Wyoming freedom scholarship act-2.

23LSO-0632
2023
STATE OF WYOMING
23LSO-0632
ENGROSSED
3.0

SENATE FILE NO. SF0143

Wyoming freedom scholarship act-2.

Sponsored by: Senator(s) Steinmetz, Baldwin, Biteman, Boner, Brennan, Cooper, Driskill, Hutchings, Kinskey, Laursen, D and Salazar and Representative(s) Allemand, Andrew, Angelos, Banks, Bear, Davis, Eklund, Haroldson, Heiner, Hornok, Jennings, Knapp, Lawley, Locke, Neiman, Niemiec, O'Hearn, Ottman, Pendergraft, Penn, Rodriguez-Williams, Singh, Slagle, Smith, Stith, Strock, Styvar, Tarver, Trujillo, Ward, Washut and Winter

A BILL

for

AN ACT relating to education; creating the Wyoming Freedom Scholarship Act; authorizing education savings accounts; specifying legal proceedings; creating an account; providing for a transfer of funds to the account; providing for the use and administration of education savings accounts for education; providing powers and duties of the state treasurer; providing rulemaking authority; specifying that a qualified school is not an agent of the state or federal government; establishing an oversight committee; making conforming amendments; authorizing a temporary committee as specified; providing an appropriation; and providing for effective dates.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1.

W.S. 21
‑
2
‑
901 through 21
‑
2
‑
910 are created to read:

ARTICLE 9
WYOMING FREEDOM SCHOLARSHIP ACT

21
‑
2
‑
901.

Short title.

This act shall be known as the Wyoming Freedom Scholarship Act." The program created by this act shall be known as the "ESA program."

21
‑
2
‑
902.

Definitions.

(a)

As used in this act, unless the context otherwise requires:

(i)

"Curriculum" means a course of study for content areas or grade levels, including any supplemental materials required or recommended by the curriculum;

(ii)

"Education

savings

account"

or

"ESA"

means

the
spending
account
for a child's education
to

which

funds

are allocated by the state treasurer, for which a parent of an ESA student enters into an agreement with the state treasurer to choose and pay for qualifying education expenses to educate the ESA student, subject to the requirements and conditions of this act;

(iii)

"Education

service

provider"

means

a

person

or

organization

that

receives

payments authorized by a parent from education savings accounts to provide educational goods and services to ESA
students;

(iv)

"Eligible student" means a child who is a Wyoming resident, who has not graduated from high school, received a high school equivalency certificate or completed the equivalent of high school through a home
‑
based educational program and who is eligible to attend a public school in this state;

(v)

"ESA student" means an eligible student who is participating in the ESA program;

(vi)

"Parent" means a resident of this state who is the parent, stepparent or legal guardian of an eligible student or ESA student and may include an eligible student or ESA student who is an emancipated minor;

(vii)

"Qualified school" means a nongovernmental primary or secondary school that is located in or that provides education services in this state and that does not discriminate on the basis of race, color or national origin;

(viii)

"State treasurer" may include an organization that the state treasurer has contracted with to carry out the purposes of this act under W.S. 21
‑
2
‑
906(a)(iv);

(ix)

"This act" means W.S. 21
‑
2
‑
901 through 21
‑
2
‑
910.

21
‑
2
‑
903.

Education savings accounts; Wyoming freedom scholarship program account.

(a)

The total amount to be deposited in an education savings account for an ESA student each year shall be six thousand dollars ($6,000.00) as adjusted annually by the state treasurer for the costs of inflation.

(b)

Payments to ESAs under this act shall be made by the state treasurer from the Wyoming freedom scholarship program account, which is hereby created. The account shall consist of funds transferred to the account and other funds appropriated by the legislature to the account. All earnings from investment of the account shall be credited by the state treasurer to the account. Except as provided by subsection (c) of this section, any unencumbered, unobligated balance of the account at the end of each fiscal year shall not revert but shall remain in the account and shall be expended to fund ESAs as provided by this act.

(c)

If at the end of a fiscal year the state treasurer determines that the amount in the Wyoming freedom scholarship program account is more than thirty million dollars ($30,000,000.00) and is more than one hundred and fifty percent (150%) of the amount required to fund all approved ESAs for that fiscal year, the state treasurer shall transfer the excess amount determined under this subsection to the school foundation program account.

