HBA-KMH H.B. 713 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 713 By: Cuellar Higher Education 1/25/1999 Introduced BACKGROUND AND PURPOSE A national study reviewed by the Texas Higher Education Coordinating Board showed that college participation and graduation rates decrease as family income decreases. In Texas, at least 46 percent of all households, and 62 percent of African American and Hispanic households, have annual incomes of less than $25,000. The rising cost of tuition, fees, and other expenses such as room, board, books, and transportation, has made attending a Texas institution of higher education prohibitively expensive for many Texas students and their families. H.B. 713 creates the Texas Gateway to the Future Scholarship Program, which establishes a grant program intended to streamline and simplify the award process and to focus scholarship money directly toward those Texas students attending or intending to attend the state's institutions of higher education that show the greatest amount of financial need. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill expressly delegates rulemaking authority to the Texas Higher Education Coordinating Board in SECTION 1 (Section 56.303) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Chapter 56, Education Code, by adding Subchapter M, as follows: SUBCHAPTER M. TEXAS GATEWAY TO THE FUTURE SCHOLARSHIP PROGRAM Sec. 56.301. DEFINITIONS. (1) Defines "coordinating board" as the Texas Higher Education Coordinating Board. (2) Defines "eligible institution" as an institution of higher education, or a private or independent institution of higher education. (3) Defines "private or independent institution of higher education", "public junior college", and "public technical institute" as assigned under Section 61.003. Currently, Section 61.003 defines these terms, as follows: "Institution of higher education means" any public technical institute, public junior college, public senior college or university, medical or dental unit, or other agency of higher education as defined in this section. "Public junior college" means any junior college certified by the board in accordance with Section 61.063 of this chapter. "Public technical institute" means the Texas State Technical College System. Sec. 56.302. PROGRAM NAME; PURPOSE. Provides that the student financial assistance program authorized by this subchapter is known as the Texas Gateway to the Future Scholarship Program (program), and provides for a scholarship awarded under the program to be known as a Texas Gateway scholarship (TG scholarship). Sets forth that the purpose of this subchapter is to provide a grant of money to enable eligible students to attend public and private institutions of higher education in this state. Sec. 56.303. ADMINISTRATION OF PROGRAM. Requires the coordinating board to administer the program, to adopt rules necessary to implement the program or the subchapter, and to consult with the student financial aid officers of eligible institutions in developing the rules. Requires the coordinating board to adopt rules to provide a TG scholarship to an eligible student enrolled in an eligible institution of higher education in the most efficient manner possible. Prohibits the total amount of TG scholarships awarded from exceeding the amount available for the program from appropriations, gifts, grants, or other funds. Requires the coordinating board and eligible institutions to give highest priority to awarding scholarships to students who demonstrate the greatest financial need. Sec. 56.304. ELIGIBLE PERSON. Sets forth that for a person to be eligible for the program, the person must be a resident of this state as determined by coordinating board rules, a graduate of a public high school in this state or a private high school in this state accredited by an organization recognized by the State Board of Education, meet financial need requirements as defined by the coordinating board, enrolled in an undergraduate degree or certificate program at an eligible institution, enroll for at least one-half of a full course load as an entering freshman in an undergraduate degree or certificate program, and comply with any other requirement adopted by the coordinating board under this subchapter. Sets forth as a further requirement that in order to receive a TG scholarship for the 2003 fall semester or a subsequent semester or term, a person must have graduated from a public high school in this state not earlier than the 1998-1999 school year and have completed the recommended or advanced high school curriculum established under Section 28.002 (Required Curriculum) or an equivalent curriculum recognized by the State Board of Education. Currently, Section 28.002 does not designate a set required curriculum but rather gives the State Board of Education the authority to designate a required curriculum. Prohibits eligibility in the program by a person who has received a baccalaureate degree, or receipt of a TG scholarship for more than 150 semester credits hours or the equivalent. Sec. 56.305. ACADEMIC PERFORMANCE REQUIREMENTS. Authorizes a person to continue to receive a TG scholarship during each semester or term in which the person continues to be eligible, but only if the person makes satisfactory academic progress toward an undergraduate degree or certificate as determined by the coordinating board. Authorizes continued eligibility if a person who received a TG scholarship and received an undergraduate certificate or associate degree subsequently enrolls within 12 months in a program leading to a higher-level undergraduate degree. Sec. 56.306. SCHOLARSHIP USE. Authorizes the use of TG scholarship funds