Rep. Norm Thurston — Voting Record

Bill

Number

H.B. 398 Second Substitute (2023GS)

Sponsor

Rep. Abbott, N.

Final action

Governor Signed 3/14/2023

Outcome

Became law — signed by Gov. Spencer J. Cox

Summary

What it does

• This bill:
• modifies defined terms;
• expands the expenses for which a scholarship recipient may use a scholarship award;
• amends the formula for calculating a scholarship amount for an eligible student;
• allows a scholarship granting organization to prorate a scholarship award under certain circumstances;
• increases the amount of donations a scholarship granting organization may carry forward in a fiscal year; and
• makes technical changes.

Every vote on this bill

Bill text

SPECIAL NEEDS OPPORTUNITY SCHOLARSHIP PROGRAM
AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Nelson T. Abbott
Senate Sponsor: 
 Lincoln Fillmore
LONG TITLE
General Description:
This bill amends provisions related to the Special Needs Opportunity Scholarship
Program.
Highlighted Provisions:
This bill:
▸ modifies defined terms;
▸ expands the expenses for which a scholarship recipient may use a scholarship
award;
▸ amends the formula for calculating a scholarship amount for an eligible student;
▸ allows a scholarship granting organization to prorate a scholarship award under
certain circumstances;
▸ increases the amount of donations a scholarship granting organization may carry
forward in a fiscal year; and
▸ makes technical changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
53E-7-401
, as last amended by Laws of Utah 2022, Chapter 262
53E-7-402
, as last amended by Laws of Utah 2022, Chapter 262
53E-7-405
, as last amended by Laws of Utah 2022, Chapters 262, 456
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
53E-7-401
 is amended to read:
53E-7-401.
Definitions.
As used in this part:
(1) "Eligible student" means:
(a) a student who:
(i) is eligible to participate in public school, in kindergarten or grades 1 through 12;
(ii) is a resident of the state;
(iii) (A) has an IEP; or
(B) is determined by a multidisciplinary evaluation team to be eligible for services
under 20 U.S.C. Sec. 1401(3); and
(iv) during the school year for which the student is applying for the scholarship, is not:
(A) a student who receives a scholarship under the Carson Smith Scholarship Program
created in Section 
53F-4-302
; or
(B) 
enrolled as
 a public school student; or
(b) a student who:
(i) meets the requirement of Subsections (1)(a)(i) and (ii); and
(ii) is a sibling of and resides in the same household as a student described in
Subsection (1)(a) if:
(A) the student described in Subsection (1)(a) is a scholarship student and has verified
enrollment or intent to enroll at a qualifying school; and
(B) the sibling is applying for a scholarship to attend the same qualifying school.
(2) (a) "Employee" means an individual working in a position in which the individual's
salary, wages, pay, or compensation, including as a contractor, is paid from:
(i) program donations to a scholarship granting organization; or
(ii) scholarship money allocated to a qualifying school by a scholarship granting
organization under Section 
53E-7-405
.
(b) "Employee" does not include an individual who volunteers at the scholarship
granting organization or qualifying school.
(3) "Family income" means the annual income of the parent, parents, legal guardian, or
legal guardians with whom a scholarship student lives.
(4) "Federal poverty level" means the poverty level as defined by the most recently
revised poverty income guidelines published by the United States Department of Health and
Human Services in the Federal Register.
(5) "Multidisciplinary evaluation team" means two or more individuals:
(a) who are qualified in two or more separate disciplines or professions; and
(b) who evaluate a child.
(6) "Officer" means:
(a) a member of the board of a scholarship granting organization or qualifying school;
or
(b) the chief administrative officer of a scholarship granting organization or qualifying
school.
(7) "Program donation" means a donation to the program under Section 
53E-7-405
.
(8) "Qualifying school" means a private school that:
(a) provides kindergarten, elementary, or secondary education;
(b) is approved by the state board under Section 
53E-7-408
; and
(c) meets the requirements described in Section 
53E-7-403
.
(9) "Relative" means a father, mother, husband, wife, son, daughter, sister, brother,
uncle, aunt, nephew, niece, first cousin, mother-in-law, father-in-law, brother-in-law,
sister-in-law, son-in-law, or daughter-in-law.
(10) "Scholarship" means a grant awarded to an eligible student:
(a) by a scholarship granting organization out of program donations; and
(b) for the purpose of paying for a scholarship expense.
[
(11) "Scholarship expense" means:
]
[
(a) tuition, fees, or textbooks for a qualifying school;
]
[
(b) educational therapy, if the educational therapy is provided by a licensed physician
or licensed practitioner, including occupational, behavioral, physical, or speech-language
therapies;
]
[
(c) textbooks, curriculum, or other instructional materials, including supplemental
materials or associated online instruction required by a curriculum;
]
[
