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PRINTER'S NO. 1182
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1134
Session of
2021
INTRODUCED BY NEILSON, STAMBAUGH, HILL-EVANS, SANCHEZ, KINSEY,
GROVE, STEPHENS, DRISCOLL, ROWE AND O'MARA, APRIL 7, 2021
REFERRED TO COMMITTEE ON EDUCATION, APRIL 7, 2021
AN ACT
Amending the act of March 10, 1949 (P.L.30, No.14), entitled "An
act relating to the public school system, including certain
provisions applicable as well to private and parochial
schools; amending, revising, consolidating and changing the
laws relating thereto," providing for individual empowerment
scholarship accounts; and establishing the Pennsylvania
Empowerment Scholarship Accounts Program, the Department of
Education Empowerment Scholarship Fund and the State
Treasurer Empowerment Scholarship Fund.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of March 10, 1949 (P.L.30, No.14), known
as the Public School Code of 1949, is amended by adding an
article to read:
ARTICLE XXVI-L
INDIVIDUAL EMPOWERMENT SCHOLARSHIP ACCOUNTS
Section 2601-L. Definitions.
The following words and phrases when used in this article
shall have the meanings given to them in this section unless
context clearly indicates otherwise:
"Annual education plan." An initial individualized
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evaluation and subsequent annual reviews that are developed for
a student who meets the requirements under section 2602-L(b) to
determine ongoing annual eligibility through the school year in
which the student reaches 22 years of age.
"Curriculum." A complete course of study approved by the
department for content areas or grade levels, including
supplemental materials required by the curriculum.
"Department." The Department of Education of the
Commonwealth.
"Eligible postsecondary institution." A community college as
defined in section 1901-A, a university under the jurisdiction
of the Pennsylvania State System of Higher Education or an
accredited private postsecondary institution.
"Parent." A resident of this Commonwealth who is the parent
or legal guardian of a qualified student.
"Qualified school." A preschool for pupils with disabilities
or a nongovernmental primary or secondary school that is located
in this Commonwealth and that does not discriminate on the basis
of race, color or national origin.
"Qualified student." A person who meets the requirements
under section 2602-L(b).
"Treasurer." The State Treasurer of the Commonwealth.
Section 2602-L. Pennsylvania Empowerment Scholarship Accounts
Program.
(a) Establishment.--The Pennsylvania Empowerment Scholarship
Accounts Program is established in the Department of Education
to provide options for the education of students in this
Commonwealth.
(b) Qualified students.--A resident of this Commonwealth is
qualified for an individual empowerment scholarship account if
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the person meets any of the following requirements:
(1) Is identified as having a disability under section
504 of the Rehabilitation Act of 1973 (Public Law 93-112, 29
U.S.C. § 794 et seq.).
(2) Is identified as a student with a disability as
defined in section 1301-A.
(3) Is attending a school or school district that has
been assigned a score below 60 in its School Performance
Profile under section 603-B or who is currently eligible to
attend kindergarten and who resides within the attendance
boundary of a school that has been assigned a score below 60
in its School Performance Profile.
(4) Is a previous recipient of a scholarship issued
under this article, unless the qualified student's enrollment
agreement has been terminated under section 2603-L(e).
(5) Is a child of a parent who is a member of the armed
forces of the United States and who is on active duty or was
killed in the line of duty. A child who meets the
requirements of this paragraph is not subject to subsection
(c).
(c) Enrollment agreement.--To enroll a qualified student for
an individual empowerment scholarship account, the parent of the
qualified student must sign an enrollment agreement to do all of
the following:
(1) Use a portion of the individual empowerment
scholarship account money allocated annually to provide an
education for the qualified student in the subjects of
reading, grammar, mathematics, social studies and science,
unless the individual empowerment scholarship account is
allocated money according to a transfer schedule other than
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the quarterly transfers under section 2603-L(a).
(2) Not enroll the qualified student in a school
district or charter school and release the school district or
charter school from all obligations.
(3) Not accept a scholarship from a school tuition
organization for the qualified student in the same year a
parent signs the agreement under this section.
(4) Not file an affidavit of intent to homeschool.
(5) Not use money deposited in the qualified student's
account for any of the following:
(i) Computer hardware or other technological
devices.
(ii) Transportation of the pupil.
(iii) Consumable educational supplies, including
paper, pens or markers.
(6) Use the money deposited in the individual
empowerment scholarship account only for the following
expenses of the qualified student:
(i) Tuition or fees at a qualified school.
(ii) Textbooks required by a qualified school.
(iii) If the qualified student meets the criteria
specified in subsection (b)(1) or (2) as determined by a
school district or by an independent third party
contracted for under section 2603-L(i), any of the
following additional expenses:
(A) Educational therapies from a licensed or
accredited practitioner or provider.
