House Bill 1863, also known as Senate Bill 2078, amends various sections of the Tennessee Code Annotated to enhance the oversight of financial aid programs funded by net lottery proceeds. The bill mandates that the Tennessee Higher Education Commission (THEC) prepare and submit a comprehensive report to several legislative committees. This report will identify any fiscal years since 2004 where net lottery proceeds were inadequate to fully fund scholarships and grants, leading to either a pro rata reduction in awarded amounts or a draw from the general shortfall reserve subaccount to cover deficiencies.

The report must be submitted by October 1, 2027, and should encompass data from the 2004 fiscal year through the 2026 fiscal year. This legislative action aims to ensure transparency and accountability in the management of educational funding derived from lottery proceeds, thereby safeguarding the financial aid programs that support students in Tennessee.