Texas 2025 - 89th Regular

Texas House Bill HB3 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	89R14082 MM-F
2	2	By: Buckley H.B. No. 3
3	3
4	4
5	5
6	6
7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to the establishment of an education savings account
10	10	program.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. The purpose of this Act is to:
13	13	(1) provide additional educational options to assist
14	14	families in this state in exercising the right to direct the
15	15	educational needs of their children; and
16	16	(2) achieve a general diffusion of knowledge.
17	17	SECTION 2. Chapter 29, Education Code, is amended by adding
18	18	Subchapter J to read as follows:
19	19	SUBCHAPTER J. EDUCATION SAVINGS ACCOUNT PROGRAM
20	20	Sec. 29.351. DEFINITIONS. In this subchapter:
21	21	(1) "Account" means an education savings account
22	22	established under the program.
23	23	(2) "Certified educational assistance organization"
24	24	means an organization certified under Section 29.354 to support the
25	25	administration of the program.
26	26	(3) "Child with a disability" means a child who is
27	27	eligible to participate in a school district's special education
28	28	program under Section 29.003.
29	29	(4) "Higher education provider" means an institution
30	30	of higher education or a private or independent institution of
31	31	higher education, as those terms are defined by Section 61.003.
32	32	(5) "Parent" means a resident of this state who is a
33	33	natural or adoptive parent, managing or possessory conservator,
34	34	legal guardian, custodian, or other person with legal authority to
35	35	act on behalf of a child.
36	36	(6) "Participating child" means a child enrolled in
37	37	the program.
38	38	(7) "Participating parent" means a parent of a
39	39	participating child.
40	40	(8) "Program" means the program established under this
41	41	subchapter.
42	42	(9) "Program participant" means a participating child
43	43	or a participating parent.
44	44	Sec. 29.352. ESTABLISHMENT OF PROGRAM. The comptroller
45	45	shall establish a program to provide funding for approved
46	46	education-related expenses of children participating in the
47	47	program.
48	48	Sec. 29.3521. AMOUNT OF APPROPRIATION. The amount of money
49	49	appropriated for a state fiscal biennium for purposes of the
50	50	program may not exceed the greater of:
51	51	(1) the amount of money appropriated for purposes of
52	52	the program for the preceding biennium; or
53	53	(2) the amount of money necessary for the biennium to
54	54	provide the amount specified under Section 29.361 for each
55	55	participating child and each child on the waiting list maintained
56	56	by the comptroller under Section 29.356(f) on the January 1
57	57	preceding the biennium.
58	58	Sec. 29.353. PROGRAM FUND. (a) The program fund is an
59	59	account in the general revenue fund to be administered by the
60	60	comptroller.
61	61	(b) The fund is composed of:
62	62	(1) general revenue transferred to the fund;
63	63	(2) money appropriated to the fund;
64	64	(3) gifts, grants, and donations received under
65	65	Section 29.370; and
66	66	(4) any other money available for purposes of the
67	67	program.
68	68	(c) Money in the fund may be appropriated only for the uses
69	69	specified by this subchapter.
70	70	Sec. 29.3535. PROMOTION OF PROGRAM. Notwithstanding
71	71	Chapter 2113, Government Code, the comptroller or the comptroller's
72	72	designee may enter into contracts or agreements and engage in
73	73	marketing, advertising, and other activities to promote, market,
74	74	and advertise the development and use of the program. The
75	75	comptroller may use money from the program fund to pay for
76	76	activities authorized under this section.
77	77	Sec. 29.354. SELECTION OF CERTIFIED EDUCATIONAL ASSISTANCE
78	78	ORGANIZATIONS. (a) An organization may apply to the comptroller
79	79	for certification as a certified educational assistance
80	80	organization during an application period established by the
81	81	comptroller.
82	82	(b) To be eligible for certification, an organization must:
83	83	(1) have the ability to perform one or more of the
84	84	duties and functions required of a certified educational assistance
85	85	organization under this subchapter;
86	86	(2) be in good standing with the state; and
87	87	(3) be able to assist the comptroller in administering
88	88	the program wholly or partly, including the ability to:
89	89	(A) accept, process, and track applications for
90	90	the program;
91	91	(B) assist prospective applicants, applicants,
92	92	and program participants with finding preapproved education
93	93	service providers and vendors of educational products;
94	94	(C) accept and process payments for approved
95	95	education-related expenses; and
96	96	(D) verify that program funding is used only for
97	97	approved education-related expenses.
98	98	(c) The comptroller shall establish cybersecurity
99	99	requirements for certified educational assistance organizations,
100	100	including the implementation of best practices developed under
101	101	Section 2054.5181, Government Code.
102	102	(d) The comptroller may certify not more than five
103	103	educational assistance organizations to support the administration
104	104	of the program, including by:
105	105	(1) administering wholly or partly:
106	106	(A) the application process under Section
107	107	29.356; and
108	108	(B) the program expenditures process under
109	109	Section 29.360; and
110	110	(2) assisting prospective applicants, applicants, and
111	111	program participants with understanding approved education-related
112	112	expenses and finding preapproved education service providers and
113	113	vendors of educational products.
114	114	(e) A certified educational assistance organization is not
115	115	considered to be a provider of professional or consulting services
116	116	under Chapter 2254, Government Code.
117	117	Sec. 29.355. ELIGIBLE CHILD. (a) A child is eligible to
118	118	participate in the program and may, subject to available funding,
119	119	enroll in the program for the semester following the semester in
120	120	which the child's application is submitted under Section 29.356 if
121	121	the child is eligible to:
122	122	(1) attend a public school under Section 25.001; or
123	123	(2) enroll in a public school's prekindergarten
124	124	program under Section 29.153.
