C.S.H.B. 2465 78(R)    BILL ANALYSIS

C.S.H.B. 2465
By: Grusendorf
Public Education
Committee Report (Substituted)


Currently, parents can choose to send their children to public schools,
private institutions, or homeschool their child. However, many parents
find choices other than public school financially unfeasible. In some
school districts many parents might feel that public schools do not meet
the educational needs of their children, and that private schools provide
an acceptable alternative. Unfortunately, many parents are either unable
to take advantage of this option, or are only able to do so with a
considerable financial sacrifice. 


C.S.H.B. 2465 establishes the Education Freedom Program in those school
districts in Texas where enrollment is greater than 40,000 and a majority
of students are educationally disadvantaged. The purpose of the bill is
provide parents of all incomes the ability to choose whether to send their
children to a public or private school. 


It is the committee's opinion that rulemaking authority is expressly
granted to the comptroller of public accounts in SECTION 1(Section 29.354
and Sec. 29.364, Education Code) and SECTION 3 of this bill. 


C.S.H.B. 2465 amends the Education Code by setting forth provisions
establishing the Education Freedom Program (program). The bill defines a
district that is eligible for the program as one in which, during the
2001-2002 school year, a majority of the students were educationally
disadvantaged and the enrollment was greater than 40,000. The bill defines
a private school as a nongovernmental educational establishment that
exists for the general education of elementary and secondary students but
not a school that provides education in a home setting by the parent or
that limits enrollment to relatives of the school's staff. 

The bill stipulates that a child eligible for the program reside in an
eligible district, have attended a public school for the majority the
preceding regular full semester, and reside in a household that had, in
their most recently filed federal income tax return, an annual household
income not exceeding 200% of the qualifying income for the reduced price
lunch under the national school lunch program. 
The bill provides that an eligible child may attend any public school in
the child's district of residence, attend a public school in another
district subject to provisions in Section 29.203, or  use a scholarship as
provided by this bill (Section 29.354) to pay the costs of attending a
private school. The bill provides that a child's scholarship is an amount
equal to the average funding per child for maintenance and operations,
during the preceding school year in the district in which the child
resides, at the time the child first becomes eligible for participation in
the program, from all sources other than the available school fund,
federal funds, and funds for special education programs. The bill sets
forth funding provisions for children entitled to special education

 The bill sets forth requirements regarding the administration of
scholarships by the comptroller including the calculation and distribution
of payments by the comptroller, and scholarship certificate issue and
endorsement. The bill provides that  a child's scholarship is the
entitlement of the child,  
under the supervision of the child's parent, and prohibits a private
school from sharing, refunding, or rebating a child's scholarship with the
parent or child in any manner.     

In order to participate in the program, the bill requires that a private
school be accredited by or have filed an application for accreditation by
an accrediting association recognized by the commissioner of education to
accredit nongovernmental schools in this state. The bill prohibits a
private school chosen by an eligible child's parent from discriminating on
the basis of the child's race, national origin, or ethnicity and sets
forth other provisions relating to private school admissions under the

The bill requires each private school that accepts a scholarship under
this program to annually administer in the spring either the appropriate
assessment instrument adopted by the Texas Education Agency (Section
39.023) or a norm-referenced assessment instrument approved by the
commissioner (Section 39.026). The bill requires, no later than September
1, 2005, the commissioner in conjunction with the comptroller and the
Charles A. Dana Center, to create a rating system under which a student in
this program is rated based on the student's yearly progress. 

The bill also requires a participating school district to offer each child
attending a private school under this program transportation free of
charge to and from the public school the child would otherwise attend and
authorizes a private school that accepts a scholarship under this program
to use any public school as a transportation collection location for the
private school's scholarship students. 

The bill prohibits a parent or child from being required to pay tuition in
addition to the child's scholarship. The bill provides that a  private
school in  this program is not an agent or arm of the state or federal
government and prohibits the Texas Education Agency, State Board of
Education, commissioner of education, comptroller, or any other state
agency from regulating the educational program of a private school under
this program beyond the conditions of the program. 

The bill sets forth provisions relating to the limitation of the number of
students participating in the program. For the 2005-2006 school year, the
bill stipulates that a district eligible for the program may include any
school district whose board of trustees adopts a resolution to participate
in the program and a child that resides in such a district will be
eligible for the program.  

The bill sets forth requirements of the comptroller in conjunction with
the Charles A. Dana Center relating to the evaluation of the program and
stipulates that this section on program evaluation expires June 1, 2010.
The bill requires the comptroller to make the education freedom program
available for participation no later than January 1, 2004. 


Upon passage, or, if the Act does not receive the necessary vote, the Act
takes effect September 1, 2003. 


C.S.H.B. 2465 modifies the original version by specifying eligible
districts as those with a majority of students that are educationally
disadvantaged rather than a majority of students eligible for the federal
free and reduced price lunch program.  

C.S.H.B. 2465 modifies the original by adding provisions relating to the
amount of a scholarship for a child that is eligible for special education
services (Section 29.354(c)). C.S.H.B. 2465 modifies the original by
authorizing the comptroller to require that a private school submit
evidence of the child's attendance at the private school before the
comptroller directs funds to the private school (Section 29.354(h)).
C.S.H.B. 2465 modifies the original by requiring the comptroller to direct
the distribution of funds to the district in which the child resides at
the time the child first becomes  eligible for participation in the
program on an annual basis.  

C.S.H.B. 2465 modifies the original by adding provisions relating to
student admissions and nondiscrimination (Section 29.356). C.S.H.B. 2465
modifies the original by adding provisions relating to an academic rating
system for students of private schools under the program. 

C.S.H.B. 2465 modifies the original by adding provisions that limit the
number of children in a school district who may participate in the program
to the lesser of: five percent of eligible children, or the number of
children for whom the total amount of scholarships is equal to three
percent of the districts total maintenance and operations revenue for the
preceding school year. 

C.S.H.B. 2465 modifies the original by requiring researchers who conduct
the evaluation study of the program to provide the legislature with a
final copy of the evaluation report.