Education Savings Accounts for Military Families Act of 2023

II 118TH CONGRESS 1ST SESSION S. 60 To amend the Elementary and Secondary Education Act of 1965 to allow parents of eligible military dependent children to establish Military Edu- cation Savings Accounts, and for other purposes. IN THE SENATE OF THE UNITED STATES JANUARY 24 (legislative day, JANUARY 3), 2023 Mr. CRUZ (for himself, Mr. SCOTT of South Carolina, and Mr. BRAUN) intro- duced the following bill; which was read twice and referred to the Com- mittee on Finance A BILL To amend the Elementary and Secondary Education Act of 1965 to allow parents of eligible military dependent children to establish Military Education Savings Ac- counts, and for other purposes. 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 ‘‘Education Savings Ac- 4 counts for Military Families Act of 2023’’. 5 SEC. 2. MILITARY EDUCATION SAVINGS ACCOUNTS. 6 (a) IN GENERAL.—Title VII of the Elementary and 7 Secondary Education Act of 1965 (20 U.S.C. 7701 et 8 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 2 •S 60 IS seq.) is amended by inserting after section 7012 the fol- 1 lowing: 2 ‘‘SEC. 7012A. MILITARY EDUCATION SAVINGS ACCOUNTS. 3 ‘‘(a) IN GENERAL.—The Secretary of Education, in 4 consultation with the Secretary of Defense, shall carry out 5 a program under which the Secretary of Education shall— 6 ‘‘(1) at the request of a parent of an eligible 7 military dependent child, establish an account on be- 8 half of such child (to be known as a ‘Military Edu- 9 cation Savings Account’) into which the Secretary 10 shall deposit funds in an amount determined under 11 subsection (d); and 12 ‘‘(2) establish a procedure under which the par- 13 ent of the child may use funds in the account to pay 14 for the educational expenses of the child in accord- 15 ance with this section. 16 ‘‘(b) APPLICATION.— 17 ‘‘(1) IN GENERAL.—To be eligible to participate 18 in the program under this section for a school year, 19 a parent of an eligible military dependent child shall 20 submit an application to the Secretary in accordance 21 with this subsection. 22 ‘‘(2) APPLICATION PROCESS.—In carrying out 23 paragraph (1), the Secretary shall— 24 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 3 •S 60 IS ‘‘(A) accept applications on a year-round 1 basis and establish procedures for approving 2 applications in an expeditious manner; and 3 ‘‘(B) create a standardized form that par- 4 ents can use to apply for the program and en- 5 sure that such form is readily available in writ- 6 ten and electronic formats, including on a pub- 7 licly accessible website. 8 ‘‘(3) APPROVAL.—Subject to the availability of 9 funds to carry out this section, the Secretary shall 10 approve the application of a parent to establish a 11 Military Education Savings Account if— 12 ‘‘(A) the application is submitted in ac- 13 cordance with the application process estab- 14 lished by the Secretary pursuant to this sub- 15 section; 16 ‘‘(B) the application demonstrates that the 17 child on whose behalf the Military Education 18 Savings Account is to be established is an eligi- 19 ble military dependent child; and 20 ‘‘(C) the parent who submits the applica- 21 tion enters into a written agreement with the 22 Secretary under which the parent agrees— 23 ‘‘(i) to provide the child with instruc- 24 tion in, at minimum, the fields of reading, 25 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 4 •S 60 IS language, mathematics, science, and social 1 studies; 2 ‘‘(ii) to not enroll the child in a public 3 elementary school or a public secondary 4 school, on a full-time basis while partici- 5 pating in the program; 6 ‘‘(iii) to use funds in the Military 7 Education Savings Account only for the 8 purposes authorized under this section; 9 and 10 ‘‘(iv) to comply with all other require- 11 ments of this section. 12 ‘‘(4) RENEWALS.—The Secretary shall establish 13 a process for the automatic renewal of a previously 14 established Military Education Savings Account ex- 15 cept in cases in which— 16 ‘‘(A) the parents of the child on whose be- 17 half the account was established choose not to 18 renew the account; or 19 ‘‘(B) the account was used to commit 20 fraud or was otherwise not used in accordance 21 with the requirements of this section. 22 ‘‘(c) PRIORITY IN THE EVENT OF INSUFFICIENT 23 FUNDS.— 24 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 5 •S 60 IS ‘‘(1) IN GENERAL.