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A BILL TO BE ENTITLED
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AN ACT
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relating to the payment of apprenticeship education expenses using |
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the state's programs for paying, prepaying, or saving toward the |
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costs of attending an institution of higher education. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 54.605(a), Education Code, is amended to |
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read as follows: |
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(a) A prepaid tuition contract remains in effect after the |
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program is terminated if, when the program is terminated, the |
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beneficiary: |
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(1) has been accepted by or is enrolled in an |
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institution of higher education, a private or independent |
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institution of higher education, [or] a career school or college, |
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or an apprenticeship program described by Section 54.619(i); or |
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(2) is projected to graduate from high school not |
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later than the third anniversary of the date the program is |
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terminated. |
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SECTION 2. Section 54.619, Education Code, is amended by |
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adding Subsection (i) to read as follows: |
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(i) Notwithstanding other provisions of this subchapter, |
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any contract benefits purchased under this subchapter may be |
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applied to the payment of apprenticeship program expenses for a |
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registered apprenticeship program as if the apprenticeship program |
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were an institution of higher education or private or independent |
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institution of higher education. On the purchaser's request, the |
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board shall apply, in accordance with Section 54.628, any existing |
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amount of prepaid tuition contract benefits to the payment of |
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apprenticeship program expenses. The board is not responsible for |
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the payment of apprenticeship program expenses in excess of that |
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amount. The board may adopt rules as necessary to implement this |
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subsection. In this subsection, "apprenticeship program expenses" |
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means expenses for fees, books, supplies, and equipment required |
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for a beneficiary to participate in an apprenticeship program that |
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is registered and certified with the United States Department of |
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Labor under the National Apprenticeship Act (29 U.S.C. Section 50 |
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et seq.). |
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SECTION 3. Section 54.701(8), Education Code, is amended to |
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read as follows: |
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(8) "Qualified higher education expenses" has the |
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meaning assigned by Section 529, Internal Revenue Code of 1986, as |
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amended, and includes expenses for fees, books, supplies, and |
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equipment required for the beneficiary to participate in an |
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apprenticeship program that is registered and certified with the |
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United States Department of Labor under the National Apprenticeship |
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Act (29 U.S.C. Section 50 et seq.). |
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SECTION 4. Section 54.751, Education Code, is amended by |
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adding Subdivisions (1-a) and (9-a) and amending Subdivisions (2) |
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and (6) to read as follows: |
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(1-a) "Apprenticeship program expenses" means the |
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expenses for fees, books, supplies, and equipment required for a |
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beneficiary to participate in a registered apprenticeship program. |
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(2) "Beneficiary" means the person designated under a |
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prepaid tuition contract as the person entitled to apply one or more |
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tuition units purchased under the contract to the payment of the |
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person's: |
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(A) undergraduate tuition and required fees at a |
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general academic teaching institution, two-year institution of |
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higher education, private or independent institution of higher |
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education, medical and dental unit, career school, or accredited |
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out-of-state institution of higher education; and |
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(B) apprenticeship program expenses. |
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(6) "Prepaid tuition contract" means a contract under |
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which a person purchases from the board on behalf of a beneficiary |
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one or more tuition units that the beneficiary is entitled to apply |
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to the payment of the beneficiary's: |
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(A) undergraduate tuition and required fees at a |
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general academic teaching institution, two-year institution of |
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higher education, private or independent institution of higher |
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education, medical and dental unit, career school, or accredited |
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out-of-state institution of higher education; or |
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(B) apprenticeship program expenses. |
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(9-a) "Registered apprenticeship program" means an |
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apprenticeship program that is registered and certified with the |
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United States Department of Labor under the National Apprenticeship |
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Act (29 U.S.C. Section 50 et seq.). |
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SECTION 5. Section 54.753(a), Education Code, is amended to |
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read as follows: |
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(a) Under the program, a purchaser may prepay the costs of |
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all or a portion of a beneficiary's undergraduate tuition and |
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required fees at a general academic teaching institution, two-year |
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institution of higher education, private or independent |
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institution of higher education, medical and dental unit, career |
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school, or accredited out-of-state institution of higher education |
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or all or a portion of the beneficiary's apprenticeship program |
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expenses by entering into a prepaid tuition contract with the board |
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to purchase one or more tuition units of a type described by this |
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section at the applicable price established by the board for that |
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type of unit for the year in which the unit is purchased. The |
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portion of the beneficiary's undergraduate tuition and required |
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fees for which a tuition unit may be redeemed at a particular |