125	125	(b) A child who establishes eligibility under this section
126	126	may, subject to available funding and the requirements of this
127	127	subchapter, participate in the program until the earliest of the
128	128	date on which:
129	129	(1) the child graduates from high school;
130	130	(2) the child is no longer eligible to either attend a
131	131	public school under Section 25.001 or enroll in a public school's
132	132	prekindergarten program under Section 29.153, as applicable;
133	133	(3) the child enrolls in a school district or
134	134	open-enrollment charter school in a manner in which the child will
135	135	be counted toward the district's or school's average daily
136	136	attendance for purposes of the allocation of funding under the
137	137	Foundation School Program; or
138	138	(4) the child is declared ineligible for the program
139	139	by the comptroller under this subchapter.
140	140	Sec. 29.356. APPLICATION TO PROGRAM. (a) A parent of an
141	141	eligible child may apply to a certified educational assistance
142	142	organization designated by the comptroller to enroll the child in
143	143	the program for the following semester, term, or school year, as
144	144	determined by the comptroller. The comptroller shall establish
145	145	deadlines by which an applicant must complete and submit an
146	146	application form to participate in the program.
147	147	(b) On receipt of more acceptable applications during an
148	148	application period for admission under this section than available
149	149	positions in the program due to insufficient funding, a certified
150	150	educational assistance organization shall, at the direction of the
151	151	comptroller, fill the available positions by lottery of applicants,
152	152	prioritizing applicants:
153	153	(1) in the following order:
154	154	(A) children to whom Paragraph (B) does not
155	155	apply; and
156	156	(B) children who previously ceased participation
157	157	in the program due to enrollment in a public school; and
158	158	(2) within each of the groups described by Subdivision
159	159	(1), as follows, as applicable:
160	160	(A) children with a disability who are members of
161	161	a household with a total annual income that is at or below 500
162	162	percent of the federal poverty guidelines;
163	163	(B) children who are members of a household with
164	164	a total annual income that is at or below 200 percent of the federal
165	165	poverty guidelines;
166	166	(C) children who are members of a household with
167	167	a total annual income that is above 200 percent of the federal
168	168	poverty guidelines and below 500 percent of the federal poverty
169	169	guidelines; and
170	170	(D) children who are members of a household with
171	171	a total annual income that is at or above 500 percent of the federal
172	172	poverty guidelines.
173	173	(c) For purposes of Subsection (b), a certified educational
174	174	assistance organization shall prioritize a participating child's
175	175	sibling who is eligible to participate in the program in the same
176	176	manner as the participating child.
177	177	(d) The comptroller shall adopt rules necessary to
178	178	administer Subsection (b). The comptroller shall post on the
179	179	comptroller's Internet website any rule adopted under this
180	180	subsection.
181	181	(e) The comptroller shall create an application form for the
182	182	program and each certified educational assistance organization
183	183	designated by the comptroller shall make the application form
184	184	readily available through various sources, including the
185	185	organization's Internet website. The application form must state
186	186	the application deadlines established by the comptroller under
187	187	Subsection (a). Each organization shall ensure that the
188	188	application form, including any required supporting document, is
189	189	capable of being submitted to the organization electronically.
190	190	(f) The comptroller shall create and maintain a waiting list
191	191	based on the priority categories described by Subsection (b) for
192	192	applicants if, during an application period, there are more
193	193	acceptable applications for admission than there are available
194	194	positions.
195	195	(g) Each certified educational assistance organization
196	196	designated under Subsection (a) shall post on the organization's
197	197	Internet website an applicant and participant handbook with a
198	198	description of the program, including:
199	199	(1) expenses allowed under the program under Section
200	200	29.359;
201	201	(2) a list of preapproved education service providers
202	202	and vendors of educational products under Section 29.358;
203	203	(3) a description of the application process under
204	204	this section and the program expenditures process under Section
205	205	29.360; and
206	206	(4) a description of the responsibilities of program
207	207	participants.
208	208	(h) Each certified educational assistance organization
209	209	designated under Subsection (a) shall annually provide to the
210	210	parent of each child participating in the program the information
211	211	described by Subsection (g). The organization may provide the
212	212	information electronically.
213	213	(i) The comptroller or a certified educational assistance
214	214	organization designated under Subsection (a):
215	215	(1) may require the participating parent to submit
216	216	annual notice regarding the parent's intent for the child to
217	217	continue participating in the program for the next school year; and
218	218	(2) may not require a program participant in good
219	219	standing to annually resubmit an application for continued
220	220	participation in the program.
221	221	(j) The agency shall provide to the comptroller the
222	222	information necessary to make the determinations required under
223	223	Subsection (b).
224	224	Sec. 29.357. PARTICIPATION IN PROGRAM. (a) To receive
225	225	funding under the program, a participating parent must agree to:
226	226	(1) spend money received through the program only for
227	227	expenses allowed under Section 29.359;
228	228	(2) share or authorize the administrator of an
229	229	assessment instrument to share with the program participant's
230	230	certified educational assistance organization the results of any
231	231	assessment instrument required to be administered to the child
232	232	under Section 29.358(b)(2)(B) or other law;
233	233	(3) refrain from selling an item purchased with
234	234	program money; and
235	235	(4) notify the program participant's certified
236	236	educational assistance organization not later than 30 business days
237	237	after the date on which the child:
238	238	(A) enrolls in a public school, including an
239	239	open-enrollment charter school;
240	240	(B) graduates from high school; or
241	241	(C) is no longer eligible to either:
242	242	(i) enroll in a public school under Section
243	243	25.001; or
244	244	(ii) enroll in a public school's
245	245	prekindergarten program under Section 29.153.
246	246	(b) The administrator of an assessment instrument required
247	247	to be administered under Section 29.358(b)(2)(B) or other law shall
248	248	share with a parent the participating child's results on the
249	249	assessment instrument, including, if available, the participating
250	250	child's percentile rank. A child's results and rank on an
251	251	assessment instrument administered under this section are
252	252	confidential, are not subject to disclosure under Chapter 552,
253	253	Government Code, and may only be shared as necessary to fulfill the
254	254	requirements of this subchapter. In providing the results and rank
255	255	for an assessment instrument, the administrator shall ensure
256	256	compliance with state and federal law regarding the confidentiality
257	257	of student educational information, including the Family
258	258	Educational Rights and Privacy Act of 1974 (20 U.S.C. Section
259	259	1232g).