(d)

Payments to each approved ESA shall be disbursed on a quarterly basis by the state treasurer or another state agency or person designated by the state treasurer to administer and disburse funds to education savings accounts.

(e)

The ESA program shall not be funded with county, city or school district tax revenues.

21
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2
‑
904.

ESA program parent agreement; ESA administration.

(a)

Before participation in the ESA program, parents of an ESA student shall sign an agreement with the state treasurer to do all of the following:

(i)

Use the funds deposited in the ESA only for any of the following qualifying expenses to educate the ESA student:

(A)

Tuition and fees at a qualified school;

(B)

Tuition and fees for non
‑
public online learning programs;

(C)

Tutoring services provided by an individual or a tutoring facility. The tutoring services shall not be provided by an ESA student's immediate family;

(D)

Services contracted for and provided by a public school district including at a charter school. Services under this subparagraph may include, without limitation, individual classes and extracurricular activities and programs;

(E)

Textbooks, curriculum and other instructional materials, including, but not limited to, any supplemental materials or associated online instruction required by either a curriculum or an education service provider;

(F)

Computer hardware or other technological devices that are primarily used to help meet an ESA student's educational needs;

(G)

Educational software and applications;

(H)

School uniforms;

(J)

Fees for nationally standardized assessments, advanced placement examinations, examinations related to college or university admission and tuition and fees for preparatory courses for the exams;

(K)

Tuition and fees for summer education programs and specialized after school education programs, but not after school childcare;

(M)

Tuition, fees, instructional materials and examination fees at a career or technical school;

(N)

Educational services and therapies including, but not limited to, occupational, behavioral, physical, speech
‑
language and audiology therapies;

(O)

Tuition and fees at an institution of higher education;

(P)

Fees for transportation paid to a fee
‑
for
‑
service transportation provider for the student to travel to and from an education service provider;

(Q)

Any other educational expense approved by the state treasurer.

(ii)

As provided in this section, use Wyoming freedom scholarship program account monies to provide an education for the ESA student that provides fundamental instruction in at least reading, writing, mathematics, civics, history, literature and science. No parent shall be required to include any instruction that conflicts with the parent's or ESA student's religious doctrines; and

(iii)

Not enroll the qualified student in a school district or charter school and to release the applicable school district from all obligations to educate the qualified student. This paragraph shall not:

(A)

Require an eligible student to withdraw from a school district or charter school before applying for or receiving an ESA if the eligible student withdraws from the school district or charter school before receiving or expending any monies in the student's ESA;

(B)

Prevent a qualified student from applying in advance for an ESA to be funded beginning the following school year;

(C)

Prevent the school district or charter school from charging an ESA for any services provided to the qualified student to the extent authorized by law.

(b)

Funds in an ESA shall not be refunded, rebated or shared with a parent or ESA student in any manner. Any refund or rebate for goods or services purchased with ESA funds shall be credited directly to the student's ESA.

(c)

Parents may make payments for costs of educational goods and services not covered by the funds in the ESA. Personal deposits into an ESA shall not be permitted.

(d)

Funds deposited in an ESA shall not constitute taxable income to the parent or the ESA student.

(e)

An ESA shall remain active and any unused funds shall roll over from quarter to quarter and from year to year until the parent withdraws the ESA student from the ESA program or until the ESA student is no longer eligible for the ESA program, unless the ESA is closed because of a substantial misuse of funds. When an ESA is closed, any unused funds shall revert to the Wyoming freedom scholarship program account.

(f)

Nothing in this act shall be construed to require an ESA student to be enrolled, full
‑
time or part
‑
time, in a private school or a nonpublic online school. An ESA student receiving individualized instruction in a non
‑
school setting shall not be construed to be a home
‑
based educational program as defined in W.S. 21
‑
4
‑
101(a)(v).

21
‑
2
‑
905.

Application.

(a)

A parent may apply to the state treasurer to establish an ESA for an eligible student.

(b)

The state treasurer shall establish procedures for approving applications in an expeditious manner.

