us-tx/regs
34 Tex. Admin. Code § 16.404 — Education Service Providers and Vendors of Educational Products
(a)
To be approved as an education service provider or vendor of educational products or services by the comptroller, a provider or vendor must submit a comptroller-approved application and:
(1) if an education service provider, be located in this state;
(2) if a vendor of products or services, be registered with the secretary to do business in this state;
(3) have the right to transact business in this state by complying with all tax filing, collection, and payment requirements imposed by the state of Texas; and
(4) agree and certify under penalty of perjury that the provider or vendor will:
(A) accept orders and money from the program only for education-related expenses approved under Education Code, §29.359;
(B) subject to subsection (b) of this section, not charge a program participant for services or products paid for by the program, including tuition and fees, in an amount greater than or in addition to the established standard amount charged to all others for that service or product by the provider or vendor;
(C) not accept program money for a service or product to the extent the service or product is not provided;
(D) not rebate, refund, or credit to or share program money with a program participant or any person on behalf of a program participant;
(E) promptly return any money received in violation of program rules or other relevant law to the comptroller or designated certified educational assistance organization for deposit into the program fund;
(F) ensure that each person who will interact with a participating child by reason of their employment with the provider or vendor, including in person, online, or electronic interactions, is not identified as having engaged in misconduct described by Education Code, §22A.051(a)(2)(A), (B), (C), or (D), by:
(i) using the interagency reportable conduct search engine established under Health and Safety Code, Chapter 810; or
(ii) if the interagency reportable conduct search engine established under Health and Safety Code, Chapter 810, has not been established, using the registry established under Education Code, §22A.051;
(G) comply with the audits requirements under Education Code, §29.363, by providing to a private entity under contract with the comptroller or to the state auditor information or documentation related to a program transaction;
(H) notify the comptroller or designated certified educational assistance organization not later than the 30th calendar day after the date that the provider or vendor no longer meets the program requirements; and
(I) abide by all other program requirements.
(b)
A private school may charge different standard amounts of tuition and fees for categories of students if those categories are unrelated to program participation.
(c)
An approved provider of supplemental special education services under Education Code, Chapter 29, Subchapter A-1, in good standing with the agency shall be approved as a vendor of educational products or services for the program.
(d)
A private school shall be approved as a provider by permitting electronic verification of, if available, or submitting proof of:
(1) accreditation by an organization recognized by the Texas Private School Accreditation Commission or agency;
(2) annual administration of an assessment instrument to participating children in grades 3 through 12;
(3) continuous operation of a campus, regardless of whether located in this state, for at least two school years preceding the date the school seeks approval; and
(4) that the school is located in this state.
(e)
For a private school that operates more than one campus in this state, including a virtual campus, approval to participate extends only to a campus that is:
(1) operated by that school; and
(2) covered by the accreditation that the school submitted under subsection (d)(1) of this section or covered by another accreditation by an organization recognized by the Texas Private School Accreditation Commission or agency.
(f)
A public school or open-enrollment charter school shall be approved as a vendor of educational products or services by permitting electronic verification of, if available, or submitting proof of accreditation by the agency and demonstrating the ability to provide services or products to participating children in a manner such that the children are not counted toward the district's or school's average daily attendance.
(g)
A higher education provider shall be approved as a vendor of educational products or services by permitting electronic verification of, if available, or submitting proof of a nationally recognized postsecondary accreditation.
(h)
A private provider of a prekindergarten or kindergarten program shall be approved as an education service provider by permitting electronic verification of, if available, or submitting proof that the provider meets the requirements of Education Code, §29.171 and is located in this state;
(i)
A private tutor, therapist, or employee of a teaching service shall be approved as a vendor of educational products or services by permitting electronic verification of, if available, or submitting proof that:
(1) the individual providing the service to the child is not required to be discharged or refused to be hired by a school district under Education Code, §22A.157, and has not engaged in misconduct described by Education Code, §22A.052(b)(1), by obtaining a complete national criminal history record review in an acceptable format and dated within 30 days of the application;
(2) the individual providing the service to the child is not included in the registry under Education Code, §22A.151;
(3) if a tutor or employee of a teaching service:
(A) is an educator employed by or a retired educator formerly employed by a school accredited by the agency, an organization recognized by the agency, or an organization recognized by the Texas Private School Accreditation Commission;
(B) holds a relevant license or accreditation issued by a state, regional, or national certification or accreditation organization; or
(C) is employed in or retired from a teaching or tutoring capacity at a higher education provider; and
(4) if a therapist, the individual providing the service possesses a current, relevant license or accreditation issued by a state, regional, or national certification or accreditation organization.
(j)
To be approved as a vendor of products or services under Education Code, §29.358(b-1), a vendor must comply with subsection (a) of this section and must:
(1) if a vendor of an online educational course or program under Education Code, §29.359(A)(1)(C), permit electronic verification of, if available, or submit proof that each person who will interact with a participating child by reason of their employment with the vendor, including in person, online, or electronic interactions, is not required to be discharged or refused to be hired by a school district under Education Code, §22A.157, and has not engaged in misconduct described by Education Code, §22A.052(b)(1), by obtaining a complete national criminal history record review in an acceptable format and dated within 30 days of the application;
(2) if a vendor of an academic assessment under Education Code, §29.359(4), comply with Education Code, §29.357(b); or
(3) if a vendor of transportation services under Education Code, §29.359(6), permit electronic verification of, if available, or submit proof that:
(A) each person who will interact with a participating child by reason of their employment with the vendor, including in person, online, or electronic interactions, is not required to be discharged or refused to be hired by a school district under Education Code, §22A.157, and has not engaged in misconduct described by Education Code, §22A.052(b)(1), by obtaining a complete national criminal history record review in an acceptable format and dated within 30 days of the application; and
(B) each person providing such transportation services holds a valid Texas driver's license required for the transportation service provided.
(k)
Money transferred by the program to a participating child's account may not be used to pay any individual related to the participating child within the third degree by consanguinity or affinity, as determined under Government Code, Chapter 573. For the purpose of this subsection, a payment to an entity, other than a sole proprietorship owned by the individual or a partnership of which the individual is a partner, is not a payment to an individual related to the participating child.
Source Note: The provisions of this §16.404 adopted to be
effective December 15, 2025, 50 TexReg 8046.
Source: official text