(d) tuition and fees for an online learning course or program; or
]
[
(e) fees associated with a state-recognized industry certification examination or any
examination related to college or university admission.
]
(11) "Scholarship expense" means an expense that a parent or eligible student incurs in
the education of the eligible student for goods or a service that a qualifying school provides or
facilitates, including:
(a) tuition and fees of a qualifying school;
(b) fees and instructional materials at a technical college;
(c) tutoring services;
(d) fees for after-school or summer education programs;
(e) textbooks, curricula, or other instructional materials, including any supplemental
materials or associated online instruction that a curriculum or a qualifying school recommends;
(f) educational software and applications;
(g) supplies or other equipment related to an eligible student's educational needs;
(h) computer hardware or other technological devices that are intended primarily for an
eligible student's educational needs;
(i) fees for the following examinations, or for a preparation course for the following
examinations, that the scholarship granting organization approves:
(i) a national norm-referenced or standardized assessment described in Section
53F-6-410
, an advanced placement examination, or another similar assessment;
(ii) a state-recognized industry certification examination; and
(iii) an examination related to college or university admission;
(j) educational services for students with disabilities from a licensed or accredited
practitioner or provider, including occupational, behavioral, physical, audiology, or
speech-language therapies;
(k) contracted services that the scholarship granting organization approves and that an
LEA provides, including individual classes, after-school tutoring services, transportation, or
fees or costs associated with participation in extracurricular activities;
(l) ride fees or fares for a fee-for-service transportation provider to transport the
scholarship student to and from a qualifying school, not to exceed $750 in a given school year;
(m) expenses related to extra curricular activities, field trips, educational supplements,
and other educational experiences; or
(n) the scholarship granting organization approves in accordance with Subsection
53E-7-405
(3).
(12) "Scholarship granting organization" means an organization that is:
(a) qualified as tax exempt under Section 501(c)(3), Internal Revenue Code; and
(b) recognized through an agreement with the state board as a scholarship granting
organization, as described in Section 
53E-7-404
.
(13) "Scholarship student" means an eligible student who receives a scholarship under
this part.
(14) "Special Needs Opportunity Scholarship Program" or "program" means the
program established in Section 
53E-7-402
.
(15) "Value of the weighted pupil unit" means the amount established each year in the
enacted public education budget that is multiplied by the number of weighted pupil units to
yield the funding level for the basic state-supported school program.
Section 2. Section 
53E-7-402
 is amended to read:
53E-7-402.
Special Needs Opportunity Scholarship Program.
(1) There is established the Special Needs Opportunity Scholarship Program under
which a parent may apply to a scholarship granting organization on behalf of the parent's
student for a scholarship to help cover the cost of a scholarship expense.
(2) (a) A scholarship granting organization shall[
: (i)
] award, in accordance with this
part, scholarships to eligible students[
; and
]
.
[
(ii) determine the amount of a scholarship in accordance with Subsection (3).
]
(b) In awarding scholarships, a scholarship granting organization shall give priority to
an eligible student described in Subsection 
53E-7-401
(1)(a) by:
(i) establishing an August 10 deadline for an eligible student described in Subsection
53E-7-401
(1)(b) to apply for a scholarship; and
(ii) awarding a scholarship to an eligible student described in Subsection
53E-7-401
(1)(b) only if funds exist after awarding scholarships to all eligible students
described in Subsection 
53E-7-401
(1)(a) who have applied and qualify.
(c) Subject to available funds, a scholarship awarded to an eligible student described in
Subsection 
53E-7-401
(1)(b) shall be for a similar term as a scholarship awarded to the eligible
student's sibling.
[
(3) A scholarship granting organization shall determine a full-year scholarship award
to pay for the cost of one or more scholarship expenses in an amount not more than:
]
[
(a) for an eligible student described in Subsection 
53E-7-401
(1)(a) who is:
]
[
(i) in grades 1 through 12 with an IEP and whose family income is:
]
[
(A) at or below 185% of the federal poverty level, the value of the weighted pupil unit
multiplied by 2.5;
]
[
(B) between 185% and 555% of the federal poverty level, the value of the weighted
pupil unit multiplied by two; or
]
[
(C) above 555% of the federal poverty level, the value of the weighted pupil unit
multiplied by 1.5;
]
[
(ii) in grades 1 through 12 and who does not have an IEP, the value of the weighted
pupil unit;
]
[
(iii) in kindergarten with an IEP, the value of the weighted pupil unit; or
]
[
