View Amendment Current Amendment: ED to Bill 935

The Committee on Education proposed the following amendment (935R001.KMM.GH):

Amend the bill, as and if amended, by striking all after the enacting words and inserting:

/ SECTION1. This act may be cited and referred to as the 'Put Parents in Charge Act.'

SECTION2. Title 59 of the 1976 Code is amended by adding:


Education Scholarship Accounts

Section 59-8-110. For purposes of this chapter:

(1) 'Department' means the South Carolina Department of Education.

(2) 'Education Scholarship Account', 'ESA', or 'account' means the individual account that is administered by the department to which funds are allocated to the parent of an ESA student to pay for qualifying expenses.

(3) 'Eligible student' means a student who:

(a) is a resident of this State;

(b)(i) attended a public school in this state during the previous school year;

(ii) had not yet attained the age of five on or before September first of the previous school year but who has attained the age of five on or before September of the current school year; or

(iii) received an ESA scholarship pursuant to this chapter for the pr evious school year; and

(c)(i) has a statement of Medicaid eligibility;

(ii) has an IEP; or

(iii) has a sibling living in the same household who receives an ESA scholarship.

( 4)'ESA student' means an eligible student who is participating in the Education Scholarship Account program.

( 5)'IDEA' means the Individuals with Disabilities Education Act found in 20 U.S.C. Section 1400, et seq.

( 6)'Parent' means a resident of this State who is the natural or adoptive parent, legal guardian, custodian, or other person with legal authority to act on behalf of an eligible student.

( 7)'Education service provider' means a person or organization approved by the department that receives payments from education savings accounts to provide educational goods and services to ESA students.

( 8)'Program' means the ESA program created by this chapter.

( 9)'Resident school district' means the public school district in which the student is domiciled.

(1 0)'Scholarship' means education funding allocated from an account established pursuant to this chapter.

(1 1)'Substantial misuse' means willfully and knowingly receiving or spending any portion of a scholarship for any purpose other than a qualifying expense.

(1 2)'Qualifying expense' means:

(a) tuition and fees of an education service provider;

(b) textbooks, curriculum, or other instructional materials, including, but not limited to, any supplemental materials or associated online instruction required by either a curriculum or an education service provider;

(c) tutoring services approved by the department;

(d) computer hardware or other technological devices that are used primarily for an ESA student's educational needs and approved by the department or a licensed physician;

( e)tuition and fees for an approved nonpublic online education service provider or course;

( f)fees for approved:

(1) national norm-referenced examinations, advanced placement examinations, or similar assessments;

(2) industry certification exams; or

(3) examinations related to college or university admission;

( g)educational services for pupils with disabilities from a licensed or accredited practitioner or provider including, but not limited to, occupational, behavioral, physical, and speech-language therapies;

( h)approved contracted services from a public school district, including individual classes, after school tutoring services, transportation, or fees or costs associated with participation in extracurricular activities;

( i) contracted teaching services and education classes approved by the depatrment;

( j)fees for transportation paid to a fee-for-service transportation provider for the ESA student to travel to and from an eligible provider as defined in this section, but not to exceed seven hundred and fifty dollars for each school year;

( k)fees for ESA account management by private financial management firms approved by the department; or

( l) any other educational expense approved by the department.

Section 59-8-115.(A) The department shall create a standard application process and establish the timeline for parents of eligible students to establish the eligibility of their student for the Education Scholarship Account program. The application window established shall last at least forty-five days, opening no later earlier than January fifteenth and closing no later than April fifteenth each calendar year.

(B) Pursuant to the timeline established pursuant to subsection (A), the department shall:

(1) process applications in the order in which they are received, after a preference has been extended to all prior-year participants and their respective siblings; and

(2) enroll and issue award letters within thirty days of the deadline for receipt of completed applications and all required documentation.

(C) Before awarding a scholarship, the department shall have obtained evidence of the student's eligibility through the card issued in the student's name from the Department of Health and Human Services for Medicaid eligibility included as applicable with application documentation.

