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A BILL TO BE ENTITLED
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AN ACT
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relating to the administration and operation of, and the |
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participation of state employees in, the state's programs for |
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prepaying or saving toward the costs of attending an institution of |
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higher education. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 54.603, Education Code, is amended to |
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read as follows: |
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Sec. 54.603. SUNSET PROVISION. The Prepaid Higher |
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Education Tuition Board is subject to Chapter 325, Government Code |
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(Texas Sunset Act). Unless continued in existence as provided by |
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that chapter, the board is abolished and the programs established |
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under this subchapter and under Subchapters [Subchapter] G and H |
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terminate September 1, 2019. |
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SECTION 2. Section 54.702, Education Code, is amended by |
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adding Subsection (h) to read as follows: |
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(h) The board may enter into an interagency contract with |
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the Employees Retirement System of Texas to allow an employee of |
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this state to enroll in the plan during the retirement system's |
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annual enrollment period. The board shall provide information and |
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materials regarding the plan to the retirement system for |
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distribution to state employees during the enrollment period. |
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SECTION 3. Section 54.751, Education Code, is amended by |
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amending Subdivisions (2) and (6) and adding Subdivision (3-a) to |
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read as follows: |
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(2) "Beneficiary" means the person designated under a |
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prepaid tuition contract as the person entitled to apply one or more |
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tuition units purchased under the contract to the payment of the |
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person's undergraduate tuition and required fees at a general |
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academic teaching institution, two-year institution of higher |
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education, private or independent institution of higher education, |
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career school, or accredited out-of-state institution of higher |
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education. |
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(3-a) "Career school" means a career school or college |
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as defined by Section 132.001 that offers a two-year associate |
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degree as approved by the Texas Higher Education Coordinating |
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Board. |
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(6) "Prepaid tuition contract" means a contract under |
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which a person purchases from the board on behalf of a beneficiary |
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one or more tuition units that the beneficiary is entitled to apply |
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to the payment of the beneficiary's undergraduate tuition and |
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required fees at a general academic teaching institution, two-year |
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institution of higher education, private or independent |
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institution of higher education, career school, or accredited |
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out-of-state institution of higher education. |
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SECTION 4. Section 54.752, Education Code, is amended by |
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adding Subsection (d) to read as follows: |
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(d) The board may enter into an interagency contract with |
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the Employees Retirement System of Texas to allow an employee of |
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this state to enroll in the program during the retirement system's |
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annual enrollment period. The board shall provide information and |
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materials regarding the program to the retirement system for |
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distribution to state employees during the enrollment period. |
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SECTION 5. Section 54.7521, Education Code, is amended to |
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read as follows: |
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Sec. 54.7521. TEXAS SAVE AND MATCH PROGRAM. (a) The board |
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by rule shall develop and shall implement the Texas Save and Match |
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program under which money paid by a purchaser under a prepaid |
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tuition contract may be matched with: |
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(1) contributions made by any person to the Texas Save |
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and Match program and used to purchase additional tuition units on |
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behalf of beneficiaries selected as provided by board rule; and |
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(2) money appropriated by the legislature for the |
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Texas Save and Match program and used to purchase additional |
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tuition units on behalf of beneficiaries: |
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(A) whose annual household income is below the |
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state median family income, adjusted for household size; |
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(B) whose enrollment in the program would, as |
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determined by the board, promote the participation goals and |
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targets of the most recent revision of "Closing the Gaps," the |
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state's master plan for higher education; or |
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(C) who meet other criteria established by board |
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rule. |
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(b) Notwithstanding other law, for purposes of Subchapter |
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I, Chapter 659, Government Code: |
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(1) the Texas Save and Match program is considered an |
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eligible charitable organization entitled to participate in a state |
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employee charitable campaign under Subchapter I, Chapter 659, |
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Government Code; and |
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(2) a state employee is entitled to authorize a |
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payroll deduction for contributions to the Texas Save and Match |
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program as a charitable contribution under Section 659.132, |
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Government Code. |
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SECTION 6. Section 54.753(a), Education Code, is amended to |
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read as follows: |
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(a) Under the program, a purchaser may prepay the costs of |
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all or a portion of a beneficiary's undergraduate tuition and |
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required fees at a general academic teaching institution, two-year |
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institution of higher education, private or independent |
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institution of higher education, career school, or accredited |
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out-of-state institution of higher education by entering into a |
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prepaid tuition contract with the board to purchase one or more |
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tuition units of a type described by this section at the applicable |
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price established by the board for that type of unit for the year in |
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which the unit is purchased. The portion of the beneficiary's |
