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HB1489 • 2025

An Act amending the act of March 10, 1949 (P.L.30, No.14), known as the Public School Code of 1949, establishing the Lifeline Scholarship Program and the Lifeline Scholarship Fund; and conferring powers and imposing duties on the State Treasury and Auditor General.

An Act amending the act of March 10, 1949 (P.L.30, No.14), known as the Public School Code of 1949, establishing the Lifeline Scholarship Program and the Lifeline Scholarship Fund; and conferring powers and imposing duties on the State Treasury and Auditor General.

Education
Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor
OWLETT
Last action
2025-05-21
Official status
Referred to EDUCATION, May 21, 2025
Effective date
Not listed

Plain English Breakdown

Using official source text because the generated explanation was unavailable or could not be confirmed against the official bill text.

An Act amending the act of March 10, 1949 (P.L.30, No.14), known as the Public School Code of 1949, establishing the Lifeline Scholarship Program and the Lifeline Scholarship Fund; and conferring powers and imposing duties on the State Treasury and Auditor General.

An Act amending the act of March 10, 1949 (P.L.30, No.14), known as the Public School Code of 1949, establishing the Lifeline Scholarship Program and the Lifeline Scholarship Fund; and conferring powers and imposing duties on the State Treasury and Auditor General.

What This Bill Does

  • An Act amending the act of March 10, 1949 (P.L.30, No.14), known as the Public School Code of 1949, establishing the Lifeline Scholarship Program and the Lifeline Scholarship Fund; and conferring powers and imposing duties on the State Treasury and Auditor General.

Limits and Unknowns

  • This entry is temporarily using official source text because the generated explanation could not be confirmed against the official bill text during the last sync.

Bill History

  1. 2025-05-21 EDUCATION

    Referred to EDUCATION, May 21, 2025

Official Summary Text

An Act amending the act of March 10, 1949 (P.L.30, No.14), known as the Public School Code of 1949, establishing the Lifeline Scholarship Program and the Lifeline Scholarship Fund; and conferring powers and imposing duties on the State Treasury and Auditor General.

