Federal

Education Savings Accounts for Military Families Act of 2023

Source: Congress.gov · 4,870 words in original text

What This Bill Does

This bill creates Military Education Savings Accounts that parents of eligible military-dependent children can use to pay for education. The Secretary of Education will deposit money into these accounts, and parents can use the funds to pay for approved educational services instead of enrolling their children full-time in public schools. ##

Who It Affects

- Parents of children with at least one parent on active duty in the military - Military-dependent children who were enrolled in public school for at least 100 consecutive days in the previous school year - Private schools, tutors, online learning providers and other education service providers - The Department of Education - States that receive education funding ##

Key Provisions

- Parents of eligible military children can request that the Secretary of Education establish a Military Education Savings Account and deposit funds into it (Sec. 7012A(a)) - Parents must apply for the program and enter a written agreement stating they will teach reading, language, mathematics, science and social studies, and will not enroll their child full-time in public school while participating (Sec. 7012A(b)) - Each account receives $6,000 in the first year, adjusted yearly for inflation (Sec. 7012A(d)) - Parents can use account funds for private school tuition, tutoring, online learning, textbooks, computers, therapy services, college savings contributions and many other approved educational expenses (Sec. 7012A(e)) - The Secretary will maintain a registry of approved education providers and create an online marketplace where parents can purchase services (Sec. 7012A(f) and (g)) - Accounts automatically renew each year unless the family chooses not to renew or the account was used fraudulently (Sec. 7012A(b)) - Accounts terminate when a child enrolls full-time in public school, reaches age 22 (or 26 for children with disabilities), completes college, or when funds have not been used for two years (Sec. 7012A(j)) - Any unspent money in an account when it terminates must be returned to the U.S. Treasury (Sec. 7012A(j)) - Children with these accounts are considered to meet their state's school attendance requirements (Sec. 7012A(k)) - Money contributed to and withdrawn from these accounts is not counted as income for federal tax purposes (Sec. 7012A(m)) - The Secretary can use no more than 5 percent of program funds for administrative costs (Sec. 7012A(s)) ##

What Changes

If this bill becomes law, parents of military-dependent children will have a new option to access government funding for education outside the traditional public school system. They can establish accounts with government-deposited funds and choose from a wide range of education providers and services. Education providers like private schools, tutors and online learning companies will have a new source of payment through the online marketplace. The federal government will begin spending money on these accounts starting in fiscal year 2024. States must recognize these accounts as meeting compulsory school attendance requirements. ##

Important Definitions

- **Eligible military dependent child**: A child whose parent is on active duty in the military and who attended public school for at least 100 consecutive days in the prior school year (Sec. 7012A(t)) - **Qualified educational service provider**: Any person or business licensed by a state to provide educational services, including private schools, tutors, online learning providers, higher education institutions, therapy providers and curriculum providers (Sec. 7012A(t)) - **Institution of higher education**: Not specified in bill text beyond reference to the Higher Education Act of 1965 - **Uniformed services**: Defined by reference to federal law and includes military personnel on active duty, but does not include National Guard officers who have been activated (Sec. 7012A(t)) ##

