Bill Text: TX HB4340 | 2023-2024 | 88th Legislature | Introduced


Bill Title: Relating to the establishment of the Education Savings Account Program to allow certain children to use public money to pursue educational alternatives to public schools and an insurance premium tax credit for contributions made for purposes of that program.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2023-04-11 - Left pending in committee [HB4340 Detail]

Download: Texas-2023-HB4340-Introduced.html
 
 
  By: Frank H.B. No. 4340
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the establishment of the Education Savings Account
  Program to allow certain children to use public money to pursue
  educational alternatives to public schools and an insurance premium
  tax credit for contributions made for purposes of that program.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  The purpose of this Act is to provide additional
  educational options to assist families in this state in exercising
  the right to direct the education of their children.
         SECTION 2.  Chapter 29, Education Code, is amended by adding
  Subchapter J to read as follows:
  SUBCHAPTER J. EDUCATION SAVINGS ACCOUNT PROGRAM
         Sec. 29.351.  DEFINITIONS. In this subchapter:
               (1)  "Account" means an education savings account
  established under the program.
               (2)  "Certified educational assistance organization"
  means an educational assistance organization certified under
  Section 29.354 to assist in administering the program.
               (3)  "Child with a disability" means a child who is
  eligible to participate in a school district's special education
  program under Section 29.003.
               (4)  "Cocurricular activity" means an activity that
  directly adds value to classroom instruction and curriculum,
  including an academic field trip, performance, contest,
  demonstration, or display. The term does not include an athletic or
  other nonacademic activity.
               (5)  "Higher education provider" means an institution
  of higher education or a private or independent institution of
  higher education, as those terms are defined by Section 61.003.
               (6)  "Parent" means a resident of this state who is a
  natural or adoptive parent, managing or possessory conservator,
  legal guardian, custodian, or other person with legal authority to
  act on behalf of a child.
               (7)  "Program" means the Education Savings Account
  Program established under this subchapter.
               (8)  "Program participant" means a child and a parent
  of a child enrolled in the program.
         Sec. 29.352.  ESTABLISHMENT OF PROGRAM.  The comptroller
  shall establish the Education Savings Account Program to provide
  funding for approved education-related expenses of program
  participants.
         Sec. 29.353.  EDUCATION SAVINGS ACCOUNT PROGRAM FUND. (a)
  The Education Savings Account Program fund is an account in the
  general revenue fund to be administered by the comptroller.
         (b)  The fund is composed of:
               (1)  general revenue transferred to the fund;
               (2)  money appropriated to the fund;
               (3)  gifts, grants, and donations received under
  Section 29.369;
               (4)  contributions to the fund for which an entity
  receives a credit against the entity's state premium tax liability
  under Chapter 230, Insurance Code; and
               (5)  any other money available for purposes of the
  program.
         (c)  Money in the fund may be appropriated only to the
  comptroller for purposes of making payments to program participants
  and administering the program under this subchapter.
         Sec. 29.354.  SELECTION OF CERTIFIED EDUCATIONAL ASSISTANCE
  ORGANIZATION. (a) An organization may apply to the comptroller for
  certification as a certified educational assistance organization
  during an application period established by the comptroller.
         (b)  To be eligible for certification, the organization
  must:
               (1)  have the ability to perform the duties and
  functions required of a certified educational assistance
  organization under this subchapter;
               (2)  be in good standing with the state;
               (3)  be exempt from taxation under Section 501(a),
  Internal Revenue Code of 1986, as an organization described by
  Section 501(c)(3) of that code; and
               (4)  be able to assist the comptroller in administering
  the program, including the ability to:
                     (A)  accept, process, and track applications for
  the program;
                     (B)  assist prospective applicants, applicants,
  and program participants with finding preapproved education
  service providers and vendors of educational products; and
                     (C)  verify that program funding is used only for
  approved education-related expenses.