Current Bill Text

Read the full stored bill text
PRINTER'S NO. 1743
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 1489
Session of
2025
INTRODUCED BY OWLETT, WHITE, HAMM, GREINER, STAATS, OLSOMMER,
MENTZER, PICKETT, STENDER, PUGH, KAUFFMAN, CUTLER, GAYDOS,
ANDERSON, BERNSTINE, BARGER, M. MACKENZIE, ZIMMERMAN, ROWE,
COOPER, KOZAK, SCIALABBA, SMITH AND WALSH, MAY 19, 2025
REFERRED TO COMMITTEE ON EDUCATION, MAY 21, 2025
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," establishing the Lifeline Scholarship
Program and the Lifeline Scholarship Fund; and conferring
powers and imposing duties on the State Treasury and Auditor
General.
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 XVII-E
LIFELINE SCHOLARSHIP PROGRAM
Section 1701-E. Scope of article.
This article relates to the Lifeline Scholarship Program.
Section 1702-E. Definitions.
The following words and phrases when used in this article
shall have the meanings given to them in this section unless the
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context clearly indicates otherwise:
"Applicant." A parent who applies for participation in the
program under section 1704-E on behalf of an eligible student.
"Attendance boundary." As defined in section 2002-B.
"Department." The Department of Education of the
Commonwealth.
"Eligible student." A school-age child who:
(1) Is a resident of this Commonwealth.
(2) Has not received a high school diploma.
(3) Satisfies at least one of the following:
(i) Resides, as determined under section 1302,
within the attendance boundary of a low-achieving school
or resided, as determined under section 1302, within the
attendance boundary of a low-achieving school at the time
the State Treasury received written confirmation that the
child accepted an offer of enrollment under section 1704-
E.
(ii) Lives in a household with a household income
below 350% of the Federal poverty guidelines or lived in
a household with a household income below 350% of the
Federal poverty guidelines at the time the State Treasury
received written confirmation that the child accepted an
offer of enrollment under section 1704-E.
(4) Satisfies one of the following:
(i) Attended a public school in this Commonwealth in
the preceding school year.
(ii) Received a scholarship from the program in the
preceding school year.
(iii) Will attend kindergarten for the first time in
the next school year.
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"Fund." The Lifeline Scholarship Fund established in section
1708-E.
"Kindergarten." A one-year formal educational program,
whether part time or full time, that occurs during the school
year immediately prior to first grade.
"Lifeline scholarship account." A spending account
established and administered by the State Treasury and directed
by a parent for a scholarship recipient that may be used for
tuition, school-related fees and special education services fees
to attend a participating nonpublic school.
"Low-achieving school." As defined in section 2002-B.
"Nonpublic school." A nonprofit school, other than a public
school, located in this Commonwealth where a resident of this
Commonwealth may legally fulfill the compulsory attendance
requirements of this act.
"Parent." An individual who is a resident of this
Commonwealth and:
(1) has legal custody or guardianship of an eligible
student; or
(2) keeps in the individual's home an eligible student
and supports the student gratis as if the student were a
lineal descendant of the individual.
"Participating nonpublic school." A nonpublic school
offering a program of instruction for kindergarten through grade
twelve, or a combination of grades, that:
(1) notifies the State Treasury of the nonpublic
school's desire to participate in the program; and
(2) provides certification to the State Treasury that
the nonpublic school meets the criteria under section 1711-
E(a).
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"Program." The Lifeline Scholarship Program established
under section 1703-E(a).
"Public school." A school operated by a school district, an
intermediate unit, area career and technical school, charter
school, regional charter school or cyber charter school.
"Resident school district." The school district in which an
eligible student resides.
"Scholarship." A scholarship that is awarded to an eligible
student under the program.
"Scholarship recipient." An eligible student who is awarded
a scholarship under the program.
"School-age child." A child enrolling in kindergarten or in
grades one through twelve.
"School-related fee." A fee charged by a participating
nonpublic school to:
(1) all students for books, instructional materials,
technology equipment and services, uniforms, activities and
concurrent enrollment programs; or
(2) scholarship recipients for additional education-
related resources, supplemental instruction or interventions
to help scholarship recipients achieve grade-level
expectations.
"School year." A school term as defined in section 102.
"Special education services fee." A fee charged by a
participating nonpublic school for special education services
for a student with special needs as agreed to by the parent and
the participating nonpublic school.
"State Treasury." The Treasury Department of the
Commonwealth.
"Student with special needs." A child who is subject to an
