By: Pitts, McCall (Senate Sponsor - Bivins) H.B. No. 3459
(In the Senate - Received from the House May 12, 2003;
May 13, 2003, read first time and referred to Committee on Finance;
May 24, 2003, reported adversely, with favorable Committee
Substitute by the following vote: Yeas 9, Nays 2; May 24, 2003,
sent to printer.)
COMMITTEE SUBSTITUTE FOR H.B. No. 3459 By: Bivins
A BILL TO BE ENTITLED
AN ACT
relating to fiscal matters involving certain governmental
educational entities, including public school finance, program
compliance monitoring by the Texas Education Agency, amounts
withheld from compensatory education allotments, the public school
technology allotment, the composition of and accounting for the
permanent school fund and the available school fund, health
insurance coverage provided by certain educational entities, and
the uses of the telecommunications infrastructure fund.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The following provisions of the Education Code
are repealed:
(1) Chapters 41, 42, and 46; and
(2) Section 45.002.
SECTION 2. Section 1 of this Act takes effect September 1,
2004, but only if, before that date:
(1) the legislature has enacted a school finance
system to replace the system established by Chapters 41, 42, 45, and
46, Education Code;
(2) the Act enacting a school finance system in
compliance with Subdivision (1) of this section affirmatively
states that the system is a comprehensive school finance system for
the entire state; and
(3) the school finance system enacted in compliance
with Subdivision (1) of this section has become law.
SECTION 3. Subchapter B, Chapter 7, Education Code, is
amended by adding Section 7.027 to read as follows:
Sec. 7.027. LIMITATION ON COMPLIANCE MONITORING. (a)
Except as provided by Section 29.001(5), 29.010(a), 39.074, or
39.075, the agency may monitor compliance with requirements
applicable to a process or program provided by a school district,
campus, program, or school granted charters under Chapter 12,
including the process described by Subchapter F, Chapter 11, or a
program described by Subchapter A, B, C, D, E, F, H, or I, Chapter
29, Subchapter A, Chapter 37, or Section 38.003, and the use of
funds provided for such a program under Subchapter C, Chapter 42,
only as necessary to ensure:
(1) compliance with federal law and regulations;
(2) financial accountability, including compliance
with grant requirements; and
(3) data integrity for purposes of:
(A) the Public Education Information Management
System (PEIMS); and
(B) accountability under Chapter 39.
(b) The board of trustees of a school district or the
governing body of an open-enrollment charter school has primary
responsibility for ensuring that the district or school complies
with all applicable requirements of state educational programs.
SECTION 4. Section 21.253, Education Code, is amended to
read as follows:
Sec. 21.253. REQUEST FOR HEARING. (a) A teacher must file
a written request for a hearing under this subchapter with the
commissioner not later than the 15th day after the date the teacher
receives written notice of the proposed action. The teacher must
provide the district with a copy of the request and must provide the
commissioner with a copy of the notice.
(b) The parties may agree in writing to extend by not more
than 10 days the deadline for requesting a hearing.
SECTION 5. Sections 21.254(c), (d), and (e), Education
Code, are amended to read as follows:
(c) If a hearing examiner is not selected by the parties to a
pending case under Subsection (e), the [The] commissioner shall
assign a hearing examiner to the [a pending] case not earlier than
the sixth business day and not later than the 10th business day
after the date on which the commissioner receives the request for a
hearing. When a hearing examiner has been assigned to a case, the
commissioner shall immediately notify the parties.
(d) The parties may agree to reject a hearing examiner for
any reason and either [Either] party is entitled to reject the
assigned hearing examiner for cause. A rejection must be in writing
and filed with the commissioner not later than the third day after
the date of notification of the hearing examiner's assignment. If
the parties agree to reject the hearing examiner or if the
commissioner determines that one [the] party has good cause to
reject the hearing examiner, the commissioner shall assign another
hearing examiner as provided by Subsection (b). If neither party
makes a timely rejection, the assignment is final.
(e) After the teacher receives the notice of the proposed
action, the parties by agreement may select a hearing examiner from
the list maintained by the commissioner under Subsection (a) or a
person who is not certified to serve as a hearing examiner. A
person who is not a certified hearing examiner may be selected only
if the person is [under this subsection must be] licensed to
practice law in this state. If the parties agree on a hearing
examiner, the parties shall, before the date the commissioner is
permitted to assign a hearing examiner, notify the commissioner in
writing of the agreement, including [before the teacher files a
request for hearing under Section 21.253, the request shall
include] the name of the hearing examiner selected. [If the parties
agree on a hearing examiner after the teacher files the request for
hearing, the teacher shall promptly notify the commissioner in
writing of the name of the hearing examiner.]
SECTION 6. Sections 21.257(a) and (c), Education Code, are
amended to read as follows:
(a) Not later than the 60th [45th] day after the date on
which the commissioner receives a teacher's written request for a
hearing, the hearing examiner shall complete the hearing and make a
written recommendation that:
(1) includes proposed findings of fact and conclusions
of law; and
(2) may include a proposal for granting relief.
(c) The parties may agree in writing to extend by not more
than 45 days [waive] the right to a recommendation by the date
prescribed by Subsection (a). A hearing under this section may not
be held on a Saturday, Sunday, or a state or federal holiday, unless
all parties agree.
SECTION 7. Subchapter G, Chapter 21, Education Code, is
amended by adding Section 21.3041 to read as follows:
Sec. 21.3041. REHEARING BY COMMISSIONER. (a) Not later
than the 20th day after the date the party or the party's
representative receives notice of the commissioner's decision
under Section 21.304, the party may file a request for rehearing.
(b) A request for rehearing is not required for a party to
appeal the commissioner's decision under Section 21.307.
(c) A request for rehearing is denied by operation of law if
the commissioner does not issue an order before the 45th day after
the date the party or the party's representative receives notice of
the commissioner's decision.
SECTION 8. Section 21.307(b), Education Code, is amended to
read as follows:
(b) An appeal under this section must be perfected not later
than the 30th day after:
(1) the date the party or the party's representative
receives [received] notice of the commissioner's decision or the
date on which the decision of the board of trustees is [was]
affirmed by operation of law if the commissioner fails [failed] to
issue a decision within the required period; or
(2) if a request for rehearing is filed under Section
21.3041, the date on which the request is denied by order of the
commissioner or by operation of law under Section 21.3041(c). [A
motion for rehearing is not required for the party to appeal.]
SECTION 9. Subchapter I, Chapter 21, Education Code, is
amended by adding Section 21.413 to read as follows:
Sec. 21.413. CLASSROOM SUPPLY REIMBURSEMENT PROGRAM. (a)
The commissioner shall establish a reimbursement program under
which the commissioner provides funds to a school district for the
purpose of reimbursing classroom teachers in the district who
expend personal funds on classroom supplies. A school district
must match any funds provided to the district under the
reimbursement program with local funds to be used for the same
purpose.
