By: Creighton, Zaffirini  S.B. No. 1094          (In the Senate - Filed March 5, 2021; March 18, 2021, read   first time and referred to Committee on Higher Education;   April 6, 2021, reported favorably by the following vote:  Yeas 9,   Nays 0; April 6, 2021, sent to printer.)Click here to see the committee vote     A BILL TO BE ENTITLED   AN ACT     relating to the payment of apprenticeship education expenses using   the state's programs for paying, prepaying, or saving toward the   costs of attending an institution of higher education.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 54.605(a), Education Code, is amended to   read as follows:          (a)  A prepaid tuition contract remains in effect after the   program is terminated if, when the program is terminated, the   beneficiary:                (1)  has been accepted by or is enrolled in an   institution of higher education, a private or independent   institution of higher education, [or] a career school or college,   or an apprenticeship program described by Section 54.619(i); or                (2)  is projected to graduate from high school not   later than the third anniversary of the date the program is   terminated.          SECTION 2.  Section 54.619, Education Code, is amended by   adding Subsection (i) to read as follows:          (i)  Notwithstanding other provisions of this subchapter,   any contract benefits purchased under this subchapter may be   applied to the payment of apprenticeship program expenses for a   registered apprenticeship program as if the apprenticeship program   were an institution of higher education or private or independent   institution of higher education. On the purchaser's request, the   board shall apply, in accordance with Section 54.628, any existing   amount of prepaid tuition contract benefits to the payment of   apprenticeship program expenses. The board is not responsible for   the payment of apprenticeship program expenses in excess of that   amount. The board may adopt rules as necessary to implement this   subsection. In this subsection, "apprenticeship program expenses"   means expenses for fees, books, supplies, and equipment required   for a beneficiary to participate in an apprenticeship program that   is registered and certified with the United States Department of   Labor under the National Apprenticeship Act (29 U.S.C. Section 50   et seq.).          SECTION 3.  Section 54.701(8), Education Code, is amended to   read as follows:                (8)  "Qualified higher education expenses" has the   meaning assigned by Section 529, Internal Revenue Code of 1986, as   amended, and includes expenses for fees, books, supplies, and   equipment required for the beneficiary to participate in an   apprenticeship program that is registered and certified with the   United States Department of Labor under the National Apprenticeship   Act (29 U.S.C. Section 50 et seq.).          SECTION 4.  Section 54.751, Education Code, is amended by   adding Subdivisions (1-a) and (9-a) and amending Subdivisions (2)   and (6) to read as follows:                (1-a)  "Apprenticeship program expenses" means the   expenses for fees, books, supplies, and equipment required for a   beneficiary to participate in a registered apprenticeship program.                (2)  "Beneficiary" means the person designated under a   prepaid tuition contract as the person entitled to apply one or more   tuition units purchased under the contract to the payment of the   person's:                      (A)  undergraduate tuition and required fees at a   general academic teaching institution, two-year institution of   higher education, private or independent institution of higher   education, medical and dental unit, career school, or accredited   out-of-state institution of higher education; and                      (B)  apprenticeship program expenses.                (6)  "Prepaid tuition contract" means a contract under   which a person purchases from the board on behalf of a beneficiary   one or more tuition units that the beneficiary is entitled to apply   to the payment of the beneficiary's:                      (A)  undergraduate tuition and required fees at a   general academic teaching institution, two-year institution of   higher education, private or independent institution of higher   education, medical and dental unit, career school, or accredited   out-of-state institution of higher education; or                      (B)  apprenticeship program expenses.                (9-a)  "Registered apprenticeship program" means an   apprenticeship program that is registered and certified with the   United States Department of Labor under the National Apprenticeship   Act (29 U.S.C. Section 50 et seq.).          SECTION 5.  