537 well as requests for preapproval of and reimbursements for
538538 qualifying education expenses; and
539539 (b) may contract with private
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568568 institutions to develop the payment system;
569569 (5) implement, as soon as practicable, a
570570 commercially viable, cost-effective and user-friendly system,
571571 as part of the same system that facilitates the electronic or
572572 online funds transfers, for parents to publicly rate, review
573573 and share information about education service providers;
574574 (6) continue making deposits into a student's
575575 education opportunity account until the:
576576 (a) department has been notified or
577577 determines that the student is no longer a participating
578578 student;
579579 (b) department determines that there was
580580 misuse of the funds in the education opportunity account;
581581 (c) student withdraws from the program;
582582 (d) student enrolls full time in a
583583 public school; or
584584 (e) student graduates from high school;
585585 (7) audit individual education opportunity
586586 accounts;
587587 (8) make a parent or participating student
588588 ineligible for the program in the event of misuse of education
589589 opportunity account funds; provided that if a parent is
590590 determined to be ineligible for the program and the
591591 participating student is free from personal misconduct, that
592592 student may be eligible for an education opportunity account if
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621621 placed with a new guardian or other person with the legal
622622 authority to act on behalf of the student;
623623 (9) refer suspected cases of misuse of
624624 education opportunity account funds to law enforcement if
625625 evidence of fraudulent use of education opportunity account
626626 funds exists;
627627 (10) create procedures to ensure that a fair
628628 process exists to determine whether a misuse of education
629629 opportunity account funds has occurred; and
630630 (11) create procedures to ensure that a fair
631631 process exists to determine whether an education service
632632 provider may be barred from receiving payments from education
633633 opportunity accounts; provided that an education service
634634 provider may appeal the department's decision to bar the
635635 education service provider from receiving payments from
636636 education opportunity accounts; and provided further that if
637637 the department bars an education service provider from
638638 receiving payments, the department shall notify parents of
639639 participating students of the department's decision.
640640 B. The department may:
641641 (1) contract with private organizations to
642642 administer the program or specific functions of the program,
643643 including contracting with private financial management firms
644644 to manage education opportunity accounts;
645645 (2) withhold from deposits or deduct from an
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674674 education opportunity account an amount to cover the costs of
675675 administering the program, in an amount up to a maximum of five
676676 percent annually in the first two years of the program and up
677677 to a maximum of three percent annually thereafter;
678678 (3) bar an education service provider from
679679 accepting payments from education opportunity accounts if the
680680 department determines that the education service provider has:
681681 (a) substantially misrepresented
682682 information or failed to refund any overpayments in a timely
683683 manner; or
684684 (b) failed to provide participating
685685 students with sufficient educational goods or services;
686686 (4) accept gifts, grants and donations from
687687 any source to cover administrative costs, to inform the public
688688 about the program or to fund additional education opportunity
689689 accounts; and
690690 (5) adopt rules in accordance with the State
691691 Rules Act that are consistent with the Education Opportunity
692692 Account Act and necessary for the administration of that act,
693693 including rules:
694694 (a) establishing or contracting for the
695695 establishment of an online anonymous fraud reporting service;
696696 (b) establishing an anonymous telephone
697697 hotline for fraud reporting;
698698 (c) requiring a surety bond for
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727727 education service providers receiving more than one hundred
728728 thousand dollars ($100,000) in education opportunity account
729729 funds; or
730730 (d) for refunding payments from
731731 education service providers to education opportunity accounts."
732732 SECTION 6. A new section of the Public School Code is
733733 enacted to read:
734734 "[NEW MATERIAL] EDUCATION SERVICE PROVIDERS--
735735 APPLICATIONS--AUTONOMY--NOT ACTING FOR THE STATE.--
736736 A. The department by rule shall provide the
737737 application process and procedures for prospective education
738738 service providers to apply for listing as an eligible education
739739 service provider. An application form signed by a prospective
740740 education service provider warrants that the education service
741741 provider:
742742 (1) will not refund, rebate or share money
743743 from education opportunity accounts with parents or
744744 participating students and shall return refunds to the
745745 department; and
746746 (2) will provide the education services
747747 contained in the agreement entered into with a parent.
748748 B. An education service provider is not an agent of
749749 the state or federal government, a local school board or school
750750 district or governing authority or charter school. No action
751751 of an education service provider shall be construed as an
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780780 action by the state or any of its departments, institutions or
781781 political subdivisions.
