PART 1. TEXAS HIGHER EDUCATION COORDINATING BOARD
CHAPTER 4. RULES APPLYING TO ALL PUBLIC INSTITUTIONS OF HIGHER EDUCATION IN TEXAS
SUBCHAPTER Y. PROVISIONS REGARDING SCHOLARSHIP TO A RELATIVE OF A BOARD MEMBER OF AN INSTITUTION OF HIGHER EDUCATION OR UNIVERSITY SYSTEM
The Texas Higher Education Coordinating Board (Coordinating Board) proposes new rules in Texas Administrative Code, Title 19, Part 1, Chapter 4, Subchapter Y, §§4.380 - 4.385, concerning Provisions Regarding Scholarship to a Relative of a Board Member of an Institution of Higher Education or University System. Specifically, this new section will establish the authority and purpose, definitions, applicability, and substantive requirements relating to mitigating the appearance of favoritism in the offering of certain scholarships at public colleges and universities. The Coordinating Board is authorized to adopt rules regarding this subject by Texas Education Code, §51.969.
The proposed rules are reconstituted from Texas Administrative Code, Title 19, Part 1, Chapter 21, Subchapter O. Nonsubstantive revisions were made by eliminating unnecessary provisions or definitions, adding citations, and updating rule language for improved clarity.
Rule 4.380, Authority and Purpose, establishes the statutory authority for the subchapter and outlines its purpose. It is the reconstituted and simplified current §21.468.
Rule 4.381, Definitions, establishes definitions for relevant words or phrases used throughout the subchapter. It is the reconstituted §21.469, with definitions removed that are duplicative with §4.3 in the chapter's General Provisions.
Rule 4.382, Applicability, specifies that the rules apply to persons attending any public institution of higher education in Texas. It is the reconstituted and retitled §21.470, with non-substantive revisions to improve clarity.
Rule 4.383, Prohibited Scholarships, establishes the type of applicable scholarships subject to the rules of the subchapter and the circumstances in which an individual may be ineligible for these scholarships. It is the reconstituted §21.471, with nonsubstantive revisions to improve readability.
Rule 4.384, Declaration of Eligibility, outlines the written statement students must file with their institutions prior to receiving a scholarship subject to this subchapter's provisions. It is the reconstituted §21.472.
Rule 4.385, Criminal Penalty, establishes the criminal penalty associated with making a false statement on the Declaration of Eligibility. It is the reconstituted §21.473, with updated citation.
Dr. Charles Contéro-Puls, Assistant Commissioner for Student Financial Aid Programs, has determined that for each of the first five years the sections are in effect there would be no fiscal implications for state or local governments as a result of enforcing or administering the rules. There are no estimated reductions in costs to the state and to local governments as a result of enforcing or administering the rule. There are no estimated losses or increases in revenue to the state or to local governments as a result of enforcing or administering the rule.
There is no impact on small businesses, micro businesses, and rural communities. There is no anticipated impact on local employment.
Dr. Charles Contéro-Puls, Assistant Commissioner for Student Financial Aid Programs, has also determined that for each year of the first five years the section is in effect, the public benefit anticipated as a result of administering the section will be the improved access to the rules by moving them to a more appropriate location. There are no anticipated economic costs to persons who are required to comply with the sections as proposed.
Government Growth Impact Statement
(1) the rules will not create or eliminate a government program;
(2) implementation of the rules will not require the creation or elimination of employee positions;
(3) implementation of the rules will not require an increase or decrease in future legislative appropriations to the agency;
(4) the rules will not require an increase or decrease in fees paid to the agency;
(5) the rules will not create a new rule;
(6) the rules will not limit an existing rule;
(7) the rules will not change the number of individuals subject to the rule; and
(8) the rules will not affect this state's economy.
Comments on the proposal may be submitted to Dr. Charles Contéro-Puls, Assistant Commissioner for Student Financial Aid Programs, P.O. Box 12788, Austin, Texas 78711-2788, or via email at SFAPPolicy@highered.texas.gov. Comments will be accepted for 30 days following publication of the proposal in the Texas Register.
