Toth Voucher Bill Pays $10K A Kid, Freezes Rules For Private Schools

The text as introduced · 2,980 words

By: Toth
H.B. No. 984

A BILL TO BE ENTITLED

AN ACT

relating to the establishment of an empowerment scholarship account

program.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Chapter 29, Education Code, is amended by adding

Subchapter J to read as follows:

SUBCHAPTER J. EMPOWERMENT SCHOLARSHIP ACCOUNT PROGRAM

Sec. 29.351. DEFINITIONS. In this subchapter:

(1) "Account" means an empowerment scholarship

account established under the program.

(2) "Child with a disability" means a child who is:

(A) eligible to participate in a school

district's special education program under Section 29.003; or

(B) covered by Section 504, Rehabilitation Act of

1973 (29 U.S.C. Section 794).

(3) "Curriculum" means a complete course of study for

a particular content area or grade level.

(4) "Financial institution" means a bank, credit

union, savings bank, or savings and loan association organized

under the laws of this state, the laws of another state, or federal

law that has its main office or a branch office in this state. The

term does not include any institution the deposits of which are not

insured by the Federal Deposit Insurance Corporation or the

National Credit Union Administration.

(5) "Parent" means a resident of this state who is a

natural or adoptive parent, managing or possessory conservator,

legal guardian, custodian, or other person with legal authority to

act on behalf of a child.

(6) "Postsecondary educational institution" means:

(A) an institution of higher education or a

private or independent institution of higher education as defined

by Section 61.003; or

(B) a career school or college as defined by

Section 132.001.

(7) "Program" means the empowerment scholarship

account program established under this subchapter.

(8) "Program participant" means a child and a parent

of a child enrolled in the program.

Sec. 29.352. PURPOSES. The purposes of the empowerment

scholarship account program are to:

(1) improve public schools and overall academic

performance;

(2) promote efficiency;

(3) promote and preserve the liberties and rights of

the people; and

(4) increase parental options.

Sec. 29.353. ESTABLISHMENT OF PROGRAM. (a) The

comptroller shall establish and administer an empowerment

scholarship account program to provide funding for certain

education-related expenses of eligible children.

(b) The comptroller, with cooperation from the agency,

shall ensure that information about the program is readily

available to the public through various sources, including the

agency's Internet website. The comptroller shall make information

about the program available to parents of children eligible to

participate in the program through the comptroller's Internet

website.

Sec. 29.354. ELIGIBLE CHILD. (a) A child is eligible to

participate in the program if the child is eligible to attend a

public school under Section 25.001.

(b) A child may participate in the program until the

earliest of the following dates:

(1) the date on which the child graduates from high

school;

(2) the date on which the child is no longer eligible

to attend a public school under Section 25.001;

(3) the date on which the child enrolls in a public

school, including an open-enrollment charter school; or

(4) the date on which the child is declared ineligible

for the program by the comptroller under this subchapter.

(c) Notwithstanding Subsection (b), the comptroller shall

establish guidelines for, in the least disruptive manner possible:

(1) a child participating in the program to cease

participation and enroll in a public school, including an

open-enrollment charter school; and

(2) a child who previously participated in the program

and subsequently enrolled in a public school, including an

open-enrollment charter school, to resume participation in the

program.

Sec. 29.355. ENROLLMENT IN PROGRAM. (a) A parent of an

eligible child may enroll the child in the program for the following

school year.

(b) The comptroller shall by rule create an enrollment form

for the program and make the enrollment form readily available to

interested parents through various sources, including the

comptroller's Internet website.

(c) The comptroller shall provide to each parent who submits

an enrollment form a publication that describes the operation of

the program, including:

(1) expenses allowed under the program under Section

29.357;

(2) expense reporting requirements; and

(3) a description of the responsibilities of program

participants and the duties of the comptroller under this

subchapter.

Sec. 29.356. PARTICIPATION IN PROGRAM. (a) To receive

funding under the program, a parent of an eligible child must agree

to:

(1) spend funds received through the program only for

expenses allowed under Section 29.357;

(2) notify the comptroller if the child enrolls in a

public school, including an open-enrollment charter school, not

later than the 30th day after the date of enrollment; and

(3) inform the comptroller if the child graduates from

high school.

(b) The parent of a child participating in the program is

the trustee of the child's account.

(c) The comptroller shall provide annually to each program

participant the publication provided under Section 29.355(c).

Sec. 29.357. APPROVED EDUCATION-RELATED EXPENSES. (a)

Funds received under the program may be used only for the following

expenses incurred by a program participant:

(1) tuition and fees:

(A) at a private school accredited by an

organization that is recognized by the Texas Private School

Accreditation Commission;

(B) at a postsecondary educational institution;

or

(C) for an online educational course or program;

(2) the purchase of textbooks or other instructional

materials;

(3) the purchase of a curriculum;

(4) fees for classes or other educational services

provided by a public school, if the classes or services do not

qualify the child to be included in the school's average daily

attendance;

(5) fees for services provided by a private tutor or

teaching service;

(6) for a child with a disability, fees for

educational therapies or services provided by a practitioner or

provider;

(7) costs of computer hardware and software and other

technological devices, not to exceed in any year 10 percent of the

total amount paid to the program participant's account that year;

(8) fees for a nationally norm-referenced achievement

test or examination, an assessment instrument adopted by the agency

under Section 39.023, an advanced placement test or similar

examination, or any examination related to college or university

admission; and

(9) fees for the management of the participant's

account charged by a financial institution.