(b) The commissioner shall adopt rules for the local
allocation of funds provided to a school district under the
reimbursement program. A school district shall allow each
classroom teacher in the district who is reimbursed under the
reimbursement program to use the funds in the teacher's discretion,
except that the funds must be used for the benefit of the district's
students. A school district may not use funds received under the
reimbursement program to replace local funds used by the district
for the same purpose.
(c) The commissioner shall identify state and federal funds
available for use under the reimbursement program, including funds
subject to the Education Flexibility Partnership Act of 1999 (20
U.S.C. Section 5891a et seq.), and its subsequent amendments, as
well as consolidated administrative funds.
(d) The commissioner shall establish the reimbursement
program for implementation beginning not later than the 2005-2006
school year. The commissioner may implement the reimbursement
program only if funds are specifically appropriated by the
legislature for the program or if the commissioner identifies
available funds, other than general revenue funds, that may be used
for the program.
SECTION 10. Subchapter A, Chapter 29, Education Code, is
amended by adding Section 29.0161 to read as follows:
Sec. 29.0161. CONTRACT WITH STATE OFFICE OF ADMINISTRATIVE
HEARINGS FOR SPECIAL EDUCATION DUE PROCESS HEARINGS. (a) Not later
than December 1, 2003, the agency and the State Office of
Administrative Hearings shall jointly determine whether it would be
cost-effective for the agency to enter an interagency contract with
the office under which the office would conduct all or part of the
agency's special education due process hearings under 20 U.S.C.
Section 1415 and its subsequent amendments.
(b) If, as provided by Subsection (a), the agency and the
State Office of Administrative Hearings jointly determine it would
be cost-effective to transfer all or a portion of the agency's
special education due process hearings to the office, the agency
and the office shall enter into an interagency contract to transfer
the hearings accordingly.
SECTION 11. Sections 29.062(a) and (e), Education Code, are
amended to read as follows:
(a) The legislature recognizes that compliance with this
subchapter is an imperative public necessity. Therefore, in
accordance with the policy of the state, the agency shall evaluate
the effectiveness of programs under this subchapter based on the
academic excellence indicators adopted under Section 39.051(a),
including the results of assessment instruments. The agency may
combine evaluations under this section with federal accountability
measures concerning students of limited English proficiency
[monitor compliance with state rules by inspecting each school
district and open-enrollment charter school on-site at least every
three years].
(e) If a school district or open-enrollment charter school
fails to satisfy appropriate standards adopted by the commissioner
for purposes of Subsection (a) [or refuses to comply after proper
notification], the agency shall apply sanctions, which may include
the removal of accreditation, loss of foundation school funds, or
both.
SECTION 12. Section 31.021(b), Education Code, is amended
to read as follows:
(b) The State Board of Education shall annually set aside
out of the available school fund of the state an amount sufficient
for the board, school districts, and open-enrollment charter
schools to purchase and distribute the necessary textbooks for the
use of the students of this state for the following school year.
The board shall determine the amount of the available school fund to
set aside for the state textbook fund based on:
(1) a report by the commissioner issued on July 1 or,
if that date is a Saturday or Sunday, on the following Monday,
stating the amount of unobligated money in the fund;
(2) [a requirement to provide an allotment to be
distributed to each district equal to $30 per student in average
daily attendance, or a greater amount for any year provided by
appropriation, to be used only to:
[(A) provide for the purchase by school districts
of electronic textbooks or technological equipment that
contributes to student learning; and
[(B) pay for training educational personnel
directly involved in student learning in the appropriate use of
electronic textbooks and for providing for access to technological
equipment for instructional use;
[(3)] the commissioner's estimate, based on textbooks
selected under Section 31.101 and on attendance reports submitted
under Section 31.103 by school districts and open-enrollment
charter schools, of the amount of funds, in addition to funds
reported under Subdivision (1), that will be necessary for purchase
and distribution of textbooks for the following school year; and
(3) [(4)] any amount the board determines should be
set aside for emergency purposes caused by unexpected increases in
attendance.
SECTION 13. Section 31.103(b), Education Code, is amended
to read as follows:
(b) A requisition for textbooks for the following school
year shall be based on the maximum attendance reports under
Subsection (a), plus an additional 10 percent, except as otherwise
provided. A school district or open-enrollment charter school
shall make a requisition for a textbook on the conforming or
nonconforming list through the commissioner to the state depository
designated by the publisher or as provided by State Board of
Education rule, as applicable, not later than June 1 of each year.
The designated state depository or, if the publisher or
manufacturer does not have a designated textbook depository in this
state under Section 31.151(a)(6)(B), the publisher or manufacturer
shall fill a requisition approved by the agency at any other time in
the case of an emergency. As made necessary by available funds, the
commissioner shall reduce the additional percentage of attendance
for which a district or school may requisition textbooks. The
commissioner may, on application of a district or school that is
experiencing high enrollment growth, increase the additional
percentage of attendance for which the district or school may
requisition textbooks.
SECTION 14. Subchapter A, Chapter 32, Education Code, is
amended by adding Section 32.005 to read as follows:
Sec. 32.005. TECHNOLOGY ALLOTMENT. (a) Each school
district is entitled to an allotment of $30 for each student in
average daily attendance or a different amount for any year
provided by appropriation.
(b) An allotment under this section may be used only to:
(1) provide for the purchase by school districts of
electronic textbooks or technological equipment that contributes
to student learning; and
(2) pay for training educational personnel directly
involved in student learning in the appropriate use of electronic
textbooks and for providing for access to technological equipment
for instructional use.
(c) The allotment under this section may be paid from:
(1) the telecommunications infrastructure fund under
Subchapter C, Chapter 57, Utilities Code;
(2) the available school fund; or
(3) any other fund that may be used for that purpose
and that is identified in the General Appropriations Act as the
source of payment of the allotment.
SECTION 15. Section 32.033(a), Education Code, is amended
to read as follows:
(a) The agency, in coordination with institutions of higher
education and other public or private entities, may [shall]
maintain and expand, as needed, the telecommunications
capabilities of school districts and regional education service
centers. The agency shall design and implement a
telecommunications system for distance learning throughout the
state.
SECTION 16. Section 39.023(e), Education Code, is amended
to read as follows:
(e) Under rules adopted by the State Board of Education,
every other year, the agency shall release the questions and answer
keys to each assessment instrument administered under Subsection
(a), (b), (c), (d), or (l) after the last time the instrument is
administered for that [a] school year. To ensure a valid bank of
questions for use each year, the agency is not required to release a
question that is being field-tested and was not used to compute the
student's score on the instrument. The agency shall also release,
under board rule, each question that is no longer being
field-tested and that was not used to compute a student's score.
SECTION 17. Section 39.051(f), Education Code, is amended
to read as follows:
(f) The [Beginning with the 2002-2003 school year, the]
indicator under Subsection (b)(1) must include the results of
assessment instruments required under Section 39.023(b). [Those
results may not be aggregated by grade level or subject area.]