Effective Date

Not specified in bill text

I 118TH CONGRESS 1ST SESSION H. R. 452 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 HOUSE OF REPRESENTATIVES JANUARY 24, 2023 Mr. BANKS (for himself, Mr. MCHENRY, Mr. BARR, Mr. LAMBORN, Mr. WITTMAN, Mr. BUCSHON, and Mr. SCHWEIKERT) introduced the fol- lowing bill; which was referred to the Committee on Education and the Workforce, and in addition to the Committees on Ways and Means, and Appropriations, for a period to be subsequently determined by the Speak- er, in each case for consideration of such provisions as fall within the ju- risdiction of the committee concerned 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 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 452 IH SEC. 2. MILITARY EDUCATION SAVINGS ACCOUNTS. 1 (a) IN GENERAL.—Title VII of the Elementary and 2 Secondary Education Act of 1965 (20 U.S.C. 7701 et 3 seq.) is amended by inserting after section 7012 the fol- 4 lowing: 5 ‘‘SEC. 7012A. MILITARY EDUCATION SAVINGS ACCOUNTS. 6 ‘‘(a) IN GENERAL.—The Secretary of Education, in 7 consultation with the Secretary of Defense, shall carry out 8 a program under which the Secretary of Education shall— 9 ‘‘(1) at the request of a parent of an eligible 10 military dependent child, establish an account on be- 11 half of such child (to be known as a ‘Military Edu- 12 cation Savings Account’) into which the Secretary 13 shall deposit funds in an amount determined under 14 subsection (d); and 15 ‘‘(2) establish a procedure under which the par- 16 ent of the child may use funds in the account to pay 17 for the educational expenses of the child in accord- 18 ance with this section. 19 ‘‘(b) APPLICATION.— 20 ‘‘(1) IN GENERAL.—To be eligible to participate 21 in the program under this section for a school year, 22 a parent of an eligible military dependent child shall 23 submit an application to the Secretary in accordance 24 with this subsection. 25 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 452 IH ‘‘(2) APPLICATION PROCESS.—In carrying out 1 paragraph (1), the Secretary shall— 2 ‘‘(A) accept applications on a year-round 3 basis and establish procedures for approving 4 applications in an expeditious manner; and 5 ‘‘(B) create a standardized form that par- 6 ents can use to apply for the program and en- 7 sure that such form is readily available in writ- 8 ten and electronic formats, including on a pub- 9 licly accessible website. 10 ‘‘(3) APPROVAL.—Subject to the availability of 11 funds to carry out this section, the Secretary shall 12 approve the application of a parent to establish a 13 Military Education Savings Account if— 14 ‘‘(A) the application is submitted in ac- 15 cordance with the application process estab- 16 lished by the Secretary pursuant to this sub- 17 section; 18 ‘‘(B) the application demonstrates that the 19 child on whose behalf the Military Education 20 Savings Account is to be established is an eligi- 21 ble military dependent child; and 22 ‘‘(C) the parent who submits the applica- 23 tion enters into a written agreement with the 24 Secretary under which the parent agrees— 25 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 452 IH ‘‘(i) to provide the child with instruc- 1 tion in, at minimum, the fields of reading, 2 language, mathematics, science, and social 3 studies; 4 ‘‘(ii) to not enroll the child in a public 5 elementary school or a public secondary 6 school, on a full-time basis while partici- 7 pating in the program; 8 ‘‘(iii) to use funds in the Military 9 Education Savings Account only for the 10 purposes authorized under this section; 11 and 12 ‘‘(iv) to comply with all other require- 13 ments of this section. 14 ‘‘(4) RENEWALS.—The Secretary shall establish 15 a process for the automatic renewal of a previously 16 established Military Education Savings Account ex- 17 cept in cases in which— 18 ‘‘(A) the parents of the child on whose be- 19 half the account was established choose not to 20 renew the account; or 21 ‘‘(B) the account was used to commit 22 fraud or was otherwise not used in accordance 23 with the requirements of this section. 24 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 452 IH ‘‘(c) PRIORITY IN THE EVENT OF INSUFFICIENT 1 FUNDS.— 2 ‘‘(1) IN GENERAL.