Bill Text: IA HF2284 | 2015-2016 | 86th General Assembly | Introduced
Bill Title: A bill for an act establishing an education savings grant pilot program by providing education savings grants for certain pupils attending a nonpublic school, requiring periodic legislative review of the pilot program, establishing an education savings grant fund, making appropriations, providing penalties, and including applicability provisions.
Sponsorship: Partisan Bill (Republican 1)
Status: (Introduced - Dead) 2016-04-04 - Passed subcommittee. [HF2284 Detail]
Download: Iowa-2015-HF2284-Introduced.html
House File 2284 - Introduced HOUSE FILE BY HIGHFILL A BILL FOR 1 An Act establishing an education savings grant pilot program 2 by providing education savings grants for certain pupils 3 attending a nonpublic school, requiring periodic legislative 4 review of the pilot program, establishing an education 5 savings grant fund, making appropriations, providing 6 penalties, and including applicability provisions. 7 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: TLSB 5632YH (4) 86 md/sc PAG LIN 1 1 Section 1. Section 256.7, Code 2016, is amended by adding 1 2 the following new subsection: 1 3 NEW SUBSECTION. 33. Adopt rules relating to applications 1 4 for an education savings grant pursuant to section 257.11B, 1 5 including application processing timelines and information 1 6 required to be submitted by a parent or guardian. 1 7 Sec. 2. Section 257.6, subsection 1, paragraph a, Code 2016, 1 8 is amended by adding the following new subparagraph: 1 9 NEW SUBPARAGRAPH. (8) Resident pupils attending an 1 10 accredited nonpublic school while receiving an education 1 11 savings grant pursuant to section 257.11B. Such pupils 1 12 shall not be counted for enrollment purposes under any other 1 13 subparagraph of this subsection 1. 1 14 Sec. 3. NEW SECTION. 257.11B Education savings grant pilot 1 15 program. 1 16 1. a. For the school budget year beginning July 1, 2017, 1 17 and each succeeding budget year, the following pupils shall be 1 18 eligible to receive an education savings grant in the manner 1 19 provided in this section: 1 20 (1) Not more than one hundred twenty pupils who are eligible 1 21 to enroll in kindergarten through grade twelve in the Waterloo 1 22 community school district, who are eligible for free and 1 23 reduced price meals under the federal National School Lunch 1 24 Act and the federal Child Nutrition Act of 1966, 42 U.S.C. 1 25 {1751=1785, and who are attending a nonpublic school during the 1 26 applicable school budget year. 1 27 (2) Not more than seventy pupils who are eligible to enroll 1 28 in kindergarten through grade twelve in the Sioux Center 1 29 community school district, who are eligible for free and 1 30 reduced price meals under the federal National School Lunch 1 31 Act and the federal Child Nutrition Act of 1966, 42 U.S.C. 1 32 {1751=1785, and who are attending a nonpublic school during the 1 33 applicable school budget year. 1 34 b. Education savings grants shall be made available to 1 35 parents and guardians in the manner authorized under subsection 2 1 4, paragraph "c", for the payment of qualified educational 2 2 expenses as provided in this section. 2 3 2. a. (1) By January 31 preceding the school year for 2 4 which the education savings grant is requested, the parent 2 5 or guardian of the pupil requesting to receive an education 2 6 savings grant shall submit an application to the department of 2 7 education, on application forms developed by the department, 2 8 indicating that the parent or guardian intends to enroll the 2 9 pupil in a nonpublic school. 2 10 (2) In addition to such information deemed appropriate by 2 11 the department of education, the application shall require 2 12 certification from the nonpublic school of the pupil's 2 13 enrollment for the following school year. 2 14 b. By March 1 preceding the school year for which the 2 15 education savings grant is requested, the department of 2 16 education shall notify the department of management of the 2 17 number of pupils in each school district designated for the 2 18 following school year to receive an education savings grant. 2 19 The department of education shall also notify the parent 2 20 or guardian of such pupils who are approved to receive an 2 21 education savings grant. 2 22 c. Education savings grants shall only be approved for one 2 23 school year per application, and applications must be submitted 2 24 under paragraph "a" for education savings grants in subsequent 2 25 school years. Applications for education savings grants are 2 26 approved in the order in which they are filed. However, in 2 27 order to provide continuity of education for pupils receiving 2 28 education savings grants, the department shall give priority 2 29 to applications submitted for pupils who received an education 2 30 savings grant during the previous school year. 2 31 3. The department of management shall assign each pupil an 2 32 education savings grant in an amount equal to five thousand 2 33 eight hundred fifty=four dollars. 