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undergraduate tuition and required fees for which a tuition unit |
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may be redeemed at a particular general academic teaching |
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institution or two-year institution of higher education is assigned |
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to the tuition unit at the time of purchase, and the tuition unit |
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may be redeemed to pay that portion of the tuition and fees at the |
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general academic teaching institution or two-year institution of |
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higher education in any academic year in which the unit is redeemed |
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in accordance with this subchapter. The purchaser may purchase one |
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type of unit or a combination of two or three types of units. |
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SECTION 7. Section 54.754(d), Education Code, is amended to |
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read as follows: |
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(d) If a beneficiary redeems fewer tuition units of the type |
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or combination of types necessary to pay the total cost of the |
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beneficiary's tuition and required fees at the general academic |
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teaching institution, two-year institution of higher education, |
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private or independent institution of higher education, career |
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school, or accredited out-of-state institution of higher education |
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at which the beneficiary enrolls, the beneficiary is responsible |
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for paying the amount of the difference between the amount of |
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tuition and required fees for which the beneficiary pays through |
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the redemption of one or more tuition units and the total cost of |
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the beneficiary's tuition and required fees at the institution. |
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SECTION 8. Sections 54.765(a), (b), (c), (f), and (g), |
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Education Code, are amended to read as follows: |
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(a) Except as provided by Subsection (h) [(e)], the |
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comptroller is the custodian of the assets of the fund. |
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(b) The comptroller shall pay money from the fund [on a
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warrant drawn by the comptroller] supported only by [on] a voucher |
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signed by the comptroller or the comptroller's authorized |
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representative. The comptroller may designate the plan manager as |
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the comptroller's authorized representative to pay expenditures or |
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transfer funds under this section and Sections 54.766 and 54.767. |
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(c) When a beneficiary enrolls at a general academic |
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teaching institution or two-year institution of higher education, |
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on written authorization from the purchaser of the tuition unit or |
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units for that beneficiary, the comptroller or the comptroller's |
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authorized representative shall transfer to the institution an |
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amount equal to the lesser of: |
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(1) the sum of: |
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(A) the total purchase price of the tuition unit |
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or units the beneficiary redeems for the semester or other academic |
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term; and |
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(B) the amount determined under Subsection (d); |
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or |
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(2) an amount equal to 101 percent of the amount of |
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tuition and required fees covered by the tuition units being |
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redeemed. |
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(f) When a beneficiary enrolls at a private or independent |
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institution of higher education, career school, or accredited |
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out-of-state institution of higher education, on written |
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authorization from the purchaser of the tuition unit or units for |
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that beneficiary, the comptroller or the comptroller's authorized |
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representative shall transfer to the institution the lesser of: |
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(1) an amount equal to the current cost of the tuition |
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and required fees that would be covered by redemption of the number |
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and type of tuition units the beneficiary is redeeming if the |
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beneficiary were redeeming the unit or units at a general academic |
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teaching institution or two-year institution of higher education as |
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follows: |
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(A) for a Type I unit, at the general academic |
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teaching institution that[, in the sales year in which the unit was
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purchased,] had the highest tuition and required fee cost; |
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(B) for a Type II unit, at a general academic |
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teaching institution that[, in the sales year in which the unit was
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purchased,] had tuition and required fee cost at the weighted |
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average; and |
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(C) for a Type III unit, at a two-year |
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institution of higher education that[, in the sales year in which
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the unit was purchased,] had tuition and required fee cost at the |
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weighted average; or |
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(2) an amount equal to the total purchase price of the |
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tuition unit or units the beneficiary redeems for the semester or |
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other academic term plus the portion of the total return on assets |
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of the fund attributable to that amount. |
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(g) The comptroller annually shall provide to the board a |
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sworn statement of the amount of the fund's assets in the |
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comptroller's or plan manager's custody. The plan manager shall |
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provide to the comptroller a quarterly report of all funds |
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distributed during the previous quarter. The comptroller may |
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require more frequent reports or may request that the plan manager |
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provide any additional information at any time necessary to ensure |
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that the fund's assets are adequately protected. |
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SECTION 9. Section 54.767, Education Code, is amended to |
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read as follows: |
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Sec. 54.767. USE OF FUND ASSETS. The assets of the fund may |
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be used only to: |
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(1) pay the costs of program administration and |
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operations; |
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(2) make payments to general academic teaching |
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institutions, two-year institutions of higher education, private |
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or independent institutions of higher education, career schools, |
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and accredited out-of-state institutions of higher education on |
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behalf of beneficiaries; and |
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(3) make refunds under prepaid tuition contracts. |
