SB395 Alabama 2016 Session

Summary

Primary Sponsor

Dick Brewbaker

Republican

Session

Regular Session 2016

Title

Education, Education Savings Account program, created

Summary

SB395 would create an Education Savings Account program that allows parents to use funds that would be paid to their child’s resident district for an education program of the parents’ choosing.

What This Bill Does

It establishes Education Savings Accounts for eligible students (including many with IEPs) and deposits 90% of the base district funding for each student into the account, with funds usable for approved educational expenses. Parents must sign an agreement to educate the child in specified subjects, not enroll in charter schools or the Tax Credit Scholarship program, and to use the funds for eligible services such as tuition, tutoring, curriculum, and certain college or online learning costs. The program caps new participants at 1,000 per year on a first-come, first-served basis, and participating schools and providers must meet standards and be approved by the department. The district's state aid is reduced by the amount paid into the ESA, and the program includes governance, auditing, and reporting requirements for administrators and providers.

Who It Affects

• Eligible students in Alabama who have an Individualized Education Program (IEP) or meet other disability criteria, and their parents or guardians, who may receive an Education Savings Account and use funds for approved education services outside the resident district.
• Participating private schools, private tutors, eligible postsecondary institutions, and other education providers, along with resident public school districts whose funding and enrollment counts are affected by the program, who must comply with program rules and may receive funds to educate eligible students.

Key Provisions

• Creates the Education Savings Account (ESA) program, titled the Education Savings Account Act.
• Defines key terms: department, eligible student (including students with IEPs), organization, parent, participating/private school, private tutoring, and resident school district.
• Eligibility and required parental agreement: a parent must commit to educating the student in core subjects, not enroll in charter schools or the Tax Credit Scholarship program, and not enroll in public school unless for contracted services.
• Qualifying expenses: funds may be used for tuition/fees at participating schools, textbooks, licensed tutors, curriculum, online programs, exams and college admissions costs, and certain other educational services, including postsecondary tuition and disability services.
• Funding and limits: the state deposits into each ESA 90% of the base district allocation (adjusted by weights); the program is limited to 1,000 new eligible students per year, on a first-come, first-served basis; funds reduce state aid to the resident district.
• Administration and oversight: organizations must be eligible (501(c)(3)), perform background checks, file annual CPA-verified compliance reports, and manage or verify accounts; the department pays quarterly and collects administrative fees; private managers may charge market-based fees.
• Usage controls and accountability: funds must be used for qualified educational purposes; audits may be conducted; the department may bar providers for noncompliance and refer fraud cases to law enforcement; student testing and data reporting requirements are specified.
• Autonomy and regulation: participating private schools have the maximum freedom to educate within program rules and are not considered state agents; state regulatory authority is not expanded beyond program enforcement.
• Record transfers and implementation: the resident district must provide student records to participating schools; the program takes effect in the fall semester after passage and governor approval.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Education