(b) Expenses allowed under Subsection (a) do not include

expenses for:

(1) consumable supplies, including paper, pens,

pencils, folders, and notebooks;

(2) food; or

(3) before-school or after-school child care or child

care during school holidays and vacations.

(c) An education service provider or vendor of educational

products must provide a program participant with a receipt for each

expense allowed under Subsection (a) charged by the provider or

vendor to the participant.

(d) The content or religious nature of a product or service

may not be considered in determining whether a payment for the

product or service is an expense allowed under Subsection (a).

(e) A finding that a program participant used funds

distributed under the program to pay for an expense not allowed

under Subsection (a) does not affect the validity of any payment

made by the participant for an expense that is allowed under that

subsection.

Sec. 29.358. AMOUNT OF PAYMENT; FINANCING. (a) A parent of

an eligible child shall receive each year that the child

participates in the program quarterly payments from the state to

the child's account equal to a total amount of $10,000.

(b) In addition to any funding the district receives under

Chapter 48, for each child participating in the program, the school

district the child would otherwise attend is entitled to receive

for the first year in which the child participates in the program an

amount equal to 50 percent of the difference between:

(1) the state average maintenance and operations

expenditures per student in average daily attendance for the

preceding fiscal year; and

(2) the amount the child's parent receives under

Subsection (a) for the year.

(c) Any funds remaining in a child's account at the end of a

fiscal year are carried forward to the next fiscal year unless

another provision of this subchapter mandates the closure of the

account.

(d) The parent of a child participating in the program may

make payments for the expenses of educational programs, services,

and products not covered by funds in the child's account.

(e) A payment under Subsection (a) may not be financed using

federal funds or money appropriated from the available school fund.

Sec. 29.359. ADMINISTRATION OF ACCOUNTS. (a) The

comptroller may contract with one or more financial institutions to

establish and manage an account for each child participating in the

program. A program participant must be able to access the

participant's account by using a debit card or online or electronic

transfer payment service.

(b) The comptroller shall make quarterly payments to each

program participant's account in equal amounts on or before the

15th day of August, November, February, and May.

(c) The comptroller may deduct an amount from each quarterly

payment to a program participant's account to cover the

comptroller's cost of administering the program. The amount

deducted may not exceed five percent of the payment.

(d) Not later than 30 days after the end of each fiscal year,

the comptroller shall reconcile payments made to and from all

accounts under the program.

(e) On the date on which a child who participated in the

program is no longer eligible to participate in the program under

Section 29.354(b), the child's account is closed and any remaining

funds are returned to the state for deposit in the foundation school

fund.

(f) The comptroller may contract with a private entity to

administer all or any part of the program.

Sec. 29.360. RANDOM AUDITING OF ACCOUNTS. (a) The

comptroller shall contract with a private entity to randomly audit

accounts as necessary to ensure compliance with applicable law and

the requirements of the program.

(b) In auditing an account, the comptroller or private

entity may require that a program participant provide further

information and documentation regarding any payment from the

participant's account.

(c) The private entity shall report to the comptroller any

violation of this subchapter or other relevant law found by the

entity during an audit conducted under this section.

Sec. 29.361. SUSPENSION OF ACCOUNT. (a) The comptroller

shall suspend the account of a program participant who fails to

comply with applicable law or a requirement of the program,

including a requirement under Section 29.356(a), or who

substantially misuses funds received under the program.

(b) On suspension of an account under Subsection (a), the

comptroller shall notify the program participant in writing that

the account has been suspended and that no further payments may be

made from the account. The notification must specify the grounds

for the suspension and state that the participant has 10 business

days to respond and take any corrective action required by the

comptroller.

(c) On the expiration of the 10-day period under Subsection

(b), the comptroller shall:

(1) order permanent closure of the suspended account

and declare the program participant ineligible for the program;

(2) order temporary reinstatement of the account,

conditioned on the performance of a specified action by the

participant; or

(3) order full reinstatement of the account.

(d) The comptroller may recover funds distributed under the

program that were used for expenses not allowed under Section

29.357(a) from the program participant or the entity that received

the funds if the participant's account is suspended or closed under

this section.

Sec. 29.362. TUITION AND FEES; REFUND PROHIBITED. (a) An

education service provider may not charge a child participating in

the program an amount greater than the standard amount charged for

that service by the provider.

(b) An education service provider or a vendor of educational

products receiving funds distributed under the program may not in

any manner rebate, refund, or credit to or share with a program

participant, or any person on behalf of a participant, any program

funds paid or owed by the participant to the provider or vendor.

Sec. 29.363. REFERRAL TO ATTORNEY GENERAL. (a) If the

comptroller obtains evidence of fraudulent use of an account, the

comptroller may refer the case to the attorney general for

investigation.

