II

106TH CONGRESS

1ST SESSION S. 1719

To provide flexibility to certain local educational agencies that develop voluntary public and private parental choice programs under title VI of

the Elementary and Secondary Education Act of 1965.

IN THE SENATE OF THE UNITED STATES

OCTOBER 12, 1999

Mr. HUTCHINSON (for himself, Mr. SANTORUM, Mr. ABRAHAM, Mr. COVERDELL, Mr. MCCAIN, Mr. DEWINE, Mrs. HUTCHISON, and Mr.

BROWNBACK) introduced the following bill; which was read twice and referred to the Committee on Health, Education, Labor, and Pensions

A BILL

To provide flexibility to certain local educational agencies

that develop voluntary public and private parental choice

programs under title VI of the Elementary and Secondary Education Act of 1965.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Educational Opportu5 nities Act of 1999’’.
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1 TITLE I—HELP SCHOLARSHIPS

2 SEC. 101. SHORT TITLE.

3 This title may be cited as the ‘‘Helping Empower

4 Low-Income Parents (HELP) Scholarships Amendments

5 of 1999’’.

6 SEC. 102. FINDINGS.

7 Congress finds the following:

8 (1) Congress strongly supports the efforts to

9 expand educational opportunities for low-income

10 families.

11 (2) The HELP Scholarships and the education

12 tax credit proposed under this Act are designed to

13 provide additional learning opportunities and tools

14 for individuals living in economically-disadvantaged

15 communities in a manner consistent with the edu16 cation flexibility initiatives already adopted by Con17 gress.

18 SEC. 103. DEFINITIONS.

19 Section 6003 of the Elementary and Secondary Edu20 cation Act of 1965 (20 U.S.C. 7303) is amended—

21 (1) in the section heading, by striking ‘‘DEFI22 NITION’’ and inserting ‘‘DEFINITIONS’’;

23 (2) by striking ‘‘(1)’’, ‘‘(2)’’, and ‘‘(3)’’;
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1 (3) in the matter proceeding subparagraph (A),

2 by striking ‘‘title the term’’ and inserting the fol3 lowing: ‘‘title—

4 ‘‘(1) the term’’;

5 (4) by striking the period at the end; and

6 (5) by adding at the end the following:

7 ‘‘(2) the term ‘poverty line’ means the poverty

8 line (as defined by the Office of Management and

9 Budget, and revised annually in accordance with sec10 tion 673(2) of the Community Services Block Grant

11 Act (42 U.S.C. 9902(2)) applicable to a family of

12 the size involved; and

13 ‘‘(3) the term ‘voluntary public and private pa14 rental choice program’ means a program that meets

15 the requirements of section 6301(b)(10), is author16 ized by State law, and includes 1 or more private

17 schools to allow low-income parents to choose the

18 appropriate school for their children.’’.

19 SEC. 104. ALLOCATION TO LOCAL EDUCATIONAL AGEN20 CIES.

21 Subsection (a) of section 6102 of the Elementary and

22 Secondary Education Act of 1965 (20 U.S.C. 7312(a)) is

23 amended to read as follows:

24 ‘‘(a) DISTRIBUTION RULE.—

25 ‘‘(1) STATE FUNDS.—
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1 ‘‘(A) IN GENERAL.—Of the amount made

2 available to a State educational agency each fis3 cal year to carry out this title, the agency may

4 reserve for State programs—

5 ‘‘(i) not more than 10 percent; or

6 ‘‘(ii) in the case of a State that has in

7 effect a law that establishes a voluntary

8 public and private parental choice pro9 gram, not more than 25 percent.

10 ‘‘(B) LIMITATION ON USE OF CERTAIN RE11 SERVED AMOUNTS.—If a State educational

12 agency reserves under subparagraph (A) more

13 than 10 percent of amounts made available to

14 the agency for a fiscal year, the agency shall

15 use amounts in excess of 10 percent of amounts

16 so made available only for voluntary public and

17 private parental choice programs.

