Education Savings Accounts for Military Families Act of 2023
This bill directs the Department of Education (ED) to establish a program to provide children with parents on active duty in the uniformed services with funds to pay educational expenses.
Specifically, ED must establish a tax-exempt Military Education Savings Account for dependent children of parents in the uniformed services for the payment of the children's educational expenses. Funds in the savings account may be used for specified purposes, including the cost of attendance at a private elementary or secondary school or institution of higher education, private tutoring, or costs associated with an apprenticeship or other vocational training program.
[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 452 Introduced in House (IH)]
<DOC>
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
Education 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 following
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
Speaker, in each case for consideration of such provisions as fall
within the jurisdiction 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 Accounts, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Education Savings Accounts for
Military Families Act of 2023''.
SEC. 2. MILITARY EDUCATION SAVINGS ACCOUNTS.
(a) In General.--Title VII of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 7701 et seq.) is amended by inserting
after section 7012 the following:
``SEC. 7012A. MILITARY EDUCATION SAVINGS ACCOUNTS.
``(a) In General.--The Secretary of Education, in consultation with
the Secretary of Defense, shall carry out a program under which the
Secretary of Education shall--
``(1) at the request of a parent of an eligible military
dependent child, establish an account on behalf of such child
(to be known as a `Military Education Savings Account') into
which the Secretary shall deposit funds in an amount determined
under subsection (d); and
``(2) establish a procedure under which the parent of the
child may use funds in the account to pay for the educational
expenses of the child in accordance with this section.
``(b) Application.--
``(1) In general.--To be eligible to participate in the
program under this section for a school year, a parent of an
eligible military dependent child shall submit an application
to the Secretary in accordance with this subsection.
``(2) Application process.--In carrying out paragraph (1),
the Secretary shall--
``(A) accept applications on a year-round basis and
establish procedures for approving applications in an
expeditious manner; and
``(B) create a standardized form that parents can
use to apply for the program and ensure that such form
is readily available in written and electronic formats,
including on a publicly accessible website.
``(3) Approval.--Subject to the availability of funds to
carry out this section, the Secretary shall approve the
application of a parent to establish a Military Education
Savings Account if--
``(A) the application is submitted in accordance
with the application process established by the
Secretary pursuant to this subsection;
``(B) the application demonstrates that the child
on whose behalf the Military Education Savings Account
is to be established is an eligible military dependent
child; and
``(C) the parent who submits the application enters
into a written agreement with the Secretary under which
the parent agrees--
``(i) to provide the child with instruction
in, at minimum, the fields of reading,
language, mathematics, science, and social
studies;
``(ii) to not enroll the child in a public
elementary school or a public secondary school,
on a full-time basis while participating in the
program;
``(iii) to use funds in the Military
Education Savings Account only for the purposes
authorized under this section; and
``(iv) to comply with all other
requirements of this section.
``(4) Renewals.--The Secretary shall establish a process
for the automatic renewal of a previously established Military
Education Savings Account except in cases in which--
``(A) the parents of the child on whose behalf the
account was established choose not to renew the
account; or
``(B) the account was used to commit fraud or was
otherwise not used in accordance with the requirements
of this section.
``(c) Priority in the Event of Insufficient Funds.--
``(1) In general.--If the funds appropriated to carry out
this section are insufficient to enable the Secretary to
establish and fully fund a Military Education Savings Account
for each eligible military dependent child whose parent has an
application approved under subsection (b) for a school year,
the Secretary shall--
``(A) first renew and fully fund previously
established Military Education Savings Accounts; and
``(B) if funds remain available after renewing all
accounts under subparagraph (A), conduct the lottery
described in paragraph (3) to select the children on
whose behalf accounts will be established using the
remaining funds.
``(2) Transfer authority.--Notwithstanding any other
provision of law, the Secretary may transfer amounts from any
account of the Department of Education to renew and fully fund
previously established Military Education Savings Accounts
under paragraph (1)(A). The authority to transfer amounts under
the preceding sentence shall not be subject to any transfer or
reprogramming requirements under any other provision of law.
``(3) Lottery.--The lottery described in this paragraph is
a lottery in which--
``(A) siblings of children on whose behalf Military
Education Savings Accounts have previously been
established have the highest probability of selection;
``(B) children of enlisted members have the next-
highest probability of selection after the children
described in subparagraph (A);
``(C) children of warrant officers have the next-
highest probability of selection after the children
described in subparagraph (B); and
``(D) children of commissioned officers have the
lowest probability of selection.
