Voucher School Accountability Act.

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
S 1
SENATE BILL 744

Short Title: Voucher School Accountability Act. (Public)
Sponsors: Senators Meyer and Chaudhuri (Primary Sponsors).
Referred to: Rules and Operations of the Senate
March 26, 2025
*S744-v-1*
A BILL TO BE ENTITLED 1
AN ACT TO INCREASE A CCOUNTABILITY AND RE PORTING STANDARDS FO R 2
NONPUBLIC SCHOOLS RECEIVING OPPORTUNITY SCHOLARSHIP FUNDS. 3
The General Assembly of North Carolina enacts: 4
SECTION 1.(a) G.S. 115C-12(39) reads as rewritten: 5
"(39) Power to Accredit Schools. – Upon the request of a local board of education, 6
request, the State Board of Education shall evaluate schools in local school 7
administrative units and nonpublic school receiving funds from scholarship 8
grants pursuant to Part 2A of Article 39 of this Chapter to determine whether 9
the education provided by those schools meets acceptable levels of quality. 10
The State Board shall adopt rigorous and appropriate academic standards for 11
accreditation after consideration of (i) the standard s of regional and national 12
accrediting agencies, (ii) the academic standards adopted in accordance with 13
subdivision (9c) of this section, and (iii) other information it deems 14
appropriate. For the nonpublic schools, as a minimum requirement of 15
accreditation, the State Board shall verify that a nonpublic school is 16
complying with subdivisions (3a), (10), and (11) of subsection (a) of 17
G.S. 115C-562.5. 18
The local school administrative unit or nonpublic school shall compensate 19
the State Board for the actual costs of the accreditation process." 20
SECTION 1.(b) G.S. 115C-562.2 read as rewritten: 21
"§ 115C-562.2. Scholarship grants. 22
… 23
(b2) Scholarship grants shall be awarded in monthly insta llments to eligible students as 24
follows: 25
… 26
(b5) In addition to the amount of the scholarship grant, for any student receiving a 27
scholarship grant in grades three, eight, or 11, three through 12, the Authority shall provide to 28
the nonpublic school an amount equal to the cost of the nationally standardized test required to 29
be administered as provided in G.S. 115C-562.5. 30
…." 31
SECTION 1.(c) G.S. 115C-562.5 reads as rewritten: 32
"§ 115C -562.5. Obligations of nonpublic schools accepting eligible students receiving 33
scholarship grants. 34
(a) A nonpublic school that accepts eligible stud ents receiving scholarship grants shall 35
comply with the following: 36
General Assembly Of North Carolina Session 2025
Page 2 Senate Bill 744-First Edition
(1) Provide Annually provide to the Authority and the Division of Nonpublic 1
education documentation for required tuition and fees charged to the student 2
by the nonpublic school. The Divisio n shall collect this information and 3
publish it on its website. 4
(1a) Limit increases to the costs of tuition and fees by no more than five percent 5
(5%) each school year. 6
(2) Provide to the Authority a criminal background check conducted for the staff 7
member with the highest decision-making authority, as defined by the bylaws, 8
articles of incorporation, or other governing document. For all other 9
employees, if the nonpublic school is located in a local school administrative 10
unit that has adopted a policy requiring criminal history checks under 11
G.S. 115C-332, then the nonpublic school shall adopt a policy mirroring the 12
local board of education policy. Each nonpublic school shall apply its policy 13
uniformly in requiring applicants for employment to be checked for a criminal 14
history before the applicant is given an unconditional job offer. A nonpublic 15
school may employ an applicant conditionally while the board is checking the 16
person's criminal history and making a decision based on the results of the 17
check. If the local school administrative unit adopts a policy providing for 18
periodic checks of criminal history of employees, then the nonpublic school 19
located in that local school administrative unit shall adopt a policy mirroring 20
that local board of education policy. A no npublic school shall indicate, upon 21
the inquiry by any other public school unit or nonpublic school in the State, 22
as to the reason for an employee 's resignation or dismissal, if an employee 's 23
criminal history was relevant to the employee 's resignation or dismissal. 24
Information provided to the Authority in accordance with this subdivision is 25
otherwise privileged information and is not a public record but is for the 26
