76R13912 JSA-D
By Ellis S.B. No. 315
Substitute the following for S.B. No. 315:
By Brown of Brazos C.S.S.B. No. 315
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to authorizing the use of certain prepaid tuition
1-3 contracts to cover an additional period of attendance at an
1-4 institution of higher education or attendance at a proprietary
1-5 school.
1-6 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-7 SECTION 1. Section 54.6001, Education Code, is amended to
1-8 read as follows:
1-9 Sec. 54.6001. PUBLIC PURPOSE. An educated population being
1-10 necessary to the social development and economic health of this
1-11 state, the legislature finds and declares it to be an urgent public
1-12 necessity to assist young Texans in obtaining a higher education.
1-13 Because the state's population is rapidly growing and is diverse,
1-14 the state is required to use all of the higher education facilities
1-15 and resources within the state, both public and private, to provide
1-16 a wide variety of educational environments and instructional
1-17 options and to preserve the partnership between the state and
1-18 private or independent institutions of higher education and between
1-19 the state and proprietary schools, as defined by Section 132.001,
1-20 that offer a two-year associate degree as approved by the Texas
1-21 Higher Education Coordinating Board. Therefore, the prepaid higher
1-22 education tuition program is established to help Texas students
1-23 attend the institution that best meets their individual needs.
1-24 SECTION 2. Section 54.601, Education Code, is amended to
2-1 read as follows:
2-2 Sec. 54.601. DEFINITIONS. In this subchapter:
2-3 (1) "Beneficiary" means a person who is entitled to
2-4 receive benefits under a prepaid tuition contract.
2-5 (2) "Board" means the Prepaid Higher Education Tuition
2-6 Board.
2-7 (3) "Estimated average private tuition and required
2-8 fees" means an estimated average of tuition and required fees to be
2-9 charged by private or independent institutions of higher education
2-10 as determined annually by the board.
2-11 (4) "Fund" means the Texas tomorrow fund.
2-12 (5) "Institution of higher education" has the meaning
2-13 assigned by Section 61.003.
2-14 (6) "Prepaid tuition contract" means a contract
2-15 entered into under this subchapter by the board and a purchaser to
2-16 provide for the payment of higher education tuition and required
2-17 fees of a beneficiary.
2-18 (7) "Private or independent institution of higher
2-19 education" has the meaning assigned by Section 61.003.
2-20 (8) "Program" means the prepaid higher education
2-21 tuition program.
2-22 (9) "Proprietary school" means a proprietary school,
2-23 as defined by Section 132.001, that offers a two-year associate
2-24 degree as approved by the Texas Higher Education Coordinating
2-25 Board.
2-26 (10) "Public junior college" has the meaning assigned
2-27 by Section 61.003.
3-1 (11) [(10)] "Public senior college or university" has
3-2 the meaning assigned by Section 61.003.
3-3 (12) [(11)] "Purchaser" means a person who is
3-4 obligated to make payments under a prepaid tuition contract.
3-5 SECTION 3. Subsection (a), Section 54.605, Education Code,
3-6 is amended to read as follows:
3-7 (a) A prepaid tuition contract remains in effect after the
3-8 program is terminated if, when the program is terminated, the
3-9 beneficiary:
3-10 (1) has been accepted by or is enrolled in an
3-11 institution of higher education, [or] a private or independent
3-12 institution of higher education, or a proprietary school; or
3-13 (2) is projected to graduate from high school not
3-14 later than the third anniversary of the date the program is
3-15 terminated.
3-16 SECTION 4. Subsection (b), Section 54.618, Education Code,
3-17 is amended to read as follows:
3-18 (b) The board may:
3-19 (1) adopt an official seal;
3-20 (2) adopt rules to implement this subchapter;
3-21 (3) sue and be sued;
3-22 (4) enter into contracts and other necessary
3-23 instruments;
3-24 (5) enter into agreements or other transactions with
3-25 the United States, state agencies, including institutions of higher
3-26 education, private or independent institutions of higher education,
3-27 proprietary schools, and local governments;
4-1 (6) appear in its own behalf before governmental
4-2 agencies;
4-3 (7) contract for necessary goods and services and
4-4 engage the services of private consultants, actuaries, trustees,
4-5 records administrators, managers, legal counsel, and auditors for
4-6 administrative or technical assistance;
4-7 (8) solicit and accept gifts, grants, loans, and other
4-8 aid from any source or participate in any other way in any
4-9 government program to carry out this subchapter;
4-10 (9) impose administrative fees;
4-11 (10) contract with a person to market the program;
4-12 (11) purchase liability insurance covering the board
4-13 and employees and agents of the board; and
4-14 (12) establish other policies, procedures, and
4-15 eligibility criteria to implement this subchapter.
4-16 SECTION 5. Section 54.619, Education Code, is amended by
4-17 adding Subsection (h) to read as follows:
4-18 (h) Notwithstanding other provisions of this subchapter, any
4-19 contract benefits purchased under this subchapter may be applied to
4-20 the payment of tuition and required fees at a proprietary school as
4-21 if the proprietary school were an institution of higher education
4-22 or private or independent institution of higher education. On the
4-23 purchaser's request, the board shall apply, in accordance with
4-24 Section 54.628, any existing amount of prepaid tuition contract
4-25 benefits to the payment of tuition and required fees at a
4-26 proprietary school. The board is not responsible for the payment
4-27 of tuition and required fees at the proprietary school in excess of
5-1 that amount. The board may adopt rules as necessary to implement
5-2 this subsection.
5-3 SECTION 6. Subsection (a), Section 54.6252, Education Code,
5-4 is amended to read as follows:
5-5 (a) The board may permit the purchaser of a prepaid tuition
5-6 contract for a senior college plan or a private college plan at any
5-7 time during which the contract is in effect and before the
5-8 beneficiary graduates from high school to enter into a supplemental
5-9 contract to prepay the tuition and required fees of the beneficiary
5-10 for a number of undergraduate credit hours, in addition to the
5-11 undergraduate credit hours included in the primary contract, equal
5-12 to the number of credit hours purchased for one year under the
5-13 primary contract. The additional credit hours must be for the same
5-14 type of institution as the credit hours purchased under the primary
5-15 contract.
5-16 SECTION 7. (a) The change in law made by this Act regarding
5-17 the application of prepaid tuition contract benefits to the payment
5-18 of tuition and required fees at a proprietary school applies to
5-19 contract benefits purchased under Subchapter F, Chapter 54,
5-20 Education Code, as amended by this Act, before, on, or after the
5-21 effective date of this Act.
5-22 (b) Except as provided by Subsection (c) of this section,
5-23 the amendment made by this Act to Section 54.6252, Education Code,
5-24 does not apply to a prepaid tuition contract entered into before
5-25 the effective date of this Act.
5-26 (c) The Prepaid Higher Education Tuition Board may permit
5-27 the purchaser of a prepaid tuition contract entered into before the
6-1 effective date of this Act to amend the contract to conform to
6-2 Section 54.6252, Education Code, as amended by this Act. The board
6-3 may require the purchaser to make increased or additional payments
6-4 as necessary to compensate for any additional costs that the board
6-5 estimates will be incurred under the contract because of the
6-6 contract amendment.
6-7 SECTION 8. This Act takes effect September 1, 1999.
6-8 SECTION 9. The importance of this legislation and the
6-9 crowded condition of the calendars in both houses create an
6-10 emergency and an imperative public necessity that the
6-11 constitutional rule requiring bills to be read on three several
6-12 days in each house be suspended, and this rule is hereby suspended.