by a person designated to receive them (recipient) for payment of any usual and customary cost of attendance at an institution of higher education incurred by recipient. Requires recipient to designate initially on recipient's application whether the money will be used for tuition and fees or should be disbursed directly to recipient and authorizes recipient to change disbursement instructions in a subsequent semester or term. Authorizes disbursement of TG scholarship proceeds only upon proof by recipient of payment or arrangement for payment of all recipient's tuition and fees. Authorizes the institution disbursing the TG scholarship proceeds to retain an amount equal to recipient's tuition and fees until proof of payment or arrangement for payment is presented if tuition and fees have not been paid by the due date. Prohibits an eligible institution from requiring a person to use TG scholarship proceeds to pay tuition and fees. Sec. 56.307. SCHOLARSHIP AMOUNT. Sets forth that the TG scholarship for students attending general academic institutions equals the amount of tuition and required fees charged to the student. Sets forth that the TG scholarship for students enrolled in private or independent institutions of higher learning equals the average statewide amount of tuition and required fees that a resident student enrolled full-time in a baccalaureate degree program would be charged for that semester or term at general academic institutions, as determined by the coordinating board. Prohibits the TG scholarship from being reduced by any gift aid for which a person is eligible, unless the total sum of gift aid and TG scholarship exceeds the total cost of attendance at an eligible institution. Sec. 56.308. NOTIFICATION OF PROGRAM TO STUDENTS AND HIGH SCHOOLS. Requires the coordinating board to distribute to each eligible institution of higher education and to each school district a copy of the rules adopted under this subchapter. Requires each school district to notify its students of the program and the eligibility requirements of the program and ensure that each student's official transcript or diploma indicates whether the student has completed the recommended high school curriculum established under Section 28.002 (Required Curriculum). Sec. 56.309. FUNDING. Authorizes the coordinating board to solicit and accept gifts and grants from any public or private source for the purposes of this subchapter. SECTION 2. Amends Section 54.5021(c), Education Code, to delineate Subchapter M, Chapter 56, Education Code, as the guidelines for making scholarship awards funded by this subsection rather than "to needy and deserving students." SECTION 3. Amends Section 56.039, Education Code, to make a conforming change. SECTION 4. Amends Section 151.423, Tax Code, to authorize reimbursement for scholarships under Subchapter M, Chapter 56, Education Code, rather than for student financial assistance grants offered under Chapter 56, Education Code. Makes conforming changes. SECTION 5. Repealer: Sections 54.215 and 54.216, Education Code. Currently, Section 54.215 (Texas National Guard/ROTC Students) makes certain exemptions from tuition and fees for students selected to participate in the program. Currently, Section 54.216 (Texas New Horizons Scholarships), provides for the issuing of scholarships to qualified students from money available in the Texas New Horizons Scholarship Trust Fund. SECTION 6. Repealer: Subchapter F, Chapter 56, Education Code. This section is effective June 1, 1999. Currently, Subchapter F (Texas Educational Opportunity Grant Program) provides for grants of money to eligible students to attend eligible institutions of higher education in Texas. SECTION 7. Repealer: Subchapter L, Chapter 61, Education Code. This section is effective June 1, 1999. Currently, Subchapter L (Financial Aid for Professional Nursing Students and Vocational Nursing Students and Loan Repayment Program for Certain Nurses) provides for the establishment of a scholarship program, matching fund program, or loan repayment program to promote the health care and educational needs of the state. SECTION 8. Transfers any money, wherever situated, which was appropriated or collected for any program abolished under Sections 5, 6, or 7 of this Act to the Texas Higher Education Coordinating Board for use in the Texas Gateway to the Future Scholarship Program. SECTION 9. Requires the coordinating board to review and study the laws relating to student financial aid, grant, and scholarship programs or tuition and fee waivers or exemptions, to describe possible improvements to existing programs to maximize the benefits to the state and its students, and to make recommendations for legislative or administrative action that may be taken to consolidate, expand, or otherwise modify existing programs or create new programs. Requires the coordinating board to report its activities and findings to the governor, the lieutenant governor, and the speaker of the house of representatives not later than December 1, 2000. SECTION 10. Authorizes a person receiving an exemption under Section 54.215 (Texas National Guard/ROTC Students) to continue to receive the exemption until the person is no longer eligible for it, as Section 54.215 existed on January 1, 1999. Requires the Texas Gateway to the Future Scholarship Program to cover the costs of the continued exemptions under Section 54.215. SECTION 11. Requires the coordinating board to award scholarships under the program beginning with the 1999 fall semester. Requires the coordinating board to adopt rules for awarding TG scholarships no later than July 25, 1999. SECTION 12.Emergency clause. Effective date: upon passage.