SECTION 18. Sections 39.055(a) and (e), Education Code, are
amended to read as follows:
(a) The commissioner shall develop a process for auditing
school district dropout records electronically. The commissioner
shall also develop a system and standards for review of the audit or
use systems already available at the agency. The system must be
designed to identify districts that are at high risk of having
inaccurate dropout records and that, as a result, require on-site
monitoring of dropout records. If the electronic audit of a
district's dropout records indicates that a district is not at high
risk of having inaccurate dropout records, the district may not be
subject to on-site monitoring under this subsection. If the
risk-based system indicates that a district is at high risk of
having inaccurate dropout records, the district is entitled to an
opportunity to respond to the commissioner's determination before
on-site monitoring may be conducted. The district must respond not
later than the 30th day after the date the commissioner notifies the
district of the commissioner's determination. If the district's
response does not change the commissioner's determination that the
district is at high risk of having inaccurate dropout records or if
the district does not respond in a timely manner, the commissioner
shall order agency staff to conduct on-site monitoring of the
[board of trustees of each school district shall have the]
district's dropout records [audited annually at district expense by
a public accountant or certified public accountant who:
[(1) is certified or registered, as appropriate, and
licensed under Chapter 901, Occupations Code;
[(2) has successfully completed training provided by
the agency in auditing school dropout records; and
[(3) is not an employee of the district].
(e) [The agency shall review each report of an audit of
dropout records.] The commissioner shall notify the board of
trustees of a school district of any objection the commissioner has
to the district's dropout data [report], any violation of sound
accounting practices or of a law or rule revealed by the data
[report], or any recommendation by the commissioner concerning the
data [report]. If the data reflect [report reflects] that a penal
law has been violated, the commissioner shall notify the county
attorney, district attorney, or criminal district attorney, as
appropriate, and the attorney general. The commissioner is
entitled to access to all district records the commissioner
considers necessary or appropriate for the review, analysis, or
approval of district dropout data [a report].
SECTION 19. Section 42.152, Education Code, is amended by
amending Subsections (c), (q), and (r) and adding Subsections
(q-1)-(q-4) and (u) to read as follows:
(c) Funds allocated under this section shall be used [only]
to fund supplemental programs and services designed to eliminate
any disparity in performance on assessment instruments
administered under Subchapter B, Chapter 39, or disparity in the
rates of high school completion between students at risk of
dropping out of school, as defined by Section 29.081, and all other
students. Specifically, the funds, other than an indirect cost
allotment established under State Board of Education rule, which
may not exceed 15 percent, may be used [only] to meet the costs of
providing a compensatory, intensive, or accelerated instruction
program under Section 29.081 or an alternative education program
established under Section 37.008 or to support a program eligible
under Title I of the Elementary and Secondary Education Act of 1965,
as provided by Pub. L. No. 103-382 and its subsequent amendments,
and by federal regulations implementing that Act, at a campus at
which at least 40 [50] percent of the students are educationally
disadvantaged. In meeting the costs of providing a compensatory,
intensive, or accelerated instruction program under Section
29.081, a district's compensatory education allotment shall [may]
be used [only] for costs supplementary to the regular education
program, such as costs for program and student evaluation,
instructional materials and equipment and other supplies required
for quality instruction, supplemental staff expenses, salary for
teachers of at-risk students, smaller class size, and
individualized instruction. A home-rule school district or an
open-enrollment charter school must use funds allocated under
Subsection (a) for a purpose authorized in this subsection but is
not otherwise subject to Subchapter C, Chapter 29. Notwithstanding
any other provisions of this section:
(1) to ensure that a sufficient amount of the funds
allotted under this section are available to supplement
instructional programs and services, no more than 18 percent of the
funds allotted under this section may be used to fund disciplinary
alternative education programs established under Section 37.008;
[and]
(2) the commissioner may waive the limitations of
Subdivision (1) upon an annual petition, by a district's board and a
district's site-based decision making committee, presenting the
reason for the need to spend supplemental compensatory education
funds on disciplinary alternative education programs under Section
37.008, provided that:
(A) the[. The] district [shall] in its petition
reports [report] the number of students in each grade level, by
demographic subgroup, not making satisfactory progress under the
state's assessment system; and
(B) the[. The] commissioner makes the [will make
this] waiver request information available annually to the public
on the agency's website; and
(3) for purposes of this subsection, a program
specifically designed to serve students at risk of dropping out of
school, as defined by Section 29.081, is considered to be a program
supplemental to the regular education program, and a district may
use its compensatory education allotment for such a program.
(q) The State Board of Education, with the assistance of the
state auditor and the comptroller, shall develop and implement by
rule [a] reporting and auditing systems [system] for district and
campus expenditures of compensatory education funds to ensure that
compensatory education funds, other than the indirect cost
allotment, are spent only to supplement the regular education
program as required by Subsection (c). The reporting requirements
shall be managed electronically to minimize local administrative
costs. A district shall submit the report required by this
subsection not later than the 150th day after the last day
permissible for resubmission of information required under Section
42.006.
(q-1) The commissioner shall develop a system to identify
school districts that are at high risk of having used compensatory
education funds other than in compliance with Subsection (c) or of
having inadequately reported compensatory education expenditures.
If a review of the report submitted under Subsection (q), using the
risk-based system, indicates that a district is not at high risk of
having misused compensatory education funds or of having
inadequately reported compensatory education expenditures, the
district may not be required to perform a local audit of
compensatory education expenditures and is not subject to on-site
monitoring under this section.
(q-2) If a review of the report submitted under Subsection
(q), using the risk-based system, indicates that a district is at
high risk of having misused compensatory education funds, the
commissioner shall notify the district of that determination. The
district must respond to the commissioner not later than the 30th
day after the date the commissioner notifies the district of the
commissioner's determination. If the district's response does not
change the commissioner's determination that the district is at
high risk of having misused compensatory education funds or if the
district does not respond in a timely manner, the commissioner
shall:
(1) require the district to conduct a local audit of
compensatory education expenditures for the current or preceding
school year;
(2) order agency staff to conduct on-site monitoring
of the district's compensatory education expenditures; or
(3) both require a local audit and order on-site
monitoring.
(q-3) If a review of the report submitted under Subsection
(q), using the risk-based system, indicates that a district is at
high risk of having inadequately reported compensatory education
expenditures, the commissioner may require agency staff to assist
the district in following the proper reporting methods or amending
a district or campus improvement plan under Subchapter F, Chapter
11. If the district does not take appropriate corrective action
before the 45th day after the date the agency staff notifies the
district of the action the district is expected to take, the
commissioner may:
(1) require the district to conduct a local audit of
the district's compensatory education expenditures; or
(2) order agency staff to conduct on-site monitoring
of the district's compensatory education expenditures.
(q-4) The commissioner, in the year following a local [an]
audit of compensatory education expenditures, shall withhold from a
district's foundation school fund payment an amount equal to the
amount of compensatory education funds the agency determines were
not used in compliance with Subsection (c). The commissioner shall
release to a district funds withheld under this subsection when the
district provides to the commissioner a detailed plan to spend
those funds in compliance with Subsection (c).