782782 C. An education service provider shall not be
783783 required to alter its creed, practices, admissions policy or
784784 curriculum to accept payments pursuant to the Education
785785 Opportunity Account Act except as provided in that act."
786786 SECTION 7. A new section of the Public School Code is
787787 enacted to read:
788788 "[NEW MATERIAL] STUDENT RECORDS.--Upon being notified that
789789 a participating student is enrolled with an education service
790790 provider, a public school that previously enrolled the
791791 participating student shall provide the education service
792792 provider with the student's school records. The public school
793793 and the education service provider shall comply with the
794794 provisions of the federal Family Educational Rights and Privacy
795795 Act of 1974 when sharing student records."
796796 SECTION 8. A new section of the Public School Code is
797797 enacted to read:
798798 "[NEW MATERIAL] EDUCATION OPPORTUNITY REVIEW COMMISSION.--
799799 A. The department shall create the "education
800800 opportunity review commission" to assist the department in
801801 determining what expenditures meet the requirements to be
802802 considered qualifying education expenses to educate a
803803 participating student and to provide recommendations to the
804804 department on how to implement, administer and improve the
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833833 program.
834834 B. The education opportunity review commission
835835 shall consist of nine voting members who shall be:
836836 (1) five parents of participating students and
837837 represent no fewer than four counties of the state; and
838838 (2) four New Mexico licensed educators.
839839 C. The voting members shall be appointed by the
840840 secretary and shall serve at the pleasure of the secretary.
841841 The secretary, or the secretary's designee, shall serve as the
842842 nonvoting chair of the education opportunity review commission.
843843 D. The department may request that the education
844844 opportunity review commission meet, in person or through a
845845 virtual or telephonic platform, to:
846846 (1) determine whether an expenditure from an
847847 education opportunity account is or was a qualifying expense;
848848 and
849849 (2) review appeals of denials of an education
850850 service provider and make a recommendation to the secretary.
851851 E. When requested, the education opportunity review
852852 commission shall, by majority vote, recommend to the
853853 department:
854854 (1) if a particular use of funds constitutes a
855855 qualifying expense; and
856856 (2) if an education service provider should be
857857 allowed to receive, or continue receiving, payments from
858858 .229415.2
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886886 education opportunity accounts."
887887 SECTION 9. A new section of the Public School Code is
888888 enacted to read:
889889 "[NEW MATERIAL] REPORT TO LEGISLATURE AND GOVERNOR.--The
890890 department shall report to the legislature and the governor by
891891 December 1 of each year on the program and its participants.
892892 The report shall include the number, grades and ages of
893893 participating students and where they attend school or receive
894894 other educational services; the geographic distribution of
895895 participating students by county; other demographic and
896896 economic data about participating students and parents; the
897897 number and locations of education service providers, the
898898 services they provide and the number of students they serve;
899899 the total amount of deposits into education opportunity
900900 accounts and the cost of financial management contracts; the
901901 total expenditures for education service providers and the
902902 average cost of educational services being provided to
903903 participating students, by type of service and geographic
904904 region; and other information requested by the legislature or
905905 governor and considered reportable by the department."
906906 SECTION 10. A new section of the Public School Code is
907907 enacted to read:
908908 "[NEW MATERIAL] EDUCATION OPPORTUNITY ACCOUNT FUND--
909909 CREATED.--
910910 A. The "education opportunity account fund" is
911911 .229415.2
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939939 created in the state treasury. The fund consists of money
940940 appropriated by the legislature, federal money granted to the
941941 state for the purposes of the fund, income from investment of
942942 the fund and money otherwise accruing to the fund. Money in
943943 the fund shall not revert to any other fund at the end of a
944944 fiscal year. The department shall administer the fund, and
945945 money in the fund is appropriated to the department to carry
946946 out the purposes of the Education Opportunity Account Act.
947947 B. Money in the fund shall be disbursed on warrants
948948 signed by the secretary of the department pursuant to vouchers
949949 signed by the secretary or the secretary's authorized
950950 representative."
951951 SECTION 11. APPROPRIATIONS.--
952952 A. The following amounts are appropriated from the
953953 general fund to the education opportunity account fund for
954954 expenditure in fiscal year 2025 and subsequent fiscal years for
955955 the following purposes:
956956 (1) five hundred eighty thousand dollars
957957 ($580,000) for the public education department to administer
958958 the education opportunity account program; and
959959 (2) one hundred million dollars ($100,000,000)
960960 to carry out the purposes of the Education Opportunity Account
961961 Act.
962962 B. Any unexpended or unencumbered balance remaining
963963 at the end of a fiscal year shall not revert to the general
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992992 fund.
993993 SECTION 12. SEVERABILITY.--If any part or application of
994994 the Education Opportunity Account Act is held invalid, the
995995 remainder or its application to other situations or persons
996996 shall not be affected.
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