SB252 - Revises provisions relating to education. (BDR 34-635)

S.B. 252 - *SB252* SENATE BILL NO. 252–SENATORS BUCK AND STONE FEBRUARY 27, 2025 ____________ Referred to Committee on Education SUMMARY—Revises provisions relating to education. (BDR 34-635) FISCAL NOTE: Effect on Local Government: May have Fiscal Impact. Effect on the State: Yes. ~ EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. AN ACT relating to education; establishing the Nevada Education Savings Account Program by which certain children may receive a grant of money for deposit into an education savings account; authorizing an account-granting organization to apply to the Department of Education for a certificate to open and manage education savings accounts; setting forth the duties and authority of a certified account-granting organization; establishing certain limitations on the use of money in an education savings account; exempting a child who receives an education savings account from certain educational enrollment and attendance requirements; establishing a credit against the modified business tax for taxpayers who donate money to an account-granting organization; and providing other matters properly relating thereto. Legislative Counsel’s Digest: Existing law establishes the Nevada Educational Choice Scholarship Program, 1 whereby a scholarship organization may provide a grant of money to allow certain 2 pupils to attend a private school. (NRS 388D.250-388D.280) Section 2 of this bill 3 establishes the Nevada Education Savings Account Program, whereby, under 4 certain circumstances, an account-granting organization may establish an education 5 savings account for a child. 6 Existing law establishes a credit against the payroll tax paid by certain 7 businesses equal to an amount approved by the Department of Taxation and which 8 must not exceed the amount of any donation of money which is made by a taxpayer 9 to a scholarship organization that provides grants on behalf of certain pupils. (NRS 10 363A.130, 363B.110) Sections 28 and 30 of this bill establish similar tax credits 11 – 2 – - *SB252* for a donation of money which is made by a taxpayer to an account-granting 12 organization that provides grants of money to education savings accounts. 13 Section 12 of this bill: (1) requires an account-granting organization to apply to 14 the Department of Education for a certificate to participate in the Program; and (2) 15 sets forth certain application requirements. Section 12 further provides that, if the 16 application is approved, an account-granting organization may: (1) solicit and 17 accept donations from certain taxpayers; and (2) provide grants to education 18 savings accounts pursuant to the provisions of the Program. 19 Section 21 of this bill sets forth certain requirements for an account-granting 20 organization to apply annually to renew its certificate issued by the Department. 21 Section 13 of this bill: (1) requires each account-granting organization to 22 implement a system for administering education savings accounts; and (2) 23 authorizes each account-granting organization to contract with a private financial 24 institution for the administration of education savings accounts. 25 Section 14 of this bill requires that an account-granting organization ensure that 26 at least 90 percent of the money received pursuant to sections 28 and 30 is 27 allocated to education savings accounts. 28 Section 15 of this bill imposes certain duties on an account-granting 29 organization. 30 Section 16 of this bill: (1) authorizes the parent of any child required to attend 31 public school to apply to an account-granting organization for an education savings 32 account; and (2) sets forth certain requirements for an agreement between a parent 33 and account-granting organization in order to open an education savings account 34 for a child. 35 Section 17 of this bill requires the account-granting organization to deposit in a 36 child’s education savings account an amount that is equal to the base per pupil 37 funding plus any weighted funding that the child would be entitled to if the child 38 were enrolled in a public school. 39 Section 18 of this bill requires an account-granting organization to establish a 40 process for approving an education service provider to receive money from an 41 education savings account. 42 Section 19 of this bill sets forth certain allowable uses of money deposited in a 43 child’s education savings account. 44 Section 20 of this bill authorizes unused money remaining in a child’s 45 education savings account to be used within a certain period of time for any 46 postsecondary education. 