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A BILL TO BE ENTITLED
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AN ACT
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relating to the payment of certain education expenses using the |
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state's programs for paying, prepaying, or saving toward the costs |
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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 a registered apprenticeship program described by Section |
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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 tuition and required fees for a registered |
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apprenticeship program as if the apprenticeship program were an |
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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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registered apprenticeship program tuition and required fees. The |
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board is not responsible for the payment of registered |
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apprenticeship program tuition and required fees 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, "registered apprenticeship |
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program" means an apprenticeship program that is registered and |
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certified with the United States Department of Labor under Section |
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1 of the National Apprenticeship Act (29 U.S.C. Section 50 et seq.). |
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SECTION 3. Section 54.751, Education Code, is amended by |
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amending Subdivisions (2) and (6) and adding Subdivision (9-a) to |
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read as follows: |
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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) registered apprenticeship program tuition |
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and required fees. |
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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) registered apprenticeship program tuition |
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and required fees. |
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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 Section 1 of the National |
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Apprenticeship Act (29 U.S.C. Section 50 et seq.). |
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SECTION 4. 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 |
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education, or registered apprenticeship program by entering into a |
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prepaid tuition contract with the board to purchase one or more |
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tuition units of a type described by this section at the applicable |
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price established by the board for that type of unit for the year in |
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which the unit is purchased. The portion of the beneficiary's |
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undergraduate tuition and required fees for which a tuition unit |
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may be redeemed at a particular general academic teaching |
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institution or two-year institution of higher education is assigned |
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to the tuition unit at the time of purchase, and the tuition unit |
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may be redeemed to pay that portion of the tuition and fees at the |
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general academic teaching institution or two-year institution of |
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higher education in any academic year in which the unit is redeemed |
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in accordance with this subchapter. The purchaser may purchase one |
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type of unit or a combination of two or three types of units. |
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SECTION 5. Sections 54.754(a) and (d), Education Code, are |
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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, the board shall apply |
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money in the fund, in the amount provided by Section 54.765 to pay |
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all or the applicable portion of the costs of the beneficiary's |
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tuition and required fees at the 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 registered apprenticeship program in which the |
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beneficiary enrolls. Subject to Subsection (b)(2) and the other |
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provisions of this section, a beneficiary may redeem any type of |
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tuition unit for attendance at an institution, [or] unit, school, |
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or program described by this section. A general academic teaching |
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institution or two-year institution of higher education shall |
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accept the amount transferred to the institution under Section |
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54.765(c) when the unit or units are redeemed as payment for all or |
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the applicable portion of the beneficiary's tuition and required |
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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 |
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institution of higher education, or registered apprenticeship |
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program at which the beneficiary enrolls, the beneficiary is |
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responsible for paying the amount of the difference between the |
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amount of tuition and required fees for which the beneficiary pays |
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through the redemption of one or more tuition units and the total |
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cost of the beneficiary's tuition and required fees at the |
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institution, [or] unit, school, or program. |
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SECTION 6. 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 that would be covered by redemption of the number |
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and type of tuition units the beneficiary is redeeming if the |
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beneficiary were redeeming the unit or units at a general academic |
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teaching institution or two-year institution of higher education as |
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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 7. 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 8. 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 |
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institution of higher education, or registered apprenticeship |
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program under this chapter are exempt from attachment, levy, |
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garnishment, execution, and seizure for the satisfaction of any |
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debt, judgment, or claim against a purchaser, beneficiary, or |
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successor in interest of a 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 registered apprenticeship program under a |
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prepaid tuition contract. |
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SECTION 9. Section 54.774(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 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 10. 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, school, or program shall keep the |
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information confidential. |
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SECTION 11. Section 54.801(1), Education Code, is amended |
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to read as follows: |
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(1) "Accredited out-of-state institution of higher |
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education," "career school," "general academic teaching |
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institution," "medical and dental unit," "private or independent |
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institution of higher education," "registered apprenticeship |
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program," and "two-year institution of higher education" have the |
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meanings assigned by Section 54.751. |
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SECTION 12. 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, 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 at which a |
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beneficiary may enroll or is enrolled. The institution, unit, [or] |
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school, or program receiving information described by Subsection |
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(a) shall keep the information confidential. |
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SECTION 13. 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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tuition and required fees for a registered apprenticeship program |
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applies to contract benefits purchased under Subchapters F and H, |
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Chapter 54, Education Code, as amended by this Act, before, on, or |
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after the effective date of this Act. |
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SECTION 14. This Act takes effect September 1, 2021. |