exclusive use of the Authority. 27
(3) Provide to the parent or guardian of an eligible student, whose tuition and fees 28
are paid in whole or in part with a scholarship grant, an annual written 29
explanation of the student's progress, including the stude nt's scores on 30
standardized achievement tests. 31
(3a) Comply with the standard course of study in accordance with Part 1 of Article 32
8 of this Chapter and related rules adopted by the State Board of Education. 33
(4) Administer, at least once in each school year, tests as provided in this 34
subdivision. Administer each school year all tests required by the State Board 35
of Education pursuant to G.S. 115C-174.11(c) for students in grades three and 36
higher in a local school administrative unit. Test performance data for students 37
shall be submitted to the Authority by July 15 of each year. Test performance 38
data reported to the Authority or collected by the Authority under this 39
subdivision is not a public record under Chapter 13 2 of the General Statutes. 40
Tests shall be administered to all eligible students enrolled in grades three and 41
higher whose tuition and fees are paid in whole or in part with a scholarship 42
grant as follows:Statutes, to the extent the data contains personally identifiable 43
information. 44
a. The nationally standardized test designated by the Authority in grades 45
three and eight. 46
b. The ACT in grade 11. 47
c. A nationally standardized test or other nationally standardized 48
equivalent measurement selected by the chief administrative officer of 49
the nonpublic school in all other grades four and higher. For grades 50
four through seven, the nationally standardized test or other equivalent 51
General Assembly Of North Carolina Session 2025
Senate Bill 744-First Edition Page 3
measurement selected must measure achievement in the areas of 1
English grammar, reading, spelling, and mathematics. For grades nine, 2
10, and 12, the nationally standardized test or other equivalent 3
measurement selected must measure either (i) achievement in the areas 4
of English grammar, reading, spelling, and mathematics or (ii) 5
competencies in the verbal and quantitative areas. Nothing in this 6
subdivision shall prohibit a nonpublic school from administering 7
additional tests to its students. 8
(5) Provide to the Authority graduation rates of the students receiving scholarship 9
grants in a manner consistent with nationally recognized standards. 10
(6) Contract with a certified public accountant to perform a financial review, an 11
audit, consistent with generally accepted methods of accounting or any other 12
comprehensive basis of accounting recognized by the American Institute of 13
Certified Public Accountants (AICPA) for each school year in which the 14
school enrolls 70 or more students receiving scholarship grants or scholarship 15
funds awarded by the Authority. year. A nonpublic school shall report the 16
results of an audit to the Joint Legislative Education Oversight Committee by 17
December 31 of the year in which the audit is conducted. 18
(6a) If a school receives more than two hundred fifty thousand dollars ($250,000) 19
in grant funds under this Part, it shall publish its expenditures in the Uniform 20
Education Reporting System. 21
(7) Maintain a school facility within the State where in -person instruction is 22
provided. This subdivision does not prohibit a school from offering 23
remote-only courses of instruction in addition to in-person instruction. 24
(8) Provide the following information annually to the Division: 25
a. Name and address of the school, including physical location address. 26
A school with more than one physical location shall establish a 27
separate notice of intent for each physical location and shall provide 28
all information required by this subdivision for each physical location. 29
b. The name of the owners and chief administrator. 30
c. Number of students in attendance at the school as of October 1. 31
d. All attendance records of students receiving scholarship grants from 32
the previous school year to ensure compliance with compulsory 33
attendance in accordance with Part 1 of Article 26 of this Chapter. 34
(9) Maintain accreditation from the State Board of Education in accordance with 35
G.S. 115C-12(39). 36
(10) At least fifty percent (50%) of the teachers in the nonpublic school shall hold 37
teacher licenses. 38
(11) Provide instruction each school year for at least 185 days or 1,025 39