260	260	Sec. 29.358. PREAPPROVED PROVIDERS AND VENDORS. (a) The
261	261	comptroller shall by rule establish a process for the preapproval
262	262	of education service providers and vendors of educational products
263	263	for participation in the program. The comptroller shall allow for
264	264	the submission of applications on a rolling basis.
265	265	(b) The comptroller shall approve an education service
266	266	provider or vendor of educational products for participation in the
267	267	program if the provider or vendor:
268	268	(1) has previously been approved by the agency to
269	269	provide supplemental special education services under Subchapter
270	270	A-1 and remains in good standing with the agency;
271	271	(2) for a private school, demonstrates:
272	272	(A) accreditation by an organization recognized
273	273	by:
274	274	(i) the Texas Private School Accreditation
275	275	Commission; or
276	276	(ii) the agency; and
277	277	(B) annual administration of a nationally
278	278	norm-referenced assessment instrument or the appropriate
279	279	assessment instrument required under Subchapter B, Chapter 39;
280	280	(3) for a public school, demonstrates:
281	281	(A) accreditation by the agency; and
282	282	(B) the ability to provide services or products
283	283	to participating children in a manner in which the children are not
284	284	counted toward the school's average daily attendance;
285	285	(4) for a private tutor, therapist, or teaching
286	286	service, demonstrates that:
287	287	(A) the tutor or therapist or each employee of
288	288	the teaching service who intends to provide educational services to
289	289	a participating child:
290	290	(i) is an educator employed by or a retired
291	291	educator formerly employed by a school accredited by the agency, an
292	292	organization recognized by the agency, or an organization
293	293	recognized by the Texas Private School Accreditation Commission;
294	294	(ii) holds a relevant license or
295	295	accreditation issued by a state, regional, or national
296	296	certification or accreditation organization; or
297	297	(iii) is employed in or retired from a
298	298	teaching or tutoring capacity at a higher education provider;
299	299	(B) the tutor or therapist or each employee of
300	300	the teaching service who intends to provide educational services to
301	301	a participating child provides to the comptroller a national
302	302	criminal history record information review completed by the tutor,
303	303	therapist, or employee, as applicable, within a period established
304	304	by comptroller rule; and
305	305	(C) the tutor or therapist or each employee of
306	306	the teaching service who intends to provide educational services to
307	307	a participating child is not:
308	308	(i) required to be discharged or refused to
309	309	be hired by a school district under Section 22.085; or
310	310	(ii) included in the registry under Section
311	311	22.092;
312	312	(5) for a higher education provider, demonstrates
313	313	nationally recognized postsecondary accreditation; or
314	314	(6) notwithstanding Subdivision (2), for a private
315	315	provider serving children in prekindergarten or kindergarten,
316	316	demonstrates that the provider meets the requirements to be an
317	317	eligible private provider under Section 29.171.
318	318	(c) The comptroller may approve only an education service
319	319	provider or vendor of educational products that operates in this
320	320	state.
321	321	(d) An education service provider or vendor of educational
322	322	products shall provide information requested by the comptroller to
323	323	verify the provider's or vendor's eligibility for preapproval under
324	324	this section. The comptroller may not approve a provider or vendor
325	325	if the comptroller cannot verify the provider's or vendor's
326	326	eligibility for preapproval.
327	327	(e) Each applicant for approval under this section shall
328	328	submit to the comptroller documentation demonstrating that each
329	329	person employed by the applicant or provider who will interact with
330	330	a participating child is not identified as having engaged in
331	331	misconduct described by Section 22.093(c)(1)(A) or (B) using the
332	332	interagency reportable conduct search engine established under
333	333	Chapter 810, Health and Safety Code.
334	334	(f) The comptroller shall review the documentation for each
335	335	person described by Subsection (e). Each applicant for approval
336	336	under this section must provide the comptroller with any
337	337	information requested by the comptroller to enable the comptroller
338	338	to complete the review.
339	339	(g) An education service provider or vendor of educational
340	340	products must agree to:
341	341	(1) abide by the disbursement schedule under Section
342	342	29.360(c) and all other requirements of this subchapter;
343	343	(2) accept money from the program only for
344	344	education-related expenses approved under Section 29.359;
345	345	(3) notify the comptroller not later than the 30th day
346	346	after the date that the provider or vendor no longer meets the
347	347	requirements of this section; and
348	348	(4) return any money received, including any interest
349	349	or other additions received related to the money, in violation of
350	350	this subchapter or other relevant law to the comptroller for
351	351	deposit into the program fund.
352	352	(h) An education service provider or vendor of educational
353	353	products that receives approval under this section may participate
354	354	in the program until the earliest of the date on which the provider
355	355	or vendor:
356	356	(1) no longer meets the requirements under this
357	357	section; or
358	358	(2) violates this subchapter or other relevant law.