—If the funds appropriated 1 to carry out this section are insufficient to enable 2 the Secretary to establish and fully fund a Military 3 Education Savings Account for each eligible military 4 dependent child whose parent has an application ap- 5 proved under subsection (b) for a school year, the 6 Secretary shall— 7 ‘‘(A) first renew and fully fund previously 8 established Military Education Savings Ac- 9 counts; and 10 ‘‘(B) if funds remain available after renew- 11 ing all accounts under subparagraph (A), con- 12 duct the lottery described in paragraph (3) to 13 select the children on whose behalf accounts will 14 be established using the remaining funds. 15 ‘‘(2) TRANSFER AUTHORITY.—Notwithstanding 16 any other provision of law, the Secretary may trans- 17 fer amounts from any account of the Department of 18 Education to renew and fully fund previously estab- 19 lished Military Education Savings Accounts under 20 paragraph (1)(A). The authority to transfer 21 amounts under the preceding sentence shall not be 22 subject to any transfer or reprogramming require- 23 ments under any other provision of law. 24 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 6 •S 60 IS ‘‘(3) LOTTERY.—The lottery described in this 1 paragraph is a lottery in which— 2 ‘‘(A) siblings of children on whose behalf 3 Military Education Savings Accounts have pre- 4 viously been established have the highest prob- 5 ability of selection; 6 ‘‘(B) children of enlisted members have the 7 next-highest probability of selection after the 8 children described in subparagraph (A); 9 ‘‘(C) children of warrant officers have the 10 next-highest probability of selection after the 11 children described in subparagraph (B); and 12 ‘‘(D) children of commissioned officers 13 have the lowest probability of selection. 14 ‘‘(d) AMOUNT OF DEPOSITS.— 15 ‘‘(1) FIRST YEAR OF PROGRAM.—The amount 16 of funds deposited into each Military Education Sav- 17 ings Account for the first school year for which such 18 accounts are established under this section shall be 19 $6,000 for each eligible military dependent child cov- 20 ered by the account. 21 ‘‘(2) SUBSEQUENT YEARS.—The amount of 22 funds deposited into each Military Education Sav- 23 ings Account for any school year after the year de- 24 scribed in paragraph (1), shall be the amount deter- 25 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 7 •S 60 IS mined under this subsection for the previous school 1 year increased by a percentage equal to the percent- 2 age increase in the Chained Consumer Price Index 3 for All Urban Consumers (as published by the Bu- 4 reau of Labor Statistics of the Department of 5 Labor) over the period of such previous school year. 6 ‘‘(e) USE OF FUNDS.—Funds deposited into a Mili- 7 tary Education Savings Account for a school year may be 8 used by the parent of an eligible military dependent child 9 to make payments to a qualified educational service pro- 10 vider that is approved by the Secretary under subsection 11 (f)(1) for— 12 ‘‘(1) costs of attendance at a private elementary 13 school or secondary school recognized by the State, 14 which may include a private school that has a reli- 15 gious mission; 16 ‘‘(2) private online learning programs; 17 ‘‘(3) private tutoring; 18 ‘‘(4) services provided by a public elementary 19 school or secondary school attended by the child on 20 a less than full-time basis, including individual class- 21 es and extracurricular activities and programs; 22 ‘‘(5) textbooks, curriculum programs, or other 23 instructional materials, including any supplemental 24 materials required by a curriculum program, private 25 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 8 •S 60 IS school, private online learning program, or a public 1 school, or any parent directed curriculum associated 2 with K–12 education; 3 ‘‘(6) computer hardware or other technological 4 devices that are used to help meet a child’s edu- 5 cational needs, except that such hardware or devices 6 may not be purchased by a parent more than once 7 in an 18-month period; 8 ‘‘(7) educational software and applications; 9 ‘‘(8) uniforms purchased from or through a pri- 10 vate school recognized by the State; 11 ‘‘(9) fees for nationally standardized assessment 12 exams, advanced placement exams, any exams re- 13 lated to college or university admission, or tuition or 14 fees for preparatory courses for such exams; 15 ‘‘(10) fees for summer education programs and 16 specialized after-school education programs (but not 17 including after-school childcare); 18 ‘‘(11) educational services and therapies, in- 19 cluding occupational, behavioral, physical, speech- 20 language, and audiology therapies; 21 ‘‘(12) fees for transportation paid to a fee-for- 22 service transportation