18 ‘‘(2) LOCAL FUNDS.—A State educational agen19 cy shall distribute amounts made available to the

20 agency under this title that are not reserved under

21 paragraph (1) to local educational agencies within

22 such State that are located in an area designated as

23 an empowerment zone or an enterprise community

24 under section 1391 of the Internal Revenue Code of

25 1986.
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1 SEC. 105. USES OF FUNDS.

2 (a) STATE USES OF FUNDS.—Section 6201(a)(1) of

3 the Elementary and Secondary Education Act of 1965 (20

4 U.S.C. 7331(a)(1)) is amended—

5 (1) in subparagraph (B), by striking ‘‘and’’

6 after the semicolon; and

7 (2) by inserting after subparagraph (C) the fol8 lowing:

9 ‘‘(D) establishing voluntary public and pri10 vate parental choice programs in accordance

11 with section 6301(b)(10); and’’.

12 (b) LOCAL USES OF FUNDS.—Section 6301(b) of the

13 Elementary and Secondary Education Act of 1965 (20

14 U.S.C. 7351) is amended—

15 (1) in paragraph (8), by striking ‘‘and’’ after

16 the semicolon;

17 (2) in paragraph (9), by striking the period and

18 inserting ‘‘; and’’; and

19 (3) by inserting after paragraph (9) the fol20 lowing:

21 ‘‘(10) voluntary public and private parental

22 choice programs that—

23 ‘‘(A) are located in an area designated as

24 an empowerment zone or an enterprise commu25 nity under section 1391 of the Internal Revenue

26 Code of 1986;
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1 ‘‘(B) ensure that participation in such a

2 voluntary public and private parental choice

3 program is limited to families whose family in4 come does not exceed 185 percent of the pov5 erty line;

6 ‘‘(C) ensure that—

7 ‘‘(i) the maximum amount of a vol8 untary public and private parental choice

9 scholarship does not exceed the per pupil

10 expenditure of the local educational agency

11 in which an applicant for a voluntary pub12 lic and private parental choice scholarship

13 resides; and

14 ‘‘(ii) the minimum amount of a vol15 untary public and private parental choice

16 scholarship is not less than 60 percent of

17 the per pupil expenditure of the local edu18 cational agency in which an applicant for

19 a voluntary public and private parental

20 choice scholarship resides or the cost of

21 tuition at a private school, whichever is

22 less;

23 ‘‘(D) ensure that for a private school,

24 which may include a religiously affiliated school,
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1 choosing to participate in a voluntary public

2 and private parental choice program—

3 ‘‘(i) such a school is permitted to im4 pose the same academic requirements for

5 all students, including students selected for

6 a scholarship as provided under this para7 graph;

8 ‘‘(ii) receipt of funds under this title

9 is not conditioned with requirements or

10 regulations that preclude the use of such

11 funds for sectarian educational purposes or

12 require removal of religious art, icons,

13 scripture, or other symbols; and

14 ‘‘(iii) such a school is in compliance

15 with all State requirements applicable to

16 the operation of a private school that are

17 in effect in the year preceding the date of

18 the enactment of the Helping Empower

19 Low-income Parents (HELP) Scholarships

20 Amendments of 1997;

21 ‘‘(E) may allow State, local, and private

22 funds to be used for voluntary public and pri23 vate parental choice programs; and

24 ‘‘(F) ensure priority for students who were

25 enrolled in a public school in the school year
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1 preceding the school year in which a voluntary

2 public and private parental choice school begins

3 operation.’’.

4 SEC. 106. EVALUATION.

5 Part D of title VI of the Elementary and Secondary

6 Education Act of 1965 (20 U.S.C. 7371 et seq.) is

7 amended—

8 (1) by adding at the end of section 6402 the

9 following new subsection:

10 ‘‘(j) APPLICATION.—This section shall not apply to

11 funds that a State or local educational agency uses to es12 tablish a voluntary public and private parental choice pro13 gram in accordance with section 6301(b)(10).’’; and

14 (2) by adding at the end of such part the fol15 lowing new sections:

16 ‘‘SEC. 6404. EVALUATION.