359	359	Sec. 29.359. APPROVED EDUCATION-RELATED EXPENSES. (a)
360	360	Subject to Subsection (b), money received under the program may be
361	361	used only for the following education-related expenses incurred by
362	362	a participating child at a preapproved education service provider
363	363	or vendor of educational products:
364	364	(1) tuition and fees for:
365	365	(A) a private school;
366	366	(B) a higher education provider;
367	367	(C) an online educational course or program; or
368	368	(D) a program that provides training for an
369	369	industry-based credential;
370	370	(2) the purchase of textbooks or other instructional
371	371	materials or uniforms required by a private school, higher
372	372	education provider, or course in which the child is enrolled,
373	373	including purchases made through a third-party vendor of
374	374	educational products;
375	375	(3) fees for classes or other educational services
376	376	provided by a public school, including an open-enrollment charter
377	377	school, if the classes or services do not qualify the child to be
378	378	included in the school's average daily attendance;
379	379	(4) costs related to academic assessments;
380	380	(5) fees for services provided by a private tutor or
381	381	teaching service;
382	382	(6) fees for transportation provided by a
383	383	fee-for-service transportation provider for the child to travel to
384	384	and from a preapproved education service provider or vendor of
385	385	educational products;
386	386	(7) fees for educational therapies or services
387	387	provided by a practitioner or provider, only for fees that are not
388	388	covered by any federal, state, or local government benefits such as
389	389	Medicaid or the Children's Health Insurance Program (CHIP) or by
390	390	any private insurance that the child is enrolled in at the time of
391	391	receiving the therapies or services;
392	392	(8) costs of computer hardware or software and other
393	393	technological devices required by an education service provider or
394	394	vendor of educational products or prescribed by a physician to
395	395	facilitate a child's education, not to exceed in any year 10 percent
396	396	of the total amount paid to the participating child's account that
397	397	year; and
398	398	(9) costs of breakfast or lunch provided to a child
399	399	during the school day by a private school.
400	400	(b) Money received under the program may not be used to pay
401	401	any person who is related to the program participant within the
402	402	third degree by consanguinity or affinity, as determined under
403	403	Chapter 573, Government Code.
404	404	(c) A finding that a program participant used money
405	405	distributed under the program to pay for an expense not allowed
406	406	under Subsection (a) does not affect the validity of any payment
407	407	made by the participant for an approved education-related expense
408	408	that is allowed under that subsection.
409	409	Sec. 29.360. PROGRAM EXPENDITURES. (a) The comptroller
410	410	shall disburse from the program fund to each certified educational
411	411	assistance organization the amount specified under Section
412	412	29.361(a) for each participating child served by the organization.
413	413	(b) To initiate payment to an education service provider or
414	414	vendor of educational products for an education-related expense
415	415	approved under Section 29.359, the participating parent must submit
416	416	a request in a form prescribed by comptroller rule to the certified
417	417	educational assistance organization that serves the child.
418	418	(c) Subject to Subsection (d) and Sections 29.362(f) and
419	419	29.364, on receiving a request under Subsection (b), a certified
420	420	educational assistance organization shall verify that the request
421	421	is for an expense approved under Section 29.359 and, not later than
422	422	the 15th business day after the date the organization verifies the
423	423	request, send payment to the education service provider or vendor
424	424	of educational products.
425	425	(d) A disbursement under this section may not exceed the
426	426	applicable participating child's account balance.
427	427	(e) A certified educational assistance organization shall
428	428	provide participating parents with electronic access to:
429	429	(1) view the participating child's current account
430	430	balance;
431	431	(2) initiate the payment process under Subsection (b);
432	432	and
433	433	(3) view a summary of past account activity, including
434	434	payments from the account to education service providers and
435	435	vendors of educational products.
436	436	Sec. 29.361. AMOUNT OF PAYMENT; FINANCING. (a) Regardless
437	437	of the deadline by which the participating parent applies for
438	438	enrollment in the program under Section 29.356(a) and except as
439	439	provided by Subsections (b), (b-1), and (d) of this section, a
440	440	participating parent shall receive each school year that the
441	441	parent's child participates in the program payments from the state
442	442	to be held in trust for the benefit of the child from money
443	443	available under Section 29.353 to the child's account in an amount
444	444	equal to:
445	445	(1) 85 percent of the estimated statewide average
446	446	amount of state and local funding per student in average daily
447	447	attendance for the applicable school year; or
448	448	(2) for a child with a disability, subject to
449	449	Subsection (b), the sum of the amount described by Subdivision (1)
450	450	and the amount the school district in which the child would
451	451	otherwise be enrolled would be entitled to receive for the child
452	452	calculated based on the child's individualized education program,
453	453	as determined in accordance with Section 29.3615, and the
454	454	provisions of Chapter 48 that provide funding based on a child's
455	455	participation in a school district's special education program
456	456	under Subchapter A applicable for the school year preceding the
457	457	school year in which the child initially enrolls in the program.
458	458	(b) The amount provided to a child with a disability for a
459	459	school year under Subsection (a)(2) may not exceed $30,000.
460	460	(b-1) Notwithstanding Subsection (a), a participating child
461	461	who is a home-schooled student, as defined by Section 29.916(a)(1),
462	462	may not receive payments to the child's account under Subsection
463	463	(a) in an amount that exceeds $2,000 for a school year.
464	464	(c) In determining the estimated statewide average amount
465	465	of state and local funding per student in average daily attendance
466	466	under Subsection (a), the commissioner shall:
467	467	(1) to the extent practicable, make the determination
468	468	not later than January 15 preceding the applicable school year; and
469	469	(2) include projected state and local funding under
470	470	Chapters 48 and 49 and the amount the state is required to
471	471	contribute to the Teacher Retirement System of Texas under Section
472	472	825.404, Government Code, for the applicable school year.
473	473	(d) If a child enrolls in the program after the beginning of
474	474	a school year, the comptroller shall prorate the amount the
475	475	participating parent of the child receives under Subsection (a)
476	476	based on the date the child enrolls in the program.
477	477	(e) A participating parent must submit all requests for
478	478	payment from the account of the parent's child for expenses
479	479	incurred during a fiscal year to the comptroller not less than 90
480	480	days after the end of that fiscal year.
481	481	(f) Any money remaining in a participating child's account
482	482	at the end of a fiscal year is carried forward to the next fiscal
483	483	year unless another provision of this subchapter mandates the
484	484	closure of the account.
485	485	(g) A participating parent may make payments for the
486	486	expenses of educational programs, services, and products not
487	487	covered by money in the account of the parent's child.