(D) The department shall approve an application for an ESA if:

(1) the parent submits an annual application for an ESA in accordance with the application and procedures established by the department;

(2) the student on whose behalf the parent is applying is an eligible student;

(3) funds are available for the ESA; and

(4) the parent signs an annual agreement with the department:

(a) to provide, at a minimum, a program of academic instruction for the eligible student in at least the subjects of English/language arts to include writing, mathematics, social studies, and science;

(b) to ensure the ESA student takes assessments as referenced in Section 59-8-150 or provides assessments in a similar manner through other means if the ESA student does not receive full-time instruction from an education service provider;

(c) to use program funds for qualifying expenses only for an approved provider to educate the eligible student, subject to penalty;

(d) not to enroll their eligible student in a public school as a full-time student in the resident school district, as defined in this chapter;

(e) not to participate in a home instruction program under Sections 59-65-40, 59-65-45, or 59-65-47;

(f) to comply with the conditions and requirements of the ESA program as established by the department; and

(g) to confirm that, if the parent's child is a student with disabilities, the parent has received notice from the department that participation in the ESA program is a parental placement of the ESA student under IDEA, along with an explanation of the rights that parentally placed studen ts possess under IDEA and any applicable state laws and regulations, including the consultation process provided for in 20 U.S.C. Section 1412(a)(10) and the Indivdual Education Program requirements described in Section 1414(d) of IDEA.

(E) The department shall make available on its website in a conspicuous location information in conformity with 34 C.F.R Sections 300.130 through 300.144, Assistance to States for the Education of Children with Disabilities, explaining to parents the rights of children with disabilities under IDEA both in public schools and as parentally placed students in private schools.

( F)A parent will be allowed to make payments for the cost of educational goods and services not covered by the funds in their student's ESA; however, personal deposits into an ESA are prohibited.

( G)Funds received pursuant to this section do not constitute taxable income to the parent of the ESA student or to the ESA student.

(H) A parent's signed agreement under subsection (D)(4) satisfies the state's compulsory attendance law pursuant to Section 59-65-10.

(I) The State Board of Education shall promulgate regulations for the administration of the program as may be applicable.

(J) The department may contract with qualified organizations to administer the program application process or specific functions, maintenance, and monitoring of the program application process as required above.

Section 59-8-120.(A) There is established, at the department, the 'South Carolina Education Scholarship Account Fund' that is separate and distinct from the general fund, consisting of monies appropriated to the department to provide scholarships to ESA students for qualifying expenses. The fund must receive and hold all monies allocated for it as well as all earnings until disbursed as provided in this section.

(B) The department shall administer the fund and is responsible for keeping records, managing accounts, and disbursing scholarships awarded pursuant to this section.

(C) Upon approval of an eligible student's application by the department, the State Treasurer shall transfer from the State appropriated monies allocated for the child's education in the prior school district of the child's domicile, or if the child is currently eligible to attend kindergarten, the State monies that would otherwise be allocated for the child's education in the expected school district of the child's domicile, to the department. The department shall deposit these monies into the South Carolina Education Scholarship Account Fund.

(D) The department shall create an individual online ESA account for each ESA student and transfer an amount that is equivalent to the State average of State funding per pupil in public schools for the current fiscal year as determined by the Revenue and Fiscal Affairs Office. The amount deposited shall not include federal or local funds.

(1) The parent must be able to access the online account for the ESA student using a secure portal.

(2) The ESA student account must be created within thirty days of the application approval.

(E) The department shall make payments to an ESA student's account on a quarterly basis with the first payment being distributed by July thirty-first of each year.

(F) For the purpose of funding calculations, each eligible student who participates in the program must be counted in the enrollment figures for the resident school district in which the student is zoned to attend.

(G) By September first of each school year and again on January fifteenth and March fifteenth of the school year, the department shall compare the list of ESA students with the public school enrollment lists to avoid duplicate payments.

( H)Education service providers may not refund, rebate, or share an ESA student's scholarship funds with a parent or the ESA student. The funds in an account may only be used for qualifying expenses as defined in this chapter and provided by the department.