17 ‘‘(a) ANNUAL EVALUATION.—

18 ‘‘(1) CONTRACT.—The Comptroller General of

19 the United States shall enter into a contract, with

20 an evaluating agency that has demonstrated experi21 ence in conducting evaluations, for the conduct of an

22 ongoing rigorous evaluation of the programs estab23 lished under section 6301(b)(10).

24 ‘‘(2) ANNUAL EVALUATION REQUIREMENT.—

25 The contract described in paragraph (1) shall re-
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1 quire the evaluating agency entering into such con2 tract to evaluate annually each program established

3 under section 6301(b)(10) in accordance with the

4 evaluation criteria described in subsection (b) and

5 each such program that has applied for an education

6 flexibility waiver under section 6304.

7 ‘‘(3) TRANSMISSION.—The contract described

8 in paragraph (1) shall require the evaluating agency

9 entering into such contract to transmit to the Comp10 troller General of the United States the findings of

11 each annual evaluation under paragraph (1).

12 ‘‘(b) EVALUATION CRITERIA.—The Comptroller Gen13 eral of the United States, in consultation with the Sec14 retary, shall establish minimum criteria for evaluating

15 each program established under section 6301(b)(10). Such

16 criteria shall provide for—

17 ‘‘(1) a description of the implementation of

18 each program established under section 6301(b)(10)

19 and the program’s effects on all participants,

20 schools, and communities in the program area, with

21 particular attention given to the effect of parent par22 ticipation in the life of the school and the level of

23 parental satisfaction with the program; and
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1 ‘‘(2) a comparison of the educational achieve2 ment of all students in the program area, including

3 a comparison between—

4 ‘‘(A) students receiving a voluntary public

5 and private parental choice scholarships under

6 section 6301(b)(10); and

7 ‘‘(B) students not receiving a voluntary

8 public and private parental choice scholarships

9 under such section.

10 ‘‘(c) EVALUATION FUNDS.—Pursuant to the author11 ity provided under section 14701, the Secretary shall re12 serve not more than 0.50 percent of the amount of funds

13 made available under section 6002 to carry out this sec14 tion. To determine the amount necessary for evaluation

15 purposes, the Secretary shall consider the prospective

16 scale and scope of the evaluation, including the number

17 of local educational agencies conducting voluntary public

18 and private choice programs.

19 ‘‘SEC. 6405. APPLICABILITY.

20 ‘‘(a) NOT SCHOOL AID.—Subject to subsection (b),

21 funds used under this title to establish a voluntary public

22 and private parental choice program shall be considered

23 assistance to the student and shall not be considered as

24 assistance to any school that chooses to participate in such

25 program.
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1 ‘‘(b) NO FEDERAL CONTROL.—The Secretary is not

2 permitted to exercise any direction, supervision, or control

3 over curricula, program of instruction, administration, or

4 personnel of any school that chooses to participate in a

5 voluntary public and private choice program established

6 under 6309(b)(10).’’.

7 TITLE II—EDUCATION TAX

8 CREDIT

9 SEC. 201. SHORT TITLE.

10 This title may be cited as the ‘‘Children’s Education

11 Tax Credit Act’’.

12 SEC. 202. CREDIT FOR EDUCATION EXPENSES.

13 (a) IN GENERAL.—Subpart C of part IV of sub14 chapter A of chapter 1 of the Internal Revenue Code of

15 1986 (relating to refundable credits) is amended by redes16 ignating section 35 as section 36 and by inserting after

17 section 34 the following new section:

18 ‘‘SEC. 35. EDUCATION EXPENSES.

19 ‘‘(a) GENERAL RULE.—In the case of an individual,

20 there shall be allowed as a credit against the tax imposed

21 by this subtitle for the taxable year the amount of the

22 qualified education expenses paid by the taxpayer during

23 the taxable year for the education of any individual with

24 respect to whom the taxpayer is allowed a deduction under

25 section 151(c).
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1 ‘‘(b) LIMITATION.—The amount allowed as a credit

2 under subsection (a) for any taxable year with respect to

3 the qualified education expenses of any 1 individual shall

4 not exceed $1,000.