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individualized education program under 20 U.S.C. Ch. 33
(relating to education of individuals with disabilities) and 22
Pa. Code Ch. 14 (relating to special education services and
programs).
Section 1703-E. Lifeline Scholarship Program.
(a) Establishment.--Beginning with the 2026-2027 school
year, the Lifeline Scholarship Program is established as a
program in the State Treasury to provide scholarships to help
eligible students pay tuition, school-related fees and special
education services fees for attendance at a participating
nonpublic school.
(b) Notice to parents.--
(1) Within 15 days of receipt of a notice under section
2010-B, a school district with a school designated as a low-
achieving school shall notify the parent of a student who is
attending or residing within the attendance boundary of the
low-achieving school during the school year of the school's
designation.
(2) The notice shall be in a form provided by the State
Treasury, in consultation with the department, and shall
provide the following information regarding the program:
(i) A description of the program.
(ii) Instructions for obtaining information about
applying for a scholarship under the program.
(iii) A list of any school in the school district
that has been designated as a low-achieving school.
(iv) Notice of the parent's responsibilities
regarding application to a participating nonpublic school
if the parent seeks to enroll an eligible student in a
participating nonpublic school.
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(3) The notice shall be posted on the school district's
publicly accessible Internet website.
(c) Notice to State Treasury.--A school district required to
submit a notice to parents under subsection (b) shall provide
the State Treasury with a list of students whose parents were
provided the notice. The notification shall be made in a manner
and form established by the State Treasury.
Section 1704-E. Application.
(a) Application form.--No later than two weeks after the
effective date of this section, the State Treasury shall develop
an application form that can be accessed from and submitted
electronically on the State Treasury's publicly accessible
Internet website.
(b) Application and approval process.--
(1) No later than April 1, 2026, and each April 1
thereafter, an applicant may apply to the State Treasury for
a scholarship for the following school year according to
guidelines developed by the State Treasury under section
1709-E. An application shall be approved by the State
Treasury if the student meets the eligibility requirements of
this article.
(2) A renewal application shall be approved by the State
Treasury if the student meets the eligibility requirements of
this article, notwithstanding the residence or income
criteria specified in paragraph (3) of the definition of
"eligible student" in section 1702-E.
(3) A parent may appeal the State Treasury's decision
regarding nonapproval of an application. The appeal shall be
governed by 2 Pa.C.S. Chs. 1 (relating to general
provisions), 5 (relating to practice and procedure) and 7
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(relating to judicial review).
(4) No later than May 1, 2026, and each May 1
thereafter, the State Treasury shall notify the applicant
whether a scholarship will be awarded for the following
school year.
(5) For the 2026-2027 school year, scholarships shall be
awarded on a first-come, first-served basis considering money
available in the fund.
(6) For the 2027-2028 school year, and each school year
thereafter, the State Treasury shall give priority for
scholarships to prior year scholarship recipients, and shall
award scholarships to new applicants on a first-come, first-
served basis considering money available in the fund.
(7) Upon notification by the State Treasury that a
scholarship has been awarded, the applicant shall apply for
enrollment of the scholarship recipient directly to the
participating nonpublic school under an application procedure
developed by the participating nonpublic school.
(8) No later than June 1, 2026, and each June 1
thereafter, a participating nonpublic school shall provide
written confirmation to the State Treasury of scholarship
recipients who have accepted an offer of enrollment for the
following school year and provide the State Treasury with the
amounts to be charged to the scholarship recipient for
tuition, school-related fees and special education services
fees. The notification shall be made in a manner and form
established by the State Treasury.
(9) The State Treasury may establish a waiting list for
eligible students with approved applications who did not
receive awards due to availability of money in the fund and,
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if, by July 1, 2026, and by July 1 each year thereafter,
additional money is available in the fund for scholarships,
may award scholarships to the eligible students on a first-
come, first-served basis.
Section 1705-E. Agreement.
(a) Authorization.--Upon receipt of written confirmation
that a scholarship recipient has accepted an offer of enrollment
under section 1704-E, the State Treasury must enter into or
renew an agreement with the applicant. The agreement shall
provide the following:
(1) The scholarship recipient shall enroll in a
participating nonpublic school for the school year for which
the agreement applies.