( I)The department may contract with qualified organizations to administer the program.

Section 59-8-125.(A) The department shall develop an online electronic system for payment for services by participating parents. The department shall not adopt a system that requires parents to be reimbursed for out-of-pocket expenses.

(B) The General Assembly shall appropriate funds to the department for initial costs to create the program. Thereafter, the department shall deduct an amount from the grants of all accounts to cover the costs of overseeing the accounts and administering the program up to a limit of three percent. Annually, on or before December thirty-first, the department shall notify the respective Chairmen of the Senate Finance Committee and House of Representatives Ways and Means Committee regarding the amount deducted for administrative costs and an itemization of the costs incurred to administer the program for the previous school year.

(C) The department may contract with qualified vendors to manage accounts and shall establish reasonable fees for private financial management firms participating in the program based upon market rates.

(D) The department may contract with qualified organizations to administer the program or specific functions of the program.

(E) Payments made by the department must remain in force until a parent or ESA student is proven to have participated in a prohibited activity specified in this chapter, an ESA student returns to a public school in his resident public school district, or an ESA student graduates from high school or attains twenty-two years of age, whichever occurs first. An ESA student who enrolls in his resident public school district is considered to have returned to a public school for the purpose of determining the end of the term.

(F) An account is active and usable until funds are revoked by the department for substantial misuse or the ESA student leaves the program for any reason, at which time any remaining funds must revert to the program fund.

(G) Unused funds must be rolled over to the following year for an ESA student who continues to meet eligibility requirements to participate in the program.

(H) An agreement terminates automatically if the ESA student is no longer domiciled in this State, and money remaining in the account reverts to the program fund.

(I) Only one account may be established for an eligible student.

Section 59-8-130.(A) If an ESA student's program of academic instruction is terminated for any reason before the end of the semester or school year and the ESA student does not resume instruction within thirty days, then the parent shall notify the department and remaining funds in the ESA student's account must be credited to the program fund.

(B) Any funds not expended in an ESA student's scholarship account at the end of the school year will be carried forward into the next school year and expended for the same purposes.

Section 59-8-135.(A) Beginning with the 202 3-2024 School Year, the annual number of ESA students is limited by the following capacity:

(1) in School Year 2023-2024, the program is limited to five thousand ESA students;

(2) in School Year 2024-2025, the program is limited to ten thousand ESA students; and

(3) in School Year 2025-2026, and for all subsequent school years, the program is limited to fifteen thousand ESA students.

( B)In 2026, and every five years thereafter, the department shall conduct an eligibility and use review of the program and shall make recommendations to the General Assembly to improve the program.

Section 59-8-140.(A)(1) The department shall develop an application for education service providers desiring to participate in the program to submit according to the process established by the department.

(2) The department shall require an independent school that applies to be an education service provider to be located in the State, to have an educational curriculum that includes courses set forth in the state's diploma requirements and to meet the compulsory attendance and State Board of Education approval requirements in Section 59-65-10.

(3) An education service provider that participated in the program in the previous school year and which desires to participate in the program in the current school year shall reapply to the department. The education service provider reapplying shall certify to the department that it continues to meet all program requirements. An education service provider required to administer academic testing shall provide to the department test score data from the previous school year. If individual student test score data is not submitted, then the department shall remove the education service provider from the program.

(4) By March first of each year, the department will certify the list of approved education service providers for participation in the program that meet all program requirements. The department may waive the deadline requirement upon good cause shown by an education service provider.

(5) An education service provider that is denied certification pursuant to this section may seek review by filing a request for a contested case hearing with the Administrative Law Court in accordance with the court's rules of procedure.

(6) By March fifteenth of each year, the department shall publish on its website a comprehensive list of certified education service providers. The list must include the name, address, telephone number, and website address for each education service provider.

(B) The department shall establish the process for new education service providers to participate in the program which may be added on a rolling basis, subject to the department's approval, and will be published on its website.

(C) The department may bar an education service provider from the program if the department establishes that the education service provider has:

(1) failed to comply with the accountability standards established in this section; or

(2) failed to provide the ESA student with the educational services funded by the account.