(B) Services of a licensed or accredited
paraprofessional or educational aide.
(C) Tuition for vocational and life skills
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education approved by the department.
(D) Associated services that include educational
and psychological evaluations, assistive technology
rentals and braille translation services approved by
the department.
(iv) Tutoring or teaching services provided by an
individual or facility accredited by a national, regional
or State accrediting organization.
(v) Curricula.
(vi) Tuition or fees for a nonpublic online learning
program.
(vii) Fees for a nationally standardized norm-
referenced achievement test, an advanced placement
examination or an exam related to college or university
admission.
(viii) Contributions to a Coverdell education
savings account established under section 530(b)(1) of
the Internal Revenue Code of 1986 (Public Law 99-514, 26
U.S.C. § 530(b)(1)) for the benefit of the qualified
student, except that money used for elementary or
secondary education expenses must be for expenses
otherwise allowed under this section.
(ix) Tuition or fees at an eligible postsecondary
institution.
(x) Textbooks required by an eligible postsecondary
institution.
(xi) Fees for management of the individual
empowerment scholarship account.
(xii) Services provided by a public school,
including individual classes and extracurricular
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programs.
(xiii) Insurance or surety bond payments.
(xiv) Uniforms purchased from or through a qualified
school.
(xv) Beginning January 1, 2022, if the qualified
student is in the second year prior to the final year of
a contract executed under this article, costs associated
with an annual education plan conducted by an independent
evaluation team. The department shall prescribe minimum
qualifications for independent evaluation teams in
accordance with this article and factors that teams must
use to determine whether the qualified student shall be
eligible to continue to receive money under this article
through the school year in which the qualified student
reaches 22 years of age. An independent evaluation team
that provides an annual education plan under this article
shall submit a written report that summarizes the results
of the evaluation to the parent of the qualified student
and to the department on or before July 31 each year. The
written report submitted by the independent evaluation
team shall be valid for one year. If the department
determines that the qualified student meets the
eligibility criteria prescribed in the annual education
plan, the qualified student is eligible to continue to
receive money under this article until the qualified
student reaches 22 years of age, subject to annual
review. A parent may appeal the department's decision. As
an addendum to a qualified student's final-year contract,
the department shall provide the following information in
writing to the parent of the qualified student:
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(A) That the qualified student will not be
eligible to continue to receive money under this
article unless the results of an annual education
plan conducted under this article demonstrate that
the qualified student meets the eligibility criteria
prescribed in the annual education plan.
(B) That the parent is entitled to obtain a copy
of an annual education plan under this article to
determine whether the qualified student meets the
eligibility criteria prescribed in the annual
education plan.
(C) A list of independent evaluation teams that
meet the minimum qualifications prescribed by the
department under this subdivision.
(d) Transfer to individual empowerment scholarship
account.--Upon execution of the parent's agreement under
subsection (c), the department shall transfer from the money
that would otherwise be allocated to a qualified student's prior
school district, or, if the child is currently eligible to
attend kindergarten, the money that the department determines
would otherwise be allocated to a qualified student's expected
school district of attendance, to the treasurer for deposit into
an individual empowerment scholarship account an amount that is
equivalent to 90% of the sum of the amount prescribed in section
2502.53, divided by average daily membership, for the qualified
student if the qualified student were attending a charter
school. The department may retain up to 5% of the sum of the
base support level and additional assistance prescribed in
section 2502.53, divided by average daily membership, for each
student with an individual empowerment scholarship account for
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deposit in the Department of Education Empowerment Scholarship
Fund established under subsection (e), out of which the
department shall transfer 1% of the sum of the amount prescribed
in section 2502.53, divided by average daily membership, for
each student with an individual empowerment scholarship account
to the treasurer for deposit in the State Treasurer Empowerment
Scholarship Fund established in subsection (f).
(e) Department of Education Empowerment Scholarship Fund.--
The Department of Education Empowerment Scholarship Fund is
established and shall consist of money retained by the
department under subsection (d). The department shall administer
the fund. Money in the fund is subject to legislative
appropriation and shall be used for the department's costs in
administering individual empowerment scholarship accounts under
this article. If the number of individual empowerment
scholarship accounts significantly increases after fiscal year
2021-2022, the department may request an increase in the amount
appropriated to the fund in any subsequent fiscal year in the
budget estimate submitted.
(f) State Treasurer Empowerment Scholarship Fund.--The State
Treasurer Empowerment Scholarship Fund is established and shall
consist of money transferred by the department to the treasurer
under subsection (d). The treasurer shall administer the fund.
Money in the fund shall be used for the treasurer's costs in
administering the individual empowerment scholarship accounts
under this article. If the number of individual empowerment
scholarship accounts significantly increases after fiscal year
2021-2022, the treasurer may request an increase in the amount
appropriated to the fund in a subsequent fiscal year in the
budget estimate submitted. Money in the fund is subject to
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legislative appropriation.