(2) A certain sum of money shall be deposited into a
lifeline scholarship account under section 1706-E on behalf
of the scholarship recipient.
(3) The money in the lifeline scholarship account may be
expended only as authorized under this article.
(4) The parent shall notify the State Treasury if the
scholarship recipient no longer resides in this Commonwealth
or withdraws or is forced to withdraw from the participating
nonpublic school within 15 days of the change of residency or
withdrawal.
(b) Term of agreement.--Except as otherwise provided under
this article, an agreement entered into under subsection (a)
shall be valid for one school year.
(c) Termination.--
(1) An agreement entered into under subsection (a) may
be terminated early by the parent for any reason.
(2) An agreement entered into under subsection (a) shall
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be terminated by the State Treasury for any of the following
reasons:
(i) The parent is found to have engaged in
fraudulent misuse of the lifeline scholarship account. In
such case, the scholarship recipient shall be ineligible
for future participation in the program. The parent may
appeal the State Treasury's decision regarding
termination and student eligibility within 30 days of
issuance of the decision. The appeal shall be governed by
2 Pa.C.S. Chs. 1 (relating to general provisions), 5
(relating to practice and procedure) and 7 (relating to
judicial review).
(ii) The scholarship recipient no longer resides in
this Commonwealth.
(iii) The scholarship recipient withdraws or is
forced to withdraw from a participating nonpublic school
prior to the completion of the school year.
(3) If an agreement is terminated under this subsection:
(i) All available money in the lifeline scholarship
account shall revert to the fund.
(ii) The participating nonpublic school shall repay
to the State Treasury for deposit into the fund the full
amount of the scholarship payment, reduced on a pro rata
basis by the tuition, school related fees and special
education services fees owed for the portion of the
school year in which the scholarship recipient was
enrolled.
(iii) The participating nonpublic school may not
require the parent to reimburse the participating
nonpublic school for the amount of the scholarship
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returned to the State Treasury.
(d) Renewal.--An agreement entered into under subsection (a)
may be renewed for each school year for the same student.
(e) Multiple agreements.--A parent of more than one child
who is a scholarship recipient must enter into a separate
agreement under subsection (a) for each of the children.
(f) Explanation.--Upon entering into an agreement under
subsection (a) or renewing an agreement under subsection (d),
the State Treasury shall provide the parent with a written
explanation of the authorized uses of the money in the lifeline
scholarship account.
Section 1706-E. Lifeline scholarship account.
(a) Establishment.--If an agreement is entered into under
section 1705-E(a), the State Treasury shall establish a lifeline
scholarship account for the scholarship recipient. The lifeline
scholarship account shall be administered by the State Treasury
in accordance with this article.
(b) Deposit.--
(1) Upon establishment of a lifeline scholarship
account, the State Treasury shall deposit a sum of money for
the applicable school year in the lifeline scholarship
account for the scholarship recipient in accordance with this
section.
(2) For the 2026-2027 school year, the sum shall be as
follows:
(i) for a student in half-day kindergarten, $2,500;
(ii) for a student in full-day kindergarten through
grade eight, $5,000;
(iii) for a student in grades nine through twelve,
$10,000; or
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(iv) for a student with special needs regardless of
grade level, $15,000.
(3) Beginning with the 2027-2028 school year, and each
school year thereafter, the amounts in paragraph (2) shall be
increased by the greater of the average percentage increase
in the index as defined in section 302 of the act of June 27,
2006 (1st Sp.Sess., P.L.1873, No.1), known as the Taxpayer
Relief Act, for all school districts for the prior school
year and the percentage increase in the appropriation for
basic education for the prior fiscal year. The State Treasury
shall calculate the increases on an annual basis and shall
submit a notice of the increases to the Legislative Reference
Bureau for publication in the next available issue of the
Pennsylvania Bulletin.
(c) Installments.--The State Treasury shall deposit the
money for each scholarship into a lifeline scholarship account
on a schedule determined by the State Treasury in consultation
with the department.
(d) Payments to participating nonpublic schools.--A parent
may direct payments from the lifeline scholarship account to a
participating nonpublic school on behalf of the scholarship
recipient via an electronic money transfer system or other
method approved by the State Treasury under section 1709-E.
Section 1707-E. Qualified education expenses.
(a) Authorized use.--Money deposited into a lifeline
scholarship account may be used only to pay for the following
qualified expenses incurred by or associated with the
scholarship recipient:
(1) Tuition required by a participating nonpublic
school.
