By: Carona S.B. No. 1527
A BILL TO BE ENTITLED
AN ACT
1-1 relating to authorization of prepaid tuition contracts for
1-2 proprietary schools under the prepaid higher education tuition
1-3 program.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 54.6001, Education Code, is amended to
1-6 read as follows:
1-7 Sec. 54.6001. PUBLIC PURPOSE. An educated population being
1-8 necessary to the social development and economic health of this
1-9 state, the legislature finds and declares it to be an urgent public
1-10 necessity to assist young Texans in obtaining a higher education.
1-11 Because the state's population is rapidly growing and is diverse,
1-12 the state is required to use all of the higher education facilities
1-13 and resources within the state, both public and private, to provide
1-14 a wide variety of educational environments and instructional
1-15 options and to preserve the partnership between the state and
1-16 private or independent institutions of higher education and between
1-17 the state and proprietary schools, as defined by Section 132.001,
1-18 that offer a two-year associate degree as approved by the Texas
1-19 Higher Education Coordinating Board. Therefore, the prepaid higher
1-20 education tuition program is established to help Texas students
1-21 attend the institution that best meets their individual needs.
1-22 SECTION 2. Section 54.601, Education Code, is amended to
1-23 read as follows:
1-24 Sec. 54.601. DEFINITIONS. In this subchapter:
2-1 (1) "Beneficiary" means a person who is entitled to
2-2 receive benefits under a prepaid tuition contract.
2-3 (2) "Board" means the Prepaid Higher Education Tuition
2-4 Board.
2-5 (3) "Estimated average private tuition and required
2-6 fees" means an estimated average of tuition and required fees to be
2-7 charged by private or independent institutions of higher education
2-8 as determined annually by the board.
2-9 (4) "Fund" means the Texas tomorrow fund.
2-10 (5) "Institution of higher education" has the meaning
2-11 assigned by Section 61.003.
2-12 (6) "Prepaid tuition contract" means a contract
2-13 entered into under this subchapter by the board and a purchaser to
2-14 provide for the payment of higher education tuition and required
2-15 fees of a beneficiary.
2-16 (7) "Private or independent institution of higher
2-17 education" has the meaning assigned by Section 61.003.
2-18 (8) "Program" means the prepaid higher education
2-19 tuition program.
2-20 (9) "Proprietary school" means a proprietary school,
2-21 as defined by Section 132.001, that offers a two-year associate
2-22 degree as approved by the Texas Higher Education Coordinating
2-23 Board.
2-24 (10) "Public junior college" has the meaning assigned
2-25 by Section 61.003.
2-26 (11) [(10)] "Public senior college or university" has
3-1 the meaning assigned by Section 61.003.
3-2 (12) [(11)] "Purchaser" means a person who is
3-3 obligated to make payments under a prepaid tuition contract.
3-4 SECTION 3. Subsection (a), Section 54.605, Education Code,
3-5 is amended to read as follows:
3-6 (a) A prepaid tuition contract remains in effect after the
3-7 program is terminated if, when the program is terminated, the
3-8 beneficiary:
3-9 (1) has been accepted by or is enrolled in an
3-10 institution of higher education, [or] a private or independent
3-11 institution of higher education, or a proprietary school; or
3-12 (2) is projected to graduate from high school not
3-13 later than the third anniversary of the date the program is
3-14 terminated.
3-15 SECTION 4. Subsection (b), Section 54.618, Education Code,
3-16 is amended to read as follows:
3-17 (b) The board may:
3-18 (1) adopt an official seal;
3-19 (2) adopt rules to implement this subchapter;
3-20 (3) sue and be sued;
3-21 (4) enter into contracts and other necessary
3-22 instruments;
3-23 (5) enter into agreements or other transactions with
3-24 the United States, state agencies, including institutions of higher
3-25 education, private or independent institutions of higher education,
3-26 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
5-1 of tuition and required fees at the proprietary school in excess of
5-2 that amount. The board may adopt rules as necessary to implement
5-3 this subsection.
5-4 SECTION 6. The change in law made by this Act regarding the
5-5 application of prepaid tuition contract benefits to the payment of
5-6 tuition and required fees at a proprietary school applies to
5-7 contract benefits purchased under Subchapter F, Chapter 54,
5-8 Education Code, as amended by this Act, before, on, or after the
5-9 effective date of this Act.
5-10 SECTION 7. This Act takes effect September 1, 1999.
5-11 SECTION 8. The importance of this legislation and the
5-12 crowded condition of the calendars in both houses create an
5-13 emergency and an imperative public necessity that the
5-14 constitutional rule requiring bills to be read on three several
5-15 days in each house be suspended, and this rule is hereby suspended.