47 Section 22 of this bill requires the Department of Education to maintain on its 48 Internet website a list of account-granting organizations to which a parent may 49 apply for an education savings account pursuant to the Program. 50 Section 23 of this bill authorizes the Department to audit or investigate an 51 account-granting organization to ensure compliance with the provisions of sections 52 2-26 of this bill and any regulations adopted pursuant thereto. 53 Section 24 requires each account-granting organization to submit an annual 54 report of its activities to the Department. 55 Section 25 provides that no obligation or liability may be incurred by the 56 Department, a school district or any public school in this State by the provisions of 57 sections 2-26. 58 Section 26 requires the Department to adopt any regulations necessary to carry 59 out the provisions of the Program. 60 Existing law requires each child between the ages of 6 and 18 years to attend a 61 public school of the State, attend a private school or be homeschooled. (NRS 62 392.040, 392.070) Sections 16 and 27 of this bill provide an exemption to this 63 requirement for a child who receives an education savings account pursuant to the 64 Program. 65 Sections 3-11 define certain terms relating to the Program. 66 – 3 – - *SB252* THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS: Section 1. Chapter 388D of NRS is hereby amended by 1 adding thereto the provisions set forth as sections 2 to 26, inclusive, 2 of this act. 3 Sec. 2. 1. The Nevada Education Savings Account 4 Program is hereby established. 5 2. Sections 2 to 26, inclusive, of this act, may be cited as the 6 Nevada Education Savings Account Program Act. 7 Sec. 3. As used in sections 2 to 26, inclusive, of this act, 8 unless the context otherwise requires, the words and terms defined 9 in sections 4 to 11, inclusive, of this act have the meanings 10 ascribed to them in those sections. 11 Sec. 4. “Account-granting organization” means a private, 12 nonprofit organization that is certified by the Department 13 pursuant to section 12 or 21 of this act. 14 Sec. 5. “Child” means a resident of this State who is eligible 15 to enroll in a public elementary or secondary school. 16 Sec. 6. “Department” means the Department of Education. 17 Sec. 7. “Education savings account” means an account 18 established for a child by an account-granting organization 19 pursuant to section 16 of this act. 20 Sec. 8. “Education service provider” means a person or 21 organization that is approved by an account-granting organization 22 pursuant to section 18 of this act to receive money from an 23 education savings account for an expense that is authorized 24 pursuant to section 19 of this act. 25 Sec. 9. “Parent” means the parent, custodial parent, legal 26 guardian or other person in this State who has control or charge 27 of a child and the legal right to direct the education of the child. 28 Sec. 10. “Private school” means a nonprofit private 29 elementary or secondary educational institution that is licensed in 30 this State. 31 Sec. 11. “Program” means the Nevada Education Savings 32 Account Program established by section 2 of this act. 33 Sec. 12. 1. An account-granting organization must apply to 34 the Department to participate in the Program. An application must 35 include, without limitation: 36 (a) A copy of the documents indicating that the account- 37 granting organization has incorporated in this State as a nonprofit 38 organization; 39 (b) A copy of the determination by the Internal Revenue 40 Service that the account-granting organization is exempt from 41 – 4 – - *SB252* taxation pursuant to section 501(c)(3) of the Internal Revenue 1 Code, 26 U.S.C. § 501(c)(3); 2 (c) A description of the methodology that the account-granting 3 organization will use to evaluate whether a child is eligible for an 4 education savings account; 5 (d) A description of the application process that the account- 6 granting organization will use for parents applying for an 7 education savings account; 8 (e) A description of how the account-granting organization 9 will approve education service providers to receive money from an 10 education savings account; 11 (f) A description of the process that the account-granting 12 organization will use to inform parents of approved education 13 service providers; 14 (g) The process and procedures that will be used by the 15 account-granting organization for crediting refunds from an 16 education service provider back to an education savings account; 17 and 18 (h) An acknowledgment that the account-granting 19 organization is prohibited from discriminating against a parent or 20 child on the basis of race, color, ethnicity or national origin in 21 approving or denying any application for an education savings 22 account. 