Bill Text: TX SB108 | 2019-2020 | 86th Legislature | Introduced

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Bill Title: Relating to measures to increase participation in state programs relating to saving money or prepaying for college.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2019-02-01 - Referred to Higher Education [SB108 Detail]

Download: Texas-2019-SB108-Introduced.html

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86R3516 KJE-F
By: Menéndez S.B. No. 108

A BILL TO BE ENTITLED
AN ACT
relating to measures to increase participation in state programs
relating to saving money or prepaying for college.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 54.801(2), Education Code, is amended to
read as follows:
(2) "Beneficiary" means a beneficiary on whose behalf
a purchaser enters into a prepaid tuition contract with the board
under Subchapter H, [or] for whom a savings trust account is opened
under Subchapter G, or for whom a matching account is opened under
Section 54.802(a-1).
SECTION 2. Section 54.802, Education Code, is amended by
amending Subsection (a) and adding Subsections (a-1) and (d) to
read as follows:
(a) The board, in cooperation with the program entity, shall
administer the Texas Save and Match Program, under which money
contributed to a savings trust account by an account owner under a
higher education savings plan established under Subchapter G, [or]
paid by a purchaser under a prepaid tuition contract under
Subchapter H on behalf of an eligible beneficiary, or contributed
to a matching account established under Subsection (a-1) may be
matched with:
(1) contributions made by any person to the program
entity for use in making additional savings trust account
contributions under Subchapter G or in purchasing additional
tuition units under prepaid tuition contracts under Subchapter H;
or
(2) money appropriated by the legislature for the
program to be used by the board to make additional savings trust
account contributions under Subchapter G or to purchase additional
tuition units under Subchapter H.
(a-1) The board by rule shall establish an automatic
enrollment plan within the program through which a public or
private entity may request a matching account to be established
automatically, based on factors determined by the board in
consultation with the public or private entity, by the board or
program entity under this subchapter for a child who is not already
a beneficiary of a savings trust account established under
Subchapter G or of a prepaid tuition contract entered into under
Subchapter H.
(d) For purposes of this subchapter, contributions to a
matching account established by the board or program entity on
behalf of a beneficiary under this subchapter may include,
regardless of whether any corresponding funds are contributed to a
savings trust account established under Subchapter G or paid under
a prepaid tuition contract entered into under Subchapter H:
(1) initial deposits to the matching account;
(2) funds for the payment of application fees; and
(3) matching grants based on the beneficiary's income
level or achievement of specified academic goals.
SECTION 3. Sections 54.803 and 54.804, Education Code, are
amended to read as follows:
Sec. 54.803. INITIAL ELIGIBILITY FOR PARTICIPATION IN
PROGRAM. (a) To be initially eligible to participate in the
program, a beneficiary, at the time a prepaid tuition contract is
entered into on the beneficiary's behalf under Subchapter H, [or] a
savings trust account is opened on the beneficiary's behalf under
Subchapter G, or a matching account is requested on the
beneficiary's behalf under a plan established under Section
54.802(a-1), as applicable, must be:
(1) a resident of this state; or
(2) a dependent for purposes of Section 152, Internal
Revenue Code of 1986, of a resident of this state.
(b) The board shall give preference to awarding [To be
initially eligible to receive] matching funds described by Section
54.802(a)(2) under the program to [,] a beneficiary who, at the time
a prepaid tuition contract is entered into on the beneficiary's
behalf under Subchapter H, [or] a savings trust account is opened on
the beneficiary's behalf under Subchapter G, or a matching account
is requested on the beneficiary's behalf under a plan established
under Section 54.802(a-1), as applicable, is [must be] eligible for
free or reduced-price meals under the national free or
reduced-price breakfast and lunch program.
Sec. 54.804. LIMITATIONS. A matching account established
by the board or program entity on behalf of a beneficiary under this
subchapter is forfeited and reverts to the board or program entity
on the occurrence of any of the following, as applicable:
(1) the 10th anniversary of the date the beneficiary
is projected to graduate from high school, as indicated by the
purchaser in the enrollment contract, except that time spent by the
beneficiary as an active duty member of the United States armed
services tolls the period described by this subdivision;
(2) a change of beneficiary by the account owner or
purchaser of the matched account;
(3) a contract cancellation of the matched account and
refund request;
(4) the successful completion by the beneficiary of a
[an associate or] bachelor's degree program;
(5) transfer of the matched account to another
qualified tuition program of any state that meets the requirements
of Section 529, Internal Revenue Code of 1986; or
(6) any other event the board or program entity
determines would be inconsistent with the program's purposes.
SECTION 4. Section 54.805(c), Education Code, is amended to
read as follows:
(c) The [To the extent possible, the] board shall include
information about a matching account in the periodic statement
provided to applicable account owners and purchasers under
Subchapters G and H.
SECTION 5. Sections 54.807 and 54.809, Education Code, are
amended to read as follows:
Sec. 54.807. PILOT PROJECTS UNDER PROGRAM. (a) To fulfill
the intent of the program, the board, in collaboration with
relevant stakeholders, shall [may use funds described by Section
54.802(a)(2) to] establish one or more pilot projects under the
program in an effort to incentivize participation in the higher
education savings program under Subchapter G and the prepaid
tuition unit undergraduate education program under Subchapter H,
including projects that incentivize participation by:
(1) awarding additional matching grants based on a
beneficiary's achievement of specified academic goals;
(2) providing initial matching grants and paying
application fees;
(3) providing incentives for employers to contribute
matching funds to the program; and
(4) creating a program information portal designed to