(c)

The state treasurer shall create a standard form that parents can submit to establish their student's eligibility for the ESA program and shall ensure that the application form is publicly available and that completed applications may be submitted through various sources, including the internet.

(d)

The state treasurer shall approve an application for an ESA if:

(i)

The parent submits an application for an ESA in accordance with any application procedures established by the state treasurer;

(ii)

The student on whose behalf the parent is applying is an eligible student;

(iii)

Funds are available for the ESA;

(iv)

If the number of applications exceeds the available scholarship funds for a school year, the students shall be selected on a first come, first served basis, except enrollment preference shall be given to the following students:

(A)

An eligible student who in the previous school used a scholarship account; or

(B)

A sibling of an eligible student who:

(I)

Receives scholarship funds from a scholarship account at the time the sibling applied for a scholarship account; or

(II)

Received scholarship funds in the school year immediately preceding the school year in which the sibling applies for a scholarship account.

(v)

The parent signs an agreement with the state treasurer as provided in W.S. 21
‑
2
‑
904(a).

(e)

A signed agreement between the parent and state treasurer under W.S. 21
‑
2
‑
904(a) shall satisfy the compulsory school attendance requirements of W.S. 21
‑
4
‑
102. The agreement shall stipulate that an ESA student receiving individualized instruction in a non
‑
school setting is not receiving a home
‑
based educational program as defined in W.S. 21
‑
4
‑
101(a)(v). The parent shall annually provide the student's resident school district notice of intent to participate in the ESA program.

(f)

Upon notice to the state treasurer, an ESA student may choose to stop receiving ESA funding and enroll full
‑
time in a public school. Enrolling as a full
‑
time student in a public school shall result in the immediate suspension of payment of additional funds into the student's ESA and the state treasurer may close the ESA. If an eligible student applies to the state treasurer to return to the ESA program, payments into the student's existing ESA may resume if the ESA is still open and active. A new ESA may be established if the student's ESA was closed.

(g)

The state treasurer may adopt rules and policies to provide the least disruptive process for ESA students who choose to stop receiving ESA payments and enroll full
‑
time in a public school.

21
‑
2
‑
906.

Duties of the state treasurer.

(a)

In addition to the state treasurer's duties, obligations and authority specified in other sections of this act, the state treasurer shall:

(i)

Maintain an updated list of education service providers and ensure that the list is available to parents of ESA students. The list shall enable the education service provider to indicate if the education service provider is accepting new students;

(ii)

Provide parents with a written explanation of the allowable uses of ESA funds, the responsibilities of parents and the duties of the state treasurer including the role of any private financial management firms or other private organizations that the state treasurer may contract with to administer the ESA program or any aspect of the ESA program;

(iii)

Ensure that parents of students with disabilities receive notice that participation in the ESA Program is a parental placement under 20 U.S.C. § 1412, Individuals with Disabilities Education Act (IDEA), along with an explanation of the rights that parentally placed students possess under IDEA and any applicable state laws and regulations;

(iv)

If determined necessary by the state treasurer, contract with one (1) or more private organizations to administer the ESA program or specific functions of the ESA program including, without limitation, contracting with private financial management firms to manage ESAs. Notwithstanding any other provisions of law, if the state treasurer contracts with private organizations to administer the ESA program under this paragraph, the state treasurer shall seek good faith bids from not less than three (3) private organizations;

(v)

If determined necessary by the state treasurer, withhold from deposits or deduct from ESAs an amount to cover the costs of administering the ESA program, up to a maximum of five percent (5%) annually in the first two (2) years of the ESA Program and up to a maximum of three percent (3%) annually thereafter;

(vi)

Implement a commercially viable, cost
‑
effective and user
‑
friendly system for payment of services from ESAs to education service providers by electronic or online funds transfer. The payment system shall not rely exclusively on requiring parents to be reimbursed for out
‑
of
‑
pocket expenses. The payment system shall provide maximum flexibility to parents by facilitating direct payments to education service providers as well as requests for pre
‑
approval of and reimbursements for qualifying expenses listed in W.S. 21
‑
2
‑
904(a)(i). The state treasurer may contract with private organizations to develop the payment system;

(vii)

Continue making deposits into a student's ESA until:

(A)

The state treasurer determines that the ESA student is no longer an eligible student;

(B)

The state treasurer determines that there was an intentional and substantial misuse of the funds in the ESA;

(C)

The parent or ESA student withdraws from the ESA program;

(D)

The ESA student enrolls full
‑
time in a public school; or

(E)

The ESA student graduates from high school, receives a high school equivalency certificate or completes the equivalent of high school through a home
‑
based educational program.