(r) The commissioner shall grant a one-year exemption from
the requirements of Subsections (q)-(q-4) [Subsection (g)] to a
school district in which the group of students who have failed to
perform satisfactorily in the preceding school year on an
assessment instrument required under Section 39.023(a), (c), or (l)
subsequently performs on those assessment instruments at a level
that meets or exceeds a level prescribed by commissioner rule. Each
year the commissioner, based on the most recent information
available, shall determine if a school district is entitled to an
exemption for the following school year and notify the district of
that determination.
(u) Notwithstanding the allotments and reductions otherwise
required or permitted by this section or Section 39.051(a), the
legislature may in the General Appropriations Act reduce the total
amount of funding for the compensatory education allotment. After
deducting the amount of a reduction made as provided by this
subsection from the total amount computed for the allotment under
Subsection (a), the commissioner shall:
(1) reduce each district's tier one allotments in the
same manner described for a reduction in allotments under Section
42.253; and
(2) allocate funds to each district accordingly.
SECTION 20. Section 42.154(a), Education Code, is amended
to read as follows:
(a) For each full-time equivalent student in average daily
attendance in an approved career and technology education program
in grades nine through 12 or in career and technology education
programs for students with disabilities in grades seven through 12,
a district is entitled to an annual allotment equal to the adjusted
basic allotment multiplied by a weight of 1.35 [1.37].
SECTION 21. Section 42.253(b), Education Code, is amended
to read as follows:
(b) Except as provided by this subsection, the commissioner
shall base the determinations under Subsection (a) on the estimates
provided to the legislature under Section 42.254, or, if the
General Appropriations Act provides estimates for that purpose, on
the estimates provided under that Act, for each school district for
each school year. The commissioner shall reduce the entitlement of
each district that has a final taxable value of property for the
second year of a state fiscal biennium that is higher than the
estimate under Section 42.254 or the General Appropriations Act, as
applicable. A reduction under this subsection may not reduce the
district's entitlement below the amount to which it is entitled at
its actual taxable value of property. [The sum of the reductions
under this subsection may not be greater than the amount necessary
to fully fund the entitlement of each district.]
SECTION 22. Sections 42.259(c), (d), and (f), Education
Code, are amended to read as follows:
(c) Payments from the foundation school fund to each
category 2 school district shall be made as follows:
(1) 22 percent of the yearly entitlement of the
district shall be paid in an installment to be made on or before the
25th day of September of a fiscal year;
(2) 18 percent of the yearly entitlement of the
district shall be paid in an installment to be made on or before the
25th day of October;
(3) 9.5 percent of the yearly entitlement of the
district shall be paid in an installment to be made on or before the
25th day of November;
(4) 7.5 percent of the yearly entitlement of the
district shall be paid in an installment to be made on or before the
25th day of April;
(5) five percent of the yearly entitlement of the
district shall be paid in an installment to be made on or before the
25th day of May;
(6) 10 percent of the yearly entitlement of the
district shall be paid in an installment to be made on or before the
25th day of June;
(7) 13 percent of the yearly entitlement of the
district shall be paid in an installment to be made on or before the
25th day of July; and
(8) 15 percent of the yearly entitlement of the
district shall be paid in an installment to be made after the fifth
day of September and not later than the 10th day of September of the
calendar year following the calendar year of the payment made under
Subdivision (1) [on or before the 25th day of August].
(d) Payments from the foundation school fund to each
category 3 school district shall be made as follows:
(1) 45 percent of the yearly entitlement of the
district shall be paid in an installment to be made on or before the
25th day of September of a fiscal year;
(2) 35 percent of the yearly entitlement of the
district shall be paid in an installment to be made on or before the
25th day of October; and
(3) 20 percent of the yearly entitlement of the
district shall be paid in an installment to be made after the fifth
day of September and not later than the 10th day of September of the
calendar year following the calendar year of the payment made under
Subdivision (1) [on or before the 25th day of August].
(f) Except as provided by Subsection (c)(8) or (d)(3), any
[Any] previously unpaid additional funds from prior years owed to a
district shall be paid to the district together with the September
payment of the current year entitlement.
SECTION 23. Section 43.001(b), Education Code, is amended
to read as follows:
(b) The available school fund, which shall be apportioned
annually to each county according to its scholastic population,
consists of:
(1) the interest and dividends arising from any
securities or funds belonging to the permanent school fund, as
determined in accordance with the accrual basis of accounting;
(2) all interest derivable from the proceeds of the
sale of land set apart for the permanent school fund;
(3) all money derived from the lease of land belonging
to the permanent school fund;
(4) one-fourth of all revenue derived from all state
occupation taxes, exclusive of delinquencies and cost of
collection;
(5) one-fourth of revenue derived from state gasoline
and special fuels excise taxes as provided by law; and
(6) all other appropriations to the available school
fund made by the legislature for public school purposes.
SECTION 24. Sections 43.001(a) and (b), Education Code, are
amended to read as follows:
(a) Except as provided by Subsection (b), the [The]
permanent school fund, which is a perpetual endowment for the
public schools of this state, consists of:
(1) all land appropriated for the public schools by
the constitution and laws of this state;
(2) all of the unappropriated public domain remaining
in this state, including all land recovered by the state by suit or
otherwise except pine forest land as defined by Section 88.111;
(3) all proceeds from the authorized sale of permanent
school fund land;
(4) all proceeds from the lawful sale of any other
properties belonging to the permanent school fund;
(5) all investments authorized by Section 43.003 of
properties belonging to the permanent school fund; and
(6) all income from the mineral development of
permanent school fund land, including income from mineral
development of riverbeds and other submerged land.
(b) The available school fund, which shall be apportioned
annually to each county according to its scholastic population,
consists of:
(1) the distributions to the fund from the permanent
school fund as provided by Section 5(a), Article VII, Texas
Constitution [interest and dividends arising from any securities or
funds belonging to the permanent school fund];
(2) [all interest derivable from the proceeds of the
sale of land set apart for the permanent school fund;
[(3) all money derived from the lease of land
belonging to the permanent school fund;
[(4)] one-fourth of all revenue derived from all state
occupation taxes, exclusive of delinquencies and cost of
collection;
(3) [(5)] one-fourth of revenue derived from state
gasoline and special fuels excise taxes as provided by law; and
(4) [(6)] all other appropriations to the available
school fund made by the legislature for public school purposes.
SECTION 25. Section 43.002, Education Code, is amended to
read as follows:
Sec. 43.002. TRANSFERS FROM PERMANENT SCHOOL FUND AND
GENERAL REVENUE FUND TO AVAILABLE SCHOOL FUND. (a) On the first
working day of each month in a state fiscal year, the comptroller
shall transfer from the permanent school fund to the available
school fund an amount equal to one-twelfth of the annual
distribution from the permanent school fund to the available school
fund as provided by Section 5(a), Article VII, Texas Constitution,
for the fiscal year.