         (c)  The comptroller shall certify one educational
  assistance organization to assist in administering the program,
  including by:
               (1)  administering the application process under
  Section 29.356;
               (2)  assisting prospective applicants, applicants, and
  program participants with understanding eligible expenses and
  finding preapproved education service providers and vendors of
  educational products;
               (3)  ensuring money in a program participant's account
  is used only for approved expenses under Section 29.359; and
               (4)  publishing data and an annual report regarding:
                     (A)  the number of program applications received,
  accepted, and waitlisted;
                     (B)  program participant satisfaction; and
                     (C)  assessment results reported under Section
  29.357(2).
         Sec. 29.355.  ELIGIBLE CHILD. (a) A child is eligible to
  participate in the program if the child is eligible to attend a
  public school under Section 25.001 and either:
               (1)  was enrolled in a public school during the entire
  preceding school year; or
               (2)  is enrolling in kindergarten or first grade for
  the first time.
         (b)  A sibling of a child who is eligible to participate in
  the program under Subsection (a) is eligible to participate in the
  program if the sibling is eligible to attend a public school under
  Section 25.001.
         (c)  A child who establishes eligibility under this section
  may participate in the program until the earliest of the following
  dates:
               (1)  the date on which the child graduates from high
  school;
               (2)  the date on which the child is no longer eligible
  to attend a public school under Section 25.001;
               (3)  the date on which the child enrolls in a public
  school, including an open-enrollment charter school; or
               (4)  the date on which the child is declared ineligible
  for the program by the comptroller under this subchapter.
         Sec. 29.356.  APPLICATION TO PROGRAM. (a)  A parent of an
  eligible child may apply to the certified educational assistance
  organization to enroll the child in the program for the following
  school year. The certified educational assistance organization
  shall:
               (1)  establish a reasonable annual deadline by which an
  applicant must complete and submit an application form to
  participate in the program; and
               (2)  on receipt of more acceptable applications for
  admission under this section than available positions in the
  program due to insufficient funding, prioritize applicants who are:
                     (A)  members of a household with a total annual
  income that is at or below 200 percent of the income guidelines
  necessary to qualify for the national free or reduced-price lunch
  program established under 42 U.S.C. Section 1751 et seq;
                     (B)  students with a disability; or
                     (C)  students who are covered by Section 504,
  Rehabilitation Act of 1973 (29 U.S.C. Section 794).
         (b)  The certified educational assistance organization shall
  create an application form for the program and make the application
  form readily available to interested parents through various
  sources, including the organization's Internet website.  The
  application form must state the application deadline. The
  organization shall ensure that the application form is capable of
  being submitted to the organization electronically.
         (c)  The certified educational assistance organization shall
  post on the organization's Internet website an applicant and
  participant handbook with a description of the program, including:
               (1)  expenses allowed under the program under Section
  29.359;
               (2)  a list of preapproved education service providers
  and vendors of educational products under Section 29.358;
               (3)  the organization's expense reporting
  requirements; and
               (4)  a description of the responsibilities of program
  participants.
         (d)  The certified educational assistance organization shall
  annually provide to each program participant the information
  described by Subsection (c). The organization may provide the
  information electronically.
         (e)  A parent of a child described by Section 29.355(a)(2)(B)
  may submit an application for the eligible child and the child's
  sibling concurrently. The certified educational assistance
  organization shall consider concurrently the applications of
  siblings who apply by the date established by the organization
  under Subsection (a).
         (f)  The certified educational assistance organization may
  not require a program participant in good standing to annually
  resubmit an application for continued participation in the program.
         Sec. 29.357.  PARTICIPATION IN PROGRAM. To receive funding
  under the program, a parent of an eligible child must agree to:
               (1)  spend money received through the program only for
  expenses allowed under Section 29.359;
               (2)  share or authorize the administrator of an
  assessment instrument to share with the certified educational
  assistance organization the results of any assessment instrument
  required to be administered to the child under Section
  29.358(b)(1)(B) or other law;
               (3)  refrain from selling an item purchased with
  program money in accordance with Section 29.359(a)(2) until the end
  of the 12th month after the date the item is purchased; and
               (4)  notify the certified educational assistance
  organization not later than 30 days after the date on which the
  child:
                     (A)  enrolls in a public school, including an
  open-enrollment charter school;
                     (B)  graduates from high school; or
                     (C)  is no longer eligible to enroll in a public
  school under Section 25.001.