(viii)

Conduct or contract for the auditing of individual ESAs and shall at a minimum conduct or contract for random audits of ESAs on an annual basis;

(ix)

If the state treasurer finds an intentional and substantial misuse of ESA funds, determine that the parent or ESA student is ineligible for participation in the ESA program. The state treasurer shall by rule create procedures to ensure that a fair process exists to determine whether an intentional and substantial misuse of ESA funds has occurred. If an ESA student is free from personal misconduct, that student shall be eligible for an ESA in the future if placed with a new guardian or other person with the legal authority to act on behalf of the student. The state treasurer shall have the authority to refer suspected cases of intentional and substantial misuse of ESA funds to the department of audit or the attorney general for investigation if evidence of fraudulent use of ESA funds is obtained. A parent or ESA student may appeal the state treasurer's decision to make the parent or ESA student ineligible for the ESA program;

(x)

Prohibit an education service provider from accepting payments from ESAs if the state treasurer determines that the education service provider has:

(A)

Intentionally and substantially misrepresented information or failed to refund any overpayments in a timely manner; or

(B)

Routinely failed to provide students with promised educational goods or services.

(xi)

By rule create procedures to ensure that a fair process exists to determine whether an education service provider should be prohibited from receiving payments from ESAs under paragraph (x) of this subsection. If the state treasurer bars an education service provider from receiving payments from ESAs, it shall notify parents and ESA students of the decision as quickly as possible. Education service providers may appeal the state treasurer's decision to bar them from receiving payments from ESAs.

(b)

If an education service provider requires partial payment of tuition or fees prior to the start of the school year to reserve space for an ESA student admitted to the education service provider, the state treasurer may make the partial payment prior to the start of the school year in which the ESA is awarded and deduct that amount from subsequent quarterly ESA deposits to ensure adequate funds remain available in the ESA throughout the school year. If an ESA student decides not to use the education service provider, the partial payment made under this subsection shall be returned to the state treasurer by the education service provider and credited to the student's ESA.

(c)

The state treasurer may accept gifts and grants from any source to cover administrative costs of the program, to inform the public about the ESA Program or to fund ESAs.

(d)

The state treasurer may adopt rules that are not inconsistent with this act and that are necessary for the administration of this act including rules:

(i)

Establishing or contracting for the establishment of an online anonymous fraud reporting service;

(ii)

Establishing an anonymous telephone hotline for fraud reporting;

(iii)

Requiring a surety bond for education service providers receiving more than one hundred fifty thousand dollars ($150,000.00) in ESA funds; and

(iv)

Establishing a procedure for refunding payments from education service providers to ESAs.

(e)

Rules adopted by the state treasurer under subsection (d) of this section shall focus on easing parental involvement in the program and encouraging educational service providers to provide parents and ESA students with a broad array of educational options.

21
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2
‑
907.

Parent review commission.

(a)

There is created the parent review commission to assist the state treasurer in determining whether questionable expenditures meet the requirements to be considered qualifying expenses to educate the ESA student under W.S. 21
‑
2
‑
904(a)(i) and to provide recommendations to the state treasurer on how to implement, administer and improve the ESA program.

(b)

The parent review commission shall consist of seven (7) members appointed by the state treasurer. The members of the commission shall be parents of ESA students and shall represent not less than four (4) different counties. Members shall serve at the pleasure of the state treasurer for a term of four (4) years and may be reappointed. The state treasurer or his designee shall serve as the nonvoting chairperson of the commission.

(c)

The state treasurer may request the commission to meet, in person or virtually, to determine whether an expenditure of ESA funds is or was a qualifying expense to educate an ESA student. The commission may by majority vote recommend that the expenditure be denied or approved.

