I 116TH CONGRESS 1ST SESSION H. R. 778 To expand school choice in the District of Columbia. IN THE HOUSE OF REPRESENTATIVES JANUARY 24, 2019 Mr. MEADOWS introduced the following bill; which was referred to the Committee on Oversight and Reform A BILL To expand school choice in the District of Columbia. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Educational Freedom 4 Accounts Act’’. 5 SEC. 2. DEFINITIONS. 6 In this Act: 7 (1) ADMINISTERING ENTITY.—The term ‘‘ad- 8 ministering entity’’ means the entity that receives 9 the contract under section 3(a) for a fiscal year. 10 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 2 •HR 778 IH (2) CHIEF FINANCIAL OFFICER.—The term 1 ‘‘chief financial officer’’ means the Chief Financial 2 Officer of the District of Columbia. 3 (3) ELIGIBLE CHILD.—The term ‘‘eligible 4 child’’ means a child— 5 (A) who is a resident of the District of Co- 6 lumbia; 7 (B) who is eligible to receive a free public 8 education in the District of Columbia; 9 (C) who— 10 (i) was enrolled in a public school or 11 preschool program of the District of Co- 12 lumbia, including a charter school, during 13 the previous school year; 14 (ii) received an education savings ac- 15 count under this Act for the preceding 16 school year; 17 (iii) received an opportunity scholar- 18 ship under section 3007(a) of the Scholar- 19 ships for Opportunity and Results Act for 20 the preceding school year; or 21 (iv) is entering prekindergarten or 22 kindergarten; 23 (D) whose parent chooses to not enroll the 24 child in a public elementary school, secondary 25 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 3 •HR 778 IH school, or prekindergarten program for the 1 school year for which the child will receive a 2 scholarship under section 4; and 3 (E) whose parent does not submit a notifi- 4 cation of home schooling described in section 5 5202 of title 5, Code of the District of Colum- 6 bia Regulations (or any successor notification) 7 to the Office of the State Superintendent of 8 Education of the District of Columbia for any 9 year for which the parent enters into an agree- 10 ment under section 4(a)(2)(B). 11 (4) INSTITUTION OF HIGHER EDUCATION.—The 12 term ‘‘institution of higher education’’ has the 13 meaning given the term in section 102 of the Higher 14 Education Act of 1965 (20 U.S.C. 1002). 15 (5) PARENT.—The term ‘‘parent’’ means the 16 guardian, custodian, or other person with the au- 17 thority to act on behalf of a child. 18 (6) PARTICIPATING PROVIDER.—The term 19 ‘‘participating provider’’ means an entity that— 20 (A) is— 21 (i) a nonpublic school located in the 22 District of Columbia that provides edu- 23 cation to prekindergarten, elementary 24 school, or secondary school students; 25 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 4 •HR 778 IH (ii) a public school, including a char- 1 ter school, located in the District of Co- 2 lumbia, except only with respect to pro- 3 viding individual courses or extracurricular 4 activities described in section 4(c)(1)(E) or 5 transportation described in section 6 4(c)(1)(I) to such services; 7 (iii) a tutor or tutoring facility; 8 (iv) a nonpublic provider of distance 9 or online learning; 10 (v) a therapy center or other provider 11 of special education or disability services; 12 (vi) an institution of higher education 13 located in the District of Columbia; or 14 (vii) an entity that provides edu- 15 cational services or products; 16 (B) notifies the administering entity of the 17 entity’s intent to become a participating pro- 18 vider; and 19 (C) agrees, as a condition of receiving 20 funds from an education savings account estab- 21 lished under section 4, to comply with the re- 22 quirements of this Act. 23 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 5 •HR 778 IH SEC. 3. CONTRACT AUTHORIZED. 1 (a) IN GENERAL.—Beginning with the 2019–2020 2 school year, the Chief Financial Officer shall carry out this 3 Act for each school year by awarding a contract to 1 entity 4 described in subsection (b) to enable the administering en- 5 tity to carry out the program under section 4 for all eligi- 6 ble children in the District of Columbia. 7 (b) ELIGIBILITY.—In order to be eligible for a con- 8 tract under this section, an entity shall be— 9 (1) exempt from Federal income tax pursuant 10 to 501(c)(3) of the Internal Revenue Code of 1986; 11 (2) based within the District of Columbia; and 12 (3) able to demonstrate an ability to meet all 13 requirements of this Act. 14 (c) APPLICATION.