(b) With the consent of the appropriate local county or

district attorney, the attorney general has concurrent

jurisdiction with the consenting local prosecutor to prosecute an

offense referred to the attorney general under Subsection (a).

Sec. 29.364. PROVIDER ACCOUNTABILITY. (a) A private school

must be accredited by an organization that is recognized by the

Texas Private School Accreditation Commission to receive funds

distributed under the program.

(b) A private tutor or teaching service and a practitioner

or provider who provides educational therapies or services for a

child with a disability must be licensed or accredited by a regional

or national accrediting organization to receive funds distributed

under the program.

Sec. 29.365. PROGRAM PARTICIPANT, PROVIDER, AND VENDOR

AUTONOMY. (a) An education service provider or vendor of

educational products that receives funds distributed under the

program is not an agent of the state or federal government.

(b) Except as provided by this subchapter, the comptroller,

the agency, the State Board of Education, any other state agency, or

any school district may not:

(1) regulate the educational program of an education

service provider or vendor of educational products that receives

funds distributed under the program; or

(2) exercise control or supervision over a program

participant or an education service provider or vendor of

educational products that receives funds distributed under the

program.

(c) The program does not expand the regulatory authority of

the state or any school district to impose any additional

regulation on an education service provider or vendor of

educational products except those reasonably necessary to enforce

the program as provided by this subchapter.

(d) A private school may not be required to modify the

school's creed, practices, admissions policies, curriculum,

performance standards, or assessments to receive funds distributed

under the program.

(e) A private school voluntarily selected by a parent for

the parent's child to attend or a parent who homeschools the

parent's child, with or without governmental assistance, may not be

required to comply with any state law or rule governing the

applicable educational program that was not in effect on January 1,

2025.

(f) In any proceeding challenging a rule adopted by a state

agency or officer under this subchapter, the agency or officer has

the burden of proof to establish that the rule:

(1) is necessary to implement or enforce the program

as provided by this subchapter; and

(2) does not impose an undue burden on a program

participant or an education service provider or vendor of

educational products that receives or seeks to receive funds

distributed under the program.

Sec. 29.366. STUDENT RECORDS AND INFORMATION. (a) On

request by the parent of a child participating in the program, the

school district or open-enrollment charter school that the child

would otherwise attend shall provide a copy of the child's school

records possessed by the district or school, if any, to the child's

parent or, if applicable, the private school the child attends.

(b) The agency shall provide to the comptroller any

information available to the agency requested by the comptroller

regarding a child who participates or seeks to participate in the

program.

Sec. 29.367. REPORTING NUMBER OF PARTICIPANTS. (a) Not

later than October 1 of each year, the comptroller shall notify the

commissioner and the Legislative Budget Board of the number of

eligible children likely to participate in the program,

disaggregated by the school district or open-enrollment charter

school the eligible children would otherwise attend.

(b) Not later than March 1 of each year, the comptroller

shall provide final information to the commissioner and the

Legislative Budget Board regarding the number of children

participating in the program, disaggregated in the same manner as

the initial information under Subsection (a).

Sec. 29.368. ANNUAL SURVEY. The comptroller may conduct an

annual parental satisfaction survey that asks each parent of a

child participating in the program to express:

(1) the parent's overall level of satisfaction with

the program; and

(2) the parent's opinion on specified topics and

issues relevant to the effectiveness of the program.

Sec. 29.369. RULES. The comptroller shall:

(1) adopt rules as necessary to implement this

subchapter, including:

(A) rules regarding expense reporting

requirements for program participants; and

(B) rules for implementing this subchapter in a

manner that ensures compliance with federal law regarding

confidentiality of student educational information, including the

Family Educational Rights and Privacy Act of 1974 (20 U.S.C.

Section 1232g); and

(2) coordinate as necessary to:

(A) calculate annually the savings to the state

from the implementation of the program; and

(B) prevent fraud in financial transactions

under the program, including by adopting measures to permit

anonymous fraud reporting by telephone hotline or online

communication.

Sec. 29.370. GIFTS, GRANTS, AND DONATIONS. The comptroller

may solicit and accept gifts, grants, and donations from any public

or private source for any expenses related to the administration of

the program, including the initial implementation of the program.

SECTION 2. Section 48.266, Education Code, is amended by

adding Subsection (b-1) to read as follows:

(b-1) Notwithstanding Subsection (b), the commissioner

shall adjust enrollment estimates and entitlement for each school

district for each school year based on information provided by the

comptroller under Section 29.367. This subsection expires

September 1, 2028.

SECTION 3. Notwithstanding Section 29.359(b), Education

Code, as added by this Act, not later than September 15, 2026, the

comptroller shall make the initial payment to each program

participant's education savings account as provided by Subchapter

J, Chapter 29, Education Code, as added by this Act.

SECTION 4. This Act applies beginning with the 2026-2027

school year.

SECTION 5. This Act takes effect immediately if it receives

a vote of two-thirds of all the members elected to each house, as

provided by Section 39, Article III, Texas Constitution. If this

Act does not receive the vote necessary for immediate effect, this

Act takes effect September 1, 2025.