(d)

The state treasurer may request the commission to meet, in person or virtually, to review appeals of education service provider denials pursuant to W.S. 21
‑
2
‑
906(a)(x) and to provide a recommendation as to whether an education service provider should be allowed to receive payments from ESAs.

21
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2
‑
908.

Education service providers.

(a)

The state treasurer may approve education service providers on his own initiative, at the request of parents or by receipt of notice provided by prospective education service providers under this section.

(b)

Before receiving payment from an ESA, a prospective education service provider shall:

(i)

Register with the state treasurer to receive payments from ESAs;

(ii)

Agree not to refund, rebate or share ESA funds with parents or ESA students in any manner, except that funds may be remitted or refunded to an ESA in accordance with procedures established by the state treasurer.

(c)

Nothing in this act shall be deemed to limit the independence or autonomy of an education service provider or to make the actions of an education service provider the actions of state government.

(d)

Education service providers shall be given maximum freedom to provide instruction and services in their usual and customary manner to meet the educational needs of ESA students.

(e)

Nothing in this act shall be construed to expand the regulatory authority of the state, its officers, or any school district to impose any additional regulation of education service providers beyond those necessary to enforce the requirements of the ESA Program.

(f)

An education service provider that accepts payment from an ESA pursuant to this act is not an agent of the state or federal government.

(g)

An education service provider shall not be required to alter its creed, practices, admission policy or curriculum to accept payments authorized by a parent from an ESA.

21
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2
‑
909.

Responsibilities of public schools and school districts.

A public school, or school

district,

that

previously

enrolled

an

ESA

student

shall

provide

a

private

school

that

is

also an

education

service

provider

and

that

has

enrolled

an

ESA

student

with

a

complete

copy

of

the ESA

student's

school

records,

while

complying

with

20

U.S.C.

§

1232g,

the

Family

Educational Rights and Privacy Act of 1974.

21
‑
2
‑
910.

Legal proceedings.

(a)

In any legal proceeding challenging the application of this act or a rule adopted under this act to an education service provider, the state bears the burden of establishing that the law is necessary and does not impose any undue burden on the education service provider.

(b)

No liability shall arise on the part of the state treasurer or the state or any public school or school district based on the award of or use of an ESA pursuant to this act.

(c)

If any part of this act is challenged in a state court as violating either the state or federal constitutions, parents of eligible students and parents of ESA students shall be permitted to intervene as of right in any lawsuit for the purposes of defending the ESA program's constitutionality. However, for the purposes of judicial administration, a court may require that all parents file a joint brief as long as the parents are not required to join any brief filed on behalf of any named state defendant.

(d)

If any provision of this act, or the application thereof to any person or circumstances, is held invalid, the invalidity shall not affect other provisions or applications of this act which can be given effect without the invalid provision or application, and to this end the provisions of this act are declared to be severable.

Section 2.

W.S. 9
‑
4
‑
601(a)(ii), 21
‑
4
‑
102 by creating a new subsection (d), 21
‑
4
‑
301 and 21
‑
13
‑
310(a)(ix) are amended to read:

9
‑
4
‑
601.

Distribution and use; funds, accounts, cities and towns benefited; exception for bonus payments.

(a)

All monies received by the state of Wyoming from the secretary of the treasury of the United States under the provisions of the act of congress of February 25, 1920 (41 Stat. 437, 450; 30 U.S.C. §§ 181, 191), as amended, or from lessees or authorized mine operators and all monies received by the state from its sale of production from federal mineral leases subject to the act of congress of February 25, 1920 (41 Stat. 437, 450; 30 U.S.C. §§ 181, 191) as amended, except as provided by subsection (b) of this section, shall be deposited into an account and the first two hundred million dollars ($200,000,000.00) of revenues received in any fiscal year shall be distributed by the state treasurer as provided in this subsection. One percent (1%) of these revenues shall be credited to the general fund as an administrative fee, and the remainder shall be distributed as follows:

(ii)

Subject to paragraph (xi) of this section,
F
orty
‑
four and eight
‑
tenths percent (44.8%)
,

to the public school foundation program account
subject to allocations under W.S. 9
‑
4
‑
605
,
;

as follows:

(A)

Fifty percent (50%) of the amount to the public school foundation program account; and

(B)

Fifty percent (50%) of the amount to the Wyoming freedom scholarship program account created by W.S. 21
‑
2
‑
903(b).