increase program awareness and accessibility among school
districts, parents, and students.
(b) At least one pilot project established under this
section must be an automatic enrollment plan described by Section
54.802(a-1). Under the pilot project, the board shall award
matching grants based on a beneficiary's achievement of specified
academic goals and may award other matching grants or provide other
incentives for participation.
(c) The board shall use funds described by Section
54.802(a)(2) and may use funds described by Section 54.802(a)(1) to
establish pilot projects under this section.
Sec. 54.809. RULES. The board shall adopt rules for the
administration of this subchapter, including rules to:
(1) implement an automatic enrollment plan under
Section 54.802(a-1); and
(2) establish a process for distributing funds
described by Section 54.802(a)(2) among programs and plans under
this subchapter.
SECTION 6. Chapter 54, Education Code, is amended by adding
Subchapter I-1 to read as follows:
SUBCHAPTER I-1. COLLEGE SAVINGS PLANS TASK FORCE AND STUDY
Sec. 54.851. DEFINITIONS. In this subchapter:
(1) "Coordinating board" means the Texas Higher
Education Coordinating Board.
(2) "Task force" means the college savings plans task
force established under this subchapter.
Sec. 54.852. COLLEGE SAVINGS PLANS TASK FORCE. (a) The
task force is established to:
(1) review and make recommendations for improvements
to the higher education savings plan established under Subchapter G
and the Texas Save and Match Program established under Subchapter
I; and
(2) evaluate strategies to increase participation in
the higher education savings plan established under Subchapter G,
particularly among economically disadvantaged students, minority
students, and students in geographical areas of the state with
lower rates of participation in the plan.
(b) The task force is composed of 11 members, consisting of:
(1) one member appointed by the chair of the house of
representatives committee with primary jurisdiction over higher
education;
(2) one member appointed by the chair of the senate
committee with primary jurisdiction over higher education;
(3) a representative of the coordinating board
designated by the commissioner of higher education;
(4) a representative of the office of the comptroller
designated by the comptroller;
(5) one member from the Texas Match the Promise
Foundation;
(6) the director of the Texas GEAR UP program; and
(7) five members appointed by the commissioner of
higher education as follows:
(A) one member with an interest in college
savings accounts representing an organization providing financial
stability services in the state;
(B) a representative of the Texas Parent Teacher
Association;
(C) a representative of an institution of higher
education;
(D) a representative of the philanthropic
community; and
(E) a representative of a regional education
service center.
(c) The task force shall meet at the call of the
coordinating board or the comptroller.
(c-1) The task force must hold at least two public meetings
not later than March 31, 2021. This subsection expires September 1,
2021.
(d) The task force shall:
(1) develop a selection process for participation in
pilot projects established under Section 54.807 and provide
guidance on those pilot projects; and
(2) provide guidance on the study conducted by the
coordinating board under Section 54.853.
Sec. 54.853. STUDY AND REPORT ON COLLEGE SAVINGS PLANS. (a)
The coordinating board shall conduct an ongoing study on the higher
education savings plan established under Subchapter G and the Texas
Save and Match Program established under Subchapter I.
(b) The study must:
(1) analyze potential strategies for increasing
participation in the higher education savings plan, particularly
among economically disadvantaged students, minority students, and
students in geographical areas of the state with lower rates of
participation in the plan, including methods to:
(A) enhance the competitiveness of the plan;
(B) reduce plan fees; and
(C) improve access to savings trust accounts
established through the plan for low-income families;
(2) evaluate potential improvements to the Texas Save
and Match Program to increase participation in the program,
including changes recommended as a result of a pilot project
established under Section 54.807; and
(3) identify potential sources of funding for the
Texas Save and Match Program.
(c) Not later than June 1 of each even-numbered year, the
coordinating board shall submit to the governor, the lieutenant
governor, the speaker of the house of representatives, the
comptroller, the standing legislative committees with primary
jurisdiction over higher education, and the task force a report on
the results of the study and any recommendations for legislative or
other action.
(d) Not later than December 1 of each even-numbered year,
the Prepaid Higher Education Tuition Board shall adopt rules to
implement one or more of the recommendations in the report
submitted under Subsection (c).
SECTION 7. Section 74.603, Property Code, is amended to
read as follows:
Sec. 74.603. AUDIT; APPROPRIATION. (a) The unclaimed
money received under this chapter or any other statute requiring
the delivery of unclaimed property to the comptroller is subject to
audit by the State Auditor and to appropriation by the legislature
for enforcing and administering this title.
(b) Unclaimed money received under this chapter in an amount
equal to or less than $5 and held by the comptroller for at least 20
years may be appropriated for the support of the Texas Save and
Match Program under Subchapter I, Chapter 54, Education Code, and,
in accordance with the General Appropriations Act, transferred to
the Prepaid Higher Education Tuition Board for that purpose.
SECTION 8. Not later than 60 days after the effective date
of this Act, the initial appointments or designations, as
applicable, of the members of the task force established under
Section 54.852, Education Code, as added by this Act, must be made.
SECTION 9. Not later than June 1, 2020, the Texas Higher
Education Coordinating Board shall submit its initial report
required under Section 54.853, Education Code, as added by this
Act.
SECTION 10. Not later than September 30, 2021, the Prepaid
Higher Education Tuition Board shall establish the pilot project
required under Section 54.807(b), Education Code, as added by this
Act.
SECTION 11. This Act takes effect immediately if it
receives a vote of two-thirds of all the members elected to each
house, as provided by Section 39, Article III, Texas Constitution.
If this Act does not receive the vote necessary for immediate
effect, this Act takes effect September 1, 2019.