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(2) School-related fees.
(3) Special education services fees.
(b) Prohibition.--A participating nonpublic school that
receives a payment for qualified education expenses authorized
under subsection (a) may not refund, rebate or otherwise
directly share any portion of the payment with the parent who
made the payment.
(c) Tax consequences and status of awards.--
(1) The money in a lifeline scholarship account is not
taxable income to the parent or scholarship recipient under
State law.
(2) An award made to, or payment from, a lifeline
scholarship account may not be construed to be an
appropriation or financial assistance to a participating
nonpublic school.
Section 1708-E. Lifeline Scholarship Fund.
(a) Establishment.--The Lifeline Scholarship Fund is
established in the State Treasury. All interest and earnings
received from investment or deposit of the money in the fund
shall be paid into the fund and used for scholarships. Any
unexpended money and interest or earnings on the money in the
fund may not be transferred or revert to the General Fund but
shall remain in the fund.
(b) Funding.--The fund shall consist of the following:
(1) Money that is appropriated, given, granted or
donated by the Commonwealth or any other government or
private agency or person for the purpose established under
this article.
(2) An amount equal to $350,000,000, which shall be
transferred from the General Fund to the fund no later than
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15 days after the effective date of this section and each
August 1 thereafter.
(c) Continuing appropriation.--The money in the fund is
appropriated on a continuing basis to the State Treasury for
scholarships.
Section 1709-E. Duties of State Treasury.
(a) List of duties.--The State Treasury shall:
(1) Develop guidelines, in consultation with the
department, as necessary for the administration of this
article.
(2) Make payments to lifeline scholarship accounts as
provided in this article.
(3) Develop a system that enables a parent to direct
payment to a participating nonpublic school in accordance
with this article.
(4) Develop a process by which a nonpublic school may
inform the State Treasury of the nonpublic school's interest
to participate in the program and demonstrate compliance with
the requirements of this article.
(5) Ensure that eligible students and their parents are
informed annually of the participating nonpublic schools in
the program by posting a list of participating nonpublic
schools on the State Treasury's publicly accessible Internet
website no later than April 1, 2026, and by April 1 of each
year thereafter.
(6) At such time and in such form and manner as
determined by the State Treasury, request and receive
information and data from a public school, resident school
district, participating nonpublic school or applicant
determined to be necessary by the State Treasury to
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administer this article.
(b) Third-party administration.--The State Treasury may
contract with a third party to administer the program.
(c) Contracting.--
(1) Notwithstanding any provision of 62 Pa.C.S. Pt. I
(relating to Commonwealth Procurement Code) to the contrary
and in order to facilitate the prompt implementation of this
article, a contract may be awarded for a supply or service
without competition if the State Treasury determines in
writing that the contract is necessary for the implementation
of any provision of this article and is in the best interest
of the Commonwealth. The State Treasury shall provide and
make publicly available a written justification of any
procurement under this section.
(2) Paragraph (1) shall expire no later than two years
following the issuance of the procurement under paragraph
(1). Procurements issued after that period shall occur in
accordance with other applicable law.
(d) Regulations.--
(1) In order to facilitate the prompt implementation of
this article, regulations determined to be necessary and
promulgated by the State Treasury shall be deemed temporary
regulations and shall expire no later than two years
following the publication of temporary regulations. The State
Treasury may promulgate temporary regulations not subject to:
(i) Section 612 of the act of April 9, 1929
(P.L.177, No.175), known as The Administrative Code of
1929.
(ii) Sections 201, 202, 203, 204 and 205 of the act
of July 31, 1968 (P.L.769, No.240), referred to as the
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Commonwealth Documents Law.
(iii) Section 204(b) of the act of October 15, 1980
(P.L.950, No.164), known as the Commonwealth Attorneys
Act.
(iv) The act of June 25, 1982 (P.L.633, No.181),
known as the Regulatory Review Act.
(2) The authority provided to the State Treasury to
adopt temporary regulations under this subsection shall
expire no later than two years following the publication of
the temporary regulations. Regulations adopted after that
period shall be promulgated as provided by law.
Section 1710-E. Auditor General powers.
The Auditor General may:
(1) Conduct a random audit of lifeline scholarship
accounts.
(2) Refer cases of suspected fraudulent misuse of
lifeline scholarship accounts to the Inspector General for
investigation. If the investigation results in a finding that
rises to the level of criminal activity, the Inspector
General shall refer the matter to the appropriate law