(a-1) Notwithstanding Subsection (a), for the fiscal year
beginning September 1, 2003, the comptroller shall transfer from
the permanent school fund to the available school fund:
(1) on January 2, 2004, an amount equal to
five-twelfths of the annual distribution from the permanent school
fund to the available school fund for that fiscal year as provided
by Section 5(g), Article VII, Texas Constitution; and
(2) on the first working day of each month after
January 2004, an amount equal to one-twelfth of the annual
distribution from the permanent school fund to the available school
fund for that fiscal year as provided by Section 5(g), Article VII,
Texas Constitution.
(a-2) Subsection (a-1) and this subsection expire September
1, 2004.
(b) Of the amounts available for transfer from the general
revenue fund to the available school fund for the months of January
and February of each fiscal year, no more than the amount necessary
to enable the comptroller to distribute from the available school
fund an amount equal to 9-1/2 percent of the estimated annual
available school fund apportionment to category 1 school districts,
as defined by Section 42.259, and 3-1/2 percent of the estimated
annual available school fund apportionment to category 2 school
districts, as defined by Section 42.259, may be transferred from
the general revenue fund to the available school fund. Any
remaining amount that would otherwise be available for transfer for
the months of January and February shall be transferred from the
general revenue fund to the available school fund in equal amounts
in June and in August of the same fiscal year.
SECTION 26. Chapter 43, Education Code, is amended by
adding Section 43.020 to read as follows:
Sec. 43.020. TREATMENT OF ACCRUED INCOME. All interest and
dividends accruing from the investments of the permanent school
fund shall be deposited to the credit of the available school fund
in accordance with the accrual basis of accounting. Funds
recognized under this section are considered part of the available
school fund and may be appropriated as provided by Section 5,
Article VII, Texas Constitution.
SECTION 27. Section 46.033, Education Code, is amended to
read as follows:
Sec. 46.033. ELIGIBLE BONDS. Bonds, including bonds issued
under Section 45.006, are eligible to be paid with state and local
funds under this subchapter if:
(1) the district made payments on the bonds during the
2002-2003 [2000-2001] school year or taxes levied to pay the
principal of and interest on the bonds were included in the
district's audited debt service collections for that school year;
and
(2) the district does not receive state assistance
under Subchapter A for payment of the principal and interest on the
bonds.
SECTION 28. Section 46.034, Education Code, is amended by
amending Subsection (c) and adding Subsections (d) and (e) to read
as follows:
(c) If the amount required to pay the principal of and
interest on eligible bonds in a school year is less than the amount
of payments made by the district on the bonds during the 2002-2003
[2000-2001] school year or the district's audited debt service
collections for that school year, the district may not receive aid
in excess of the amount that, when added to the district's local
revenue for the school year, equals the amount required to pay the
principal of and interest on the bonds.
(d) Notwithstanding any other provision of this chapter, if
the appropriation to support newly eligible bonds for the 2003-2004
school year and the 2004-2005 school year is not sufficient to
provide the state aid that school districts are entitled to under
Section 46.032, the commissioner is directed to reduce the $35
guaranteed level of state and local support per student per cent of
tax effort for newly eligible debt only to the level necessary to
fund the sum of the allotments within the appropriated amount. The
guaranteed level for eligible debt through the 2000-2001 school
year is not affected by this adjustment. The commissioner shall
make this determination as soon as practicable, prior to the
beginning of the school year. The decision of the commissioner is
final and may not be appealed.
(e) Subsection (d) and this subsection expire September 1,
2005.
SECTION 29. Section 403.093, Government Code, is amended by
amending Subsection (c) and adding Subsections (c-1) and (c-2) to
read as follows:
(c) Each month other than June, July, and August, the
comptroller shall transfer from the general revenue fund to the
state contribution account of the teacher retirement system trust
fund the equal monthly payment provided by Section 825.404. If the
appropriation provided by the legislature is different from the
amount of state contributions required, the comptroller, after the
end of the fiscal year, shall make adjustments in the teacher
retirement fund and the general revenue fund so that the total
transfers during the year equal the total amount of the state
contribution required.
(c-1) The comptroller may not transfer an amount under
Section 825.404 to the state contribution account of the teacher
retirement system trust fund during the months of June, July, and
August. After September 1 and before September 6, the comptroller
shall transfer the amount certified by the Teacher Retirement
System of Texas under Subsection (c-2).
(c-2) Not later than September 1, the Teacher Retirement
System of Texas shall compute and certify to the comptroller an
amount that is the sum of the amount of the state's required
contribution for the previous fiscal year that is attributable to
the preceding three months, plus an amount determined by computing
the rate of yield the contribution would have earned if the
contribution had been transferred to the state contribution account
of the teacher retirement system trust fund in equal monthly
installments in each of the preceding three months.
SECTION 30. Section 815.403, Government Code, is amended by
amending Subsection (e) and adding Subsections (g) and (h) to read
as follows:
(e) All money allocated and appropriated by the state to the
retirement system for benefits provided by the retirement system,
except money for the payment of lump-sum death benefits and for the
payment of benefits from the law enforcement and custodial officer
supplemental retirement fund, shall be paid, based on the annual
estimate of the retirement system, in monthly installments to the
state accumulation fund except as provided by Subsection (g). The
money required for state contributions and membership fees shall be
from respective funds appropriated to pay the compensation of the
member for whose benefit the contribution or fee is paid. If the
total of the estimated required payments is not equal to the total
of the actual payments required for a fiscal year, the retirement
system shall certify to the state comptroller of public accounts at
the end of that year the amount required for necessary adjustments,
and the comptroller shall make the required adjustments.
(g) The comptroller may not transfer an amount under
Subsection (e) to the state accumulation fund during the months of
June, July, and August. After September 1 and before September 6,
the comptroller shall transfer the amount certified by the
retirement system under Subsection (h).
(h) Not later than September 1, the retirement system shall
compute and certify to the comptroller an amount that is the sum of
the amount of the state's required contribution for the previous
fiscal year that is attributable to the preceding three months,
plus an amount determined by computing the rate of yield the
contribution would have earned if the contribution had been
transferred to the state accumulation fund in equal monthly
installments in each of the preceding three months.
SECTION 31. Section 825.404(e), Government Code, is amended
to read as follows:
(e) All money appropriated by the state to the retirement
system shall be paid to the state contribution account in equal
monthly installments as provided by Section 403.093(c), Government
Code, except:
(1) money appropriated under Subsection (d), which
remains in the general revenue fund until expenses are approved
under Chapter 2103; and
(2) money paid to the state contribution account as
provided by Section 403.093.
SECTION 32. Section 1575.002, Insurance Code, as effective
June 1, 2003, is amended to conform to Section 3.03, Chapter 1187,
Acts of the 77th Legislature, Regular Session, 2001, and to conform
more closely to the source law from which the section was derived,
and further amended to read as follows:
Sec. 1575.002. GENERAL DEFINITIONS. In this chapter:
(1) "Active employee" means a contributing member of
the Teacher Retirement System of Texas [an employee as defined by
Section 821.001, Government Code,] who:
(A) is employed by a public school [a member of
the system]; and
(B) is not entitled to coverage under a plan
provided under Chapter 1551 or 1601.
