SRC-HRD S.B. 1299 75(R)   BILL ANALYSIS


Senate Research Center   S.B. 1299
By: Ellis
Finance
4-2-97
As Filed


DIGEST 

Currently, Texas law provides for junior college, senior college,
junior-senior college, and private college prepaid tuition plans.  This
bill would provide a tuition savings plan for the purpose of prepaying
tuition for the beneficiary of the plan to attend a public or private
institution of higher education.   

PURPOSE

As proposed, S.B. 1299 establishes a tuition savings plan for the purpose
of providing for the prepayment of tuition for a student to attend a
public or private institution of higher education. 

RULEMAKING AUTHORITY

Rulemaking authority is granted to the Prepaid Higher Education Tuition
Board under SECTION 1 (Sections 54.6255(d) and (h), Education Code) of
this bill. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 54F, Education Code, by adding Section 54.6255,
as follows: 

Sec. 54.6255.  TUITION SAVINGS PLAN.  Requires the Prepaid Higher
Education Tuition Board (board), in addition to the plans listed under
Section 54.622, to establish and administer a tuition savings plan as
provided by this section.  Requires the plan to permit a person to
establish an account in the Texas tomorrow fund for the benefit of a
designated individual beneficiary who is younger than 18 years of age when
the account is established, for the purpose of prepaying tuition for the
beneficiary to attend a public or private institution for higher
education.  Sets forth provisions regarding deposits into an account.
Sets forth provisions regarding the credits to and deductions from the
account, and determining the income attributable to the amount in the
account.  Authorizes the beneficiary of the account to apply any portion
of the current balance to pay tuition and required fees at any accredited
public or private institution of higher education in or outside this state
at which the beneficiary is enrolled.  Requires the board to establish
payment procedures to ensure that the money is applied to tuition and fees
as required by this subsection.  Sets forth provisions regarding the
closing of the account.  Authorizes the person who established the account
to apply all or part of the current value of the account to the purchase
plan listed in Section 54.622 if that plan is established for the same
beneficiary.  Sets forth provisions regarding the naming of a successor
and the transference of all rights of the person over the account to
another person.  Authorizes an account to be maintained as long as the
beneficiary is living. Requires the board, if the program is abolished, to
refund to the person who established the account the current value of the
account when the refund is made. 

SECTION 2. (a) Effective date: September 1, 1997.  

(b) Requires the board to establish the program provided by Section
56.6255, Education Code, as added by this Act, and begin establishing
accounts under that section no later than January 1, 1998. 

SECTION 3. Emergency clause.