Section 54.753(a), Education Code, is amended to   read as follows:          (a)  Under the program, a purchaser may prepay the costs of   all or a portion of a beneficiary's undergraduate tuition and   required fees at a general academic teaching institution, two-year   institution of higher education, private or independent   institution of higher education, medical and dental unit, career   school, or accredited out-of-state institution of higher education   or all or a portion of the beneficiary's apprenticeship program   expenses by entering into a prepaid tuition contract with the board   to purchase one or more tuition units of a type described by this   section at the applicable price established by the board for that   type of unit for the year in which the unit is purchased. The   portion of the beneficiary's undergraduate tuition and required   fees for which a tuition unit may be redeemed at a particular   general academic teaching institution or two-year institution of   higher education is assigned to the tuition unit at the time of   purchase, and the tuition unit may be redeemed to pay that portion   of the tuition and fees at the general academic teaching   institution or two-year institution of higher education in any   academic year in which the unit is redeemed in accordance with this   subchapter. The purchaser may purchase one type of unit or a   combination of two or three types of units.          SECTION 6.  Sections 54.754(a), (d), and (e), Education   Code, are amended to read as follows:          (a)  In accordance with this subchapter, when a beneficiary   under a prepaid tuition contract redeems one or more tuition units   to pay costs of tuition and required fees or apprenticeship program   expenses, the board shall apply money in the fund, in the amount   provided by Section 54.765 to pay all or the applicable portion of   the costs of the beneficiary's tuition and required fees at the   general academic teaching institution, two-year institution of   higher education, private or independent institution of higher   education, medical and dental unit, or accredited out-of-state   institution of higher education in which the beneficiary enrolls or   the beneficiary's apprenticeship program expenses. Subject to   Subsection (b)(2) and the other provisions of this section, a   beneficiary may redeem any type of tuition unit for attendance at an   institution, [or] unit, or program described by this section. A   general academic teaching institution or two-year institution of   higher education shall accept the amount transferred to the   institution under Section 54.765(c) when the unit or units are   redeemed as payment for all or the applicable portion of the   beneficiary's tuition and required fees.          (d)  If a beneficiary redeems fewer tuition units of the type   or combination of types necessary to pay the total cost of the   beneficiary's tuition and required fees at the general academic   teaching institution, two-year institution of higher education,   private or independent institution of higher education, medical and   dental unit, career school, or accredited out-of-state institution   of higher education at which the beneficiary enrolls or   apprenticeship program expenses, the beneficiary is responsible   for paying the amount of the difference between the amount of   tuition and required fees or expenses for which the beneficiary   pays through the redemption of one or more tuition units and the   total cost of the beneficiary's tuition and required fees at the   institution or unit or the beneficiary's apprenticeship program   expenses.          (e)  If the beneficiary redeems fewer tuition units to pay   the cost of tuition and required fees or apprenticeship program   expenses than the number of units purchased on behalf of the   beneficiary under a prepaid tuition contract, other than to defer   redemption as permitted in accordance with Section 54.758, the   purchaser may:                (1)  redeem for cash the amount of the purchase price of   the excess units, plus annual interest earned on that money,   accrued at a rate set by the board not to exceed five percent   annually; or                (2)  transfer the remaining units to another   beneficiary in accordance with this subchapter.          SECTION 7.  Section 54.758(a), Education Code, is amended to   read as follows:          (a)  A prepaid tuition contract must permit the beneficiary   to elect to pay from a source other than tuition units purchased   under the contract the beneficiary's tuition and required fees or   apprenticeship program expenses for some or all of the tuition and   required fees or apprenticeship program expenses to which the   beneficiary is entitled to payment under the contract, and to defer   to a subsequent semester or other academic term the right to payment   of the beneficiary's tuition and required fees or apprenticeship   program expenses by using tuition units remaining under the   contract.          SECTION 8.  Section 54.765(f), Education Code, is amended to   read as follows:          (f)  When a beneficiary enrolls at a private or independent   institution of higher education, medical and dental unit, career   school, [or] accredited out-of-state institution of higher   education, or registered apprenticeship program, on written   authorization from the purchaser of the tuition unit or units for   that beneficiary, the comptroller or the comptroller's authorized   representative shall transfer to the institution the lesser of:                (1)  an amount equal to the current cost of the tuition   and required fees or apprenticeship program expenses that would be   covered by redemption of the number and type of tuition units the   beneficiary is redeeming if the beneficiary were redeeming the unit   or units at a general academic teaching institution or two-year   institution of higher education as follows:                      (A)  for a Type I unit, at the general academic   teaching institution that had the highest tuition and required fee   cost;                      (B)  for a Type II unit, at a general academic   teaching institution that had tuition and required fee cost at the   weighted average; and                      (C)  for a Type III unit, at a two-year   institution of higher education that had tuition and required fee   cost at the weighted average; or                (2)  an amount equal to the total purchase price of the   tuition unit or units the beneficiary redeems for the semester or   other academic term plus the portion of the total return on assets   of the fund attributable to that amount.          