—If the funds appropriated 3 to carry out this section are insufficient to enable 4 the Secretary to establish and fully fund a Military 5 Education Savings Account for each eligible military 6 dependent child whose parent has an application ap- 7 proved under subsection (b) for a school year, the 8 Secretary shall— 9 ‘‘(A) first renew and fully fund previously 10 established Military Education Savings Ac- 11 counts; and 12 ‘‘(B) if funds remain available after renew- 13 ing all accounts under subparagraph (A), con- 14 duct the lottery described in paragraph (3) to 15 select the children on whose behalf accounts will 16 be established using the remaining funds. 17 ‘‘(2) TRANSFER AUTHORITY.—Notwithstanding 18 any other provision of law, the Secretary may trans- 19 fer amounts from any account of the Department of 20 Education to renew and fully fund previously estab- 21 lished Military Education Savings Accounts under 22 paragraph (1)(A). The authority to transfer 23 amounts under the preceding sentence shall not be 24 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 6 •HR 452 IH subject to any transfer or reprogramming require- 1 ments under any other provision of law. 2 ‘‘(3) LOTTERY.—The lottery described in this 3 paragraph is a lottery in which— 4 ‘‘(A) siblings of children on whose behalf 5 Military Education Savings Accounts have pre- 6 viously been established have the highest prob- 7 ability of selection; 8 ‘‘(B) children of enlisted members have the 9 next-highest probability of selection after the 10 children described in subparagraph (A); 11 ‘‘(C) children of warrant officers have the 12 next-highest probability of selection after the 13 children described in subparagraph (B); and 14 ‘‘(D) children of commissioned officers 15 have the lowest probability of selection. 16 ‘‘(d) AMOUNT OF DEPOSITS.— 17 ‘‘(1) FIRST YEAR OF PROGRAM.—The amount 18 of funds deposited into each Military Education Sav- 19 ings Account for the first school year for which such 20 accounts are established under this section shall be 21 $6,000 for each eligible military dependent child cov- 22 ered by the account. 23 ‘‘(2) SUBSEQUENT YEARS.—The amount of 24 funds deposited into each Military Education Sav- 25 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 7 •HR 452 IH ings Account for any school year after the year de- 1 scribed in paragraph (1), shall be the amount deter- 2 mined under this subsection for the previous school 3 year increased by a percentage equal to the percent- 4 age increase in the Chained Consumer Price Index 5 for All Urban Consumers (as published by the Bu- 6 reau of Labor Statistics of the Department of 7 Labor) over the period of such previous school year. 8 ‘‘(e) USE OF FUNDS.—Funds deposited into a Mili- 9 tary Education Savings Account for a school year may be 10 used by the parent of an eligible military dependent child 11 to make payments to a qualified educational service pro- 12 vider that is approved by the Secretary under subsection 13 (f)(1) for— 14 ‘‘(1) costs of attendance at a private elementary 15 school or secondary school recognized by the State, 16 which may include a private school that has a reli- 17 gious mission; 18 ‘‘(2) private online learning programs; 19 ‘‘(3) private tutoring; 20 ‘‘(4) services provided by a public elementary 21 school or secondary school attended by the child on 22 a less than full-time basis, including individual class- 23 es and extracurricular activities and programs; 24 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 8 •HR 452 IH ‘‘(5) textbooks, curriculum programs, or other 1 instructional materials, including any supplemental 2 materials required by a curriculum program, private 3 school, private online learning program, or a public 4 school, or any parent directed curriculum associated 5 with K–12 education; 6 ‘‘(6) computer hardware or other technological 7 devices that are used to help meet a child’s edu- 8 cational needs, except that such hardware or devices 9 may not be purchased by a parent more than once 10 in an 18-month period; 11 ‘‘(7) educational software and applications; 12 ‘‘(8) uniforms purchased from or through a pri- 13 vate school recognized by the State; 14 ‘‘(9) fees for nationally standardized assessment 15 exams, advanced placement exams, any exams re- 16 lated to college or university admission, or tuition or 17 fees for preparatory courses for such exams; 18 ‘‘(10) fees for summer education programs and 19 specialized after-school education programs (but not 20 including after-school childcare); 21 ‘‘(11) educational services and therapies, in- 22 cluding occupational, behavioral, physical, speech- 23 language, and