``(d) Amount of Deposits.--
``(1) First year of program.--The amount of funds deposited
into each Military Education Savings Account for the first
school year for which such accounts are established under this
section shall be $6,000 for each eligible military dependent
child covered by the account.
``(2) Subsequent years.--The amount of funds deposited into
each Military Education Savings Account for any school year
after the year described in paragraph (1), shall be the amount
determined under this subsection for the previous school year
increased by a percentage equal to the percentage increase in
the Chained Consumer Price Index for All Urban Consumers (as
published by the Bureau of Labor Statistics of the Department
of Labor) over the period of such previous school year.
``(e) Use of Funds.--Funds deposited into a Military Education
Savings Account for a school year may be used by the parent of an
eligible military dependent child to make payments to a qualified
educational service provider that is approved by the Secretary under
subsection (f)(1) for--
``(1) costs of attendance at a private elementary school or
secondary school recognized by the State, which may include a
private school that has a religious mission;
``(2) private online learning programs;
``(3) private tutoring;
``(4) services provided by a public elementary school or
secondary school attended by the child on a less than full-time
basis, including individual classes and extracurricular
activities and programs;
``(5) textbooks, curriculum programs, or other
instructional materials, including any supplemental materials
required by a curriculum program, private school, private
online learning program, or a public school, or any parent
directed curriculum associated with K-12 education;
``(6) computer hardware or other technological devices that
are used to help meet a child's educational needs, except that
such hardware or devices may not be purchased by a parent more
than once in an 18-month period;
``(7) educational software and applications;
``(8) uniforms purchased from or through a private school
recognized by the State;
``(9) fees for nationally standardized assessment exams,
advanced placement exams, any exams related to college or
university admission, or tuition or fees for preparatory
courses for such exams;
``(10) fees for summer education programs and specialized
after-school education programs (but not including after-school
childcare);
``(11) educational services and therapies, including
occupational, behavioral, physical, speech-language, and
audiology therapies;
``(12) fees for transportation paid to a fee-for-service
transportation provider for the child to travel to and from the
facilities of a qualified educational service provider;
``(13) costs of attendance at an institution of higher
education;
``(14) costs associated with an apprenticeship or other
vocational training program;
``(15) fees for State-recognized industry certification
exams, and tuition or fees for preparatory courses for such
exams;
``(16) contributions to a college savings account, which
may include contributions to a qualified tuition program (as
defined in section 529(b)(1)(A) of the Internal Revenue Code of
1986) or other prepaid tuition plan offered by a State; or
``(17) any other educational expenses approved by the
Secretary.
``(f) Requirements for Qualified Educational Service Providers.--
``(1) Registration and approval.--The Secretary shall
establish and maintain a registry of qualified educational
service providers that are approved to receive payments from a
Military Education Savings Account. The Secretary shall approve
a qualified educational service provider to receive such
payments if the provider demonstrates to the Secretary that it
is licensed in the State in which it operates to provide one or
more of the services for which funds may be expended under
subsection (e).
``(2) Participation in online marketplace.--As a condition
of receiving funds from a Military Education Savings Account, a
qualified educational service provider shall make its services
available for purchase through the online marketplace described
in subsection (g).
``(3) Surety bond.--
``(A) In general.--The Secretary shall require each
qualified educational service provider that receives
$100,000 or more in funds from Military Education
Savings Accounts in a school year to post a surety
bond, in an amount determined by the Secretary, for
such school year.
``(B) Retention.--The Secretary shall prescribe the
circumstances under which a surety bond under
subparagraph (A) may be retained by the Secretary.
``(g) Online Marketplace.--
``(1) In general.--The Secretary shall seek to enter into a
contract with a private-sector entity under which the entity
shall--
``(A) establish and operate an online marketplace
that enables the holder of a Military Education Savings
Account to make direct purchases from qualified
educational service providers using funds from such
account;
``(B) ensure that each qualified educational
service provider on the registry maintained by the
Secretary under subsection (f)(1) has made its services
available for purchase through the online marketplace;
``(C) ensure that all purchases made through the
online marketplace are for services that are allowable
uses of funds under subsection (e); and
``(D) develop and make available a standardized
expense report form, in electronic and hard copy
formats, to be used by parents for reporting expenses
in accordance with subsection (h)(3).
``(2) Rule of construction.--Nothing in this subsection
shall be construed to require the holder of a Military
Education Savings Account to make purchases using the online
marketplace described in paragraph (1).
``(h) Transfer Schedule.--
``(1) In general.--Subject to paragraph (2), the Secretary
shall make quarterly transfers of the amount calculated
pursuant to subsection (d) for deposit into the account of each
eligible military dependent child, except that the Secretary
may make transfers according to another transfer schedule if
the Secretary determines that a transfer schedule other than
quarterly transfers is necessary for the operation of the
education savings account.