(2) ["Board of trustees" means the board of trustees
of the Teacher Retirement System of Texas.
[(3)] "Carrier" means an insurance company or hospital
service corporation authorized by the department under this code or
another insurance law of this state to provide any of the insurance
coverages, benefits, or services provided by this chapter.
(3) [(4)] "Fund" means the retired [Texas public]
school employees group insurance fund.
(4) [(5)] "Group program" means the Texas Public
School Employees Group Insurance Program authorized by this
chapter.
(5) [(6)] "Health benefit plan" means a group
insurance policy, contract, or certificate, medical or hospital
service agreement, membership or subscription contract, salary
continuation plan, or similar group arrangement to provide health
care services or to pay or reimburse expenses of health care
services.
(6) "Public school" means:
(A) a school district;
(B) another educational district whose employees
are members of the Teacher Retirement System of Texas;
(C) a regional education service center
established under Chapter 8, Education Code; or
(D) an open-enrollment charter school
established under Subchapter D, Chapter 12, Education Code.
(7) "Trustee" ["System"] means the Teacher Retirement
System of Texas.
SECTION 33. Section 1575.004, Insurance Code, as effective
June 1, 2003, is amended to read as follows:
Sec. 1575.004. DEFINITION OF RETIREE. In this chapter,
"retiree" means:
(1) an individual not eligible for coverage under a
plan provided under Chapter 1551 or 1601 who:
(A) is at least 65 years of age and has taken a
service retirement under the Teacher Retirement System of Texas
[system] with at least 10 years of service credit in the system for
actual service in public schools in this state; or
(B) has taken a service retirement under the
Teacher Retirement System of Texas and who has at least 10 years of
service credit for actual public service in the public schools in
this state, and the sum of the individual's age and amount of
service credit earned for service in the public schools of this
state equals or exceeds the number 80 [and
[(B) is not eligible for coverage under a plan
provided under Chapter 1551 or 1601]; or
(2) an individual who:
(A) has taken a disability retirement under the
Teacher Retirement System of Texas [system]; and
(B) is entitled to receive monthly benefits from
the Teacher Retirement System of Texas [system].
SECTION 34. (a) Section 1575.153, Insurance Code, as
effective June 1, 2003, is amended to conform to Section 3.10,
Chapter 1187, Acts of the 77th Legislature, Regular Session, 2001,
and further amended to read as follows:
Sec. 1575.153. [AUTOMATIC] BASIC COVERAGE. A retiree [or
active employee of a participating school district] who applies for
coverage during an enrollment period may not be denied coverage in a
basic plan provided under this chapter unless the trustee [board of
trustees] finds under Subchapter K that the retiree [individual]
defrauded or attempted to defraud the group program.
(b) Section 3.10, Chapter 1187, Acts of the 77th
Legislature, Regular Session, 2001, is repealed.
SECTION 35. Subchapter D, Chapter 1575, Insurance Code, as
effective June 1, 2003, is amended by adding Sections
1575.161-1575.163 to read as follows:
Sec. 1575.161. OPEN ENROLLMENT; ADDITIONAL ENROLLMENT
PERIODS. (a) A retiree eligible for coverage under the group
program may select any coverage provided under this chapter for
which the person is otherwise eligible:
(1) on the date that the person retires; and
(2) during any open enrollment periods for retirees
set by the trustee by rule.
(b) In addition to the enrollment periods authorized under
Subsection (a), a retiree who:
(1) is enrolled in the group program as of August 31,
2004, and who is 65 years of age or older on that date may select
coverage as described by Subsections (c) and (d) on September 1,
2004; or
(2) enrolls in the group program on or after
September 1, 2004, and who is 65 years of age or older on or after
that date may select coverage as described in Subsections (c) and
(d) on the date that the retiree is 65 years of age.
(c) If a retiree described by Subsection (b) is not covered
by the Medicare program, the retiree may enroll in the next-higher
coverage tier under the group program and may add dependent
coverage in that same coverage tier.
(d) If a retiree described by Subsection (b) is covered by
the Medicare program, the retiree may enroll in any coverage tier
under the group program and may add dependent coverage in that same
coverage tier.
(e) This section does not affect the right of a retiree
enrolled in a coverage tier under the group program to select a
lower level of coverage at any time.
Sec. 1575.162. SPECIAL ENROLLMENTS. This chapter does not
limit the ability of an individual to enroll in the group program if
the individual:
(1) experiences a special enrollment event as provided
by the Health Insurance Portability and Accountability Act of 1996
(Pub. L. No. 104-191, 110 Stat. 1936 (1996)), as amended; and
(2) is otherwise eligible to enroll in the group
program.
Sec. 1575.163. LIMITATIONS. The Teacher Retirement System
of Texas, as trustee, may not contract for or provide a health
benefit plan that excludes from participation in the network a
general hospital that:
(1) is located in a county, all or part of which is
located within the geographical service area of the health coverage
plan, in which at least two, but not more than four, general
hospitals are located; and
(2) agrees to provide medical and health care services
under the plan subject to the same terms and conditions as other
hospital providers under the plan.
SECTION 36. Section 1575.201, Insurance Code, as effective
June 1, 2003, is amended to read as follows:
Sec. 1575.201. ADDITIONAL STATE CONTRIBUTIONS; CERTAIN
CONTRIBUTIONS. (a) The state through the trustee [system] shall
contribute from money in the fund:
(1) the total cost of the basic plan covering each
participating retiree; and
(2) for each participating dependent, surviving
spouse, and surviving dependent child, the amount prescribed by the
General Appropriations Act to cover part of the cost of the basic
plan covering the dependent, surviving spouse, and surviving
dependent child.
(b) The trustee shall collect the amount of premium required
for basic coverage under the group program that exceeds the amount
contributed by the state for those individuals described by
Subsection (a)(2).
SECTION 37. Section 1575.203(a), Insurance Code, as
effective June 1, 2003, is amended to read as follows:
(a) Each state fiscal year, each active employee shall, as a
condition of employment, contribute to the fund an amount equal to
0.5 [0.25] percent of the employee's salary.
SECTION 38. Section 1575.204, Insurance Code, as effective
June 1, 2003, is amended to read as follows:
Sec. 1575.204. PUBLIC SCHOOL CONTRIBUTION [RATIO OF STATE
AND ACTIVE EMPLOYEE CONTRIBUTIONS]. Each state fiscal year, each
public school shall contribute to the fund the amount prescribed by
the General Appropriations Act, which may not be less than 0.25
percent or greater than 0.75 percent of the salary of each active
employee of the public school. The public school shall make the
contributions on a monthly basis and as otherwise prescribed by the
trustee [If the amount of state and active employee contributions
to the fund is raised by the legislature above the percentages
provided by Sections 1575.202 and 1575.203 to provide adequate
funding for the group program, the ratio between the state's
contribution and the active employees' contributions must be
maintained at two to one].