23 2. To obtain approval and certification from the Department, 24 an account-granting organization must: 25 (a) Be exempt from taxation pursuant to section 501(c)(3) of 26 the Internal Revenue Code, 26 U.S.C. § 501(c)(3); 27 (b) Not own or operate any school in this State, including, 28 without limitation, a private school; and 29 (c) Meet any other requirement established by regulation of 30 the Department. 31 3. The Department shall process an application for 32 certification within 60 days after receipt. 33 4. If certified by the Department, an account-granting 34 organization shall: 35 (a) Solicit and accept donations from taxpayers pursuant to 36 sections 28 and 30 of this act; 37 (b) Not expend more than 10 percent of the total amount of 38 money accepted pursuant to paragraph (a) to pay its 39 administrative expenses; and 40 (c) Provide grants to education savings accounts on behalf of 41 children whose parents enter into an agreement with the account- 42 granting organization pursuant to section 16 of this act. 43 Sec. 13. 1. Each account-granting organization: 44 – 5 – - *SB252* (a) Shall implement a commercially viable, cost-effective and 1 user-friendly system for administering education savings 2 accounts; and 3 (b) May contract with a private financial institution for the 4 administration of education savings accounts. 5 2. An account-granting organization: 6 (a) Shall not implement a system that requires parents to be 7 reimbursed for expenses; and 8 (b) May implement a system that provides for the preapproval 9 of a particular expense to be reimbursed from an education 10 savings account. 11 Sec. 14. 1. An account-granting organization shall ensure 12 that at least 90 percent of the money received pursuant to sections 13 28 and 30 of this act is allocated to education savings accounts. 14 2. An account-granting organization may, after notifying the 15 Department, transfer revenue received pursuant to section 28 or 16 30 of this act to any other account-granting organization for 17 allocation to education savings accounts. 18 Sec. 15. 1. Each account-granting organization shall: 19 (a) Create a standard application process that is publicly 20 available on the Internet website of the account-granting 21 organization for parents to apply for an education savings account 22 pursuant to section 16 of this act; and 23 (b) Provide each parent whose application for an education 24 savings account is approved a written explanation of: 25 (1) The responsibilities of the parent resulting from the 26 creation of an education savings account; 27 (2) The duties of the account-granting organization; 28 (3) The role of any private financial institution with which 29 the account-granting organization is contracted to administer 30 education savings accounts; and 31 (4) The education service providers who are eligible to 32 receive payment out of the education savings account for an 33 expense that is authorized pursuant to section 19 of this act. 34 2. If a parent of a child with a disability applies to receive an 35 education savings account, the account-granting organization 36 must notify the parent: 37 (a) That receiving an education savings account is a parental 38 placement pursuant to 20 U.S.C. § 1412; and 39 (b) Of the rights that the child has pursuant to 20 U.S.C. § 40 1412 and any applicable state law. 41 Sec. 16. 1. The parent of any child required to enroll in 42 and attend a public school pursuant to NRS 392.040 may apply to 43 an account-granting organization for an education savings 44 account. To the extent that money is available to make a grant 45 – 6 – - *SB252* pursuant to section 17 of this act, the account-granting 1 organization may enter into an agreement pursuant to this section 2 and open an education savings account for the child. The 3 agreement must provide that: 4 (a) The child will receive instruction in this State for the 5 school year in at least the subjects of reading, language, 6 mathematics, science and social studies; 7 (b) The parent will not use any money in the education savings 8 account, except as authorized pursuant to section 19 or 20 of this 9 act; 10 (c) The child will not be enrolled in any public school while an 11 education service provider is receiving money from the education 12 savings account of the child; 13 (d) The parent will not obtain another educational savings 14 account for the child from another account-granting 15 organization; and 16 (e) The parent will comply with any applicable statute or 17 regulation relating to education savings accounts. 18 2. To the extent that money is available to make a grant to an 19 education savings ac [Text truncated for display. Full text available on LegiScan.]