         Sec. 29.358.  APPROVED PROVIDERS. (a)  The comptroller
  shall by rule establish a process for the preapproval of education
  service providers and vendors of educational products for
  participation in the program.  The comptroller shall set a
  reasonable quarterly deadline by which a provider or vendor must
  submit an application.
         (b)  The comptroller shall approve an education service
  provider or vendor of educational products for participation in the
  program if the provider or vendor:
               (1)  for a private school, demonstrates the school's
  qualification to serve program participants, including:
                     (A)  accreditation by an organization recognized
  by the Texas Private School Accreditation Commission; and
                     (B)  annual administration of a nationally
  norm-referenced assessment instrument or the appropriate
  assessment instrument required under Subchapter B, Chapter 39;
               (2)  for a private tutor, therapist, or teaching
  service:
                     (A)  demonstrates the tutor's, therapist's, or
  service's qualification to serve program participants, including
  that the tutor or therapist or each employee of the service who
  intends to provide services to a program participant:
                           (i)  is certified under Subchapter B,
  Chapter 21;
                           (ii)  holds a relevant license or
  accreditation issued by a state, regional, or national licensing or
  accreditation organization; or
                           (iii)  is employed in a teaching or tutoring
  capacity at a higher education provider;
                     (B)  the tutor or therapist or each employee of
  the teaching service who intends to provide educational services to
  a program participant either:
                           (i)  completes a national criminal history
  record information review; or
                           (ii)  provides to the comptroller
  documentation indicating that the tutor, therapist, or employee, as
  applicable, has completed a national criminal history record
  information review within a period established by comptroller rule;
  and
                     (C)  the tutor or therapist or each employee of
  the teaching service who intends to provide educational services to
  a program participant is not included in the registry under Section
  22.092; or
               (3)  for a higher education provider, demonstrates
  postsecondary accreditation.
         (c)  The comptroller shall review the national criminal
  history record information or documentation for each private tutor,
  therapist, or teaching service employee who submits information or
  documentation under this section and verify that the individual is
  not included in the registry under Section 22.092. The tutor,
  therapist, or service must provide the comptroller with any
  information requested by the comptroller to enable the comptroller
  to complete the review.
         (d)  An education service provider or vendor of educational
  products shall provide information requested by the comptroller to
  verify the provider's or vendor's eligibility for preapproval under
  Subsection (b). The comptroller may not approve a provider or
  vendor if the comptroller cannot verify the provider's or vendor's
  eligibility for preapproval.
         Sec. 29.359.  APPROVED EDUCATION-RELATED EXPENSES. (a)
  Subject to Subsection (b), money received under the program may be
  used only for the following expenses incurred by a program
  participant at a preapproved education service provider or vendor
  of educational products:
               (1)  tuition and fees;
               (2)  the purchase of textbooks or other instructional
  materials or uniforms required by a school, higher education
  provider, course, or online educational course or program in which
  the child is enrolled;
               (3)  costs related to academic assessments;
               (4)  costs related to cocurricular activities;
               (5)  fees for transportation provided by a
  fee-for-service transportation provider for the child to travel to
  and from a preapproved education service provider or vendor of
  educational products; and
               (6)  fees for educational therapies or services
  provided by a practitioner or provider, only for fees that are not
  covered by any federal, state, or local government benefits such as
  Medicaid or the Children's Health Insurance Program (CHIP) or by
  any private insurance that the child is enrolled in at the time of
  receiving the therapies or services.
         (b)  Money received under the program may not be used to pay
  any person who is a member of the program participant's household.
         (c)  A finding that a program participant used money
  distributed under the program to pay for an expense not allowed
  under Subsection (a) does not affect the validity of any payment
  made by the participant for an expense that is allowed under that
  subsection.
         (d)  Notwithstanding Subsection (a), the comptroller shall
  by rule establish a process by which:
               (1)  program participants may be efficiently
  reimbursed for expenses described by Subsection (a)(2), (3), (4),
  (5), or (6) incurred from an education service provider or vendor of
  educational products that is not preapproved under Section
  29.358(a); and
               (2)  frequently used providers and vendors described by
  Subdivision (1) that are in good standing for three continuous
  school years may receive payment directly from an account.