``(2) Choice of schedule.--The Secretary shall establish a
process under which the parent of a child on whose behalf a
Military Education Savings Account is established may choose a
transfer schedule other than a transfer schedule determined
under paragraph (1).
``(3) Expense reports.--
``(A) Submission required.--Before receiving a
transfer under paragraph (1) or (2), the parent of an
eligible military dependent child on whose behalf a
Military Education Savings Account is established shall
submit to the Secretary an expense report demonstrating
how funds from the most recent transfer were expended.
``(B) Format.--Each such expense report shall be
submitted using the standardized expense report form
developed under subsection (g)(1)(D).
``(i) Rollover.--Amounts remaining in the Military Education
Savings Account of an eligible military dependent child at the end of a
school year shall remain available for use in accordance with
subsection (e) until the date on which such account terminates under
subsection (j).
``(j) Termination and Return of Funds.--
``(1) Termination.--The Military Education Savings Account
of an eligible military dependent child shall terminate on--
``(A) the date on which the child enrolls in a
public elementary school or secondary school on a full-
time basis;
``(B) in the case of a child who is pursuing
postsecondary education, the earlier of--
``(i) the date on which the child completes
postsecondary education; or
``(ii) the date on which the child attains
the age of 22 years;
``(C) in the case of a child who is an individual
with a disability, the date on which the child attains
the age of 26 years; or
``(D) in the case of an individual not described in
subparagraph (B) or (C), the earlier of--
``(i) the date on which the child attains
the age of 22 years; or
``(ii) the expiration of any 2-year period
during which funds in the account are not used
in accordance with this section.
``(2) Return of funds.--Any funds remaining in a Military
Education Savings Account on the date such account terminates
under paragraph (1) shall be returned to the Treasury of the
United States and shall be used to carry out the program under
this section.
``(k) Compulsory Attendance Requirements.--A State that receives
funds under this title shall consider a child with a Military Education
Savings Account for a school year as meeting the State's compulsory
school attendance requirements for such school year.
``(l) Special Rule.--In the case of a child with a Military
Education Savings Account who attends a public school on a less than
full-time basis in a school year--
``(1) the child may not attend the public school free of
charge; and
``(2) funds in the account, in an amount determined
pursuant to an agreement between the parent of the child and
the local educational agency concerned, shall be used to pay
for the child's costs of attendance at such school.
``(m) Tax Treatment of Accounts.--
``(1) In general.--A Military Education Savings Account is
exempt from taxation under subtitle A of the Internal Revenue
Code of 1986.
``(2) Contributions and distributions.--For purposes of
subtitle A of the Internal Revenue Code of 1986--
``(A) any contribution to a military education
savings account by the Secretary under this Act shall
not be includible in the gross income of the individual
for whose benefit such account is maintained or the
parent of such individual; and
``(B) any distribution from a military education
savings account which is permitted under this Act shall
not be includible in the gross income of the individual
for whose benefit such account is maintained or the
parent of such individual.
``(n) Fraud Prevention and Reporting.--The Secretary shall
establish a website and a telephone hotline that enable individuals to
anonymously report suspected fraud in the program under this section.
The Secretary also shall conduct or contract for random, quarterly, or
annual audits of accounts as needed to ensure compliance with this
section.
``(o) Contract Authority.--The Secretary may enter into one or more
contracts for the purpose of carrying out the responsibilities of the
Secretary under this section.
``(p) Refunds.--The Secretary shall establish a process under which
payments from a Military Education Savings Accounts to a qualified
educational service provider shall be refunded to the account in the
event of fraud or nonperformance by the provider.
``(q) Rules of Construction.--
``(1) Nonagency.--A qualified educational service provider
that receives a payment from a Military Education Savings
Account pursuant to this section shall not be considered an
agent of the State or the Federal Government solely because the
provider received such payment.
``(2) Prohibition of federal or state supervision or
control over nonpublic education providers.--
``(A) In general.--Nothing in this section shall be
construed to permit, allow, encourage, or authorize any
Federal or State control or supervision over any aspect
of any qualified educational service provider,
including a private, religious, or home education
provider (without regard to whether a home education
provider is treated as a private school or home school
under State law). This section shall not be construed
to exclude private, religious, or home education
providers from participation in programs or services
under this Act.
``(B) No religion-based discrimination.--The
Secretary shall not exclude, discriminate against, or
otherwise disadvantage any qualified educational
service provider with respect to programs or services
under this section based in whole or in part on the
provider's religious education character or
affiliation, including religiously based or mission-
based policies or practices.