—An eligible entity desiring a con- 15 tract under this section shall submit an application to the 16 Chief Financial Officer at such time, in such manner, and 17 containing such information as the Chief Financial Officer 18 may require. 19 (d) ADMINISTRATIVE EXPENSES.—From the 20 amounts made available under the contract described in 21 subsection (a), the administering entity may reserve an 22 amount that is not greater than the sum of 5 percent of 23 the funds allocated under section 4(a)(4) for each eligible 24 child with an education savings account, to be used by the 25 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 6 •HR 778 IH administering entity for the administrative expenses asso- 1 ciated with the program under this Act. 2 SEC. 4. UNIVERSAL EDUCATIONAL CHOICE FOR DISTRICT 3 OF COLUMBIA STUDENTS. 4 (a) BASIC ELEMENTS OF PARENTAL CHOICE IN 5 EDUCATION.— 6 (1) EDUCATIONAL CHOICE.—Except as pro- 7 vided in paragraph (6), the parent of any eligible 8 child may enter into an agreement under paragraph 9 (2)(B) with the administering entity for any year 10 during which the eligible child will be in a grade for 11 which the District of Columbia provides free public 12 education. 13 (2) PROVISION OF EDUCATION SAVINGS AC- 14 COUNTS.— 15 (A) IN GENERAL.—Beginning with the 16 2019–2020 school year, the administering enti- 17 ty shall provide, to each eligible child whose 18 parent enters into or renews an agreement de- 19 scribed in subparagraph (B) with the admin- 20 istering entity for the school year, an education 21 savings account described in paragraph (3), 22 into which scholarship amounts for the year 23 shall be deposited in accordance with paragraph 24 (4). 25 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 7 •HR 778 IH (B) AGREEMENT.—The agreement re- 1 quired under this subparagraph shall be in a 2 manner and on a form determined by the ad- 3 ministering entity and shall provide that— 4 (i) the eligible child will receive an 5 education savings account described in 6 paragraph (3) and the administering entity 7 will deposit a scholarship into the account 8 for each year that the agreement is in ef- 9 fect, in accordance with paragraph (4); 10 (ii) the eligible child may be educated 11 pursuant to any of the methods described 12 in subparagraphs (A) through (G) of sub- 13 section (c)(1); 14 (iii) the parent shall direct the use of 15 the funds provided in the education savings 16 account for educational expenses described 17 in subsection (c), and the administering 18 entity shall distribute such funds in ac- 19 cordance with paragraph (3)(B); 20 (iv) the parent agrees to the terms 21 and conditions of the education savings ac- 22 count, including any participation nec- 23 essary for the accountability activities re- 24 quired under subsection (d)(3); and 25 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 8 •HR 778 IH (v) with respect to an eligible child 1 who is a child with a disability (as defined 2 in section 602 of the Individuals with Dis- 3 abilities Education Act (20 U.S.C. 1401)), 4 the parent agrees that participation in the 5 program under this section shall have the 6 same effect as parental placement of child 7 under section 612(a)(10)(A) of such Act 8 (20 U.S.C. 1412(a)(10)(A)). 9 (3) EDUCATION SAVINGS ACCOUNT.—An edu- 10 cation savings account described in this paragraph 11 means a parent-controlled account, established exclu- 12 sively for the purpose of paying for the educational 13 expenses described in subsection (c) for an eligible 14 child who is the designated beneficiary of the ac- 15 count, that meets the following requirements: 16 (A) No funds shall be deposited into the 17 account unless the funds are— 18 (i) a disbursement of an annual schol- 19 arship from the administering entity as 20 provided under paragraph (2)(A); or 21 (ii) a deposit of opportunity scholar- 22 ship funds, in accordance with section 23 3007(a)(2) of the Scholarships for Oppor- 24 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 9 •HR 778 IH tunity and Results Act (sec. 38– 1 1853.07(a)(2), D.C. Official Code). 2 (B) The funds in the account shall be dis- 3 tributed by the administering entity on behalf 4 of the eligible child to 1 or more participating 5 providers, upon direction by the parent, at the 6 appropriate time. 7 (C) Except as provided in subparagraph 8 (D), any amount in the account that is attrib- 9 utable to a deposit provided under paragraph 10 (2)(A) or a deposit of any opportunity scholar- 11 ship funds awarded under section 3007 of the 12 Scholarships for Opportunity and Results Act 13 (sec. 38–1853.07, D.C. Official Code) may be 14 paid or distributed out of the account only for 15 the purpose of paying education expenses de- 16 scribed in subsection (c) for the eligible child. 