1-1     By:  Bivins                                             S.B. No. 10
 1-2           (In the Senate - Filed March 4, 1999; March 4, 1999, read
 1-3     first time and referred to Committee on Education; March 29, 1999,
 1-4     reported adversely, with favorable Committee Substitute by the
 1-5     following vote:  Yeas 5, Nays 4; March 29, 1999, sent to printer.)
 1-6     COMMITTEE SUBSTITUTE FOR S.B. No. 10                    By:  Bivins
 1-7                            A BILL TO BE ENTITLED
 1-8                                   AN ACT
 1-9     relating to the creation of a public education scholarship program
1-10     for certain educationally disadvantaged children in certain school
1-11     districts.
1-12           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13           SECTION 1.  Chapter 29, Education Code, is amended by adding
1-14     Subchapter J to read as follows:
1-15                    Subchapter J.  PUBLIC EDUCATION SCHOLARSHIP
1-16                                   PROGRAM
1-17           Sec. 29.351.  DEFINITIONS.  In this subchapter:
1-18                 (1)  "Free school" means a nongovernmental educational
1-19     establishment that exists for the general education of elementary
1-20     or secondary students and that accepts funding from state and local
1-21     sources as provided by this subchapter in lieu of tuition for some
1-22     or all of its students.  The term does not include a school that
1-23     provides education in a home setting or by the parent or that
1-24     limits enrollment to relatives of the staff of the school.
1-25                 (2)  "Parent" includes a guardian or custodian.
1-26                 (3)  "Private school" means a nongovernmental
1-27     educational establishment that does not accept funding from state
1-28     and local sources as provided by this subchapter in lieu of
1-29     tuition.
1-30           Sec. 29.352.  ELIGIBILITY OF CHILD FOR PUBLIC EDUCATION
1-31     SCHOLARSHIP.  (a)  Except as provided by Section 29.368, a child is
1-32     eligible for a public education scholarship under this subchapter
1-33     if the child:
1-34                 (1)  attends school in a district whose central
1-35     administrative office is located in a county with a population of
1-36     more than 575,000;
1-37                 (2)  is educationally disadvantaged;
1-38                 (3)  did not perform satisfactorily on the most recent
1-39     assessment instrument administered to the child under Section
1-40     39.023 in reading, writing, or mathematics;
1-41                 (4)  was not enrolled in a private school during the
1-42     current or preceding school year; and
1-43                 (5)  was not enrolled in a free school during the
1-44     current or preceding school year, unless the child attended the
1-45     free school using a public education scholarship.
1-46           (b)  After a student has used a public education scholarship
1-47     to attend a free school, the student remains eligible for the
1-48     scholarship until the student again enrolls in a public school.
1-49           (c)  At any one time, no more than five percent of a school
1-50     district's total student population may be receiving scholarships
1-51     under this subchapter.
1-52           Sec. 29.353.  PARENTAL CHOICE.  (a)  A school district
1-53     described by Section 29.352(a)(1) shall notify the parent of each
1-54     child eligible for a public education scholarship that the child is
1-55     eligible to attend a free school as provided by this subchapter.
1-56           (b)  A child may attend a private school but may not receive
1-57     funding from state and local sources for that purpose under this
1-58     subchapter.
1-59           Sec. 29.354.  FINANCING.  (a)  Each school district is
1-60     entitled to receive state funding as provided by Chapter 42 and
1-61     other law.
1-62           (b)  A child eligible under Section 25.001 to attend school
1-63     in a school district but who attends a free school under this
1-64     subchapter and who registers that free school choice with the
 2-1     district shall be considered in determining the district's average
 2-2     daily attendance under Section 42.005.  The commissioner shall
 2-3     adopt a procedure that a free school shall use to report the
 2-4     average daily attendance of any student for whom the free school is
 2-5     receiving public education scholarship funds under this subchapter.
 2-6           Sec. 29.355.  PUBLIC EDUCATION SCHOLARSHIP.  (a)  Except as
 2-7     provided by Subsection (b), a child's public education scholarship
 2-8     is the sum of state and local revenues per student in average daily
 2-9     attendance under the Foundation School Program available to school
2-10     districts, if required, after exercising an option under Section
2-11     41.003, including all school district tax revenues and an amount
2-12     determined by the commissioner for each state fiscal biennium that
2-13     represents the average annual state expenditure per student for
2-14     textbooks and the technology allotment under Section 31.021(b)(2).
2-15           (b)  The district that a child attending a free school under
2-16     this subchapter would otherwise attend on the basis of residence
2-17     shall pay to the free school the lesser of:
2-18                 (1)  80 percent of the child's public education
2-19     scholarship; or
2-20                 (2)  an amount equal to the sum of state and local
2-21     revenues per student less the sum of the adjustments under Sections
2-22     42.103 and 42.105, distributions from the available school fund,
2-23     federal funds, and any district expenditures for debt service for
2-24     the acquisition or improvement of facilities, computed on a per
2-25     student basis.