488	488	(h) A payment under Subsection (a) may not be financed using
489	489	federal money or money from the available school fund or the state
490	490	instructional materials and technology fund.
491	491	(i) Payments received under this subchapter do not
492	492	constitute taxable income to a participating parent, unless
493	493	otherwise provided by federal or another state's law.
494	494	(j) On dates consistent with satisfying the application
495	495	deadlines established under Section 29.356(a), the agency shall
496	496	calculate and report to the comptroller the amount specified under
497	497	Subsection (a) for each participating child.
498	498	Sec. 29.3615. INDIVIDUALIZED EDUCATION PROGRAMS;
499	499	EVALUATIONS. (a) The parent of a child who is not enrolled in a
500	500	school district or open-enrollment charter school may request that
501	501	a district or school conduct a full individual and initial
502	502	evaluation of the child for purposes of determining the child's
503	503	eligibility for special education services under Subchapter A.
504	504	(b) A school district or open-enrollment charter school
505	505	that receives a request under this section shall conduct a full
506	506	individual and initial evaluation in accordance with Section 29.004
507	507	not later than the 45th day after the date the district or school
508	508	receives the request.
509	509	(c) If a school district or open-enrollment charter school
510	510	determines based on an evaluation conducted under Subsection (b)
511	511	that a child is eligible for special education services, the
512	512	district or school shall develop an individualized education
513	513	program for the child in accordance with Section 29.005.
514	514	(d) At the agency's request, a school district or
515	515	open-enrollment charter school shall provide to the agency a
516	516	child's individualized education program developed under Section
517	517	29.005 or this section.
518	518	(e) The agency may adopt rules as necessary to implement
519	519	this section, including rules regarding an appeal of a
520	520	determination of eligibility for special education services and
521	521	services to be provided as described in an individualized education
522	522	program.
523	523	Sec. 29.362. ADMINISTRATION OF ACCOUNTS. (a) On receipt
524	524	of money distributed by the comptroller for purposes of making
525	525	payments to program participants, a certified educational
526	526	assistance organization shall hold that money in trust for the
527	527	benefit of children participating in the program and make quarterly
528	528	payments to the account of each participating child served by the
529	529	organization in equal amounts on or before the first day of July,
530	530	October, January, and April.
531	531	(b) Each year, the comptroller may deduct from the total
532	532	amount of money appropriated for purposes of this subchapter an
533	533	amount, not to exceed three percent of that total amount, to cover
534	534	the comptroller's cost of administering the program.
535	535	(c) Each quarter, each certified educational assistance
536	536	organization shall submit to the comptroller a breakdown of the
537	537	organization's costs of administering the program for the previous
538	538	quarter, and the comptroller shall disburse from money appropriated
539	539	for the program to each certified educational assistance
540	540	organization the amount necessary to cover the organization's costs
541	541	of administering the program for that quarter. The total amount
542	542	disbursed to all certified educational assistance organizations
543	543	under this subsection for a state fiscal year may not exceed five
544	544	percent of the amount appropriated for the purposes of the program
545	545	for that fiscal year.
546	546	(d) On or before the first day of October and February, a
547	547	certified educational assistance organization shall:
548	548	(1) verify with the agency that each participating
549	549	child is not enrolled in a public school, including an
550	550	open-enrollment charter school, in a manner in which the child is
551	551	counted toward the school's average daily attendance for purposes
552	552	of the allocation of state funding under the Foundation School
553	553	Program; and
554	554	(2) notify the comptroller if the organization
555	555	determines that a participating child is:
556	556	(A) enrolled in a public school, including an
557	557	open-enrollment charter school, in a manner in which the child is
558	558	counted toward the school's average daily attendance for purposes
559	559	of the allocation of state funding under the Foundation School
560	560	Program; or
561	561	(B) not enrolled in a preapproved private school.
562	562	(e) The comptroller by rule shall establish a process by
563	563	which a participating parent may authorize the comptroller or a
564	564	certified educational assistance organization to make a payment
565	565	directly from the participant's account to a preapproved education
566	566	service provider or vendor of educational products for an expense
567	567	allowed under Section 29.359.
568	568	(f) On the date on which a child who participated in the
569	569	program is no longer eligible to participate in the program under
570	570	Section 29.355 and payments for any education-related expenses
571	571	allowed under Section 29.359 from the child's account have been
572	572	completed, the participating child's account shall be closed and
573	573	any remaining money returned to the comptroller for deposit in the
574	574	program fund.
575	575	(g) Each quarter, any interest or other earnings
576	576	attributable to money held by a certified educational assistance
577	577	organization for purposes of the program shall be remitted to the
578	578	comptroller for deposit in the program fund.
579	579	Sec. 29.363. AUDITING. (a) The comptroller shall contract
580	580	with a private entity to audit accounts and program participant
581	581	eligibility data not less than once per year to ensure compliance
582	582	with applicable law and program requirements. The audit must
583	583	include a review of:
584	584	(1) each certified educational assistance
585	585	organization's internal controls over program transactions; and
586	586	(2) compliance by:
587	587	(A) certified educational assistance
588	588	organizations with Section 29.354 and other program requirements;
589	589	(B) program participants with Section 29.357(a)
590	590	and other program requirements; and
591	591	(C) education service providers and vendors of
592	592	educational products with Section 29.358 and other program
593	593	requirements.
594	594	(b) In conducting an audit, the private entity may require a
595	595	program participant, education service provider or vendor of
596	596	educational products, or certified educational assistance
597	597	organization to provide information and documentation regarding
598	598	any transaction occurring under the program.
599	599	(c) The private entity shall report to the comptroller any
600	600	violation of this subchapter or other relevant law and any
601	601	transactions the entity determines to be unusual or suspicious
602	602	found by the entity during an audit conducted under this section.
603	603	The comptroller shall report the violation or transaction to:
604	604	(1) the applicable certified educational assistance
605	605	organization;
606	606	(2) the education service provider or vendor of
607	607	educational products, as applicable; and
608	608	(3) each participating parent who is affected by the
609	609	violation or transaction.