17 (D) Any balance remaining in the account 18 shall be returned to the Chief Financial Officer 19 on the last day of the period covered by an 20 agreement described in paragraph (2)(B) if— 21 (i) such agreement is broken or ended 22 by the parent during the agreement period; 23 (ii) the parent of the eligible child 24 does not renew the agreement for the eligi- 25 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 10 •HR 778 IH ble child for the immediately succeeding 1 academic year; 2 (iii) during the most recent year of 3 the agreement, the parents do not use any 4 funds in the account for eligible expenses 5 described in subsection (c); or 6 (iv) the child no longer qualifies as an 7 eligible child. 8 (4) AMOUNT OF SCHOLARSHIP AND TRANSFER 9 OF FUNDS.— 10 (A) TRANSFER OF FUNDS.—By not later 11 than August 1 of each school year— 12 (i) the administering entity shall no- 13 tify the Chief Financial Officer of the total 14 amount calculated under subparagraph (B) 15 to be provided under this Act for scholar- 16 ships to eligible children for such school 17 year; and 18 (ii) the Chief Financial Officer shall 19 transfer such amount, from any funds or 20 revenues available to the District of Co- 21 lumbia, to the administering entity to en- 22 able the administering entity to pay for the 23 scholarships and the administration ex- 24 penses for the full fiscal year, in accord- 25 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 11 •HR 778 IH ance with subparagraphs (B) and (D) and 1 section 3(d). 2 (B) AMOUNT.—The total amount provided 3 under this section for a full-year scholarship on 4 behalf of an eligible child shall equal— 5 (i) in the case of an eligible child from 6 a family with an income of not more than 7 185 percent of the poverty level described 8 in subparagraph (C) or an eligible child 9 who is a child with a disability, as defined 10 in section 602 of the Individuals with Dis- 11 abilities Education Act (20 U.S.C. 1401), 12 90 percent of the funds that would other- 13 wise be allocated by the District of Colum- 14 bia Public Schools for such child, as deter- 15 mined by the uniform per student funding 16 formula defined in the District of Colum- 17 bia School Reform Act of 1995 (sec. 38– 18 804.01, D.C. Official Code); 19 (ii) in the case of an eligible child 20 from a family with an income of more than 21 185 percent, and not more than 300 per- 22 cent, of such poverty level, 85 percent of 23 the funds that would otherwise be allocated 24 by the District of Columbia Public Schools 25 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 12 •HR 778 IH for such child as determined by such uni- 1 form per student funding formula; and 2 (iii) in the case of an eligible child 3 from a family with an income that equals 4 or exceeds 300 percent of such poverty 5 level, 80 percent of the funds that would 6 otherwise be allocated by the District of 7 Columbia Public Schools for such child as 8 determined by such uniform per student 9 funding formula. 10 (C) CALCULATION OF POVERTY LEVEL.— 11 In determining the poverty level for purposes of 12 this paragraph, the administering entity shall 13 use the criteria of poverty used by the Bureau 14 of the Census in compiling the most recent de- 15 cennial census, as the criteria have been up- 16 dated by increases in the Consumer Price Index 17 for All Urban Consumers, published by the Bu- 18 reau of Labor Statistics. 19 (D) QUARTERLY DISBURSEMENT.—The 20 administering entity shall distribute the amount 21 of a scholarship provided under this section to 22 an eligible child whose parent has entered into 23 an agreement under paragraph (2)(B) into the 24 eligible child’s education savings account, which 25 VerDate Sep 11 2014 05:06 Feb 02, 2019 Jkt 089200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H778.IH H778 kjohnson on DSK79L0C42 with BILLS 13 •HR 778 IH may be through 4 equal quarterly deposits or 1 any other distribution schedule determined ap- 2 propriate by the administering entity. 3 (5) OWNERSHIP OF THE EDUCATION SAVINGS 4 ACCOUNT.—An education savings account estab- 5 lished for an eligible child under this Act, and any 6 funds deposited within the education savings ac- 7 count, shall belong to the eligible [Text truncated for display. 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