SECTION 9.  Section 54.767, Education Code, is amended to   read as follows:          Sec. 54.767.  USE OF FUND ASSETS. The assets of the fund may   be used only to:                (1)  pay the costs of program administration and   operations;                (2)  make payments to general academic teaching   institutions, two-year institutions of higher education, private   or independent institutions of higher education, medical and dental   units, career schools, [and] accredited out-of-state institutions   of higher education, and registered apprenticeship programs on   behalf of beneficiaries; and                (3)  make refunds under prepaid tuition contracts.          SECTION 10.  Sections 54.769(b) and (c), Education Code, are   amended to read as follows:          (b)  The rights of a purchaser, beneficiary, or successor in   interest of a purchaser or beneficiary in and under a prepaid   tuition contract and the payment of tuition and required fees for a   beneficiary under a prepaid tuition contract to a general academic   teaching institution, two-year institution of higher education,   private or independent institution of higher education, medical and   dental unit, career school, or accredited out-of-state institution   of higher education or apprenticeship program expenses under this   chapter are exempt from attachment, levy, garnishment, execution,   and seizure for the satisfaction of any debt, judgment, or claim   against a purchaser, beneficiary, or successor in interest of a   purchaser or beneficiary.          (c)  A claim or judgment against a purchaser, beneficiary, or   successor in interest of a purchaser or beneficiary does not impair   or entitle the claim or judgment holder to assert or enforce a lien   against:                (1)  the rights of a purchaser, beneficiary, or   successor in interest of a purchaser or beneficiary in and under a   prepaid tuition contract; or                (2)  the right of a beneficiary to the payment of   tuition and required fees to a general academic teaching   institution, two-year institution of higher education, private or   independent institution of higher education, medical and dental   unit, career school, or accredited out-of-state institution of   higher education or apprenticeship program expenses under a prepaid   tuition contract.          SECTION 11.  Section 54.774(a), Education Code, is amended   to read as follows:          (a)  A prepaid tuition contract remains in effect after the   program is terminated if, when the program is terminated, the   beneficiary:                (1)  has been accepted by or is enrolled at a general   academic teaching institution, two-year institution of higher   education, private or independent institution of higher education,   medical and dental unit, career school, [or] accredited   out-of-state institution of higher education, or registered   apprenticeship program; or                (2)  is projected to graduate from high school not   later than the third anniversary of the date the program is   terminated.          SECTION 12.  Section 54.775(b), Education Code, is amended   to read as follows:          (b)  Notwithstanding Subsection (a), the board may release   information described by that subsection to a general academic   teaching institution, two-year institution of higher education,   private or independent institution of higher education, medical and   dental unit, career school, [or] accredited out-of-state   institution of higher education, or registered apprenticeship   program at which a beneficiary may enroll or is enrolled. The   institution, [or] unit, or program shall keep the information   confidential.          SECTION 13.  Section 54.806(b), Education Code, is amended   to read as follows:          (b)  Notwithstanding Subsection (a), the board or program   entity may release information described by Subsection (a) to the   extent required by a general academic teaching institution,   two-year institution of higher education, private or independent   institution of higher education, career school, [or] accredited   out-of-state institution of higher education, or registered   apprenticeship program at which a beneficiary may enroll or is   enrolled. The institution, [or] school, or program receiving   information described by Subsection (a) shall keep the information   confidential.          SECTION 14.  The change in law made by this Act regarding the   application of prepaid tuition contract benefits to the payment of   apprenticeship program expenses for a registered apprenticeship   program applies to contract benefits purchased under Subchapters F   and H, Chapter 54, Education Code, as amended by this Act, before,   on, or after the effective date of this Act.          SECTION 15.  This Act takes effect September 1, 2021.     * * * * *