         Sec. 29.360.  AMOUNT OF PAYMENT; FINANCING. (a) A parent of
  an eligible child shall receive each year that the child
  participates in the program a payment from the state from funds
  available under Section 29.353 to the child's account in an amount
  equal to 90 percent of the state average maintenance and operations
  revenue per student in average daily attendance for the preceding
  state fiscal year.
         (b)  Any money remaining in a child's account at the end of a
  fiscal year is carried forward to the next fiscal year unless
  another provision of this subchapter mandates the closure of the
  account.
         (c)  The parent of a child participating in the program may
  make payments for the expenses of educational programs, services,
  and products not covered by money in the child's account.
         (d)  A payment under Subsection (a) may not be financed using
  federal money.
         (e)  Payments received under this subchapter do not
  constitute taxable income to the eligible student's parent, unless
  otherwise provided by federal law.
         (f)  Not later than November 1 of each even-numbered year,
  the comptroller shall submit to the legislature:
               (1)  a summary of participant enrollment in the
  program;
               (2)  the amount of cost savings accruing to the state as
  a result of the program; and
               (3)  an estimate of the total amount of funding
  required for the program for the following state fiscal biennium.
         Sec. 29.361.  ADMINISTRATION OF ACCOUNTS.  (a) The
  comptroller shall make quarterly payments to each program
  participant's account in equal amounts on or before the first day of
  July, October, January, and April.
         (b)  The comptroller may deduct an amount from each quarterly
  payment to a program participant's account to cover the
  comptroller's cost of administering the program. The amount
  deducted may not exceed three percent of the payment.
         (c)  Each quarter, the comptroller shall disburse to the
  certified educational assistance organization an amount from the
  total amount of money appropriated for purposes of this subchapter
  to cover the organization's cost of administering the program. The
  total amount disbursed to the certified educational assistance
  organization under this subsection for a fiscal year may not exceed
  five percent of the amount appropriated for purposes of this
  subchapter for that fiscal year.
         (d)  Before payments are made under Subsection (a) in October
  and April, the certified educational assistance organization
  shall:
               (1)  verify with the agency that each program
  participant is not enrolled in a public school, including an
  open-enrollment charter school; and
               (2)  notify the comptroller if the organization
  determines that a program participant is enrolled in a public
  school, including an open-enrollment charter school.
         (e)  On the date on which a child who participated in the
  program is no longer eligible to participate in the program under
  Section 29.355(b), the child's account is closed and any remaining
  money is returned to the state for deposit in the Education Savings
  Account Program fund.
         Sec. 29.362.  RANDOM AUDITING. (a) The comptroller may
  contract with a private entity to randomly audit accounts and the
  certified educational assistance organization as necessary to
  ensure compliance with applicable law and program requirements.
         (b)  In conducting an audit, the comptroller or private
  entity may require that a program participant or the certified
  educational assistance organization provide additional information
  and documentation regarding any payment made under the program.
         (c)  The private entity shall report to the comptroller any
  violation of this subchapter or other relevant law found by the
  entity during an audit conducted under this section. The
  comptroller shall report the violation to:
               (1)  the certified educational assistance
  organization;
               (2)  the education service provider or vendor of
  educational products, as applicable; and
               (3)  the parent of each child participating in the
  program who is affected by the violation.
         Sec. 29.363.  SUSPENSION OF ACCOUNT. (a) The comptroller
  shall suspend the account of a program participant who fails to
  remain in good standing by complying with applicable law or a
  requirement of the program.
         (b)  On suspension of an account under Subsection (a), the
  comptroller shall notify the program participant in writing that
  the account has been suspended and that no additional payments may
  be made from the account. The notification must specify the grounds
  for the suspension and state that the participant has 30 business
  days to respond and take any corrective action required by the
  comptroller.
         (c)  On the expiration of the 30-day period under Subsection
  (b), the comptroller shall:
               (1)  order closure of the suspended account;
               (2)  order temporary reinstatement of the account,
  conditioned on the performance of a specified action by the program
  participant; or
               (3)  order full reinstatement of the account.