The new section is proposed under Texas Education Code, Section 51.969, which provides the Coordinating Board with the authority to adopt rules relating to the provisions of that section.
The proposed new section affects Texas Administrative Code, Title 19, Part 1, Chapter 4.
§4.380.Authority and Purpose.
(a) Authority. Authority for this subchapter is provided in the Texas Education Code, §51.969.
(b) The purpose of these provisions is to provide guidance regarding the awarding of certain scholarships in such a way as to avoid criminal penalties.
§4.381.Definitions.
In addition to the words and terms defined in §4.3 of this chapter (relating to Definitions), the following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise:
(1) Affinity--Relationship between individuals based on being married or the fact that the spouse of one of the individuals is related by consanguinity to the other individual. The ending of a marriage ends relationships by affinity unless a child of that marriage is living, in which case the affinity continues as long as a child of that marriage lives. These relationships are named as follows:
(A) First Degree--Spouse, spouse's child, spouse's mother or father, child's spouse, parent's spouse.
(B) Second Degree--Spouse's brother or sister, spouse's grandparent, spouse's grandchild, brother or sister's spouse, grandparent's spouse, grandchild's spouse.
(2) Consanguinity--Relationship between individuals based on being descendants of one another or sharing a common ancestor. An adopted child is considered to be a child of the adoptive parent. These relationships are named as follows:
(A) First Degree--Mother, father, daughter, or son.
(B) Second Degree--Brother, sister, grandparent, or grandchild.
(C) Third Degree--Great-grandparent, great-grandchild, uncle (brother of parent), aunt (sister of parent), nephew (son of brother or sister), or niece (daughter of brother or sister).
(3) Scholarship--An award of gift aid that does not have to be repaid by the student or earned through service or performance.
(4) University System--The association of one or more public senior colleges or universities, medical or dental units or other agencies of higher education under the policy direction of a single governing board, as defined in Texas Education Code, §61.003(10).
(5) Within the Second Degree of Affinity--A circumstance in which a person is a spouse, spouse's child, spouse's mother or father, child's spouse, parent's spouse, spouse's brother or sister, spouse's grandparent, spouse's grandchild, brother or sister's spouse, grandparent's spouse, or grandchild's spouse.
(6) Within the Third Degree by Consanguinity--A circumstance in which a person is a parent, child, brother, sister, grandparent, grandchild, great-grandparent, great-grandchild, aunt who is a sister of a parent of the individual, uncle who is a brother of a parent of the individual, nephew who is a child of a brother or sister of the individual, or niece who is a child of a brother or sister of the individual of an individual. An adopted child is considered to be a child of the adoptive parent for this purpose.
§4.382.Applicability.
The rules in this subchapter apply to a person attending any institution of higher education, as defined in §4.3 of this chapter (relating to Definitions), in Texas.
§4.383.Prohibited Scholarships.
A person is not eligible to receive a scholarship originating from and administered by an institution of higher education or university system if the person is related to a current member of the governing board of the institution or system unless:
(1) the scholarship is granted by a private organization or third party not affiliated with the institution of higher education or university system;
(2) the scholarship is awarded exclusively on the basis of prior academic merit;
(3) the scholarship is an athletic scholarship; or
(4) the relationship is not within the third degree by consanguinity or the second degree by affinity, as the terms are defined in §4.381 of this subchapter (relating to Definitions).
§4.384.Declaration of Eligibility.
Prior to receiving a scholarship originating from and administered by an institution of higher education or university system, a student must file a written statement indicating whether the person is related within the third degree by consanguinity or the second degree by affinity to a current member of the governing board of the institution or university system. The required wording of the statement will be developed by the Board and will be made available to institutions via the Coordinating Board's website.
§4.385.Criminal Penalty.
A person commits a Class B misdemeanor offense if the person knowingly files a false statement under §4.384 of this subchapter (relating to Declaration of Eligibility).
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on January 31, 2025.
TRD-202500352
Nichole Bunker-Henderson
General Counsel
Texas Higher Education Coordinating Board
Earliest possible date of adoption: March 16, 2025
For further information, please call: (512) 427-6365