SECTION 39. Subchapter E, Chapter 1575, Insurance Code, as
effective June 1, 2003, is amended by adding Sections 1575.211 and
1575.212 to read as follows:
Sec. 1575.211. COST SHARING. (a) The total costs for the
operation of the group program shall be shared among the state, the
public schools, the active employees, and the retirees in the
manner prescribed by the General Appropriations Act.
(b) In determining the allocation of total costs under this
section, the state shall pay not more than 55 percent of the total
costs, retirees shall pay at least 30 percent of the total costs,
and the balance shall be paid by active employees and public
schools.
Sec. 1575.212. PAYMENT BY RETIREES; RANGES. (a) The
trustee by rule shall establish ranges for payment of the share of
total costs allocated under Section 1575.211 to retirees, with
different levels for:
(1) retirees who are not eligible to participate in
Part A of the Medicare program;
(2) retirees who are eligible for participation but
are not participating in Part A of the Medicare program; and
(3) retirees who are eligible for participation in the
Medicare program and are participating in Part A of the Medicare
program.
(b) In establishing ranges for payment of the share of total
costs allocated under Section 1575.211 to retirees, the trustee may
consider the years of service credit accrued by a retiree and may
reward those retirees with more years of service credit.
SECTION 40. Subchapter E, Chapter 3, Insurance Code, is
amended by adding Article 3.50-7A to read as follows:
Art. 3.50-7A. LIMITATIONS APPLICABLE TO TEXAS SCHOOL
EMPLOYEES UNIFORM GROUP COVERAGE PROGRAM. (a) This article
applies only to the uniform group coverage program established
under Article 3.50-7 of this code. A term used in this article has
the meaning assigned by Section 2, Article 3.50-7, of this code.
(b) The Teacher Retirement System of Texas, as trustee, may
not contract for or provide a health coverage plan that excludes
from participation in the network a general hospital that:
(1) is located in a county, all or part of which is
located within the geographical service area of the health coverage
plan, in which at least two, but not more than four, general
hospitals are located; and
(2) agrees to provide medical and health care services
under the plan subject to the same terms and conditions as other
hospital providers under the plan.
SECTION 41. Section 2, Article 3.50-8, Insurance Code, is
amended by amending Subsection (a) and adding Subsections (e), (f),
and (g) to read as follows:
(a) Each year, the trustee shall deliver to each school
district, including a school district that is ineligible for state
aid under Chapter 42, Education Code, each other educational
district that is a member of the Teacher Retirement System of Texas,
each participating charter school, and each regional education
service center state funds in an amount, as determined by the
trustee, equal to:
(1) the product of the number of full-time active
employees employed by the district, school, or service center,
other than in the capacity of professional staff, multiplied by
$500 [$1,000] or a greater amount as provided by the General
Appropriations Act for purposes of this article; and
(2) the product of the number of part-time active
employees employed by the district, school, or service center,
other than in the capacity of professional staff, multiplied by
$250 or a greater amount as provided by the General Appropriations
Act for purposes of this article.
(e) A member of the professional staff of a district,
charter school, or service center described by Subsection (a) of
this section is not eligible to receive state funds under
Subsection (a) of this section.
(f) For purposes of this section, a member of the
professional staff of a district, charter school, or service center
described by Subsection (a) of this section has the meaning defined
by rule by the trustee.
(g) An employee is not eligible to receive a state
contribution under this article until the 90th day after the date
the employee is employed by an entity described by Section 1(2)(A)
of this article.
SECTION 42. Section 31.301(e), Natural Resources Code, is
amended to read as follows:
(e) Before approving the trade, the appropriate board shall
make a finding that no loss to the permanent [available] school fund
or the available university fund will occur as a result of the
trade.
SECTION 43. Sections 33.016, 51.069, and 51.300, Natural
Resources Code, are amended to read as follows:
Sec. 33.016. DISPOSITION OF OTHER FUNDS. Money received by
the board for the grant of any interest not under Section [33.014
or] 33.015 of this code shall be deposited in the State Treasury to
the credit of the permanent [available] school fund.
Sec. 51.069. DISPOSITION OF PAYMENTS ON PUBLIC SCHOOL LAND.
[(a)] Payments on public school land received by the commissioner,
including payments received as interest on the purchase of public
school land, shall be transmitted to the comptroller to be credited
to the [proper fund.
[(b) The comptroller shall credit payments received on the
purchase price of public school land to the] permanent school fund
[and payments received as interest on the purchase of public school
land to the available school fund].
Sec. 51.300. DISPOSITION OF INCOME. Income received by the
commissioner under this subchapter from public school land shall be
credited to the permanent [available] school fund, and income
received from university land shall be credited to the available
university fund. Other income received by the commissioner on
other land under this subchapter shall be credited to the General
Revenue Fund.
SECTION 44. Section 51.401(b), Natural Resources Code, is
amended to read as follows:
(b) The special fund account must be an interest-bearing
account, and the interest received on the account shall be
deposited in the State Treasury to the credit of the permanent
[available] school fund.
SECTION 45. Section 52.137(b), Natural Resources Code, is
amended to read as follows:
(b) The commissioner, upon receipt of such payment made
under protest as authorized by this section, shall send to the
comptroller the payment and a written statement that the payment
was made under protest. Immediately upon receipt, the comptroller
shall:
(1) place the payment in state depositories bearing
interest in the same manner that other funds are required to be
placed in state depositories at interest;
(2) allocate the interest earned on these funds;
(3) credit the amount allocated to an account
established for this purpose until the status of the protest is
finally determined; and
(4) upon final determination that some or all of the
protested funds belong to the state, deposit the principal and the
allocated interest to the [proper funds as provided by law. All
protest payments finally determined to belong to the] permanent
school fund [shall be deposited to that fund upon such
determination, and interest earned and allocated on those funds
shall be deposited to the available school fund].
SECTION 46. Section 52.297(d), Natural Resources Code, is
amended to read as follows:
(d) The special fund account must be an interest-bearing
account, and the interest received on the account shall be
deposited in the State Treasury to the credit of the permanent
[available] school fund.
SECTION 47. Section 53.155(d), Natural Resources Code, is
amended to read as follows:
(d) The special fund account must be an interest-bearing
account, and the interest received on the account shall be
deposited in the State Treasury to the credit of the permanent
[available] school fund.
SECTION 48. Section 57.046, Utilities Code, is amended by
amending Subsection (a) and adding Subsection (c) to read as
follows:
(a) The board shall use money in the public schools account
to:
(1) to the extent directed in the General
Appropriations Act, fund the technology allotment under Section
32.005, Education Code; and
(2) award grants and loans in accordance with this
subchapter to fund:
(A) [(1)] equipment for public schools,
including computers, printers, computer labs, and video equipment;
and
(B) [(2)] intracampus and intercampus wiring to
enable those public schools to use the equipment.
(c) Section 57.047(d) does not apply to the use of money in
the public schools account for the purpose specified by Subsection
(a)(1).