2 34 4. An education savings grant fund is created in the state 2 35 treasury under the control of the department of management 3 1 consisting of moneys appropriated to the department for the 3 2 purpose of providing education savings grants under this 3 3 section. For the fiscal year commencing July 1, 2017, and 3 4 each succeeding fiscal year, there is appropriated from the 3 5 general fund of the state to the department of management to be 3 6 credited to the fund the amount necessary to pay all education 3 7 savings grants approved for that fiscal year. The director of 3 8 the department of management has all powers necessary to carry 3 9 out and effectuate the purposes, objectives, and provisions of 3 10 this section pertaining to the fund, including the power to do 3 11 all of the following: 3 12 a. Make and enter into contracts necessary for the 3 13 administration of the fund. 3 14 b. Procure insurance against any loss in connection with the 3 15 assets of the fund or require a surety bond. 3 16 c. Contract with a private financial management firm to 3 17 manage the fund, in collaboration with the treasurer of state, 3 18 including providing for the disbursement of education savings 3 19 grants in the form of an electronic debit card or checks that 3 20 are payable directly from the pupil's account in the fund. 3 21 d. Conduct audits or other review necessary to properly 3 22 administer the program. 3 23 e. Adopt rules pursuant to chapter 17A for the 3 24 administration of the fund and accounts in the fund. 3 25 5. a. For each pupil approved for an education savings 3 26 grant, the department of management shall establish an account 3 27 for that pupil in the education savings grant fund. The 3 28 amount of the pupil's education savings grant determined under 3 29 subsection 3 shall be deposited into the pupil's account on 3 30 July 1 and such amount shall be immediately available for the 3 31 payment of qualified educational expenses incurred by the 3 32 parent or guardian for the pupil during that fiscal year using 3 33 the payment method authorized under subsection 4, paragraph 3 34 "c". 3 35 b. A nonpublic school or other entity that accepts payment 4 1 from a parent or guardian using funds from a pupil's account in 4 2 the education savings grant fund shall not refund, rebate, or 4 3 share any portion of such payment with the parent, guardian, or 4 4 pupil. 4 5 c. Moneys remaining in a pupil's account upon conclusion 4 6 of the fiscal year shall remain in the pupil's account in the 4 7 education savings grant fund for the payment of qualified 4 8 educational expenses in future fiscal years, unless such 4 9 amounts are required to be transferred to the general fund of 4 10 the state under subsection 8. 4 11 6. a. For purposes of this section, "qualified educational 4 12 expenses" includes tuition and fees at a nonpublic school, 4 13 textbooks, fees or payments for educational therapies including 4 14 tutoring or cognitive skills training, curriculum fees and 4 15 materials for a course of study for a specific subject matter 4 16 or grade level, tuition or fees for nonpublic online education 4 17 programs, education materials and services for pupils with 4 18 disabilities including the cost of paraprofessionals and 4 19 assistants who are trained in accordance with state law, 4 20 standardized test fees, fees required by the department not 4 21 to exceed for each grant recipient five percent of the total 4 22 grant amount in any fiscal year, higher education expenses, 4 23 as defined in section 12D.1, resulting from the pupil's 4 24 participation in a program under chapter 261E, excluding room 4 25 and board expenses, and other expenses incurred by the parent 4 26 or guardian that are directly related to the education of the 4 27 pupil at a nonpublic school, including a nonpublic school 4 28 accredited by an independent accrediting agency approved by the 4 29 department of education. The cost of one computer or other 4 30 portable computing device shall be allowed as a qualified 4 31 educational expense for a pupil if such a purchase has not been 4 32 made using funds from that pupil's account in either of the 4 33 two immediately preceding fiscal years. "Qualified educational 4 34 expenses" does not include transportation costs for the pupil, 4 35 the cost of food or refreshments consumed by the pupil, the 5 1 cost of clothing for the pupil, or the cost of disposable 5 2 materials, including but not limited to paper, notebooks, 5 3 pencils, pens, and art supplies. 5 4 b. For purposes of this section, "nonpublic school" means 5 5 the same as defined in section 285.16. 5 6 7. A person who makes a false claim for the purpose 5 7 of obtaining an education savings grant provided for in 5 8 this section or who knowingly receives the grant or makes a 5 9 payment from an account in the education savings grant fund 5 10 without being legally entitled to it is guilty of a fraudulent 5 11 practice. The false claim for an education savings grant or a 5 12 payment from an account shall be disallowed and if amounts from 5 13 the grant have been disbursed from the applicable account in 5 14 the education savings grant fund, the department of management 5 15 shall initiate legal proceedings to recover such amounts. A 5 16 parent or guardian, or a pupil for purposes of subsection 8, 5 17 who violates this subsection is prohibited from participating 5 18 in the education savings grant program in the future. 