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general academic teaching institution or two-year institution of |
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higher education is assigned to the tuition unit at the time of |
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purchase, and the tuition unit may be redeemed to pay that portion |
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of the tuition and fees at the general academic teaching |
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institution or two-year institution of higher education in any |
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academic year in which the unit is redeemed in accordance with this |
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subchapter. The purchaser may purchase one type of unit or a |
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combination of two or three types of units. |
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SECTION 6. Sections 54.754(a), (d), and (e), Education |
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Code, are amended to read as follows: |
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(a) In accordance with this subchapter, when a beneficiary |
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under a prepaid tuition contract redeems one or more tuition units |
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to pay costs of tuition and required fees or apprenticeship program |
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expenses, the board shall apply money in the fund, in the amount |
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provided by Section 54.765 to pay all or the applicable portion of |
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the costs of the beneficiary's tuition and required fees at the |
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general academic teaching institution, two-year institution of |
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higher education, private or independent institution of higher |
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education, medical and dental unit, or accredited out-of-state |
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institution of higher education in which the beneficiary enrolls or |
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the beneficiary's apprenticeship program expenses. Subject to |
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Subsection (b)(2) and the other provisions of this section, a |
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beneficiary may redeem any type of tuition unit for attendance at an |
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institution, [or] unit, or program described by this section. A |
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general academic teaching institution or two-year institution of |
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higher education shall accept the amount transferred to the |
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institution under Section 54.765(c) when the unit or units are |
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redeemed as payment for all or the applicable portion of the |
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beneficiary's tuition and required fees. |
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(d) If a beneficiary redeems fewer tuition units of the type |
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or combination of types necessary to pay the total cost of the |
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beneficiary's tuition and required fees at the general academic |
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teaching institution, two-year institution of higher education, |
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private or independent institution of higher education, medical and |
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dental unit, career school, or accredited out-of-state institution |
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of higher education at which the beneficiary enrolls or |
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apprenticeship program expenses, the beneficiary is responsible |
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for paying the amount of the difference between the amount of |
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tuition and required fees or expenses for which the beneficiary |
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pays through the redemption of one or more tuition units and the |
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total cost of the beneficiary's tuition and required fees at the |
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institution or unit or the beneficiary's apprenticeship program |
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expenses. |
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(e) If the beneficiary redeems fewer tuition units to pay |
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the cost of tuition and required fees or apprenticeship program |
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expenses than the number of units purchased on behalf of the |
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beneficiary under a prepaid tuition contract, other than to defer |
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redemption as permitted in accordance with Section 54.758, the |
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purchaser may: |
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(1) redeem for cash the amount of the purchase price of |
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the excess units, plus annual interest earned on that money, |
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accrued at a rate set by the board not to exceed five percent |
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annually; or |
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(2) transfer the remaining units to another |
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beneficiary in accordance with this subchapter. |
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SECTION 7. Section 54.758(a), Education Code, is amended to |
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read as follows: |
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(a) A prepaid tuition contract must permit the beneficiary |
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to elect to pay from a source other than tuition units purchased |
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under the contract the beneficiary's tuition and required fees or |
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apprenticeship program expenses for some or all of the tuition and |
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required fees or apprenticeship program expenses to which the |
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beneficiary is entitled to payment under the contract, and to defer |
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to a subsequent semester or other academic term the right to payment |
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of the beneficiary's tuition and required fees or apprenticeship |
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program expenses by using tuition units remaining under the |
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contract. |
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SECTION 8. Section 54.765(f), Education Code, is amended to |
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read as follows: |
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(f) When a beneficiary enrolls at a private or independent |
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institution of higher education, medical and dental unit, career |
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school, [or] accredited out-of-state institution of higher |
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education, or registered apprenticeship program, on written |
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authorization from the purchaser of the tuition unit or units for |
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that beneficiary, the comptroller or the comptroller's authorized |
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representative shall transfer to the institution the lesser of: |
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(1) an amount equal to the current cost of the tuition |
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and required fees or apprenticeship program expenses that would be |
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covered by redemption of the number and type of tuition units the |
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beneficiary is redeeming if the beneficiary were redeeming the unit |
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or units at a general academic teaching institution or two-year |
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institution of higher education as follows: |
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(A) for a Type I unit, at the general academic |
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teaching institution that had the highest tuition and required fee |
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cost; |
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(B) for a Type II unit, at a general academic |
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teaching institution that had tuition and required fee cost at the |
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weighted average; and |