SECTION 49. Sections 57.048(c) and (d), Utilities Code, are
amended to read as follows:
(c) The total amount deposited to the credit of the fund,
excluding interest and loan repayments, may not exceed $1.75 [$1.5]
billion. Not later than August 31 of each year, the comptroller
shall determine the total amount, excluding interest and loan
repayments, that has been deposited to the credit of the fund during
that fiscal year and the preceding fiscal years. If the comptroller
determines that a total of $1.5 [$1.2] billion or more, excluding
interest and loan repayments, has been deposited to the credit of
the fund, the comptroller shall impose the assessment during the
next fiscal year at a rate that the comptroller estimates is
sufficient to produce the amount necessary to result in the deposit
in the fund of a total of not more than $1.75 [$1.5] billion,
excluding interest and loan repayments.
(d) The comptroller may not collect the assessment during a
fiscal year if the comptroller determines after the yearly review
that the total amount deposited to the credit of the fund during
that fiscal year and the preceding fiscal years is $1.74 [$1.49]
billion or more, excluding interest and loan repayments, and it is
not possible to impose the assessment during the next fiscal year at
a practical rate without collecting more than a total of $1.75
[$1.5] billion, excluding interest and loan repayments.
SECTION 50. Section 5, Chapter 314, Acts of the 56th
Legislature, Regular Session, 1959 (Article 5337-2, Vernon's Texas
Civil Statutes), is amended to read as follows:
Sec. 5. All income received by the Land Commissioner under
this Act from Public School Lands shall be credited to the Permanent
[Available] School Fund.
SECTION 51. (a) The following laws are repealed:
(1) Sections 39.055(b), (c), and (d) and 53.47(k),
Education Code;
(2) Section 823.401(h), Government Code; and
(3) Section 1575.154, Insurance Code, as effective
June 1, 2003.
(b) Section 43.008, Education Code, is repealed.
SECTION 52. Effective September 1, 2003, the comptroller of
public accounts shall transfer $42 million from the Texas school
employees uniform group coverage trust fund established under
Section 8, Article 3.50-7, Insurance Code, to the retired school
employees group insurance fund described by Subchapter G, Chapter
1575, Insurance Code, as effective June 1, 2003, to compensate the
retired school employees group insurance fund for money transferred
from that fund under Section 4.01, Chapter 1187, Acts of the 77th
Legislature, Regular Session, 2001.
SECTION 53. Subchapter F, Chapter 21, Education Code, as
amended by this Act, applies only to a hearing before a hearing
examiner under that subchapter for which a teacher makes a written
request on or after September 1, 2003. A hearing under Subchapter
F, Chapter 21, Education Code, for which a teacher made a written
request before September 1, 2003, is governed by the law in effect
on the date the teacher requests the hearing, and the former law is
continued in effect for that purpose.
SECTION 54. (a) The repeal by Section 1 of this Act of
Section 45.002, Education Code, does not impair any obligation
created by the issuance or execution of any lawful agreement or
evidence of indebtedness before September 1, 2004, that matures
after that date and that is payable from the levy and collection of
a maintenance tax under that section or another law, and an
independent school district may, on and after September 1, 2004,
levy, assess, and collect a maintenance tax, at a rate not greater
than the rate required to pay such obligations but only for so long
as those obligations remain outstanding and unpaid.
(b) Notwithstanding the repeal by Section 1 of this Act of
Chapters 41, 42, and 46, Education Code, and Section 45.002,
Education Code, a school district that, before September 1, 2004,
issues bonds, notes, or other evidences of indebtedness under
Chapter 45, Education Code, or other applicable law or enters into a
lease-purchase agreement under Subchapter A, Chapter 271, Local
Government Code, may continue, before, on, and after September 1,
2004, to receive state assistance with respect to such payments to
the same extent the district would have been entitled to receive the
assistance under Chapter 42 or 46, Education Code, as those
chapters existed before repeal by this Act, and the former law is
continued in effect for that purpose. The commissioner of
education may adopt rules to implement this subsection.
(c) The repeal by Section 1 of this Act of Chapters 41, 42,
and 46, Education Code, and Section 45.002, Education Code, does
not limit, modify, or eliminate the authority of a school district
to:
(1) issue or execute bonds, public securities, or
other obligations under Chapter 45, Education Code, or other law,
either before, on, or after September 1, 2004; or
(2) levy, assess, and collect, before, on, or after
September 1, 2004, ad valorem taxes at the full rate and in the full
amount authorized by Section 45.002, Education Code, and necessary
to pay the bonds, public securities, or other obligations when due
and payable.
(d) Before September 1, 2004, the commissioner of education
may not refuse to grant assistance to a school district under
Chapter 42 or 46, Education Code, in connection with public
securities, lease-purchase agreements, credit agreements, or other
obligations, including those described by Subchapter A, Chapter
271, Local Government Code, on the basis that the district's
authority to levy a maintenance tax is repealed effective September
1, 2004.
SECTION 55. The commissioner of education shall adopt rules
and establish the classroom supply reimbursement program as
required by Section 21.413, Education Code, as added by this Act,
not later than August 1, 2005.
SECTION 56. Notwithstanding Section 39.182, Education
Code:
(1) the Texas Education Agency is not required to
prepare and deliver a report under that section before December 1,
2003, that covers the 2002-2003 school year; and
(2) as determined by the commissioner of education,
the report required to be delivered not later than December 1, 2004,
by the Texas Education Agency under that section may include
information from the 2002-2003 school year.
SECTION 57. Section 42.152(c), Education Code, as amended
by this Act, applies to the use of compensatory education funds
allotted under Chapter 42, Education Code, for any school year,
including a school year before September 1, 2003.
SECTION 58. The change in law made by this Act to Section 2,
Article 3.50-8, Insurance Code, applies to a monthly installment to
be paid on or after September 1, 2003.
SECTION 59. Notwithstanding Article 3.50-8, Insurance
Code, the state shall pay the state contribution for active
employee health coverage or supplemental compensation authorized
under Section 2, Article 3.50-8, Insurance Code, for the last month
of state fiscal year 2005 not earlier than the first day of the
first month of state fiscal year 2006.
SECTION 60. (a) Except as otherwise provided by this Act,
this Act takes effect September 1, 2003.
(b) Sections 12, 14, 23, 26, 48, and 49 of this Act take
effect immediately if this Act receives a vote of two-thirds of all
the members elected to each house, as provided by Section 39,
Article III, Texas Constitution. If this Act does not receive the
vote necessary for immediate effect, Sections 12, 14, 23, 26, 48,
and 49 of this Act take effect September 1, 2003.
(c) Sections 24, 25, 42, 43, 44, 45, 46, 47, 50, and 51(b) of
this Act take effect January 1, 2004, but only if the constitutional
amendment proposed by S.J.R. No. 13, 78th Legislature, Regular
Session, 2003, is approved by the voters. If the proposed
constitutional amendment is not approved by the voters, Sections
24, 25, 42, 43, 44, 45, 46, 47, 50, and 51(b) of this Act have no
effect.
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