provider for the child to travel 23 to and from the facilities of a qualified educational 24 service provider; 25 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 9 •S 60 IS ‘‘(13) costs of attendance at an institution of 1 higher education; 2 ‘‘(14) costs associated with an apprenticeship or 3 other vocational training program; 4 ‘‘(15) fees for state-recognized industry certifi- 5 cation exams, and tuition or fees for preparatory 6 courses for such exams; 7 ‘‘(16) contributions to a college savings ac- 8 count, which may include contributions to a qualified 9 tuition program (as defined in section 529(b)(1)(A) 10 of the Internal Revenue Code of 1986) or other pre- 11 paid tuition plan offered by a State; or 12 ‘‘(17) any other educational expenses approved 13 by the Secretary. 14 ‘‘(f) REQUIREMENTS FOR QUALIFIED EDUCATIONAL 15 SERVICE PROVIDERS.— 16 ‘‘(1) REGISTRATION AND APPROVAL.—The Sec- 17 retary shall establish and maintain a registry of 18 qualified educational service providers that are ap- 19 proved to receive payments from a Military Edu- 20 cation Savings Account. The Secretary shall approve 21 a qualified educational service provider to receive 22 such payments if the provider demonstrates to the 23 Secretary that it is licensed in the State in which it 24 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 10 •S 60 IS operates to provide one or more of the services for 1 which funds may be expended under subsection (e). 2 ‘‘(2) PARTICIPATION IN ONLINE MARKET- 3 PLACE.—As a condition of receiving funds from a 4 Military Education Savings Account, a qualified edu- 5 cational service provider shall make its services 6 available for purchase through the online market- 7 place described in subsection (g). 8 ‘‘(3) SURETY BOND.— 9 ‘‘(A) IN GENERAL.—The Secretary shall 10 require each qualified educational service pro- 11 vider that receives $100,000 or more in funds 12 from Military Education Savings Accounts in a 13 school year to post a surety bond, in an amount 14 determined by the Secretary, for such school 15 year. 16 ‘‘(B) RETENTION.—The Secretary shall 17 prescribe the circumstances under which a sur- 18 ety bond under subparagraph (A) may be re- 19 tained by the Secretary. 20 ‘‘(g) ONLINE MARKETPLACE.— 21 ‘‘(1) IN GENERAL.—The Secretary shall seek to 22 enter into a contract with a private-sector entity 23 under which the entity shall— 24 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 11 •S 60 IS ‘‘(A) establish and operate an online mar- 1 ketplace that enables the holder of a Military 2 Education Savings Account to make direct pur- 3 chases from qualified educational service pro- 4 viders using funds from such account; 5 ‘‘(B) ensure that each qualified educational 6 service provider on the registry maintained by 7 the Secretary under subsection (f)(1) has made 8 its services available for purchase through the 9 online marketplace; 10 ‘‘(C) ensure that all purchases made 11 through the online marketplace are for services 12 that are allowable uses of funds under sub- 13 section (e); and 14 ‘‘(D) develop and make available a stand- 15 ardized expense report form, in electronic and 16 hard copy formats, to be used by parents for re- 17 porting expenses in accordance with subsection 18 (h)(3). 19 ‘‘(2) RULE OF CONSTRUCTION.—Nothing in 20 this subsection shall be construed to require the 21 holder of a Military Education Savings Account to 22 make purchases using the online marketplace de- 23 scribed in paragraph (1). 24 ‘‘(h) TRANSFER SCHEDULE.— 25 VerDate Sep 11 2014 23:42 Jan 28, 2023 Jkt 039200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S60.IS S60 kjohnson on DSK79L0C42PROD with BILLS 12 •S 60 IS ‘‘(1) IN GENERAL.—Subject to paragraph (2), 1 the Secretary shall make quarterly transfers of the 2 amount calculated pursuant to subsection (d) for de- 3 posit into the account of each eligible military de- 4 pendent child, except that the Secretary may make 5 transfers according to another transfer schedule if 6 the Secretary determines that a transfer schedule 7 other than quarterly transfers is necessary for the 8 operation of the education savings account. 9 ‘‘(2) CHOICE OF SCHEDULE.—The Secretary 10 shall establish a process under which the parent of 11 a child on whose behalf a Military Education Sav- 12 ings Account is established may choose a transfer 13 schedule other than a transfer schedule determined 14 under paragraph (1). 15 ‘‘(3) EXPENSE REPORTS.— 16 ‘‘(A) SUBMISSION REQUIRED.—Before re- 17 ceiving a transfer [Text truncated for display. 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