5 19 8. Except as provided in subsection 9, for each pupil with 5 20 a positive balance in the pupil's account in the education 5 21 savings grant fund upon graduation from high school or upon 5 22 termination of the pupil's enrollment in the nonpublic school, 5 23 moneys in the pupil's account shall be transferred by the 5 24 department for deposit in the general fund of the state. 5 25 9. For each pupil with a positive balance in the pupil's 5 26 account in the education savings grant fund upon graduation 5 27 from high school, the department of management shall maintain 5 28 such account in the fund until the pupil is twenty=five years 5 29 of age if the pupil has filed a request with the department to 5 30 extend the pupil's account for the payment of higher education 5 31 costs. A request for such an extension must be filed with 5 32 the department by June 30 immediately following graduation. 5 33 Following graduation from high school until the pupil is 5 34 twenty=five years of age, moneys in the pupil's account may 5 35 be used for higher education costs, as defined in section 6 1 12D.1, subsection 2. Disbursements from a pupil's account 6 2 for higher education costs shall be claimed by and disbursed 6 3 to the pupil. Claims and disbursements for higher education 6 4 costs under this subsection shall be made in the same manner 6 5 as claims and disbursements for qualified educational expenses 6 6 under subsections 4 and 5. Moneys in a pupil's account when 6 7 the pupil turns twenty=five years of age shall be transferred 6 8 by the department for deposit in the general fund of the state. 6 9 10. A nonpublic school that accepts payment from a parent or 6 10 guardian using funds from a pupil's account in the education 6 11 savings grant fund is not an agent of this state or other 6 12 political subdivision of this state. 6 13 11. The provisions of this section shall be subject to 6 14 legislative review at least every five years. The review 6 15 shall be based upon an education savings grant status report 6 16 containing the recommendations of a legislative interim 6 17 committee appointed to conduct a review of the education 6 18 savings grant pilot program, to be prepared with the assistance 6 19 of the department of education in association with the 6 20 department of management. The first such report shall be 6 21 submitted to the general assembly no later than January 1, 6 22 2022, with subsequent reports developed and submitted by 6 23 January 1 at least every fifth year thereafter. 6 24 Sec. 4. Section 422.7, Code 2016, is amended by adding the 6 25 following new subsection: 6 26 NEW SUBSECTION. 51. Subtract, to the extent included, the 6 27 amount of any education savings grant under section 257.11B 6 28 received during the tax year by a taxpayer authorized to spend 6 29 such grant amounts for qualified educational expenses. 6 30 Sec. 5. APPLICABILITY. This Act applies to school budget 6 31 years and fiscal years beginning on or after July 1, 2017. 6 32 Sec. 6. APPLICABILITY. The provision of this Act amending 6 33 section 422.7 applies to tax years beginning on or after 6 34 January 1, 2017. 6 35 EXPLANATION 7 1 The inclusion of this explanation does not constitute agreement with 7 2 the explanation's substance by the members of the general assembly. 7 3 This bill provides education savings grants for certain 7 4 pupils attending a nonpublic school and establishes an 7 5 education savings grant fund. 7 6 Under the bill, for school budget years beginning on or after 7 7 July 1, 2017, the following pupils are eligible to receive 7 8 an education savings grant: (1) not more than 120 pupils 7 9 who are eligible to enroll in kindergarten through grade 12 7 10 in the Waterloo community school district, who are eligible 7 11 for free and reduced price meals under federal law, and who 7 12 are attending a nonpublic school during the applicable school 7 13 budget year, and (2) not more than 70 pupils who are eligible 7 14 to enroll in kindergarten through grade 12 in the Sioux Center 7 15 community school district, who are eligible for free and 7 16 reduced price meals under federal law, and who are attending a 7 17 nonpublic school during the applicable school budget year. By 7 18 January 31 preceding the school year for which the education 7 19 savings grant is requested, the parent or guardian of the pupil 7 20 requesting to receive an education savings grant must submit an 7 21 application to the department of education indicating that the 7 22 parent or guardian intends to enroll the pupil in a nonpublic 7 23 school. 7 24 The bill requires that by March 1 preceding the school 7 25 year for which the education savings grant is requested, 7 26 the department of education must notify the department of 7 27 management of the number of pupils in each school district 7 28 designated for the following school year to receive an 7 29 education savings grant and the amount of the education savings 7 30 grant for each pupil. Education savings grants may only be 7 31 approved for one school year per application, and applications 7 32 must be submitted for education savings grants in subsequent 7 33 school years. Applications for education savings grants are 7 34 approved in the order in which they are filed. However, in 7 35 order to provide continuity of education for pupils receiving 8 1 education savings grants, the department shall give priority 8 2 to applications submitted for pupils who received an education 8 3 savings grant during the previous school year. 8 4 The amount of each education savings grant is equal to 8 5 $5,854. 