MMA C.S.H.B. 3356 75(R)BILL ANALYSIS HIGHER EDUCATION C.S.H.B. 3356 By: Rangel 4-11-97 Committee Report (Substituted) BACKGROUND During the 74th Legislative Session, H.B. 1479 created the Early High School Graduation Scholarship Program. The program provides $1,000 scholarships to students who graduate from high school in three years or less. It also provides one year college tuition and fee exemptions for high school seniors on AFDC. The scholarships are funded through savings to the Foundation School Program that the state incurs as a result of students graduating early. Under current statute, the Texas Higher Education Coordinating Board (THECB) is directed to reimburse institutions for the scholarships they have granted. The commissioner of education then must transfer to THECB, from funds appropriated for the Foundation School Program, an amount sufficient to reimburse THECB for disbursed payments. This statute requires THECB to expend funds prior to receiving reimbursement from the commissioner of education. However, THECB was not appropriated funds for that purpose, and they cannot expend funds for which they have not received an appropriation. During the interim, THECB and the commissioner of education negotiated a solution that permitted THECB to receive payment from the education agency before reimbursing the institutions. The Comptroller reluctantly agreed to this compromise although it conflicts with the statute. However, without it, the program would not have been implemented. PURPOSE C.S.H.B. 3356 would mandate that the commissioner of education transfer to THECB, from funds appropriated for the Foundation School Program, an amount sufficient to pay each eligible institution of higher education the amount of state tuition credit applied by the institution. Also, requires THECB to distribute the appropriate amount of funds to each eligible institution upon receipt of the funds. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 56.207, Education Code to read as follows: (a) Deletes language requiring THECB to distribute funds to an institution upon receipt of a report from an eligible institution. Requires THECB to submit a report at least once a year to the commissioner of education to include the following information: (1) name of student who used state tuition credit; (2) name of school district from which each student graduated from high school; (3) the amount of state tuition credit used by each student. (b) Requires the commissioner of education, upon receipt of the report, to transfer to THECB, funds appropriated for the Foundation School Program, an amount sufficient to pay each eligible institution the amount of state tuition credit applied by the institution during the period covered by the report. (c) Mandates the THECB to distribute the funds, upon their receipt, to each eligible institution. SECTION 2. Effective date: September 1, 1997. SECTION 3. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.H.B. 3356 makes non-substantive language changes as recommended by Legislative Council.