SB1490

Regular Session

Relating to adult high school charter program funding.

High Cost

Effective:2025-09-01

Enforcing Agencies

Texas Education Agency (TEA)

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

Effective Date: September 1, 2025 (Applies to the 2025-2026 school year).
Compliance Deadline: August 15, 2025 (Internal systems must be updated prior to the first attendance reporting period of the new school year).
Agency Rulemaking: The Texas Education Agency (TEA) will update the *Student Attendance Accounting Handbook* (SAAH) during Summer 2025. Operators must monitor the Texas Register for the specific codes required for PEIMS submissions.

Immediate Action Plan

1. Recalculate FY26 Budget: Direct your finance department to re-run 2025-2026 revenue projections using the new SB1490 tiers immediately.
2. Contact SIS Provider: Send a formal notice to your software vendor citing SB1490 and requesting a timeline for the logic update.
3. Audit Calendar Definitions: Review your approved academic calendar to ensure the total "instructional days" count is optimized for the new percentage calculations.
4. Monitor SAAH Updates: Assign a compliance officer to track TEA's Summer 2025 updates to the Student Attendance Accounting Handbook.

Operational Changes Required

Contracts

SIS Vendors: Review contracts with Student Information System providers immediately. You must issue a change order or service ticket requiring them to update their funding logic to match the new SB1490 tiers (e.g., ensuring a student with 40% enrollment is calculated at 0.5 ADA, not 0.25 ADA).
Lender Covenants: If your organization has debt covenants tied to revenue floors or debt service coverage ratios, notify lenders of the projected revenue increase for FY2026 to improve your credit standing.

Hiring/Training

Registrars & PEIMS Coordinators: Retrain staff on the financial criticality of precise enrollment and withdrawal dates. A discrepancy of a few days could now shift a student between funding tiers, effectively doubling the revenue for that specific enrollee.
Finance Team: CFOs must update revenue projection models immediately. The "per-student" revenue assumption for transient populations has increased significantly.

Reporting & Record-Keeping

Attendance Audits: While the method of taking attendance remains standard, the audit risk increases due to higher payouts. Maintain strict documentation of the "instructional days" denominator used to calculate the percentage of the year a student is enrolled.
PEIMS Submissions: Ensure your Fall 2025 PEIMS submission utilizes the new weighting codes. Submitting under old formulas will result in a permanent loss of eligible state revenue.

Fees & Costs

Revenue Impact: This is a revenue-generating statute. The Legislative Budget Board estimates a positive impact of over $8 million to the sector in the first year alone.
Administrative Costs: Minimal one-time costs associated with software reconfiguration.

Strategic Ambiguities & Considerations

"Instructional Days" Denominator: The statute relies on the percentage of "instructional days of the school year" a student is enrolled. For adult charters with flexible or year-round calendars, the exact denominator used to calculate this percentage is critical. If your charter defines the "school year" broadly, you may inadvertently dilute a student's percentage, dropping them into a lower funding tier. Watch for TEA guidance on how to define the "standard year" for these calculations.
Interaction with Other Weights: It is currently unclear if these new base ADA adjustments will compound automatically with other weighted funding streams (e.g., Compensatory Education or Special Education) without specific SAAH amendments.

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Legislative Timeline

This bill's path through the Texas Legislature

TopicsEducation Education--primary & Secondary Education--primary & Secondary--admission & Attendance Education--primary & Secondary--charter Schools Education--primary & Secondary--finance Adult Education

Official Analysis

View HRO Analysis View All Bill Documents

BILL ANALYSIS

Senate Research Center	S.B. 1490
89R4205 AMF-D	By: Bettencourt
	Education K-16
	3/28/2025
	As Filed

AUTHOR'S / SPONSOR'S STATEMENT OF INTENT

In 2021, S.B. 1615 (87R) created a new funding model for Subchapter G Adult High Schools (Section 12.251, Education Code) that was based on enrollment and outcomes-based measures, rather than an attendance-based model. This was done in recognition that adult learners require significantly more flexibility in their schedules to accommodate responsibilities such as a family and jobs. The bill was passed in 2021 and implemented in the 2023 school year. However, an error has been identified in the new adult high school funding system: one of the funding tiers was mistakenly left out of the bill, leading to a cascading funding shortfall for adult high schools.

S.B. 1490 seeks to remedy this error by providing funding that is in line with the original intent of the bill.

As proposed, S.B. 1490 amends current law relating to adult high school charter program funding.