8 6 The bill creates an education savings grant fund in the state 8 7 treasury under the control of the department of management 8 8 consisting of moneys appropriated to the department for the 8 9 purpose of providing education savings grants. For the fiscal 8 10 year commencing July 1, 2017, and each succeeding fiscal year, 8 11 there is appropriated from the general fund of the state to the 8 12 department of management for deposit in the fund the amount 8 13 necessary to pay all education savings grants approved for 8 14 that fiscal year. For each pupil approved for an education 8 15 savings grant, the department of management must establish an 8 16 account for that pupil in the education savings grant fund. 8 17 The amount of the pupil's education savings grant is deposited 8 18 into the pupil's account on July 1 and such amount is available 8 19 for use by parents and guardians for the payment of qualified 8 20 educational expenses, as defined in the bill, incurred by the 8 21 parent or guardian for the pupil during that fiscal year. 8 22 The bill defines "nonpublic school" to mean those nonpublic 8 23 schools accredited by the department of education and nonpublic 8 24 institutions which comply with state board of education 8 25 standards for providing special education programs. 8 26 The bill authorizes the department of education to 8 27 contract with a private financial management firm to manage 8 28 the education savings grant fund, in collaboration with the 8 29 treasurer of state, including providing for the disbursement 8 30 of education savings grants in the form of an electronic debit 8 31 card or checks that are payable directly from the pupil's 8 32 account within the fund. 8 33 The bill provides that moneys remaining in a pupil's account 8 34 upon the conclusion of the fiscal year shall remain in the 8 35 pupil's account within the education savings grant fund for 9 1 the payment of qualified educational expenses in future fiscal 9 2 years. 9 3 Under the bill, unless a pupil graduates from high school 9 4 and a request for an extension of a pupil's account for the 9 5 payment of higher education expenses is filed, for each pupil 9 6 with a positive balance in the pupil's account in the education 9 7 savings grant fund upon graduation from high school or upon 9 8 termination of the pupil's enrollment in the nonpublic school, 9 9 moneys in the pupil's account are transferred by the department 9 10 of management for deposit in the general fund of the state. 9 11 Under the bill, for each pupil with a positive balance in 9 12 the pupil's account in the education savings grant fund upon 9 13 graduation from high school, the department of management is 9 14 required to maintain the account in the fund until the pupil 9 15 is 25 years old if the pupil has filed a request with the 9 16 department by June 30 following graduation from high school 9 17 for an extension of the account for the payment of higher 9 18 education expenses. Following graduation from high school 9 19 until the pupil is 25 years old, moneys in the pupil's account 9 20 may be used by the pupil for higher education costs, as defined 9 21 in Code section 12D.1. Moneys in a pupil's account when the 9 22 pupil turns 25 years old are transferred by the department of 9 23 management for deposit in the general fund of the state. 9 24 The bill provides that a person who makes a false claim for 9 25 the purpose of obtaining an education savings grant or who 9 26 knowingly receives the grant or makes a payment from an account 9 27 within the education savings grant fund without being legally 9 28 entitled to it is guilty of a fraudulent practice and is 9 29 subject to a criminal penalty. The bill allows the department 9 30 of management to initiate legal proceedings to recover grants 9 31 and amounts improperly awarded or paid from accounts under the 9 32 bill. 9 33 The education savings grant program is subject to 9 34 legislative review at least every five years. The review 9 35 shall be based upon an education savings grant status report 10 1 containing the recommendations of a legislative interim 10 2 committee. The first such report shall be submitted to the 10 3 general assembly no later than January 1, 2022, with subsequent 10 4 reports developed and submitted by January 1 at least every 10 5 fifth year thereafter. 10 6 The bill provides that moneys from an education savings 10 7 grant under the bill are not taxable income under Code chapter 10 8 422. 10 9 Under the bill, resident pupils attending an accredited 10 10 nonpublic school while receiving an education savings grant 10 11 under the bill are required to be counted as full=time pupils 10 12 for enrollment purposes in the public school district of 10 13 residence. 10 14 The bill applies to school budget years and fiscal years 10 15 beginning on or after July 1, 2017. 10 16 The provision of the bill amending Code section 422.7 10 17 applies to tax years beginning on or after January 1, 2017. LSB 5632YH (4) 86 md/sc