         (d)  The comptroller may recover money distributed under the
  program that was used for expenses not allowed under Section 29.359
  from the program participant or the entity that received the money
  if the program participant's account is suspended or closed under
  this section.
         Sec. 29.364.  TUITION AND FEES; REFUND PROHIBITED. (a)  An
  education service provider or vendor of educational products may
  not charge a child participating in the program an amount greater
  than the amount charged for that service by the provider or vendor.
         (b)  An education service provider or vendor of educational
  products receiving money distributed under the program may not in
  any manner rebate, refund, or credit to or share with a program
  participant, or any person on behalf of a participant, any program
  money paid or owed by the participant to the provider or vendor.
         Sec. 29.365.  REFERRAL TO DISTRICT ATTORNEY. If the
  comptroller or the certified educational assistance organization
  obtains evidence of fraudulent use of an account, the comptroller
  or organization shall notify the appropriate local county or
  district attorney with jurisdiction over the residence of the
  program participant.
         Sec. 29.366.  SPECIAL EDUCATION NOTICE. (a)  The certified
  educational assistance organization shall post on the
  organization's Internet website and provide to each parent who
  submits an application for the program a notice that:
               (1)  states that a private school is not subject to
  federal and state laws regarding the provision of educational
  services to a child with a disability in the same manner as a public
  school; and
               (2)  provides information regarding rights to which a
  child with a disability is entitled under federal and state law if
  the child attends a public school, including:
                     (A)  rights provided under the Individuals with
  Disabilities Education Act (20 U.S.C. Section 1400 et seq.); and
                     (B)  rights provided under Subchapter A.
         (b)  A private school in which a child with a disability who
  is a program participant enrolls shall provide to the child's
  parent a copy of the notice required under Subsection (a).
         Sec. 29.367.  PROGRAM PARTICIPANT, PROVIDER, AND VENDOR
  AUTONOMY. (a) An education service provider or vendor of
  educational products that receives money distributed under the
  program is not a recipient of federal financial assistance on the
  basis of receiving that money.
         (b)  A rule adopted or action taken related to the program by
  an individual, governmental entity, court of law, or program
  administrator may not:
               (1)  limit the independence or autonomy of an education
  service provider, vendor of educational products, or program
  participant;
               (2)  consider the actions of an education service
  provider, vendor of educational products, or program participant to
  be the actions of an agent of state government;
               (3)  limit:
                     (A)  an education service provider's ability to
  determine the methods used to educate the provider's students or to
  exercise the provider's religious or institutional values; or
                     (B)  a program participant's ability to determine
  the participant's educational content or to exercise the
  participant's religious values;
               (4)  obligate an education service provider or program
  participant to act contrary to the provider's or participant's
  religious or institutional values, as applicable;
               (5)  impose any regulation on an education service
  provider, vendor of educational products, or program participant
  beyond those regulations necessary to enforce the requirements of
  the program; or
               (6)  require as a condition of receiving money
  distributed under the program:
                     (A)  an education service provider to modify the
  provider's creed, practices, admissions policies, curricula,
  performance standards, employment policies, or assessments; or
                     (B)  a program participant to modify the
  participant's creed, practices, curricula, performance standards,
  or assessments.
         (c)  In a proceeding challenging a rule adopted by a state
  agency or officer under this subchapter, the agency or officer has
  the burden of proof to establish by clear and convincing evidence
  that the rule:
               (1)  is necessary to implement or enforce the program
  as provided by this subchapter;
               (2)  does not violate this section;
               (3)  does not impose an undue burden on a program
  participant or an education service provider or vendor of
  educational products that participates or applies to participate in
  the program; and
               (4)  is the least restrictive means of accomplishing
  the purpose of the program while recognizing the independence of an
  education service provider to meet the educational needs of
  students in accordance with the provider's religious or
  institutional values.
         Sec. 29.368.  STUDENT RECORDS AND INFORMATION. (a) On
  request by the parent of a child participating or seeking to
  participate in the program, the school district or open-enrollment
  charter school that the child would otherwise attend shall provide
  a copy of the child's school records possessed by the district or
  school, if any, to the child's parent or, if applicable, the private
  school the child attends.