(D) The department shall create procedures to ensure that a fair process exists to determine whether an education service provider may be barred from receiving payments from accounts.

(1) If the department decides to bar an education service provider from the program, it shall notify affected students and their parents of this decision as quickly as possible.

(2) Education service providers may appeal the department's decision to bar the education service provider from receiving payments from accounts pursuant to the Administrative Procedures Act.

(E) The S tate Board of Education shall promulgate regulations to allow ESA students to return to their resident school districts at any time, providing the least disruptive process, and as may be necessary for applicable administration of the program.

Section 59-8-145.( A)The department shall adopt procedures to inform students that are eligible for the program and their parents annually of their ability to participate in the program.

( B)The department shall adopt procedures to annually inform ESA students and their parents of which education service providers will be participating in the program.

( C)The department shall provide parents of an ESA student with a written explanation of the allowable uses of an account and the responsibilities of parents and the duties of the department.

( D)The department may declare that a parent is ineligible for the program due to the parent's substantial misuse of the funds in the account.

( E)The department may conduct or contract for the auditing of accounts, and shall, at a minimum, conduct random audits of accounts on an annual basis.

( F)The department may refer cases of substantial misuse of funds to law enforcement agencies for investigation if credible evidence of the fraudulent use of an account is obtained.

( G)The department may contract with one or more qualified organizations to administer some or all portions of this program.

( H)The department shall maintain a record of the number of applications received annually for the program, the number of students accepted into the program each year, the number of students not accepted into the program each year with a corresponding explanation as to why the student was not accepted into the program. The department shall compile this information and provide a report the General Assembly by December thirty-first of each year.

Section 59-8-150.(A) To ensure equitable treatment and personal safety of all ESA students, all education service providers shall:

(1) comply with all applicable health and safety laws or codes;

(2) hold a valid occupancy permit if required by the municipality in which the education service provider is located, if applicable;

(3) not unlawfully discriminate on the basis of race, color, religion, or national origin; and

(4) conduct criminal background checks on employees and exclude from employment anyone who:

(a) is not permitted by state law to work in a school;

(b) reasonably might pose a threat to the safety of students; or

(c) is listed on federal, state, or other central child abuse registries.

(B) To ensure that funds are spent appropriately, all education service providers shall:

(1) provide parents with a receipt for all qualifying expenses; and

(2) demonstrate their financial viability by showing they can repay funds received from parents that might be provided from accounts, if they are to receive fifty thousand dollars or more during the school year, by filing a surety bond with the department prior to the start of the school year.

(C) In order to allow parents and the public to measure the achievements of the program, academic progress must be documented annually for each ESA student. ESA students with an Individualized Education Plan that cannot be accommodated with standardized testing are excluded from the requirements of item (1). Education service providers that provide academic instruction, however, must monitor the progress of students with significant cognitive disabilities through alternative assessments including portfolios.

(1) Education service providers that provide full-time academic instruction shall:

(a) ensure that each ESA student in grades three through twelve takes a nationally norm-referenced or formative assessment approved by the department. Students with disabilities for whom standardized testing is not appropriate are exempt from this requirement; and

(b) measure academic performance and annual learning gains of its ESA students by:

(i) requiring that each ESA student takes either an approved nationally norm-referenced assessment annually, or an approved formative assessment in the fall and spring, to measure learning gains in math and reading; and

(ii) collecting high school graduation information of ESA students for reporting to the department as required in this section.

(2) For the purpose of evaluating program effectiveness, education service providers that provide full-time academic instruction shall ensure that results in item (1) are:

(a) provided to the parent of an ESA student and must be provided to the department on an annual basis, beginning with the first year of program implementation; and

(b) disaggregated by grade level, gender, family income level, race , and English learner status.

(3) The department , or the appropriate organization chosen by the department, if any, must be informed of the ESA student's graduation from high school.