instructional hours during nine calendar months. 40
(12) Maintain an operating reserve of four months' worth of expenses. 41
(13) Maintain a student population that reasonably reflects the racial and et hnic 42
composition of the general population residing within the local school 43
administrative unit in which the nonpublic school is located or the racial and 44
ethnic composition of the special population that the nonpublic school seeks 45
to serve residing within the local school administrative unit in which the 46
nonpublic school is located. The nonpublic school shall be subject to any 47
court-ordered desegregation plan in effect for the local school administrative 48
unit. The State Board of Education may notify the Au thority of a nonpublic 49
school is in violation of this subdivision. 50
General Assembly Of North Carolina Session 2025
Page 4 Senate Bill 744-First Edition
(14) Report to the Division of Nonpublic Education by September 1 of each year 1
the identity of the highest paid employee in the nonpublic school. 2
(15) During each period of enrollment, the nonpublic shall enroll an eligible 3
student who submits a timely application, unless the number of applications 4
exceeds the capacity of a program, class, grade level, or building. In this case, 5
students shall be accepted by lot. Once enrolled, students are not required to 6
reapply in subsequent enrollment periods. 7
(16) Comply with all applicable State laws related to the expulsion of students in 8
local school administrative units, including G.S. 115C-390.11. 9
(17) Report to the Authority on any exp ulsions from the nonpublic school, 10
including the reason for the expulsion and the identity of the expelled student. 11
This information is not a public record under Chapter 132 of the General 12
Statutes. 13
(b) A nonpublic school that accepts students receiving scholarship grants shall not require 14
any additional fees based on the status of the student as a scholarship grant recipient. 15
(c) A nonpublic school enrolling more than 25 students in any grade whose tuition and 16
fees are paid in whole or in part with a scholarship grant shall provide and retain information on 17
student test performance in each grade with more than 25 students, as follows: 18
(1) Report to the Authority on the aggregate standardized test performance of 19
eligible students in grades three, eight, and 11. three and higher pursuant to 20
subdivision (4) of subsection (a) of this section. Aggregate test performance 21
data reported to the Authority which does not contain personally identifiable 22
student data shall be a public record under Chapter 132 of the General 23
Statutes.Statutes, and the Authority shall post this data on its website. Test 24
performance data may be shared with public or private institutions of higher 25
education located in North Carolina and shall be provided to an independent 26
research organization selected by the Authority for research purposes as 27
permitted by the Federal Education Rights and Privacy Act, 20 U.S.C. § 28
1232g. 29
(2) Retain standardized test performance data for eligible students in all other 30
grades and annually certify to the Authority compliance with the requirements 31
of subdivision (4) of subsection (a) of this section. 32
(c1) A nonpublic school shall not discriminate with respect to the categories listed in 42 33
U.S.C. § 2000d, as that statute read on January 1, 2014.the race, color, national origin, sex, sexual 34
orientation, disability, or religion of any student or their family members. 35
(d) If the Authority or the State Board of Education determines that a nonpublic school 36
is not in compliance with the requirements of this section, the nonpublic school shall be ineligible 37
to receive future scholarship funds. The nonpublic school shall notify the parent or guardian of 38
any enrolled student receiving a scholarship grant that the nonpublic school is no longer eligible 39
to receive future scholarship grants. T he Authority shall establish by rule a process for a 40
nonpublic school to appeal for reconsideration of eligibility after one year. To ensure compliance, 41
the Board of Directors of the Authority shall review the criminal history provided under 42
subdivision (2) of subsection (a) of this section to ensure that the person has not been convicted 43
of any crime listed in G.S. 115C-332. The Board shall determine through this review whether the 44