``(3) Imposition of additional requirements.--No Federal
requirements shall apply to a qualified educational service
provider other than the requirements specifically set forth in
this section. Nothing in this section shall be construed to
require a qualified educational service provider to alter its
creed, practices, admissions policy, or curriculum in order to
be eligible to receive payments from a Military Education
Savings Account.
``(4) Treatment of assistance.--For purposes of any Federal
law, assistance provided under this section shall be considered
assistance to the eligible military dependent child or to the
parents of a child on whose behalf a Military Education Savings
Account is established and shall not be considered assistance
to the qualified educational service provider that uses or
receives funds from a Military Education Savings Account.
``(r) Legal Proceedings.--
``(1) Burden.--In any legal proceeding in which a qualified
educational service provider challenges a requirement imposed
by the Department of Education on the provider, the Department
shall have the burden of establishing that the requirement is
necessary and does not impose any undue burden on the provider.
``(2) Limitation on liability.--
``(A) In general.--No liability shall arise on the
part of an entity described in subparagraph (B) solely
because such entity awards, uses, or receives funds
from a Military Education Savings Account.
``(B) Entity described.--The entities described in
this subparagraph are the following:
``(i) The Department of Education.
``(ii) An entity that enters into a
contract with the Secretary pursuant to
subsection (g) or subsection (o).
``(iii) A qualified educational service
provider.
``(3) Intervention.--
``(A) In general.--Except as provided in
subparagraph (B), a parent of an eligible military
dependent child or a parent of a child on whose behalf
a Military Education Savings Account is established may
intervene in any legal proceeding in which the
constitutionality of the program under this section is
challenged under a State constitution or the United
States Constitution.
``(B) Exception.--For purposes of judicial
administration, a court may--
``(i) limit the number of parents allowed
to intervene in a proceeding under subparagraph
(A); or
``(ii) require all parents who have
intervened in a proceeding under subparagraph
(A) to file a joint brief, except that no
parent shall be required to join any brief
filed on behalf of a State that is a defendant
in the proceeding.
``(s) Administrative Expenses.--The Secretary may use not more than
5 percent of the funds made available to carry out this section for the
direct costs of administering Military Education Savings Accounts.
``(t) Definitions.--In this section:
``(1) The terms `commissioned officer', `enlisted member',
and `warrant officer' have the meanings given those terms in
section 101(b) of title 10, United States Code.
``(2) The term `eligible military dependent child' means a
child who--
``(A) has a parent on active duty in the uniformed
services (as that term is defined in section 101 of
title 37, United States Code, except that such term
does not include an officer in the National Guard who
has been activated); and
``(B) in the case of a child seeking to establish a
Military Education Savings account for the first time,
was enrolled in a public elementary school or a public
secondary school for not less than 100 consecutive days
in the preceding school year.
``(3) The term `institution of higher education' has the
meaning given the term in section 102 of the Higher Education
Act of 1965 (20 U.S.C. 1002).
``(4) The term `qualified educational service provider'
means an entity or person that is licensed by a State to
provide one or more of the educational services for which funds
may be expended under subsection (e), including--
``(A) a private school;
``(B) a non-public online learning program or
course provider;
``(C) an institution of higher education, which may
include a community college or a technical college;
``(D) a public school;
``(E) a private tutor or entity that operates a
tutoring facility;
``(F) a provider of educational materials or
curriculum;
``(G) a provider of education-related therapies or
services; or
``(H) any other provider of educational services
licensed by a State to provide such services.''.
(b) Table of Contents.--The table of contents in section 2 of the
Elementary and Secondary Education Act is amended by inserting after
the item relating to section 7012 the following:
``Sec. 7012A. Military education savings accounts.''.
SEC. 3. AUTHORIZATION OF APPROPRIATIONS.
Section 7014 of the Elementary and Secondary Education Act of 1965
(20 U.S.C. 7714) is amended by adding at the end the following:
``(f) Military Education Savings Accounts.--For the purpose of
carrying out section 7012A--
``(1) there are authorized to be appropriated
$1,200,000,000 for fiscal year 2024; and
``(2) for each fiscal year beginning after fiscal year
2024, the amount authorized to be appropriated shall be the
amount authorized to be appropriated for the previous fiscal
year increased by the percentage increase in the Chained
Consumer Price Index for All Urban Consumers (as published by
the Bureau of Labor Statistics of the Department of Labor) over
the period of such previous fiscal year.''.
<all>
Introduced in House
Introduced in House
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 Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
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 Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
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 Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
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