610	610	Sec. 29.364. SUSPENSION OF ACCOUNT. (a) The comptroller
611	611	shall suspend the account of a participating child who fails to
612	612	remain in good standing by complying with applicable law or a
613	613	requirement of the program.
614	614	(b) On suspension of an account under Subsection (a), the
615	615	comptroller shall notify the participating parent in writing that
616	616	the account has been suspended and that no additional payments may
617	617	be made from the account. The notification must specify the grounds
618	618	for the suspension and state that the participating parent has 30
619	619	days to respond and take any corrective action required by the
620	620	comptroller.
621	621	(c) On the expiration of the 30-day period under Subsection
622	622	(b), the comptroller shall:
623	623	(1) order closure of the suspended account;
624	624	(2) order temporary reinstatement of the account,
625	625	conditioned on the performance of a specified action by the
626	626	participating parent; or
627	627	(3) order full reinstatement of the account.
628	628	(d) The comptroller may recover money distributed under the
629	629	program that was used for expenses not allowed under Section
630	630	29.359, for a child who was not eligible to participate in the
631	631	program at the time of the expenditure, or from an education service
632	632	provider or vendor of educational products that was not approved at
633	633	the time of the expenditure. The money and any interest or other
634	634	additions received related to the money may be recovered from the
635	635	participating parent or the education service provider or vendor of
636	636	educational products that received the money in accordance with
637	637	Subtitles A and B, Title 2, Tax Code, or as provided by other law if
638	638	the participating child's account is suspended or closed under this
639	639	section. The comptroller shall deposit money recovered under this
640	640	subsection into the program fund.
641	641	Sec. 29.365. TUITION AND FEES; REFUND PROHIBITED. (a) An
642	642	education service provider or vendor of educational products may
643	643	not charge a participating child an amount greater than the
644	644	standard amount charged for that service or product by the provider
645	645	or vendor.
646	646	(b) An education service provider or vendor of educational
647	647	products receiving money distributed under the program may not in
648	648	any manner rebate, refund, or credit to or share with a program
649	649	participant, or any person on behalf of a participant, any program
650	650	money paid or owed by the participant to the provider or vendor.
651	651	Sec. 29.366. REFERRAL TO DISTRICT ATTORNEY. If the
652	652	comptroller obtains evidence of fraudulent use of an account or
653	653	money distributed under the program or any other violation of law by
654	654	a certified educational assistance organization, education service
655	655	provider or vendor of educational products, or program participant,
656	656	the comptroller shall notify the appropriate local county or
657	657	district attorney with jurisdiction over, as applicable:
658	658	(1) the principal place of business of the
659	659	organization or provider or vendor; or
660	660	(2) the residence of the program participant.
661	661	Sec. 29.367. SPECIAL EDUCATION NOTICE. (a) A certified
662	662	educational assistance organization shall post on the
663	663	organization's Internet website and provide to each parent who
664	664	submits an application for the program a notice that:
665	665	(1) states that a private school is not subject to
666	666	federal and state laws regarding the provision of educational
667	667	services to a child with a disability in the same manner as a public
668	668	school; and
669	669	(2) provides information regarding rights to which a
670	670	child with a disability is entitled under federal and state law if
671	671	the child attends a public school, including:
672	672	(A) rights provided under the Individuals with
673	673	Disabilities Education Act (20 U.S.C. Section 1400 et seq.); and
674	674	(B) rights provided under Subchapter A.
675	675	(b) A private school in which a child with a disability who
676	676	is a participating child enrolls shall provide to the participating
677	677	parent a copy of the notice required under Subsection (a).
678	678	Sec. 29.368. PROGRAM PARTICIPANT, PROVIDER, AND VENDOR
679	679	AUTONOMY. (a) An education service provider or vendor of
680	680	educational products that receives money distributed under the
681	681	program is not a recipient of federal financial assistance and may
682	682	not be considered to be a state actor on the basis of receiving that
683	683	money.
684	684	(b) A state agency or state official may not adopt a rule or
685	685	take other governmental action related to the program and a
686	686	certified educational assistance organization may not take action
687	687	that:
688	688	(1) limits or imposes requirements that are contrary
689	689	to the religious or institutional values or practices of an
690	690	education service provider, vendor of educational products, or
691	691	program participant; or
692	692	(2) limits an education service provider, vendor of
693	693	educational products, or program participant from freely:
694	694	(A) determining the methods or curriculum to
695	695	educate students;
696	696	(B) determining admissions and enrollment
697	697	practices, policies, and standards;
698	698	(C) modifying or refusing to modify the
699	699	provider's, vendor's, or participant's religious or institutional
700	700	values or practices, operations, conduct, policies, standards,
701	701	assessments, or employment practices based on the provider's,
702	702	vendor's, or participant's religious values or practices; or
703	703	(D) exercising the provider's, vendor's, or
704	704	participant's religious or institutional practices as the
705	705	provider, vendor, or participant determines.
706	706	Sec. 29.369. STUDENT RECORDS AND INFORMATION. (a) On
707	707	request by the participating parent or parent of a child seeking to
708	708	participate in the program, the school district or open-enrollment
709	709	charter school that the child would otherwise attend shall provide
710	710	a copy of the child's school records possessed by the district or
711	711	school, if any, to the child's parent or, if applicable, the private
712	712	school the child attends.
713	713	(b) As necessary to verify a child's eligibility for the
714	714	program, the agency, a school district, or an open-enrollment
715	715	charter school shall provide to a certified educational assistance
716	716	organization any information available to the agency, district, or
717	717	school requested by the organization regarding a child who
718	718	participates or seeks to participate in the program, including
719	719	information regarding the child's public school enrollment status
720	720	and whether the child can be counted toward a public school's
721	721	average daily attendance for purposes of the allocation of funding
722	722	under the Foundation School Program. The organization may not
723	723	retain information provided under this subsection beyond the period
724	724	necessary to determine a child's eligibility to participate in the
725	725	program.