nonpublic school is noncompliant with this section. The Board shall make written findings with 45
regard to how the criminal history information was used when making the compliance 46
determination. The Board of Directors may delegate any of the duties in this subsection to the 47
Executive Director of the Authority. As part of its review, the Board shall determine whether the 48
results indicate that the staff member has any of the following disqualifying characteristics: 49
(1) Poses a threat to the physical safety of students or personnel. 50
General Assembly Of North Carolina Session 2025
Senate Bill 744-First Edition Page 5
(2) Demonstrates that he or she does not have the integrity or honesty to fulfill his 1
or her duties in overseeing State funds and the requirements of the scholarship 2
grant program. 3
(3) Has not fully satisfied the criminal sentencing obligations imposed following 4
his or her conviction by a court of competent jurisdiction. 5
…." 6
SECTION 1.(d) G.S. 115C-562.7 reads as rewritten: 7
"§ 115C-562.7. Reporting requirements. 8
… 9
(b) The Authority shall report annually, no later than October 15, to the Joint Legislative 10
Education Oversight Committee on the following information from the prior school year: 11
(1) Total number, grade level, race, ethnicity, and sex of eligible students 12
receiving scholarship grants. 13
(2) Total amount of scholarship grant funding awarded. 14
(3) Repealed by Session Laws 2023-134, s. 8A.6(f), effective July 1, 2023. 15
(4) Nonpublic schools in which scholarship grant recipients are enrolled, 16
including numbers of scholarship grant students at each nonpublic school. 17
(5) Nonpublic schools deemed ineligible to receive scholarships. 18
(6) The percentage of scholarship grant fund recipients who have never attended 19
a public school in North Carolina. 20
(7) Trends in exp ulsions from nonpublic schools, including any trends at a 21
nonpublic school that might reflect a pattern of bias across race, religion, 22
sexual orientation, or class. 23
(c) The Authority shall report annually, no later than December 1, to the Department of 24
Public Instruction and the Joint Legislative Education Oversight Committee on the following: 25
(1) Learning gains or losses of students receiving scholarsh ip grants. The report 26
shall include learning gains or losses of participating students on a statewide 27
basis and shall compare, to the extent possible, (i) the learning gains or losses 28
of eligible students by nonpublic school to the statewide learning gains or 29
losses of public school students with similar socioeconomic backgrounds, 30
using aggregate standardized test performance data provided to the Authority 31
by nonpublic schools and by the Department of Public Instruction.Instruction 32
and (ii) over the past fi ve years, the performance of students receiving grant 33
funds who were previously enrolled in public schoo l and the performance of 34
students who applied for grant funds, but ultimately remained in public school. 35
The report shall, at a minimum, analyze the aggregate performance of students 36
receiving scholarship grants in grades three, eight, and 11 on the designated 37
nationally standardized test in comparison to national outcomes for that test. 38
(2) Competitive effe cts on public school performance as a result of the 39
scholarship grant program. The report shall analyze the impact of the 40
availability of scholarship grants on public school performance by local 41
school administrative units to the extent possible, and shall provide 42
comparisons of the impact by geographic region and between rural and urban 43
local school administrative units. 44
This report shall be conducted by an independent research organization to be selected by the 45
Authority, which may be a public or private entity or university. The independent research 46
organization shall report to the Authority on the results of its research. The Joint Legislative 47
Education Oversight Committee shall review reports from the Authority and shall make ongoing 48
recommendations to the General Assembly as needed regarding improving administration and 49
accountability for nonpublic schools accepting students receiving scholarship grants. 50
… 51
General Assembly Of North Carolina Session 2025
Page 6 Senate Bill 744-First Edition
(f) The Department of Public Instruction shall report no later than April 1 of each year 1
to the Jo int Legislative Education Oversight Committee on the cumulative difference in the 2