(g) Account renewal.--A parent must renew the qualified
student's individual empowerment scholarship account on an
annual basis. Notwithstanding any changes to the student's
individualized education program or plan under section 504 of
the Rehabilitation Act of 1973 (Public Law 93-112, 29 U.S.C. §
794), a student who has previously qualified for an individual
empowerment scholarship account shall remain eligible to apply
for renewal until the student finishes high school.
(h) School attendance.--A signed enrollment agreement under
this section constitutes school attendance required under
Article XIII.
(i) Prohibition.--A qualified school or a provider of
services purchased under subsection (c)(6) may not share with,
refund or rebate to a parent or the qualified student any
individual empowerment scholarship account money.
(j) Return of funds.--Upon the qualified student's
graduation from a postsecondary institution or after a period of
four consecutive years after high school graduation in which the
student is not enrolled in an eligible postsecondary
institution, the qualified student's individual empowerment
scholarship account shall be closed and any remaining money
shall be returned to the Commonwealth.
(k) Tax implications.--Money received under this article
does not constitute taxable income to the parent of the
qualified student.
Section 2603-L. Administration of individual empowerment
scholarship accounts.
(a) Account deposits.--The department shall make quarterly
transfers of the amount calculated under section 2602-L(d) to
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the treasurer for deposit into the individual empowerment
scholarship account of each qualified student. The department
may make transfers according to another transfer schedule if the
department determines a transfer schedule other than quarterly
transfers is necessary for the operation of the individual
empowerment scholarship account.
(b) Scholarship award.--The department shall accept
applications between July 1 and June 30 of each year. The
department shall enroll and issue an award letter to eligible
applicants within 45 days after receipt of a completed
application and all required documentation.
(c) Private management.--The treasurer may contract with
private financial management firms to manage individual
empowerment scholarship accounts.
(d) Audits.--The department shall conduct or contract for
annual audits of individual empowerment scholarship accounts to
ensure compliance with section 2602-L(c)(6). The department
shall also conduct or contract for random audits of individual
empowerment scholarship accounts as needed.
(e) Account suspension.--The department may suspend an
individual empowerment scholarship account if the parent or
qualified student fails to comply with the terms of the
enrollment agreement or applicable laws, rules or orders. The
department shall notify the treasurer to suspend the individual
empowerment scholarship account and shall notify the parent and
qualified student in writing that the account has been suspended
and that no further transactions will be allowed or
disbursements made. The notification shall specify the reason
for the suspension and state that the parent or qualified
student has 10 days, not including weekends or Federal or State
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holidays, to respond and take corrective action. If the parent
or qualified student fails to contact the department, furnish
information or make a report that may be required for
reinstatement within the 10-day period, the department may
terminate the enrollment agreement. A parent may appeal the
department's decision.
(f) Referral to Attorney General.--The department may refer
cases of substantial misuse of money to the Attorney General for
the purpose of collection or for the purpose of a criminal
investigation if the department obtains evidence of fraudulent
use of an individual empowerment scholarship account.
(g) Budget submission.--On or before May 30 of each year,
the department shall furnish to the Legislative Budget and
Finance Committee an estimate of the amount required to fund
individual empowerment scholarship accounts for the following
fiscal year. The department shall include in the budget request
for the following fiscal year the amount estimated under section
2602-L(d), for each qualified student.
(h) Rules and policies.--The department may adopt rules and
policies necessary for the administration of individual
empowerment scholarship accounts including:
(1) Conducting or contracting for audits of the use of
account money.
(2) Establishing or contracting for the establishment of
an online anonymous fraud reporting service.
(3) Establishing an anonymous telephone hotline for
fraud reporting.
(4) Requiring a surety bond or insurance for individual
empowerment scholarship account holders.
(i) Contract for third party assessment.--The department
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shall contract with an independent third party for the purposes
of determining if a qualified student is eligible to receive
educational therapies or services under section 2602-L(c)(6)
(iii).
Section 2604-L. State control over nonpublic schools.
(a) General rule.--This article does not permit a State
agency to exercise control or supervision over a nonpublic
school or home school. A qualified school that accepts a payment
from a parent from an individual empowerment scholarship account
under this article is not an agent of the Federal or State
government.
(b) Prohibition.--A qualified school may not be required to
alter the qualified school's creed, practices, admissions policy
or curriculum in order to accept students whose parents pay
tuition or fees from an individual empowerment scholarship
account in order to participate as a qualified school.
(c) Applicability.--In any legal proceeding challenging the
application of this article to a qualified school, the
Commonwealth bears the burden of establishing that the law is
necessary and does not impose any undue burden on qualified
schools.
Section 2. This act shall take effect in 60 days.
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