2-26           (c)  A free school may not share with, refund to, or rebate
2-27     to the parent or child in any manner the child's public education
2-28     scholarship.  The school district the child would otherwise attend
2-29     is entitled to the remainder of the child's public education
2-30     scholarship funds.
2-31           Sec. 29.356.  TRANSPORTATION.  A free school shall provide to
2-32     each student using a public education scholarship transportation
2-33     without charge to and from the free school if the student would be
2-34     entitled to transportation without charge under Section 42.155 if
2-35     the free school were a public school.
2-36           Sec. 29.357.  CONDITIONS FOR RECEIPT OF FUNDS BY FREE
2-37     SCHOOLS. To receive a child's public education scholarship funds,
2-38     the free school selected for or by the child must certify to the
2-39     comptroller that the school has complied with the conditions
2-40     imposed by Sections 29.358-29.364.
2-41           Sec. 29.358.  ACCREDITATION.  A free school included in the
2-42     public education scholarship program must be accredited by a
2-43     private organization recognized by the commissioner, except that a
2-44     newly established free school may operate without such
2-45     accreditation if the school applies for accreditation before
2-46     accepting students under the program.
2-47           Sec. 29.359.  ADMISSIONS.  (a)  A free school may not refuse
2-48     to enroll a child on the basis of the child's residence, race,
2-49     national origin, ethnic background, religion, physical or mental
2-50     ability or disability, or academic achievement.
2-51           (b)  A free school may not consider athletic ability or the
2-52     amount of a public education scholarship in any admission process.
2-53           (c)  A free school may refuse to enroll a child who has been
2-54     expelled from a school district during the term of alternative
2-55     education program placement or expulsion.
2-56           (d)  Except as provided by Subsection (e), a free school that
2-57     has more public education scholarship applicants than available
2-58     positions must give priority to students at risk of dropping out of
2-59     school as defined by Section 29.081 and must fill other positions
2-60     by lottery.  A free school must declare the number of available
2-61     positions and conduct the lottery for the next school year not
2-62     later than July 1 of each year.
2-63           (e)  To achieve continuity in education, a free school may
2-64     give preference over at-risk students to enrolled students and to
2-65     the siblings of enrolled students residing in the same household or
2-66     other children residing in the same household as enrolled students
2-67     for the convenience of parents of those children.
2-68           Sec. 29.360.  SPECIAL EDUCATION SERVICES.  A child who is
2-69     eligible under state or federal law to receive special services, as
 3-1     defined by Section 29.002, and who is eligible for a public
 3-2     education scholarship is entitled to receive those services from
 3-3     the state or the school district the child would otherwise attend
 3-4     as provided by federal or state law.
 3-5           Sec. 29.361.  BILINGUAL EDUCATION SERVICES.  A parent is
 3-6     entitled to request, with the expectation that the request will not
 3-7     be unreasonably denied, that a free school provide bilingual
 3-8     education services or address the language needs of the child.  A
 3-9     free school that provides bilingual education in accordance with
3-10     state law is entitled to have the funding based on allotments for
3-11     bilingual education under Section 42.153 to the student's home
3-12     school district, for each child eligible for that allotment,
3-13     included in the student's public education scholarship.
3-14           Sec. 29.362.  TUITION; ADDITIONAL CHARGES AND FEES.  A free
3-15     school may not:
3-16                 (1)  charge an eligible child attending the school
3-17     under this subchapter tuition in addition to the child's public
3-18     education scholarship; or
3-19                 (2)  assess any additional charge, other than a fee
3-20     that a board of trustees is authorized to charge under Section
3-21     11.158, for providing an educational program or service to such a
3-22     child.
3-23           Sec. 29.363.  EXPULSION OF STUDENTS.  A free school may not
3-24     expel a student unless the student engages in an activity for which
3-25     the student may be expelled under Section 37.007.
3-26           Sec. 29.364.  ACCOUNTABILITY.  (a)  Each free school shall
3-27     report to the commissioner concerning the scholarship students'
3-28     performance on the academic excellence indicators under Section
3-29     39.051.
3-30           (b)  Each free school shall administer the appropriate
3-31     assessment instrument under Subchapter B, Chapter 39, to each
3-32     student using a public education scholarship to attend the school
3-33     and for whom an assessment instrument is required.  A free school
3-34     shall administer the assessment instrument in the same manner as
3-35     the assessment instrument is administered to public school
3-36     students.  To ensure the security of the assessment instrument and
3-37     the validity of the results, the commissioner shall adopt rules and
3-38     procedures for the administration of state-required assessment
3-39     instruments in free schools.
3-40           (c)  For the purpose of evaluating the effectiveness of the
3-41     public education scholarship program, the commissioner shall report
3-42     and publish student assessment results in a manner that allows
3-43     comparisons between scholarship students attending free schools and
3-44     students attending public schools.  The commissioner's report must
3-45     show statewide results and district and campus results.  The
3-46     commissioner's report may not include any results that permit
3-47     direct or indirect identification of the students assessed.  Copies
3-48     of the commissioner's report shall be made available for public
3-49     inspection at each public school and free school.
