FILED SENATE
Apr 7, 2021
GENERAL ASSEMBLY OF NORTH CAROLINA
S.B. 671
SESSION 2021 PRINCIPAL CLERK
S D
SENATE BILL DRS35252-MKa-87
Short Title: Changes to the K-12 Scholarship Programs. (Public)
Sponsors: Senators Lee, Ballard, and Galey (Primary Sponsors).
Referred to:
1 A BILL TO BE ENTITLED
2 AN ACT TO MAKE CHANGES TO THE KINDERGARTEN THROUGH TWELFTH
3 GRADE SCHOLARSHIP PROGRAMS.
4 The General Assembly of North Carolina enacts:
5
6 PART I. OPPORTUNITY SCHOLARSHIP GRANT PROGRAM
7 SECTION 1.1.(a) G.S. 115C-562.1(3) reads as rewritten:
8 "(3) Eligible students. – A student residing in North Carolina who has not yet
9 received a high school diploma and who meets all of the following
10 requirements:
11 a. Meets one of the following criteria:
12 1. Was a full-time student (i) assigned to and attending a public
13 school pursuant to G.S. 115C-366 or (ii) enrolled in a
14 Department of Defense Elementary and Secondary School,
15 established pursuant to 10 U.S.C. § 2164 and located in North
16 Carolina, during the spring semester prior to the school year
17 for which the student is applying.
18 2. Received a scholarship grant for the school year prior to the
19 school year for which the student is applying.
20 3. Is entering eligible to enter either kindergarten or the first
21 grade.grade pursuant to Article 25 of this Chapter. A child who
22 is the age of four on or before April 16 is eligible to attend the
23 following school year if the principal, or equivalent, of the
24 school in which the child seeks to enroll finds that the student
25 meets the requirements of G.S. 115C-364(d) and those
26 findings are submitted to the Authority with the child's
27 application.
28 4. Is a child in foster care as defined in G.S. 131D-10.2(9).
29 5. Is a child whose adoption decree was entered not more than
30 one year prior to submission of the scholarship grant
31 application.
32 6. Is a child whose parent or legal guardian is on full-time duty
33 status in the active uniformed service of the United States,
34 including members of the National Guard and Reserve on
35 active duty orders pursuant to 10 U.S.C. § 12301, et seq., and
36 10 U.S.C. § 12401, et seq.
*DRS35252-MKa-87*
 General Assembly Of North Carolina Session 2021
1 7. Is a child who meets both of the following:
2 I. Was enrolled in a nonpublic school that meets the
3 requirements of Part 1 and Part 2 of this Article during
4 the spring semester prior to the school year for which
5 the student is applying.
6 II. Was enrolled for the entire school year immediately
7 prior to the school year in which the student enrolled in
8 the nonpublic school in one of the following:
9 A. A North Carolina public school.
10 B. A Department of Defense Elementary and
11 Secondary School, established pursuant to 10
12 U.S.C. § 2164 and located in North Carolina.
13 a1. Has not enrolled in a postsecondary institution in a matriculated status
14 eligible for enrollment for 12 hours of academic credit.
15 b. Resides in a household with an income level not in excess of one
16 hundred fifty seventy-five percent (150%) (175%) of the amount
17 required for the student to qualify for the federal free or reduced-price
18 lunch program. The Authority shall not count any distribution from the
19 estate of a decedent in calculating the income level of the applicant's
20 household for the purposes of determining eligibility for a scholarship
21 under this sub-subdivision."
22 SECTION 1.1.(b) G.S. 115C-562.2 reads as rewritten:
23 "§ 115C-562.2. Scholarship grants.
24 …
25 (b) Scholarship grants awarded to eligible students residing in households with an income
26 level not in excess of the amount required for the student to qualify for the federal free or
27 reduced-price lunch program shall be for amounts of up to four thousand two hundred dollars
28 ($4,200) per year. be, per year per eligible student, in an amount up to the amount the State Board
29 of Education allocated to a charter school pursuant to G.S. 115C-218.105(a)(1), plus the
30 allocation for children with limited English proficiency and the allocation for children with
31 disabilities, in the prior fiscal year. Scholarship grants awarded to eligible students residing in
32 households with an income level in excess of the amount required for the student to qualify for
33 the federal free or reduced-price lunch program shall be for amounts of not more than ninety
34 percent (90%) of the required tuition and fees for the nonpublic school the eligible child will
35 attend. Tuition and fees for a nonpublic school may include tuition and fees for books,
36 transportation, equipment, or other items required by the nonpublic school. No scholarship grant
37 shall exceed four thousand two hundred dollars ($4,200) exceed, per year per eligible student, an
38 amount equal to the amount the State Board of Education allocated to a charter school pursuant
39 to G.S. 115C-218.105(a)(1), plus the allocation for children with limited English proficiency and
40 the allocation for children with disabilities, in the prior fiscal year and no scholarship grant shall
41 exceed the required tuition and fees for the nonpublic school the eligible student will attend.