         (b)  As necessary to verify a child's eligibility for the
  program, the agency shall provide to the certified educational
  assistance organization any information available to the agency
  requested by the organization regarding a child who participates or
  seeks to participate in the program. The organization may not
  retain information provided under this subsection beyond the period
  necessary to determine a child's eligibility to participate in the
  program.
         Sec. 29.369.  GIFTS, GRANTS, AND DONATIONS. The comptroller
  and certified educational assistance organization may solicit and
  accept gifts, grants, and donations from any public or private
  source for any expenses related to the administration of the
  program, including establishing the program.
         Sec. 29.370.  RULES; PROCEDURES. (a) The comptroller shall
  adopt rules and procedures as necessary to implement, administer,
  and enforce this subchapter.
         (b)  A rule adopted under Subsection (a) is binding on an
  organization that applies for certification as an educational
  assistance organization and a state or local governmental entity,
  including a political subdivision, as necessary to implement,
  administer, and enforce this subchapter.
         Sec. 29.371.  APPEAL; JUDICIAL REVIEW. (a) A program
  participant may appeal to the comptroller an administrative
  decision made by the comptroller or certified educational
  assistance organization under this subchapter, including a
  decision regarding eligibility, allowable expenses, or the
  participant's removal from the program.
         (b)  A program participant, education service provider, or
  vendor of educational products who is adversely affected or
  aggrieved by a decision made by the comptroller or certified
  educational assistance organization under this subchapter may file
  a suit challenging the decision in a district court in the county in
  which the program participant resides or the provider or vendor has
  its principal place of business, as applicable.
         Sec. 29.372.  RIGHT TO INTERVENE IN CIVIL ACTION. (a) A
  program participant, education service provider, or vendor of
  educational products may intervene in any civil action challenging
  the constitutionality of the program or the insurance premium tax
  credit under Chapter 230, Insurance Code.
         (b)  A court in which a civil action described by Subsection
  (a) is filed may require that all program participants, education
  service providers, and vendors of educational products wishing to
  intervene in the action file a joint brief. A program participant,
  education service provider, or vendor of educational products may
  not be required to join a brief filed on behalf of the state or a
  state agency.
         SECTION 3.  Section 22.092(d), Education Code, is amended to
  read as follows:
         (d)  The agency shall provide equivalent access to the
  registry maintained under this section to:
               (1)  private schools;
               (2)  public schools; [and]
               (3)  nonprofit teacher organizations approved by the
  commissioner for the purpose of participating in the tutoring
  program established under Section 33.913; and
               (4)  the comptroller for the purpose of preapproving
  education service providers and vendors of educational products
  under Section 29.358 for participation in the program established
  under Subchapter J, Chapter 29.
         SECTION 4.  Section 411.109, Government Code, is amended by
  adding Subsection (c) to read as follows:
         (c)  The comptroller is entitled to obtain criminal history
  record information maintained by the department about a person who
  is a private tutor, a therapist, or an employee of a teaching
  service or school who intends to provide educational services to a
  child participating in the program established under Subchapter J,
  Chapter 29, Education Code, and is seeking approval to receive
  money distributed under that program.
         SECTION 5.  Subtitle B, Title 3, Insurance Code, is amended
  by adding Chapter 230 to read as follows:
  CHAPTER 230. CREDIT AGAINST PREMIUM TAXES FOR CONTRIBUTIONS TO
  EDUCATION SAVINGS ACCOUNT PROGRAM
  SUBCHAPTER A. GENERAL PROVISIONS
         Sec. 230.001.  DEFINITIONS. In this chapter:
               (1)  "Fund" means the Education Savings Account Program
  fund under Section 29.353, Education Code.
               (2)  "State premium tax liability" means any liability
  incurred by an entity under Chapters 221 through 226.
  SUBCHAPTER B. CREDIT
         Sec. 230.051.  CREDIT. An entity may apply for a credit
  against the entity's state premium tax liability in the amount and
  under the conditions provided by this chapter. The comptroller
  shall award credits as provided by Section 230.054.