current school year between the scholarship grant award amount for each prior public school 3
attendee enrolled in a nonpublic school and the average State per pupil allocation for average 4
daily membership for a student in a public school unit. For purposes of this subsection, a "prior 5
public school attendee" is any scholarship grant recipient who was in membership in a public 6
school unit for a majority of the first or second mo nth of the school year immediately prior to 7
enrollment in a nonpublic school, beginning with students enrolled in a public school unit the 8
2023-2024 school year or subsequent school years. 9
(g) The Division of Nonpublic Education shall report to the Joint L egislative Education 10
Oversight Committee no later than October 1 of each year on all political donations from the 11
highest paid official and the official's spouse, if applicable." 12
SECTION 1.(e) G.S. 115C-562.8 reads as rewritten: 13
"§ 115C-562.8. The Opportunity Scholarship Grant Fund Reserve. 14
… 15
(b) The General Assembly finds that, due to the critical need in this State to provide 16
opportunity for school choice for North Carolina students, it is imperative that the State provide 17
an increase of funds for 15 years to the Opportunity Scholarship Grant Fund Reserve. Therefore, 18
there is appropriated from the General Fund to the Reserve the following amounts for each fiscal 19
year to be used for the purposes set forth in this section: 20
Fiscal Year Appropriation 21
2017-2018 $44,840,000 22
2018-2019 $54,840,000 23
2019-2020 $64,840,000 24
2020-2021 $74,840,000 25
2021-2022 $84,840,000 26
2022-2023 $94,840,000 27
2023-2024 $176,540,000 28
2024-2025 $191,540,000 29
2025-2026 $625,000,000 30
2026-2027 $675,000,000 31
2027-2028 $700,000,000 32
2028-2029 $725,000,000 33
2029-2030 $750,000,000 34
2030-2031 $775,000,000 35
2031-2032 $800,000,000 36
For the 2032-20332027-2028 fiscal year and each fiscal year thereafter, there is appropriated 37
from the General Fund to the Reserve the sum of eight hundred twenty -five million dollars 38
($825,000,000)five hundred forty -one million five hundred forty thousand dollars 39
($541,540,000) to be used for the purposes set forth in this section. When developing the base 40
budget, as defined by G.S. 143C-1-1, for each fiscal year specified in this subsection, the Director 41
of the Budget shall include the appropriated amount specified in this subsection for that fiscal 42
year. 43
… 44
(d) Any unexpended funds at the end of a fiscal year from the funds appropriated in a 45
particular fiscal year to be used for the award of scholarships in the following fiscal year shall be 46
used as follows: 47
(1) Up to one million dollars ($1,000,000) may be used by the Authority to contract with 48
one or more nonprofit corporations representing parents and families for out reach and 49
scholarship education and application assistance for parents and students pursuant to Part 4A of 50
this Article. 51
General Assembly Of North Carolina Session 2025
Senate Bill 744-First Edition Page 7
(2) Any remaining funds shall be carried forward for one fiscal year pursuant to 1
subsection (a) of this section. 2
…." 3
SECTION 2. Notwithstanding any other provision of law to the contrary, funds 4
appropriated for the award of opportunity scholarship grants pursuant to Part 2A of Article 39 of 5
Chapter 115C of the General Statutes are reduced as follows: 6
(1) Of the recurring funds appropria ted to the Board of Governors of The 7
University of North Carolina for the opportunity scholarship program 8
pursuant to S.L. 2021-180, by the sum of thirty million dollars ($30,000,000) 9
for the 2025-2026 fiscal year. 10
(2) Of the funds appropriated to the Opportunity Scholarship Grant Fund Reserve 11
for the 2024-2025 fiscal year and allocated from the Reserve for the award of 12
scholarship grants in the 2025 -2026 fiscal year, by the sum of twenty -eight 13
million four hundred sixty thousand dollars ($28,460,000) in n onrecurring 14
funds for the 2025-2026 fiscal year. 15
(3) Of the funds appropriated to the Opportunity Scholarship Grant Fund Reserve, 16
as follows: 17
a. By the sum of eighty-three million four hundred sixty thousand dollars 18
($83,460,000) in recurring funds for the 2025-2026 fiscal year. 19
b. By the sum of an additional fifty million dollars ($50,000,000) in 20
recurring funds for the 2026-2027 fiscal year. 21
SECTION 3. This act becomes effective July 1, 2025, and applies beginning with 22
the 2025-2026 school year. 23