(iv) in kindergarten and who does not have an IEP, half the value of the weighted
pupil unit; or
]
[
(b) for an eligible student described in Subsection 
53E-7-401
(1)(b), half the value of
the weighted pupil unit.
]
(3) (a) Beginning with the 2022-23 school year, no later than July 31 after each school
year, the state auditor shall publish the average LEA spending for a student who has an IEP or
is determined by a multidisciplinary evaluation team to be eligible for services under 20 U.S.C.
Sec. 1401(3).
(b) The state auditor shall calculate the average spending described in Subsection (3)(a)
by averaging the direct and indirect costs of educational and student support services provided
to a student who has an IEP or is determined by a multidisciplinary evaluation team to be
eligible for services under 20 U.S.C. Sec. 1401(3).
(4) Beginning with the 2023-24 school year, a scholarship granting organization:
(a) shall grant each full-year scholarship award in an amount equal to the amount
calculated under Subsection (3); and
(b) may prorate the amount of a scholarship award for a student who becomes an
eligible student during the school year.
[
(4)
] 
(5)
 Eligibility for a scholarship as determined by a multidisciplinary evaluation
team under this program does not establish eligibility for an IEP under the Individuals with
Disabilities Education Act, Subchapter II, 20 U.S.C. Secs. 1400 to 1419, and is not binding on
any LEA that is required to provide an IEP under the Individuals with Disabilities Education
Act.
[
(5)
] 
(6)
 The scholarship granting organizations shall prepare and disseminate
information on the program to a parent applying for a scholarship on behalf of a student.
Section 3. Section 
53E-7-405
 is amended to read:
53E-7-405.
Program donations -- Scholarship granting organization
requirements.
(1) A person that makes a donation to a scholarship granting organization to help fund
scholarships through the program may be eligible to receive a nonrefundable tax credit as
described in Sections 
59-7-625
 and 
59-10-1041
.
(2) In accordance with Section 
53E-7-404
, an organization may enter into an
agreement with the state board to be a scholarship granting organization.
(3) A scholarship granting organization shall:
(a) accept program donations and allow a person that makes a program donation to
designate a qualifying school to which the donation shall be directed for scholarships;
(b) adopt an application process in accordance with Subsection (5);
(c) review scholarship applications and determine scholarship awards;
(d) allocate scholarship money to a scholarship student's parent or, on the parent's
behalf, to a qualifying school in which the scholarship student is enrolled;
(e) adopt a process, with state board approval, that allows a parent to use a scholarship
to pay for a nontuition scholarship expense for the scholarship student;
(f) ensure that during the state fiscal year:
(i) at least 92% of the scholarship granting organization's revenue from program
donations is spent on scholarships;
(ii) up to 5% of the scholarship granting organization's revenue from program
donations is spent on administration of the program;
(iii) up to 3% of the scholarship granting organization's revenue from program
donations is spent on marketing and fundraising costs; and
(iv) all revenue from program donations' interest or investments is spent on
scholarships;
(g) carry forward no more than [
] 
% of the scholarship granting organization's
program donations
, less funds for a scholarship that has been awarded, and funds expended for
administration and marketing,
 from the state fiscal year in which the scholarship granting
organization received the program donations to the following state fiscal year;
(h) at the end of a state fiscal year, remit to the state treasurer donation amounts greater
than the amount described in Subsection (3)(g);
(i) prohibit a scholarship granting organization employee or officer from handling,
managing, or processing program donations, if, based on a criminal background check
conducted by the state board in accordance with Section 
53E-7-404
, the state board identifies
the employee or officer as posing a risk to the appropriate use of program donations;
(j) ensure that a scholarship can be transferred during the school year to a different
qualifying school that accepts the scholarship student;
(k) report to the state board on or before October 1 of each year the following
information, prepared by a certified public accountant:
(i) the name and address of the scholarship granting organization;
(ii) the total number and total dollar amount of program donations that the scholarship
granting organization received during the previous calendar year;
(iii) (A) the total number and total dollar amount of scholarships the scholarship
granting organization awarded during the previous state fiscal year to eligible students
described in Subsection 
53E-7-401
(1)(a); and
(B) the total number and total dollar amount of scholarships the scholarship granting
organization awarded during the previous state fiscal year to eligible students described in
Subsection 
53E-7-401
(1)(b); and
(iv) the percentage of first-time scholarship recipients who were enrolled in a public