enforcement agency for prosecution.
(3) Notify the State Treasury of cases of suspected
fraudulent misuse that are referred to the Inspector General.
Section 1711-E. Duties of participating nonpublic schools.
(a) Notification requirement.--A nonpublic school that
desires to participate in the program shall notify the State
Treasury by a date and in a manner and form established by the
State Treasury. The notification shall include certification by
the nonpublic school that:
(1) The nonpublic school is a nonprofit entity exempt
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from Federal taxation under 26 U.S.C. § 501(c)(3) (relating
to exemption from tax on corporations, certain trusts, etc.).
(2) The nonpublic school complies with the
nondiscrimination policies specified in 42 U.S.C. § 1981
(relating to equal rights under the law).
(3) The nonpublic school complies with the provisions of
sections 111 and 111.1.
(b) Prohibition.--A participating nonpublic school may not
charge a lifeline scholarship recipient a tuition rate, student-
related fees or special education services fees that are higher
than the rates the participating nonpublic school would have
charged to a student who had not received a lifeline
scholarship.
(c) Reporting requirements.--
(1) A participating nonpublic school shall report in a
manner and form determined by the State Treasury, in
consultation with the department, information regarding
scholarship recipients enrolled in the participating
nonpublic school as follows:
(i) Enrollment and disenrollment.
(ii) Regular attendance.
(iii) Chronic absenteeism.
(iv) Academic progress as measured by advancement to
the next grade level.
(v) Indication of graduation.
(vi) Concurrent or dual enrollment course credits.
(2) The State Treasury shall report the information
regularly to the department on a schedule agreed to by the
State Treasury and the department.
(d) Construction.--
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(1) For purposes of this article, a participating
nonpublic school shall be autonomous and is not an agent of
the State Treasury, the department or the Commonwealth.
(2) Neither the State Treasury, the department nor other
State agency may regulate the educational program of a
participating nonpublic school that accepts money from a
scholarship recipient beyond what is necessary to administer
the program.
Section 1712-E. Bar of certain participating nonpublic schools.
(a) Authority to State Treasury.--The State Treasury may bar
a nonpublic school from participation in the program if the
State Treasury establishes that the nonpublic school has:
(1) routinely failed to comply with the requirements
established in section 1711-E; or
(2) failed to provide a scholarship recipient with the
educational services funded by the recipient's lifeline
scholarship account.
(b) Notice.--If the State Treasury bars a nonpublic school
from participation in the program, the State Treasury shall,
after any appeal is concluded and the State Treasury's decision
is upheld under subsection (c), post the decision on the State
Treasury's publicly accessible Internet website.
(c) Appeal.--A nonpublic school may appeal the State
Treasury's decision to bar its participation in the program
within 30 days of issuance of the decision. The appeal shall be
governed by 2 Pa.C.S. Chs. 1 (relating to general provisions), 5
(relating to practice and procedure) and 7 (relating to judicial
review).
Section 1713-E. Duties of resident school districts.
A resident school district shall provide a participating
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nonpublic school that has admitted a scholarship recipient with
a complete copy of the scholarship recipient's school record
within 10 days of the receipt of notice from the participating
nonpublic school of the scholarship recipient's enrollment.
Section 1714-E. Report.
(a) Duty to prepare and submit.--Beginning January 31, 2027,
and each January 31 thereafter, the State Treasury, in
consultation with the department, shall prepare and submit to
the General Assembly an annual report on the program.
(b) Contents.--The report shall include the following:
(1) The total number of applications received for the
program.
(2) The total number of applications received for the
program, by resident school district.
(3) The total number of applications approved for the
program.
(4) The total number of applications approved for the
program, by resident school district.
(5) The total number of lifeline scholarship accounts
terminated early.
(6) The total number of lifeline scholarship accounts
investigated for fraud by the Inspector General.
(7) The total number of scholarships awarded to students
attending half-day kindergarten.
(8) The total number of scholarships awarded to students
attending full-day kindergarten through grade eight.
(9) The total number of scholarships awarded to students
attending grades nine through twelve.
(10) The total dollar amount of scholarships awarded.
(11) The total number of applications not approved due
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to lack of funding.
(12) The cost of administration of the program.
(13) Other information the State Treasury deems helpful
to the General Assembly.
Section 2. This act shall take effect immediately.
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