         Sec. 230.052.  AMOUNTS; LIMITATION ON TOTAL CREDITS. (a)
  Subject to Subsections (b) and (c), the amount of an entity's credit
  is equal to the lesser of the amount contributed to the fund during
  the period covered by the tax report or 75 percent of the entity's
  state premium tax liability for the report.
         (b)  For the 2024 state fiscal year, the total amount of
  credits that may be awarded under this chapter may not exceed $500
  million. For each subsequent state fiscal year, the total amount of
  credits that may be awarded is:
               (1)  the same total amount of credits available under
  this subsection for the previous state fiscal year, if Subdivision
  (2) does not apply; or
               (2)  125 percent of the total amount of credits
  available under this subsection for the previous state fiscal year,
  if the total amount of credits awarded in the previous state fiscal
  year was at least 90 percent of the total amount of credits
  available under this subsection for that fiscal year.
         (c)  The comptroller by rule shall prescribe procedures by
  which the comptroller may allocate credits under this chapter. The
  procedures must provide that credits are allocated first to
  entities that received preliminary approval for a credit under
  Section 230.053 and that apply under Section 230.054. The
  procedures must provide that any remaining credits are allocated to
  entities that apply under Section 230.054 on a first-come,
  first-served basis, based on the date the contribution was
  initially made.
         (d)  The comptroller may require an entity to notify the
  comptroller of the amount the entity intends or expects to apply for
  under this chapter before the beginning of a state fiscal year or at
  any other time required by the comptroller.
         Sec. 230.053.  PRELIMINARY APPROVAL FOR CREDIT. (a)  Before
  making a contribution to the fund, an entity may apply to the
  comptroller for preliminary approval of a credit under this chapter
  for the contribution.
         (b)  An entity must apply for preliminary approval on a form
  provided by the comptroller that includes the amount the entity
  expects to contribute and any other information the comptroller
  requires.
         (c)  The comptroller shall grant preliminary approval for
  credits under this chapter on a first-come, first-served basis,
  based on the date the comptroller receives the application for
  preliminary approval.
         (d)  The comptroller shall grant preliminary approval for a
  credit under this chapter for a state fiscal year if the sum of the
  amount of the credit and the total amount of all other credits
  preliminarily approved under this chapter does not exceed the
  amount provided by Section 230.052(b).
         (e)  Final award of a credit preliminarily approved under
  this section remains subject to the limitations under Section
  230.052(a) and all other requirements of this chapter.
         Sec. 230.054.  APPLICATION FOR CREDIT. (a)  An entity must
  apply for a credit under this chapter on or with the tax report
  covering the period in which the contribution was made.
         (b)  The comptroller shall adopt a form for the application
  for the credit. An entity must use this form in applying for the
  credit.
         (c)  Subject to Section 230.052(c), the comptroller may
  award a credit to an entity that applies for the credit under
  Subsection (a) of this section if the entity is eligible for the
  credit and the credit is available under Section 230.052(b). The
  comptroller has broad discretion in determining whether to grant or
  deny an application for a credit.
         (d)  The comptroller shall notify an entity in writing of the
  comptroller's decision to grant or deny the application under
  Subsection (a). If the comptroller denies an entity's application,
  the comptroller shall include in the notice of denial the reasons
  for the comptroller's decision.
         (e)  If the comptroller denies an entity's application under
  Subsection (a), the entity may request in writing a reconsideration
  of the application not later than the 10th day after the date the
  notice under Subsection (d) is received. If the entity does not
  request a reconsideration of the application on or before that
  date, the comptroller's decision is final.
         (f)  An entity that requests a reconsideration under
  Subsection (e) may submit to the comptroller, not later than the
  30th day after the date the request for reconsideration is
  submitted, additional information and documents to support the
  entity's request for reconsideration.
         (g)  The comptroller's reconsideration of an application
  under this section is not a contested case under Chapter 2001,
  Government Code. The comptroller's decision on a request for
  reconsideration of an application is final and is not appealable.
         (h)  This section does not create a cause of action to
  contest a decision of the comptroller to deny an application for a
  credit under this chapter.