42 (b1) Beginning with the 2017-2018 2022-2023 school year, within the funds appropriated
43 by the General Assembly to award scholarship grants to eligible students under this Part, the
44 Authority may award scholarship grants to at least 2,000 1,500 more eligible students each school
45 year than were served in the prior school year.
46 …."
47 SECTION 1.1.(c) G.S. 115C-562.3 reads as rewritten:
48 "§ 115C-562.3. Verification of eligibility.eligibility; information from other State agencies.
49 …
50 (b) Household members of applicants for scholarship grants shall authorize the Authority
51 to access information needed for verification efforts held by other State agencies, including the
Page 2 DRS35252-MKa-87
 General Assembly Of North Carolina Session 2021
1 Department of Revenue, the Department of Health and Human Services, and the Department of
2 Public Instruction. The Department of Public Instruction shall provide the Authority with public
3 school enrollment information to establish eligibility pursuant to G.S. 115C-562.1(3)a. as
4 needed.
5 …."
6 SECTION 1.1.(d) This section applies beginning with applications for scholarship
7 funds for the 2022-2023 school year.
8 SECTION 1.2.(a) G.S. 115C-562.8 reads as rewritten:
9 "§ 115C-562.8. The Opportunity Scholarship Grant Fund Reserve.
10 (a) The Opportunity Scholarship Grant Fund Reserve is established as a reserve to be
11 administered by the Board of Governors of The University of North Carolina for the purpose of
12 allocating funds to the Authority for the award of scholarship grants in accordance with this Part.
13 The Reserve shall consist of monies appropriated from the General Fund to the Reserve by the
14 General Assembly and any interest accrued to it thereon. These funds shall be used to award
15 scholarship grants to eligible students for the school year that begins in the fiscal year following
16 the fiscal year in which the appropriation is made to the Reserve. The Board of Governors shall
17 only use monies in the Reserve in accordance with the purposes set forth in this section. Funds
18 appropriated in a particular fiscal year to be used for the award of scholarships in the following
19 fiscal year that are unexpended at the end of the fiscal year after the fiscal year in which the funds
20 were appropriated shall be first used for the purpose set forth in subdivision (1) of subsection (d)
21 of this section. After funds are used for this purpose, any unexpended funds from the funds
22 appropriated in a particular fiscal year to be used for the award of scholarships in the following
23 fiscal year shall be carried forward for one fiscal year and may be used for the purposes set forth
24 in this section. Funds carried forward pursuant to this section that have not been spent within one
25 fiscal year shall revert to the General Fund.
26 …
27 (d) Any unexpended funds at the end of a fiscal year from the funds appropriated in a
28 particular fiscal year to be used for the award of scholarships in the following fiscal year shall be
29 used as follows:
30 (1) Up to five hundred thousand dollars ($500,000) may be used by the Authority
31 to contract with a nonprofit corporation representing parents and families for
32 marketing, outreach, and scholarship application assistance for parents and
33 students pursuant to Part 5 of this Article.
34 (2) Any remaining funds shall be carried forward for one fiscal year pursuant to
35 subsection (a) of this section."
36 SECTION 1.2.(b) Article 39 of Chapter 115C of the General Statutes is amended by
37 adding a new Part to read:
38 "Part 4A. Information for Parents and Students on Nonpublic School Scholarship Programs.
39 "§ 115C-567.1. Outreach and assistance for parents and students.