21
‑
4
‑
102.

When attendance required; exemptions; withdrawal.

(d)

A child participating in the ESA program specified by W.S. 21
‑
2
‑
901 and who provides notice of participation in the ESA program to the child's school district shall be deemed to be in compliance with the compulsory attendance requirement under this section.

21
‑
4
‑
301.

Schools to be free and accessible to all children; minimum school year.

(a)

Except as otherwise provided by law, the public schools of each school district in the state shall at all times be equally free and accessible to all children resident therein of five (5) years of age as of August 1, or September 15 if pursuant to an approved request under W.S. 21
‑
3
‑
110(a)(xxxviii), of the year in which they may register in kindergarten as provided in W.S. 21
‑
4
‑
302(b) and under the age of twenty
‑
one (21), subject to regulations of the board of trustees. Each school district shall operate its schools and its classes for a minimum of one hundred seventy
‑
five (175) days each school year unless an alternative schedule has been approved by the state board. Prior to submission of a proposed alternative schedule to the state board, the board of trustees shall hold at least two (2) advertised public meetings within the district, at which the board shall present the proposed alternative schedule and respond to public questions and comments. Any school district operating under an alternative schedule shall annually evaluate the effectiveness of that schedule in meeting the educational goals and purposes for which the schedule was adopted.

(b)

A parent, guardian or other person having control or charge of any child eligible to attend public school in Wyoming under subsection (a) of this section shall have the option to apply for the ESA program specified by W.S. 21
‑
2
‑
901 on behalf of the child.

21
‑
13
‑
310.

Annual computation of district revenues.

(a)

To ensure revenues available to each district are uniformly sufficient to enable compliance with the uniform standards for educational programs prescribed under W.S. 21
‑
9
‑
101 and 21
‑
9
‑
102 and to secure state board accreditation of educational programs under W.S. 21
‑
2
‑
304(a)(ii), the revenues specified under this subsection shall be deemed state revenues and shall be considered in determining the amount to be distributed to each district under W.S. 21
‑
13
‑
311. A district shall make an annual computation of the following revenues:

(ix)

The amount of tuition paid to the district during the previous school year, including any amount charged under W.S. 21
‑
4
‑
501 and any amount assessed in excess of the costs incurred for adult education programs, summer school programs, programs provided under an agreement for cooperative educational programs under W.S. 21
‑
20
‑
101 through 21
‑
20
‑
111 and any amount assessed for programs and services for children with disabilities, but excluding any tuition assessed by a district for the provision of virtual education programs to participating students pursuant to W.S. 21
‑
13
‑
330, any tuition assessed by a district for the provision of part
‑
time educational programs to participating students pursuant to W.S.
21
‑
2
‑
904(a)(i)(D) and
21
‑
4
‑
502(c), any revenues received by a district from post secondary education option programs provided under W.S. 21
‑
20
‑
201 or for the provision of educational programs to a nonresident student placed in a juvenile detention facility pursuant to an agreement with the student's resident school district;

Section 3
.

There is appropriated thirty million dollars ($30,000,000.00) from the general fund to the Wyoming freedom scholarship program account created by W.S. 21
‑
2
‑
903(b) for purposes of the Wyoming Freedom Scholarship Act.

Section 4.

(a)

The state treasurer shall adopt rules and take other actions as necessary to enable students to enroll in the ESA program created by this act for the school year beginning in 2024. The state treasurer shall begin accepting applications for the ESA program not later than January 1, 2024.

(b)

The state treasurer may establish and appoint a temporary committee of up to five (5) members for the purpose of advising and assisting with the promulgation of rules under subsection (a) of this section.

The members of the committee shall serve without compensation and the committee, if formed, shall dissolve not later than January 1, 2025.

Section 5
.

(a)

Except as provided in subsection (b) of this section, this act is effective immediately upon completion of all acts necessary for a bill to become law as provided by Article 4, Section 8 of the Wyoming Constitution.

(b)

Sections 1 and 2 of this act are effective January 1, 2024
.

(END)

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SF0143