726	726	(c) A certified educational assistance organization or an
727	727	education service provider or vendor of educational products that
728	728	obtains information regarding a participating child:
729	729	(1) shall comply with state and federal law regarding
730	730	the confidentiality of student educational information; and
731	731	(2) may not sell or otherwise distribute information
732	732	regarding a participating child.
733	733	Sec. 29.370. GIFTS, GRANTS, AND DONATIONS. The comptroller
734	734	and a certified educational assistance organization may solicit and
735	735	accept gifts, grants, and donations from any public or private
736	736	source for any expenses related to the administration of the
737	737	program, including establishing the program and contracting for the
738	738	report required under Section 29.371.
739	739	Sec. 29.371. ANNUAL REPORT. (a) The comptroller shall
740	740	require that each certified educational assistance organization
741	741	compile program data and produce an annual longitudinal report
742	742	regarding:
743	743	(1) the number of program applications received,
744	744	accepted, and wait-listed, disaggregated by age;
745	745	(2) program participant satisfaction;
746	746	(3) the results of assessment instruments shared in
747	747	accordance with Section 29.357(a)(2);
748	748	(4) the effect of the program on public and private
749	749	school capacity and availability;
750	750	(5) the amount of cost savings accruing to the state as
751	751	a result of the program;
752	752	(6) in a report submitted in an even-numbered year
753	753	only, an estimate of the total amount of funding required for the
754	754	program for the next state fiscal biennium;
755	755	(7) the amount of gifts, grants, and donations
756	756	received under Section 29.370; and
757	757	(8) based on surveys of former program participants or
758	758	other sources available to an organization, the number and
759	759	percentage of children participating in the program who, within one
760	760	year after graduating from high school, are:
761	761	(A) college ready, as indicated by earning a
762	762	minimum of 12 non-remedial semester credit hours or the equivalent
763	763	or an associate degree from a postsecondary educational
764	764	institution;
765	765	(B) career ready, as indicated by:
766	766	(i) earning a credential of value included
767	767	in a library of credentials established under Section 2308A.007,
768	768	Government Code; or
769	769	(ii) employment at or above the median wage
770	770	in the child's region; or
771	771	(C) military ready, as indicated by achieving a
772	772	passing score set by the applicable military branch on the Armed
773	773	Services Vocational Aptitude Battery and enlisting in the armed
774	774	forces of the United States or the Texas National Guard.
775	775	(b) In producing the report, each certified educational
776	776	assistance organization shall:
777	777	(1) use appropriate analytical and behavioral science
778	778	methodologies to ensure public confidence in the report; and
779	779	(2) comply with the requirements regarding the
780	780	confidentiality of student educational information under the
781	781	Family Educational Rights and Privacy Act of 1974 (20 U.S.C.
782	782	Section 1232g).
783	783	(c) The report must cover a period of not less than five
784	784	years and include, subject to Subsection (b)(2), the data analyzed
785	785	and methodology used.
786	786	(d) The comptroller and each certified educational
787	787	assistance organization shall post the report on the comptroller's
788	788	and organization's respective Internet websites.
789	789	Sec. 29.3715. COLLECTION AND REPORTING OF DEMOGRAPHIC
790	790	INFORMATION. (a) Each certified educational assistance
791	791	organization shall collect and report to the comptroller
792	792	demographic information regarding each participating child for
793	793	whom the organization is responsible. The report must include the
794	794	following demographic information:
795	795	(1) the child's grade;
796	796	(2) the child's age;
797	797	(3) the child's gender;
798	798	(4) the child's race or ethnicity;
799	799	(5) the school district in which the child resides;
800	800	(6) the district campus that the child would otherwise
801	801	attend;
802	802	(7) the child's zip code;
803	803	(8) the child's date of enrollment in the program;
804	804	(9) whether the child is educationally disadvantaged;
805	805	and
806	806	(10) whether the child has a disability.
807	807	(b) Not later than August 1 of each year, the comptroller
808	808	shall submit a written report to the legislature summarizing the
809	809	demographic information collected under this section.
810	810	Sec. 29.372. RULES; PROCEDURES. The comptroller shall
811	811	adopt rules and procedures as necessary to implement, administer,
812	812	and enforce this subchapter.
813	813	Sec. 29.373. APPEAL; FINALITY OF DECISIONS. (a) A program
814	814	participant may appeal to the comptroller an administrative
815	815	decision made by the comptroller or a certified educational
816	816	assistance organization under this subchapter, including a
817	817	decision regarding eligibility, allowable expenses, or the
818	818	participant's removal from the program.
819	819	(b) This subchapter may not be construed to confer a
820	820	property right on a certified educational assistance organization,
821	821	education service provider, vendor of educational products, or
822	822	program participant.
823	823	(c) A decision of the comptroller made under this subchapter
824	824	is final and not subject to appeal.
825	825	Sec. 29.374. RIGHT TO INTERVENE IN CIVIL ACTION. (a) A
826	826	program participant, education service provider, or vendor of
827	827	educational products may intervene in any civil action challenging
828	828	the constitutionality of the program.
829	829	(b) A court in which a civil action described by Subsection
830	830	(a) is filed may require that all program participants, education
831	831	service providers, and vendors of educational products wishing to
832	832	intervene in the action file a joint brief. A program participant,
833	833	education service provider, or vendor of educational products may
834	834	not be required to join a brief filed on behalf of the state or a
835	835	state agency.
836	836	SECTION 3. Section 22.092(d), Education Code, is amended to
837	837	read as follows:
838	838	(d) The agency shall provide equivalent access to the
839	839	registry maintained under this section to:
840	840	(1) private schools;
841	841	(2) public schools; [and]
842	842	(3) nonprofit teacher organizations approved by the
843	843	commissioner for the purpose of participating in the tutoring
844	844	program established under Section 33.913; and
845	845	(4) the comptroller for the purpose of preapproving
846	846	education service providers and vendors of educational products
847	847	under Section 29.358 for participation in the program established
848	848	under Subchapter J, Chapter 29.