         Sec. 230.055.  RULES; PROCEDURES.  The comptroller shall
  adopt rules and procedures to implement, administer, and enforce
  this chapter.
         Sec. 230.056.  ASSIGNMENT PROHIBITED; EXCEPTION.  An entity
  may not convey, assign, or transfer the credit allowed under this
  chapter to another entity unless substantially all of the assets of
  the entity are conveyed, assigned, or transferred in the same
  transaction.
         Sec. 230.057.  NOTICE OF AVAILABILITY OF CREDIT.  The
  comptroller shall provide notice of the availability of the credit
  under this chapter on the comptroller's Internet website, in the
  instructions for insurance premium tax report forms, and in any
  notice sent to an entity concerning the requirement to file an
  insurance premium tax report.
         SECTION 6.  Subchapter J, Chapter 29, Education Code, as
  added by this Act, applies beginning with the 2024-2025 school
  year.
         SECTION 7.  An entity may apply for a credit under Chapter
  230, Insurance Code, as added by this Act, only for a contribution
  made on or after the effective date of this Act.
         SECTION 8.  Not later than November 15, 2023, the
  comptroller of public accounts shall adopt rules as provided by
  Section 230.055, Insurance Code, as added by this Act.
         SECTION 9.  Chapter 230, Insurance Code, as added by this
  Act, applies only to a tax report originally due on or after the
  effective date of this Act.
         SECTION 10.  (a) The constitutionality and other validity
  under the state or federal constitution of all or any part of
  Subchapter J, Chapter 29, Education Code, as added by this Act, or
  Chapter 230, Insurance Code, as added by this Act, may be determined
  in an action for declaratory judgment under Chapter 37, Civil
  Practice and Remedies Code, in a district court in the county in
  which the plaintiff resides or has its principal place of business.
         (b)  An order, however characterized, of a trial court
  granting or denying a temporary or otherwise interlocutory
  injunction or a permanent injunction on the grounds of the
  constitutionality or unconstitutionality, or other validity or
  invalidity, under the state or federal constitution of all or any
  part of Subchapter J, Chapter 29, Education Code, as added by this
  Act, or Chapter 230, Insurance Code, as added by this Act, may be
  reviewed only by direct appeal to the Texas Supreme Court filed not
  later than the 15th day after the date on which the order was
  entered. The Texas Supreme Court shall give precedence to appeals
  under this section over other matters.
         (c)  The direct appeal is an accelerated appeal.
         (d)  This section exercises the authority granted by Section
  3-b, Article V, Texas Constitution.
         (e)  The filing of a direct appeal under this section will
  automatically stay any temporary or otherwise interlocutory
  injunction or permanent injunction granted in accordance with this
  section pending final determination by the Texas Supreme Court,
  unless the supreme court makes specific findings that the applicant
  seeking such injunctive relief has pleaded and proved that:
               (1)  the applicant has a probable right to the relief it
  seeks on final hearing;
               (2)  the applicant will suffer a probable injury that
  is imminent and irreparable, and that the applicant has no other
  adequate legal remedy; and
               (3)  maintaining the injunction is in the public
  interest.
         (f)  An appeal under this section, including an
  interlocutory, accelerated, or direct appeal, is governed, as
  applicable, by the Texas Rules of Appellate Procedure, including
  Rules 25.1(d)(6), 28.1, 32.1(g), 37.3(a)(1), 38.6(a) and (b),
  40.1(b), and 49.4.
         (g)  This section does not authorize an award of attorney's
  fees against this state, and Section 37.009, Civil Practice and
  Remedies Code, does not apply to an action filed under this section.
         (h)  This section does not authorize a taxpayer suit to
  contest the denial of a tax credit by the comptroller of public
  accounts.
         SECTION 11.  It is the intent of the legislature that every
  provision, section, subsection, sentence, clause, phrase, or word
  in this Act, and every application of the provisions in this Act to
  each person or entity, are severable from each other. If any
  application of any provision in this Act to any person, group of
  persons, or circumstances is found by a court to be invalid for any
  reason, the remaining applications of that provision to all other
  persons and circumstances shall be severed and may not be affected.
         SECTION 12.  This Act takes effect September 1, 2023.
feedback