BILL ANALYSIS
Senate Research Center S.B. 1941
81R5700 KEL-F By: Shapiro
AUTHOR'S / SPONSOR'S STATEMENT OF INTENT
The Texas Tuition Promise Fund (TTPF) allows a person to purchase tuition units for the future payment of undergraduate tuition and fees. The program consists of three types of units, each equal in value to one percent of the total needed, at the time the unit is redeemed, to cover one academic year at a Texas public university or public junior college or technical college. A beneficiary or purchaser cannot redeem tuition units before the third anniversary of the date it was purchased and the tuition units expire on the 10th anniversary of the beneficiary's projected high school graduation date, not counting time spent by the beneficiary as an active duty member of the U.S. armed services.
Currently the Save and Match program does not receive state appropriations. Therefore, without a method to receive funding, the program will not be able to match participants' contributions.
As proposed, S.B. 1941 expands the Texas Tomorrow Fund to cover payments to private career schools. S.B. 1941 allows state employees to enroll during the annual enrollment period for the Texas Employee's Retirement System (ERS) and expands the State Employee Charitable Campaign to include the Save and Match program as an eligible charitable contribution. S.B. 1941 also makes administrative changes regarding the payment of fees to universities and clarifies how out-of-state or private colleges' payments are calculated.
RULEMAKING AUTHORITY
This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Section 54.603, Education Code, to provide that unless continued in existence as provided by that chapter, the Prepaid Higher Education Tuition Board (board) is abolished and the programs established under this subchapter and under Subchapters G (Statutory Probate Court Associate Judges) and H (Criminal Law Magistrates in Tarrant County), rather than Subchapter G, terminate September 1, 2019.
SECTION 2. Amends Section 54.702, Education Code, by adding Subsection (h), to authorize the board to enter into an interagency contract with the Employees Retirement System of Texas (ERS) to allow an employee of this state to enroll in the plan during ERS's annual enrollment period. Requires the board to provide information and materials regarding the plan to the retirement system for distribution to state employees during the enrollment period.
SECTION 3. Amends Section 54.751, Education Code, by amending Subdivisions (2) and (6) and adding Subdivision (3-a), to redefine "beneficiary" and "prepaid tuition contract" and define "career school."
SECTION 4. Amends Section 54.752, Education Code, by adding Subsection (d), to authorize the board to enter into an interagency contract with ERS to allow an employee of this state to enroll in the program during ERS's annual enrollment period. Requires the board to provide information and materials regarding the program to ERS for distribution to state employees during the enrollment period.
SECTION 5. Amends Section 54.7521, Education Code, as follows:
Sec. 54.7521. TEXAS SAVE AND MATCH PROGRAM. (a) Creates this subsection from existing text.
(b) Provides that notwithstanding other law, for purposes of Subchapter I (Charitable Contributions), Chapter 659 (Compensation), Government Code, the Texas Save and Match program is considered an eligible charitable organization entitled to participate in a state employee charitable campaign under Subchapter I, Chapter 659, Government Code, and a state employee is entitled to authorize a payroll deduction for contributions to the Texas Save and Match program as a charitable contribution under Section 659.132 (Deduction Authorized), Government Code.
SECTION 6. Amends Section 54.753(a), Education Code, to authorize a purchaser, under the program, to prepay the costs of all or a portion of a beneficiary's undergraduate tuition and required fees at certain institutions including a career school by entering into a prepaid tuition contract with the board to purchase one or more tuition units of a type described by this section at the applicable price established by the board for that type of unit for the year in which the unit is purchased.
SECTION 7. Amends Section 54.754(d), Education Code, to provide that if a beneficiary redeems fewer tuition units of the type or combination of types necessary to pay the total cost of the beneficiary's tuition and required fees at the general academic teaching institution, two-year institution of higher education, career school, or accredited out-of-state institution of higher education at which the beneficiary enrolls, the beneficiary is responsible for paying the amount of the difference between the amount of tuition and required fees for which the beneficiary pays through the redemption of one or more tuition units and the total cost of the beneficiary's tuition and required fees at the institution.
SECTION 8. Amends Sections 54.765(a), (b), (c), (f), and (g), Education Code, as follows:
(a) Provides that except as provided by Subsection (h), rather than (e) (relating to use of excess transferred funds), the comptroller of public accounts (comptroller) is the custodian of the assets of the fund.
(b) Requires the comptroller to pay money from the fund, rather than to pay money from the fund on a warrant drawn by the comptroller, supported only by, rather than on, a voucher signed by the comptroller or the comptroller's authorized representative. Authorizes the comptroller to designate the plan manager as the comptroller's authorized representative to pay expenditures or transfer funds under this section and Sections 54.766 and 54.767.
(c) Requires the comptroller or the comptroller's authorized representative, when a beneficiary enrolls at a general academic teaching institution or two-year institution of higher education, on written authorization from the purchaser of the tuition unit or units for that beneficiary, to transfer to the institution an amount equal to the lesser of certain amounts.
(f) Requires the comptroller or the comptroller's authorized representative, when a beneficiary enrolls certain institutions, including a career school, on written authorization from the purchaser of the tuition unit or units for that beneficiary, to transfer to the institution the lesser of an amount equal to the current cost of the tuition and required fees that would be covered by redemption of the number and type of tuition units the beneficiary is redeeming if the beneficiary were redeeming the unit or units at a general academic teaching institution or two-year institution of higher education as follows for a certain Type unit, at a certain institution that had the highest tuition and required fee cost. Deletes existing text relating to the sales year in which the unit was purchased. Makes conforming changes.
(g) Requires the comptroller to annually provide to the board a sworn statement of the amount of the fund's assets in the comptroller's or plan manager's custody. Requires the plan manager to provide to the comptroller a quarterly report of all funds distributed during the previous quarter. Authorizes the comptroller to require more frequent reports or request that the plan manager provide any additional information at any time necessary to ensure that the fund's assets are adequately protected.
SECTION 9. Amends Section 54.767, Education Code, to make a conforming change.
SECTION 10. Amends Section 54.7671(b), Education Code, to make conforming changes.
SECTION 11. Amends Sections 54.769(b) and (c), to make conforming changes.
SECTION 12. Amends Section 54.774(a), Education Code, to make a conforming change.
SECTION 13. Amends Section 54.775(b), Education Code, to make a conforming change.
SECTION 14. Provides that the Texas Save and Match program is entitled to participate in the state employee charitable campaign conducted during the autumn of 2009 without regard to any limitation on the time during which an organization is required to participate in the campaign.
SECTION 15. (a) Entitles a state employee, if this Act takes effect immediately, to enroll in the Texas tomorrow fund II plan during ERS's annual enrollment period during the summer of 2009.
(b) Provides that if the Act takes effect September 1, 2009, it is the legislature's intent that ERS take the appropriate administrative actions necessary to ensure that state employees be allowed to enroll in the Texas tomorrow fund II plan effective September 1, 2009. Authorizes those administrative actions to include allowing state employees to participate in the annual open enrollment period during the summer of 2009.
SECTION 16. Effective date: upon passage or September 1, 2009.