849	849	SECTION 4. Section 411.109, Government Code, is amended by
850	850	adding Subsection (b-1) and amending Subsection (c) to read as
851	851	follows:
852	852	(b-1) The comptroller is entitled to obtain criminal
853	853	history record information as provided by Subsection (c) about a
854	854	person who is an employee of an education service provider or vendor
855	855	of educational products who intends to provide educational services
856	856	to a child participating in the program established under
857	857	Subchapter J, Chapter 29, Education Code, and is seeking approval
858	858	to receive money distributed under that program.
859	859	(c) Subject to Section 411.087 and consistent with the
860	860	public policy of this state, the comptroller is entitled to:
861	861	(1) obtain through the Federal Bureau of Investigation
862	862	criminal history record information maintained or indexed by that
863	863	bureau that pertains to a person described by Subsection (a), [or]
864	864	(b), or (b-1); and
865	865	(2) obtain from the department or any other criminal
866	866	justice agency in this state criminal history record information
867	867	maintained by the department or that criminal justice agency that
868	868	relates to a person described by Subsection (a), [or] (b), or (b-1).
869	869	SECTION 5. Section 810.002, Health and Safety Code, is
870	870	amended to read as follows:
871	871	Sec. 810.002. APPLICABILITY. This chapter applies to the
872	872	following state agencies:
873	873	(1) the Department of Family and Protective Services;
874	874	(2) the Health and Human Services Commission;
875	875	(3) the Texas Education Agency; [and]
876	876	(4) the Texas Juvenile Justice Department; and
877	877	(5) the comptroller of public accounts.
878	878	SECTION 6. Subchapter J, Chapter 29, Education Code, as
879	879	added by this Act, applies beginning with the 2026-2027 school
880	880	year.
881	881	SECTION 7. (a) Not later than May 15, 2026, the comptroller
882	882	of public accounts shall adopt rules as provided by Sections
883	883	29.356(d) and 29.372, Education Code, as added by this Act.
884	884	(b) The comptroller of public accounts may identify rules
885	885	required by the passage of Subchapter J, Chapter 29, Education
886	886	Code, as added by this Act, that must be adopted on an emergency
887	887	basis for purposes of the 2026-2027 school year and may use the
888	888	procedures established under Section 2001.034, Government Code,
889	889	for adopting those rules. The comptroller of public accounts is not
890	890	required to make the finding described by Section 2001.034(a),
891	891	Government Code, to adopt emergency rules under this subsection.
892	892	SECTION 8. (a) The constitutionality and other validity
893	893	under the state or federal constitution of all or any part of
894	894	Subchapter J, Chapter 29, Education Code, as added by this Act, may
895	895	be determined in an action for declaratory judgment under Chapter
896	896	37, Civil Practice and Remedies Code, in a district court in the
897	897	county in which the violation is alleged to have occurred or where
898	898	the plaintiff resides or has its principal place of business.
899	899	(b) An order, however characterized, of a trial court
900	900	granting or denying a temporary or otherwise interlocutory
901	901	injunction or a permanent injunction on the grounds of the
902	902	constitutionality or unconstitutionality, or other validity or
903	903	invalidity, under the state or federal constitution of all or any
904	904	part of Subchapter J, Chapter 29, Education Code, as added by this
905	905	Act, may be reviewed only by direct appeal to the Texas Supreme
906	906	Court filed not later than the 15th business day after the date on
907	907	which the order was entered. The Texas Supreme Court shall give
908	908	precedence to appeals under this section over other matters.
909	909	(c) The direct appeal is an accelerated appeal.
910	910	(d) This section exercises the authority granted by Section
911	911	3-b, Article V, Texas Constitution.
912	912	(e) The filing of a direct appeal under this section will
913	913	automatically stay any temporary or otherwise interlocutory
914	914	injunction or permanent injunction granted in accordance with this
915	915	section pending final determination by the Texas Supreme Court,
916	916	unless the supreme court makes specific findings that the applicant
917	917	seeking such injunctive relief has pleaded and proved that:
918	918	(1) the applicant has a probable right to the relief it
919	919	seeks on final hearing;
920	920	(2) the applicant will suffer a probable injury that
921	921	is imminent and irreparable, and that the applicant has no other
922	922	adequate legal remedy; and
923	923	(3) maintaining the injunction is in the public
924	924	interest.
925	925	(f) An appeal under this section, including an
926	926	interlocutory, accelerated, or direct appeal, is governed, as
927	927	applicable, by the Texas Rules of Appellate Procedure, including
928	928	Rules 25.1(d)(6), 28.1, 32.1, 37.3(a)(1), 38.6(a) and (b), 40.1(b),
929	929	and 49.4.
930	930	(g) This section does not authorize an award of attorney's
931	931	fees against this state, and Section 37.009, Civil Practice and
932	932	Remedies Code, does not apply to an action filed under this section.
933	933	SECTION 9. It is the intent of the legislature that every
934	934	provision, section, subsection, sentence, clause, phrase, or word
935	935	in this Act, and every application of the provisions in this Act to
936	936	each person or entity, is severable from each other. If any
937	937	application of any provision in this Act to any person, group of
938	938	persons, or circumstances is found by a court to be invalid for any
939	939	reason, the remaining applications of that provision to all other
940	940	persons and circumstances shall be severed and may not be affected.
941	941	SECTION 10. This Act takes effect immediately if it
942	942	receives a vote of two-thirds of all the members elected to each
943	943	house, as provided by Section 39, Article III, Texas Constitution.
944	944	If this Act does not receive the vote necessary for immediate
945	945	effect, this Act takes effect September 1, 2025.