(D) The department shall:

(1) comply with all student privacy laws;

(2) collect all test results;

(3) annually provide individual student assessment results and information to the Education Oversight Committee. The transmission of the information must be made in a manner that safeguards the data to ensure student privacy.

(E) The Education Oversight Committee shall:

(1) comply with all student privacy laws;

(2) report on and publish associated learning gains and graduation rates to the public by means of a state website with data aggregated by grade level, gender, family income level, number of years participating in the program, and race and a report for any participating school if at least fifty-one percent of the total enrolled students in the private school participated in the ESA program in the prior school year or if there at least thirty participating students who have scores for tests administered. If the Education Oversight Committee determines that the thirty participating-student cell size may be reduced without disclosing the personally identifiable information of a participating student, the Education Oversight Committee may reduce the participating-student cell size, but the cell size may not be reduced to fewer than ten participating students;

(3) evaluate and report the academic performance of ESA students compared to similar public school populations;

(4) collaborate with the department to develop and administer an annual parental satisfaction survey for all parents of ESA students to express their satisfaction with the program and their opinions on issues relevant to the ESA program that the State finds would elicit information about the effectiveness of the program, including the number of years the child has participated in it. Results of this survey must be provided to the General Assembly by December thirty-first of each year.

(E) An education service provider that is not a public school is autonomous and not an agent of the State or federal government, therefore:

(1) the department or any other state agency may not regulate the educational program of a certified education provider that accepts funds from an account;

(2) the creation of the program does not expand the regulatory authority of the State, its officers, or a school district to impose regulation of education service providers beyond those necessary to enforce the requirements of the program;

(3) the freedom of education service providers to provide for the educational needs of ESA students without governmental control must not be abridged;

(4) an education service provider that accepts payment from a parent using funds from an ESA pursuant to this chapter is not an agent of the State or federal government; and

(5) education service providers shall not be required to alter their creeds, practices, admissions policy, or curriculum in order to accept payments from a parent using funds from an ESA.

Section 59-8-155.The ESA student's resident school district shall provide a parent and the education service providers that provide academic services to an ESA student with a complete copy of the student's school records, while complying with the Family Educational Rights and Privacy Act of 1974, 20 U.S.C. Section 1232(g).

Section 59-8-160.(A) There is created the 'ESA Review Panel' that shall serve as an advisory panel to the department.

(B) The review panel shall consist of ten members, pursuant to the following:

(1) the Governor or his designee, who shall serve as the chair of the panel; and

(2) three members to be appointed by the Governor;

(3) one member appointed by the Speaker of the House of Representatives;

(4) one member appointed by the President of the Senate;

(5) one member appointed by the Chairman of the House of Representatives Education and Public Works Committee;

(6) one member appointed by the Chairman of the Senate Education Committee; and

(7) two parents of ESA students to be appointed by the Governor.

(C) The review panel may advise the department on whether certain expenses meet the requirements to be considered a qualified expense under this chapter when requested by the department. The review panel periodically may make recommendations to the General Assembly about improving the program.

(D) Members shall serve at the pleasure of their appointing authority. In making appointments to the panel, the appointing authorities, as appropriate, shall consider legal, financial, accounting, and marketing experience and race, gender, and other demographic factors to ensure nondiscrimination, inclusion, and representation of all segments of the State to the greatest extent possible.

(E) Members may not receive mileage or per diem."

SECTION 3. If any section, subsection, paragraph, subparagraph, sentence, clause, phrase, or word of this act is for any reason held to be unconstitutional or invalid, then such holding shall not affect the constitutionality or validity of the remaining portions of this act, the General Assembly hereby declaring that it would have passed this act, and each and every section, subsection, paragraph, subparagraph, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more other sections, subsections, paragraphs, subparagraphs, sentences, clauses, phrases, or words hereof may be declared to be unconstitutional, invalid, or otherwise ineffective.

SECTION 4.This act takes effect thirty days after approval by the Governor, provided that upon approval of this act by the Governor, the Department of Education shall begin undertaking and executing responsibilities incident to the implementation of this act so that the provisions of this act may be fully implemented thirty days after approval by the Governor. /