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 12.263(b), Education Code, as follows:

(b) Provides that, for purposes of determining the average daily attendance of an adult education program operated under a charter granted under Subchapter G (Adult High School Charter School Program), a student is considered to be in average daily attendance, with a 100 percent attendance rate, for:

(1) makes no changes to this subdivision;

(2) three-quarters, rather than half, of the instructional days of the school year, if the student is enrolled for at least 50 percent but less than 75 percent of the school year;

(3) half, rather than a quarter, of the instructional days of the school year, if the student is enrolled for at least 25 percent but less than 50 percent of the school year; or

(4) a quarter, rather than one-tenth, of the instructional days of the school year, if the student is enrolled for at least 10 percent but less than 25 percent of the school year.

SECTION 2. Effective date: September 1, 2025.

Senate Authors

Sen. Paul BettencourtRepublican · Primary Author

Coauthors (2)

House Sponsors

Rep. Stan GerdesRepublican · Primary Sponsor

Joint Sponsors

Cosponsors (2)

Bill Text(with markup)

S.B. No. 1490

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

	AN ACT
	relating to adult high school charter program funding.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1. Section 12.263(b), Education Code, is amended to
	read as follows:
	(b) For purposes of determining the average daily
	attendance of an adult education program operated under a charter
	granted under this subchapter, a student is considered to be in
	average daily attendance, with a 100 percent attendance rate, for:
	(1) all of the instructional days of the school year,
	if the student is enrolled for at least 75 percent of the school
	year;
	(2) three-quarters [~~half~~] of the instructional days of
	the school year, if the student is enrolled for at least 50 percent
	but less than 75 percent of the school year;
	(3) half [~~a quarter~~] of the instructional days of the
	school year, if the student is enrolled for at least 25 percent but
	less than 50 percent of the school year; or
	(4) a quarter [~~one-tenth~~] of the instructional days of
	the school year, if the student is enrolled for at least 10 percent
	but less than 25 percent of the school year.
	SECTION 2. This Act takes effect September 1, 2025.

LEGISLATIVE BUDGET BOARD
Austin, Texas

FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION


April 1, 2025

TO:	Honorable Brandon Creighton, Chair, Senate Committee on Education K-16

FROM:	Jerry McGinty, Director, Legislative Budget Board

IN RE:	SB1490 by Bettencourt (Relating to adult high school charter program funding.), As Introduced

Estimated Two-year Net Impact to General Revenue Related Funds for SB1490, As Introduced: a negative impact of ($20,408,072) through the biennium ending August 31, 2027.

The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill.

General Revenue-Related Funds, Five- Year Impact:

Fiscal Year	Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2026	($8,309,627)
2027	($12,098,445)
2028	($16,178,778)
2029	($19,208,133)
2030	($21,153,381)

All Funds, Five-Year Impact:

Fiscal Year	Probable Savings/(Cost) from Foundation School Fund 193
2026	($8,309,627)
2027	($12,098,445)
2028	($16,178,778)
2029	($19,208,133)
2030	($21,153,381)

Fiscal Analysis

The bill would adjust the number of instructional days a student in an adult education program operated under a charter school may be considered to be in average daily attendance with a 100 percent attendance rate based on certain criteria.

Methodology

The Texas Education Agency (TEA) assumes the bill would result in costs to the Foundation School Program (FSP) of $8.3 million in fiscal year 2026, $12.1 million in fiscal year 2027, increasing to $21.2 million in fiscal year 2030. TEA assumes costs of the bill would increase in subsequent fiscal years due to anticipated growth in the number of adult charter schools and enrolled students under both current law and the bill.

Local Government Impact

This analysis assumes certain open-enrollment charter schools would receive additional funding through the FSP under this bill.

Source Agencies:

701 Texas Education Agency

LBB Staff:

JMc, JPE, ASA, ANa

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Frequently Asked Questions

Common questions about SB1490

What does Texas SB1490 do?

SB1490 significantly revises the funding formula for Adult High School Charter Programs effective September 1, 2025, by increasing the Average Daily Attendance (ADA) weight for students enrolled for less than 75% of the school year. This legislation is revenue-positive for adult education charters but requires immediate updates to Student Information Systems (SIS) and financial forecasting models to ensure the new entitlement is correctly calculated and claimed. Implementation Timeline Effective Date: September 1, 2025 (Applies to the 2025-2026 school year).

Who authored SB1490?

SB1490 was authored by Texas Senator Paul Bettencourt during the Regular Session.

When was SB1490 signed into law?

SB1490 was signed into law by Governor Greg Abbott on May 24, 2025.

Which agencies enforce SB1490?

SB1490 is enforced by Texas Education Agency (TEA).

What is the cost impact of SB1490?

The cost impact of SB1490 is estimated as "high". This may vary based on industry and implementation requirements.

What topics does SB1490 address?

SB1490 addresses topics including education, education--primary & secondary, education--primary & secondary--admission & attendance, education--primary & secondary--charter schools and education--primary & secondary--finance.

Legislative data provided by LegiScanLast updated: November 25, 2025

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