3-50           (d)  The commissioner may determine that a free school is not
3-51     eligible to continue receiving public education scholarship funds
3-52     if the percentage of scholarship students attending the free school
3-53     who perform satisfactorily on the assessment instruments required
3-54     under Subchapter B, Chapter 39, is such that the free school would
3-55     be considered low-performing under Subchapter D, Chapter 39, if it
3-56     were a public school campus.  The commissioner shall promptly
3-57     notify the comptroller of the commissioner's determination under
3-58     this subsection.
3-59           Sec. 29.365.  EVALUATION OF PUBLIC EDUCATION SCHOLARSHIP
3-60     PROGRAM.  (a)  The State Board of Education shall designate an
3-61     impartial organization with experience in evaluating school choice
3-62     programs to annually evaluate the public education scholarship
3-63     program.
3-64           (b)  An evaluation under this section must:
3-65                 (1)  include a comparison of each of the following
3-66     factors before and after implementation of the program:
3-67                       (A)  student performance and improvement on
3-68     assessment instruments administered under Subchapter B, Chapter 39;
3-69                       (B)  student performance and improvement in the
 4-1     classroom;
 4-2                       (C)  student attendance;
 4-3                       (D)  students' grades;
 4-4                       (E)  incidents involving student discipline;
 4-5                       (F)  socioeconomic data on students' families;
 4-6     and
 4-7                       (G)  parents' satisfaction with their children's
 4-8     schools;
 4-9                 (2)  include a comparison of performance on assessment
4-10     instruments administered under Section 39.023 between students
4-11     using public education scholarships to attend free schools and
4-12     students in public schools who are of a similar age and background
4-13     and who reside in similar school districts; and
4-14                 (3)  examine the effects of the program on:
4-15                       (A)  eligible children who receive a public
4-16     education scholarship and who enroll in a free school;
4-17                       (B)  eligible children who receive a public
4-18     education scholarship but who do not enroll in a free school; and
4-19                       (C)  eligible children who do not apply for a
4-20     public education scholarship.
4-21           (c)  Not later than September 1, 2004, the organization
4-22     conducting the evaluation shall file a written report stating the
4-23     results of the evaluation with the governor, lieutenant governor,
4-24     and speaker of the house of representatives.  This subsection
4-25     expires January 1, 2005.
4-26           Sec. 29.366.  DUTIES OF COMPTROLLER.  (a)  The comptroller
4-27     shall adopt rules, procedures, and forms for the payment of public
4-28     education scholarships to the free schools on behalf of parents of
4-29     students attending free schools.  The comptroller's rules shall
4-30     provide for payment to a free school only after the school provides
4-31     services and only to the extent students receiving public education
4-32     scholarships attended school.
4-33           (b)  The comptroller shall adopt rules, procedures, and forms
4-34     for a free school to permit review of the financial operations of
4-35     the school.  The comptroller may determine that a free school is
4-36     not eligible to continue receiving public education scholarship
4-37     funds if the school fails to satisfy generally accepted standards
4-38     of fiscal management.
4-39           Sec. 29.367.  STATUS OF FREE SCHOOLS.  (a)  A free school is
4-40     not a government agent or instrumentality, and the conduct of a
4-41     free school is governed by law governing private conduct rather
4-42     than by law governing state action.  The purpose of this subchapter
4-43     is to allow maximum freedom to the private sector to respond to
4-44     educational needs without excessive government control, and this
4-45     subchapter shall be liberally construed to achieve that purpose.
4-46           (b)  The State Board of Education, the commissioner, or the
4-47     comptroller may not in any way regulate the educational program of
4-48     a free school, except as necessary to ensure the school's
4-49     compliance with this title.
4-50           Sec. 29.368.  PARTIAL TERMINATION OF PROGRAM.  (a)  Not later
4-51     than July 1, 2005, the commissioner shall compare the average
4-52     performance of each free school's scholarship students to the
4-53     average performance of students in public schools who are of a
4-54     similar age and background and who reside in similar school
4-55     districts.
4-56           (b)  Beginning with the 2005-2006 school year:
4-57                 (1)  a free school may not accept a student using a
4-58     public education scholarship unless the school's average student
4-59     performance level, as determined under Subsection (a), is at least
4-60     10 percent higher than the average performance level of comparable
4-61     public school students; and
4-62                 (2)  a student who used a public education scholarship
4-63     to attend a free school other than a free school whose average
4-64     student performance level meets or exceeds the level required by
4-65     Subdivision (1) is no longer eligible for a public education
4-66     scholarship.
4-67           SECTION 2.  This Act takes effect September 1, 1999.
4-68           SECTION 3.  The State Board of Education shall implement the
4-69     public education scholarship program as provided by Subchapter J,
 5-1     Chapter 29, Education Code, as added by this Act, beginning with
 5-2     the 2000-2001 school year.
 5-3           SECTION 4.  The importance of this legislation and the
 5-4     crowded condition of the calendars in both houses create an
 5-5     emergency and an imperative public necessity that the
 5-6     constitutional rule requiring bills to be read on three several
 5-7     days in each house be suspended, and this rule is hereby suspended.
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