audiology therapies; 24 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 9 •HR 452 IH ‘‘(12) fees for transportation paid to a fee-for- 1 service transportation provider for the child to travel 2 to and from the facilities of a qualified educational 3 service provider; 4 ‘‘(13) costs of attendance at an institution of 5 higher education; 6 ‘‘(14) costs associated with an apprenticeship or 7 other vocational training program; 8 ‘‘(15) fees for State-recognized industry certifi- 9 cation exams, and tuition or fees for preparatory 10 courses for such exams; 11 ‘‘(16) contributions to a college savings ac- 12 count, which may include contributions to a qualified 13 tuition program (as defined in section 529(b)(1)(A) 14 of the Internal Revenue Code of 1986) or other pre- 15 paid tuition plan offered by a State; or 16 ‘‘(17) any other educational expenses approved 17 by the Secretary. 18 ‘‘(f) REQUIREMENTS FOR QUALIFIED EDUCATIONAL 19 SERVICE PROVIDERS.— 20 ‘‘(1) REGISTRATION AND APPROVAL.—The Sec- 21 retary shall establish and maintain a registry of 22 qualified educational service providers that are ap- 23 proved to receive payments from a Military Edu- 24 cation Savings Account. The Secretary shall approve 25 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 10 •HR 452 IH a qualified educational service provider to receive 1 such payments if the provider demonstrates to the 2 Secretary that it is licensed in the State in which it 3 operates to provide one or more of the services for 4 which funds may be expended under subsection (e). 5 ‘‘(2) PARTICIPATION IN ONLINE MARKET- 6 PLACE.—As a condition of receiving funds from a 7 Military Education Savings Account, a qualified edu- 8 cational service provider shall make its services 9 available for purchase through the online market- 10 place described in subsection (g). 11 ‘‘(3) SURETY BOND.— 12 ‘‘(A) IN GENERAL.—The Secretary shall 13 require each qualified educational service pro- 14 vider that receives $100,000 or more in funds 15 from Military Education Savings Accounts in a 16 school year to post a surety bond, in an amount 17 determined by the Secretary, for such school 18 year. 19 ‘‘(B) RETENTION.—The Secretary shall 20 prescribe the circumstances under which a sur- 21 ety bond under subparagraph (A) may be re- 22 tained by the Secretary. 23 ‘‘(g) ONLINE MARKETPLACE.— 24 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 11 •HR 452 IH ‘‘(1) IN GENERAL.—The Secretary shall seek to 1 enter into a contract with a private-sector entity 2 under which the entity shall— 3 ‘‘(A) establish and operate an online mar- 4 ketplace that enables the holder of a Military 5 Education Savings Account to make direct pur- 6 chases from qualified educational service pro- 7 viders using funds from such account; 8 ‘‘(B) ensure that each qualified educational 9 service provider on the registry maintained by 10 the Secretary under subsection (f)(1) has made 11 its services available for purchase through the 12 online marketplace; 13 ‘‘(C) ensure that all purchases made 14 through the online marketplace are for services 15 that are allowable uses of funds under sub- 16 section (e); and 17 ‘‘(D) develop and make available a stand- 18 ardized expense report form, in electronic and 19 hard copy formats, to be used by parents for re- 20 porting expenses in accordance with subsection 21 (h)(3). 22 ‘‘(2) RULE OF CONSTRUCTION.—Nothing in 23 this subsection shall be construed to require the 24 holder of a Military Education Savings Account to 25 VerDate Sep 11 2014 22:16 Feb 03, 2023 Jkt 039200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H452.IH H452 kjohnson on DSK79L0C42PROD with BILLS 12 •HR 452 IH make purchases using the online marketplace de- 1 scribed in paragraph (1). 2 ‘‘(h) TRANSFER SCHEDULE.— 3 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 4 the Secretary shall make quarterly transfers of the 5 amount calculated pursuant to subsection (d) for de- 6 posit into the account of each eligible military de- 7 pendent child, except that the Secretary may make 8 transfers according to another transfer schedule if 9 the Secretary determines that a transfer schedule 10 other than quarterly transfers is necessary for the 11 operation of the education savings account. 12 ‘‘(2) CHOICE OF SCHEDULE.—The Secretary 13 shall establish a pro [Text truncated for display. Full text available on Congress.gov.]

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