Section 6-18-2505 - Account funds(a)(1) The Division of Elementary and Secondary Education shall allocate annually to each participating student's account, from funds appropriated to the Arkansas Children's Educational Freedom Account Fund or otherwise made available for the Arkansas Children's Educational Freedom Account Program, an amount equal to ninety percent (90%) of the prior year's statewide foundation funding allotted per student under § 6-20-2305.(2) For the 2023-2024 school year and each school year thereafter, a student who participated in the Succeed Scholarship Program during the 2022-2023 school year shall receive one hundred percent (100%) of the prior year's statewide foundation funding amount allotted per student under § 6-20-2305 until: (A) The participating student graduates from high school;(B) The participating student receives a certificate of completion; or(C) An event that requires an account to be closed under subdivision (f)(1) or (f)(2) of this section occurs.(b)(1) For the 2023-2024 school year, on behalf of participating students enrolled in participating schools or with participating service providers and at the direction of a participating student's parent, the Department of Education shall make four (4) equal payments in quarterly installments from the participating student's account to the participating school or participating service provider in which the participating student is enrolled for tuition, fees, and costs associated with testing and uniforms.(2) The department may:(A) Contract with a vendor or provider to manage the payment system used for purposes of implementing this subsection (b); and(B) Withhold up to five percent (5%) of funds allocated for each account annually for the administration of the program.(c) For the 2023-2024 school year, if a participating student is enrolled full-time in a participating school or with a participating service provider and the total amount of tuition, fees, testing, and uniform costs is less than the amount determined under subsection (a) of this section, the amount allocated to the student shall be the lesser amount.(d) Account funds shall: (1)(A) Not be refunded, rebated, or shared with a parent or participating student in any manner.(B) Any refund or rebate for goods or services purchased with account funds shall be credited directly to the participating student's account; and(2) Be used only for qualifying education expenses for a participating student.(e)(1) Beginning with the 2024-2025 school year and each year thereafter, the department shall develop a system for parents to direct account funds to participating schools and participating service providers by electronic funds transfer, automated clearinghouse transfer, debit card, or another system.(2) The department may: (A) Contract with a vendor or provider, including without limitation a private institution, to manage the payment system used for purposes of implementing this subsection (e); and(B) Withhold up to five percent (5%) of funds allocated for each account annually for the administration of the program.(3) The department shall:(A) Not adopt a payment system under this subsection that relies exclusively on requiring parents to be reimbursed for out-of-pocket expenses; and(B) Ensure a payment system developed under this subsection provides maximum flexibility to parents by facilitating direct payments to participating service providers and requests for preapproval of and reimbursements for qualifying expenses.(f)(1) An account shall remain in force, and any unused funds shall roll over from quarter-to-quarter and from year-to-year, until: (A) A parent withdraws his or her participating student from the program;(B) A participating student graduates from high school; or(C) The end of the school year if a participating student turns twenty-one (21) years of age, whichever occurs first.(2) An account shall be closed before an event occurs under subdivision (f)(1) of this section if the State Board of Education finds:(A) A substantial misuse of funds; or(B) That a parent has failed to comply with this subchapter or state board rules governing the program.(3)(A) Any unused funds shall revert to the division and be allocated to fund other accounts.(B)(i) There shall be a maximum amount of funds allowed to remain in each participating student's account.(ii) The state board may establish rules to determine the:(a) Maximum amount of funds allowed under subdivision (f)(3)(B)(i) of this section; and(b) Process by which account funds will be returned to the appropriate fund within the department.(g) Account funds shall not: (1) Constitute taxable income of the parent or the participating student; and(2) Be claimed as a credit, deduction, exemption, or rebate.(h) The division shall create procedures to ensure that a fair process exists to determine whether a participating student is no longer eligible for participation in the program, including without limitation a participating student who is no longer eligible for participation in the program due to his or her failure to demonstrate academic achievement or academic growth.(i)(1) If the division bars a student from participating in the program, it shall notify the participating student and his or her parent of its decision within three (3) days of its decision.(2) A parent may appeal the division's decision to bar him or her from receiving payments from accounts to the state board according to rules established by the state board.(j) The state board may promulgate rules to implement this subchapter.Amended by Act 2023EX1, No. 5,§ 3, eff. 9/14/2023.Added by Act 2023, No. 237,§ 42, eff. 3/8/2023.