5 ‘‘(c) DEFINITIONS.—For purposes of this section—

6 ‘‘(1) QUALIFIED EDUCATION EXPENSES.—

7 ‘‘(A) IN GENERAL.—The term ‘qualified

8 education expenses’ means amounts paid for—

9 ‘‘(i) tuition and fees required for the

10 enrollment or attendance of a student at

11 an eligible zone educational institution, and

12 ‘‘(ii) fees, tutoring, books, supplies,

13 computer equipment (including related

14 software and services) and other equip15 ment required for courses of instruction at

16 an eligible zone educational institution.

17 ‘‘(B) MEALS AND LODGING EXPENSES NOT

18 INCLUDED.—Such term does not include any

19 amount paid, directly or indirectly, for meals,

20 lodging, or similar personal, living, or family ex21 penses. In the event an amount paid for tuition

22 or fees includes an amount for meals, lodging,

23 or similar expenses which is not separately stat24 ed, the portion of such amount which is attrib25 utable to meals, lodging, or similar expenses
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1 shall be determined under regulations pre2 scribed by the Secretary.

3 ‘‘(C) SPECIAL RULE FOR HOME SCHOOL4 ING.—In the case of education furnished in the

5 home (as a substitute for public education)

6 which meets the requirements of State law re7 lating to compulsory school attendance, the

8 term ‘qualified education expenses’ means

9 amounts paid for tutoring, books, supplies,

10 computer equipment (including related software

11 and services), and other equipment used in fur12 nishing such education.

13 ‘‘(2) ELIGIBLE ZONE EDUCATIONAL INSTITU14 TION.—

15 ‘‘(A) IN GENERAL.—The term ‘eligible

16 zone educational institution’ means any school

17 described in subparagraph (B) which is located

18 in an area designated as an empowerment zone

19 or an enterprise community under section 1391.

20 ‘‘(B) SCHOOLS DESCRIBED.—A school de21 scribed in this subparagraph is any of the fol22 lowing:

23 ‘‘(i) A secondary school.

24 ‘‘(ii) An elementary school.
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1 ‘‘(iii) Any private, parochial, religious,

2 or home school organized for the purpose

3 of providing elementary or secondary edu4 cation, or both.

5 ‘‘(3) ELEMENTARY AND SECONDARY

6 SCHOOLS.—The terms ‘elementary school’ and ‘sec7 ondary school’ have the respective meanings given

8 such terms by section 14101 of the Elementary and

9 Secondary Education Act of 1965.

10 ‘‘(d) ADJUSTMENT FOR CERTAIN SCHOLARSHIPS.—

11 The amounts otherwise taken into account under sub12 section (a) as qualified education expenses of any indi13 vidual during any period shall be reduced (before the ap14 plication of subsection (b)) by the sum of the amounts

15 received with respect to such individual for the taxable

16 year as a qualified scholarship which under section 117

17 is not includable in gross income.

18 ‘‘(e) REGULATIONS.—The Secretary shall prescribe

19 such regulations as may be necessary to carry out the pro20 visions of this section.’’

21 (b) TECHNICAL AMENDMENTS.—

22 (1) Paragraph (2) of section 1324(b) of title

23 31, United States Code, is amended by striking ‘‘or’’

24 after ‘‘1978,’’ and by inserting before the period ‘‘,
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1 or enacted by the Children’s Education Tax Credit

2 Act’’.

3 (2) The table of sections for subpart C of part

4 IV of subchapter A of chapter 1 of such Code is

5 amended by striking the last item and inserting the

6 following new items:

‘‘Sec. 35. Education expenses.

‘‘Sec. 36. Overpayments of tax.’’

7 (c) EFFECTIVE DATE.—The amendments made by

8 this section shall apply to taxable years beginning after

9 the date of the enactment of this Act.

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