By: Guillen, Marquez, Gonzales, Flores H.B. No. 636 A BILL TO BE ENTITLED AN ACT relating to allocation of state and federal funds for adult basic education. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Section 29.255, Education Code, is amended by adding Subsections (c), (d), (d-1), and (e) to read as follows: (c) Notwithstanding any other provision of this subchapter, the agency shall allocate state and federal adult basic education funds, other than federal funds set aside for state administration, special projects, and staff development, based on need. Funds available to a service area in which there is no eligible adult basic education service provider providing student contact hours shall be distributed proportionally by the agency to other eligible adult basic education service providers in the county. If there are no other eligible adult basic education service providers in the county, the funds allocated for that county shall be distributed proportionally by the agency throughout the state to eligible adult basic education service providers by service area. (d) The agency by rule shall establish a method by which adult basic education service providers are paid on a student contact hour and student performance and completion basis. In adopting a method under this subsection, the agency shall require that the total number of eligible student contact hours must be based on the student's level of performance on a designated literacy or basic skills test so that the number of eligible student contact hours funded is increased for a student with a lower performance level. (d-1) Adult basic education service providers providing student contact hours for the 2008-2009 school year are entitled to at least the same level of student contact hours in the 2009-2010 and 2010-2011 school years as the service provider provided in the 2008-2009 school year. This subsection expires September 1, 2011. (e) The amount of state and federal adult basic education funds, other than federal funds set aside for state administration, special projects, and staff development, available for a school year that exceeds the amount of state and federal adult basic education funds, other than federal funds set aside for state administration, special projects, and staff development, available in the preceding school year shall be allocated to new student contact hours. The agency may not set the student contact hour rate for new student contact hours at a rate higher than the average rate for student contact hours in the preceding school year. SECTION 2. This Act takes effect September 1, 2009.