school during the previous school year or who entered kindergarten or a higher grade for the
first time in Utah;
(l) issue tax credit certificates as described in Section 
53E-7-407
; and
(m) require a parent to notify a scholarship granting organization if the parent's
scholarship recipient:
(i) receives scholarship money for tuition expenses; and
(ii) does not have continuing enrollment and attendance at a qualifying school.
(4) The state treasurer shall deposit the money described in Subsection (3)(h) into the
Income Tax Fund.
(5) (a) An application for a scholarship shall contain an acknowledgment by the
applicant's parent that the qualifying school selected by the parent for the applicant to attend
using a scholarship is capable of providing the level of disability services required for the
student.
(b) A scholarship application form shall contain the following statement:
"I acknowledge that:
(1) A private school may not provide the same level of disability services that are
provided in a public school;
(2) I will assume full financial responsibility for the education of my scholarship
recipient if I accept this scholarship;
(3) Acceptance of this scholarship has the same effect as a parental refusal to consent
to services as described in 24 C.F.R. Sec. 300.300, issued under the Individuals with
Disabilities Education Act, 20 U.S.C. Sec. 1400 et seq.; and
(4) My child may return to a public school at any time."
(c) Upon acceptance of a scholarship, the parent assumes full financial responsibility
for the education of the scholarship recipient.
(d) Acceptance of a scholarship has the same effect as a parental refusal to consent to
services as described in 24 C.F.R. Sec. 300.300, issued under the Individuals with Disabilities
Education Act, 20 U.S.C. Sec. 1400 et seq.
(e) The creation of the program or granting of a scholarship does not:
(i) imply that a public school did not provide a free and appropriate public education
for a student; or
(ii) constitute a waiver or admission by the state.
(6) A scholarship granting organization shall demonstrate the scholarship granting
organization's financial accountability by annually submitting to the state board a financial
information report that:
(a) complies with the uniform financial accounting standards described in Section
53E-7-404
; and
(b) is prepared by a certified public accountant.
(7) (a) If a scholarship granting organization allocates $500,000 or more in
scholarships annually through the program, the scholarship granting organization shall:
(i) contract for an annual audit, conducted by a certified public accountant who is
independent from:
(A) the scholarship granting organization; and
(B) the scholarship granting organization's accounts and records pertaining to program
donations; and
(ii) in accordance with Subsection (7)(b), report the results of the audit to the state
board for review.
(b) For the report described in Subsection (7)(a)(ii), the scholarship granting
organization shall:
(i) include the scholarship granting organization's financial statements in a format that
meets generally accepted accounting standards; and
(ii) submit the report to the state board no later than 180 days after the last day of a
scholarship granting organization's fiscal year.
(c) The certified public accountant shall conduct an audit described in Subsection
(7)(a)(i) in accordance with generally accepted auditing standards and rules made by the state
board.
(d) (i) The state board shall review a report submitted under this section and may
request that the scholarship granting organization revise or supplement the report if the report
is not in compliance with the provisions of this Subsection (7) or rules adopted by the state
board.
(ii) A scholarship granting organization shall provide a revised report or supplement to
the report no later than 45 days after the day on which the state board makes a request
described in Subsection (7)(d)(i).
(8) (a) A scholarship granting organization may not allocate scholarship money to a
qualifying school if:
(i) the scholarship granting organization determines that the qualifying school
intentionally or substantially misrepresented information on overpayment;
(ii) the qualifying school fails to refund an overpayment in a timely manner; or
(iii) the qualifying school routinely fails to provide scholarship recipients with
promised educational goods or services.
(b) A scholarship granting organization shall notify a scholarship recipient if the
scholarship granting organization stops allocation of the recipient's scholarship money to a
qualifying school under Subsection (8)(a).
(9) If a scholarship recipient transfers to another qualifying school during the school
year, the scholarship granting organization may prorate scholarship money between the
qualifying schools according to the time the scholarship recipient spends at each school.
(10) A scholarship granting organization may not:
(a) award a scholarship to a relative of the scholarship granting organization's officer or
employee; or
(b) allocate scholarship money to a qualifying school at which the scholarship recipient
has a relative who is an officer or an employee of the qualifying school.