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(C) for a Type III unit, at a two-year |
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institution of higher education that had tuition and required fee |
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cost at the weighted average; or |
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(2) an amount equal to the total purchase price of the |
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tuition unit or units the beneficiary redeems for the semester or |
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other academic term plus the portion of the total return on assets |
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of the fund attributable to that amount. |
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SECTION 9. Section 54.767, Education Code, is amended to |
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read as follows: |
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Sec. 54.767. USE OF FUND ASSETS. The assets of the fund may |
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be used only to: |
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(1) pay the costs of program administration and |
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operations; |
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(2) make payments to general academic teaching |
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institutions, two-year institutions of higher education, private |
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or independent institutions of higher education, medical and dental |
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units, career schools, [and] accredited out-of-state institutions |
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of higher education, and registered apprenticeship programs on |
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behalf of beneficiaries; and |
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(3) make refunds under prepaid tuition contracts. |
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SECTION 10. Sections 54.769(b) and (c), Education Code, are |
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amended to read as follows: |
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(b) The rights of a purchaser, beneficiary, or successor in |
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interest of a purchaser or beneficiary in and under a prepaid |
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tuition contract and the payment of tuition and required fees for a |
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beneficiary under a prepaid tuition contract to a general academic |
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teaching institution, two-year institution of higher education, |
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private or independent institution of higher education, medical and |
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dental unit, career school, or accredited out-of-state institution |
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of higher education or apprenticeship program expenses under this |
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chapter are exempt from attachment, levy, garnishment, execution, |
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and seizure for the satisfaction of any debt, judgment, or claim |
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against a purchaser, beneficiary, or successor in interest of a |
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purchaser or beneficiary. |
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(c) A claim or judgment against a purchaser, beneficiary, or |
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successor in interest of a purchaser or beneficiary does not impair |
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or entitle the claim or judgment holder to assert or enforce a lien |
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against: |
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(1) the rights of a purchaser, beneficiary, or |
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successor in interest of a purchaser or beneficiary in and under a |
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prepaid tuition contract; or |
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(2) the right of a beneficiary to the payment of |
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tuition and required fees to a general academic teaching |
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institution, two-year institution of higher education, private or |
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independent institution of higher education, medical and dental |
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unit, career school, or accredited out-of-state institution of |
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higher education or apprenticeship program expenses under a prepaid |
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tuition contract. |
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SECTION 11. Section 54.774(a), Education Code, is amended |
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to read as follows: |
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(a) A prepaid tuition contract remains in effect after the |
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program is terminated if, when the program is terminated, the |
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beneficiary: |
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(1) has been accepted by or is enrolled at a general |
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academic teaching institution, two-year institution of higher |
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education, private or independent institution of higher education, |
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medical and dental unit, career school, [or] accredited |
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out-of-state institution of higher education, or registered |
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apprenticeship program; or |
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(2) is projected to graduate from high school not |
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later than the third anniversary of the date the program is |
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terminated. |
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SECTION 12. Section 54.775(b), Education Code, is amended |
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to read as follows: |
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(b) Notwithstanding Subsection (a), the board may release |
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information described by that subsection to a general academic |
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teaching institution, two-year institution of higher education, |
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private or independent institution of higher education, medical and |
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dental unit, career school, [or] accredited out-of-state |
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institution of higher education, or registered apprenticeship |
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program at which a beneficiary may enroll or is enrolled. The |
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institution, [or] unit, or program shall keep the information |
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confidential. |
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SECTION 13. Section 54.806(b), Education Code, is amended |
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to read as follows: |
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(b) Notwithstanding Subsection (a), the board or program |
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entity may release information described by Subsection (a) to the |
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extent required by a general academic teaching institution, |
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two-year institution of higher education, private or independent |
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institution of higher education, career school, [or] accredited |
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out-of-state institution of higher education, or registered |
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apprenticeship program at which a beneficiary may enroll or is |
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enrolled. The institution, [or] school, or program receiving |
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information described by Subsection (a) shall keep the information |
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confidential. |
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SECTION 14. The change in law made by this Act regarding the |
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application of prepaid tuition contract benefits to the payment of |
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apprenticeship program expenses for a registered apprenticeship |
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program applies to contract benefits purchased under Subchapters F |
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and H, Chapter 54, Education Code, as amended by this Act, before, |
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on, or after the effective date of this Act. |
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SECTION 15. This Act takes effect September 1, 2021. |