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SECTION 10. Section 54.7671(b), Education Code, is amended |
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to read as follows: |
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(b) For purposes of a transfer of money from an account |
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under this subchapter, the value of the account at the time of |
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transfer is the lesser of: |
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(1) an amount equal to the cost, at the time of the |
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transfer, of the tuition and required fees that would be covered by |
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redemption of the number and type of tuition units to be transferred |
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from the account if the beneficiary were redeeming the units at a |
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general academic teaching institution or two-year institution of |
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higher education as follows: |
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(A) for a Type I unit, at the general academic |
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teaching institution that[, in the sales year in which the unit was
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purchased,] had the highest tuition and required fee cost; |
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(B) for a Type II unit, at a general academic |
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teaching institution that[, in the sales year in which the unit was
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purchased,] had tuition and required fee cost at the weighted |
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average; and |
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(C) for a Type III unit, at a two-year |
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institution of higher education that[, in the sales year in which
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the unit was purchased,] had tuition and required fee cost at the |
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weighted average; or |
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(2) an amount equal to the total purchase price of the |
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tuition units to be transferred from the account, plus the portion |
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of the total return on assets of the fund attributable to that |
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amount. |
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SECTION 11. Sections 54.769(b) and (c), Education Code, are |
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amended to read as follows: |
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(b) The rights of a purchaser, beneficiary, or successor in |
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interest of a purchaser or beneficiary in and under a prepaid |
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tuition contract and the payment of tuition and required fees for a |
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beneficiary under a prepaid tuition contract to a general academic |
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teaching institution, two-year institution of higher education, |
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private or independent institution of higher education, career |
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school, or accredited out-of-state institution of higher education |
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under this chapter are exempt from attachment, levy, garnishment, |
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execution, and seizure for the satisfaction of any debt, judgment, |
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or claim against a purchaser, beneficiary, or successor in interest |
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of a purchaser or beneficiary. |
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(c) A claim or judgment against a purchaser, beneficiary, or |
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successor in interest of a purchaser or beneficiary does not impair |
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or entitle the claim or judgment holder to assert or enforce a lien |
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against: |
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(1) the rights of a purchaser, beneficiary, or |
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successor in interest of a purchaser or beneficiary in and under a |
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prepaid tuition contract; or |
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(2) the right of a beneficiary to the payment of |
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tuition and required fees to a general academic teaching |
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institution, two-year institution of higher education, private or |
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independent institution of higher education, career school, or |
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accredited out-of-state institution of higher education under a |
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prepaid tuition contract. |
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SECTION 12. Section 54.774(a), Education Code, is amended |
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to read as follows: |
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(a) A prepaid tuition contract remains in effect after the |
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program is terminated if, when the program is terminated, the |
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beneficiary: |
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(1) has been accepted by or is enrolled at a general |
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academic teaching institution, two-year institution of higher |
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education, private or independent institution of higher education, |
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career school, or accredited out-of-state institution of higher |
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education; or |
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(2) is projected to graduate from high school not |
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later than the third anniversary of the date the program is |
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terminated. |
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SECTION 13. Section 54.775(b), Education Code, is amended |
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to read as follows: |
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(b) Notwithstanding Subsection (a), the board may release |
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information described by that subsection to a general academic |
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teaching institution, two-year institution of higher education, |
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private or independent institution of higher education, career |
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school, or accredited out-of-state institution of higher education |
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at which a beneficiary may enroll or is enrolled. The institution |
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shall keep the information confidential. |
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SECTION 14. The Texas Save and Match program is entitled to |
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participate in the state employee charitable campaign conducted |
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during the autumn of 2009 without regard to any limitation on the |
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time during which an organization must apply to participate in the |
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campaign. |
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SECTION 15. (a) If this Act takes effect immediately, a |
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state employee is entitled to enroll in the Texas tomorrow fund II |
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plan during the Employees Retirement System of Texas' annual open |
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enrollment period during the summer of 2009. |
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(b) If this Act takes effect September 1, 2009, it is the |
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legislature's intent that the Employees Retirement System of Texas |
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take the appropriate administrative actions necessary to ensure |
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that state employees be allowed to enroll in the Texas tomorrow fund |
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II plan effective September 1, 2009. Those administrative actions |
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may include allowing state employees to participate in the annual |
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open enrollment period during the summer of 2009. |
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SECTION 16. This Act takes effect immediately if it |
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receives a vote of two-thirds of all the members elected to each |
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house, as provided by Section 39, Article III, Texas Constitution. |
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If this Act does not receive the vote necessary for immediate |
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effect, this Act takes effect September 1, 2009. |