40 (a) The State Education Assistance Authority, in its administration of scholarship
41 programs for eligible students pursuant to Part 2A of this Article, Article 41 of this Chapter, and
42 Part 1H of Article 9 of this Chapter, may contract with a nonprofit corporation representing
43 parents and families for marketing, outreach, and scholarship application assistance for parents
44 and students. The Authority shall issue a request for proposals in order to enter into a contract
45 with a nonprofit corporation that meets the following requirements during the term of the
46 contract:
47 (1) Be a nonprofit corporation organized pursuant to Chapter 55A of the General
48 Statutes and comply at all times with the provisions of section 501(c)(3) of the
49 Internal Revenue Code.
50 (2) Employ sufficient staff who have demonstrated a capacity to market and
51 implement a scholarship grant program, including by doing the following:
DRS35252-MKa-87 Page 3
 General Assembly Of North Carolina Session 2021
1 a. Direct mail marketing.
2 b. Radio advertising.
3 c. Targeted digital advertising.
4 d. One-on-one parent and family engagement.
5 (3) Comply with the limitations on lobbying set forth in section 501(c)(3) of the
6 Internal Revenue Code.
7 (4) Have no State officer or employee serving on the board of the nonprofit.
8 (5) Conduct at least quarterly meetings of the board of directors of the nonprofit
9 at the call of its chair.
10 (b) The terms of the contract between the Authority and a nonprofit corporation shall
11 require that the nonprofit (i) maintain the confidentiality of any information provided by the
12 Authority for parents and students as directed by the Authority and (ii) not disseminate
13 information to third parties without written parental consent. During the term of the contract
14 provided for in this section, the Authority shall include on scholarship applications a statement
15 for parents to indicate nonconsent for sharing information with a nonprofit corporation.
16 (c) Notwithstanding any other provision of law, during the term of the contract provided
17 for in this section, the Authority may share the name, address, email, and telephone number of
18 the parent of any student applicant, unless the parent indicates that the information should not be
19 shared."
20 SECTION 1.2.(c) Subsection (a) of this section becomes effective June 30, 2021.
21 SECTION 1.3. G.S. 115C-562.8(c) reads as rewritten:
22 "(c) Of the funds allocated to the Authority to award scholarship grants under this Part,
23 the Authority may retain the lesser of up to four percent (4%) of the funds appropriated or one
24 two million five hundred thousand dollars ($1,500,000) ($2,000,000) each fiscal year for
25 administrative costs associated with the scholarship grant program."
26
27 PART II. COMBINE K-12 SCHOLARSHIP PROGRAMS FOR CHILDREN WITH
28 DISABILITIES
29 SECTION 2.1.(a) Article 41 of Chapter 115C of the General Statutes reads as
30 rewritten:
31 "Article 41.
32 "Personal Education Savings Accounts.Student Accounts for Children with Disabilities.
33 "§ 115C-590. North Carolina Personal Education Savings Account Student Accounts for
34 Children with Disabilities Program established.
35 There is established the North Carolina Personal Education Savings Student Accounts for
36 Children with Disabilities Program to provide the option for a parent to better meet the individual
37 educational needs of the parent's child.
38 "§ 115C-591. Definitions.
39 The following definitions apply in this Article:
40 (1) Authority. – Defined in G.S. 116-201.
41 (2) Division. – The Division of Nonpublic Education, Department of
42 Administration.
43 (2a) Educational technology. – As defined annually by the Authority, an item,
44 piece of equipment, material, product, or system which may be purchased
45 commercially off the shelf, modified, or customized and that is used primarily
46 for educational purposes for a child with a disability.
47 (3) Eligible student. – A student residing in North Carolina who has not yet
48 received a high school diploma and who meets all of the following
49 requirements:
50 a. Is eligible to attend a North Carolina public school pursuant to
51 G.S. 115C-366.Article 25 of this Chapter. A child who is the age of
Page 4 DRS35252-MKa-87
 General Assembly Of North Carolina Session 2021
1 four on or before April 16 is eligible to attend the following school
2 year if the principal, or equivalent, of the school in which the child
3 seeks to enroll finds that the student meets the requirements of
4 G.S. 115C-364(d) and those findings are submitted to the Authority
5 with the child's application.
6 b. Has not been enrolled in a postsecondary institution in a matriculated
7 status eligible for enrollment for as a full-time student taking at least
8 12 hours of academic credit.
9 c. Is a child with a disability, as defined in G.S. 115C-106.3(1),
10 including, for example, intellectual disability, hearing impairment,
11 speech or language impairment, visual impairment, serious emotional
12 disturbance, orthopedic impairment, autism, traumatic brain injury,
13 other health impairments, specific learning disability, or disability as
14 may be required to be included under IDEA.G.S. 115C-106.3(1).
15 d. Has not been placed in a nonpu