SB1786

Dual credit: beginning with the 2025–2026 school year, a grade 9–12 student in a district or charter school can qualify for the Financial Aid for Swift Transfer (FAST) program based on being educationally disadvantaged during the current school year, not just one of the four preceding years. The law expressly includes Windham School District. Students still must enroll in a dual-credit course at a participating institution; this is not free college for everyone. “Educationally disadvantaged” means eligible for the national free or reduced-price lunch program. Districts determine eligibility and notify the college; the Texas Education Agency must make available relevant data it has. The no-cost program and participating colleges’ prohibition on charging notified eligible students tuition or fees already existed. Final law, sections 1–2 and 12; Eligibility definition; Prior FAST law.

Which college outcomes earn funding: transfers after at least 15 semester credit hours or the equivalent can now count when the destination is a qualifying private or independent institution offering four-year degrees, as well as a public general academic teaching institution. “Private or independent” uses the statutory nonprofit, tax-exemption and accreditation definition, not every private provider. Other existing outcome categories remain. Final law, section 7; Institution definitions; Prior funding formula.

Credentials of value: the board must designate a credential when earned or expected cumulative wages meet the statewide high-school-graduate earnings benchmark and the student earns at least a rule-defined individual self-sufficient wage within a board-set period of no more than ten years, and allow the student to recover net attendance costs including forgone earnings. Net attendance costs deduct aid; opportunity costs compare earnings while enrolled with high-school-graduate earnings over two years for associate degrees, four for bachelor’s degrees, and a rule-set period for other programs. The board uses current education and wage data. The self-sufficient wage definition must correlate with the statewide median of the existing county wage determinations. Education and health-care credentials may receive an exception when necessary to meet workforce needs. These are funding criteria, not a promise that every graduate will earn a particular salary. Final law, section 8; Existing self-sufficient-wage standard.

Rollout: the credential tests apply to associate degrees starting in 2025–2026 and other degrees and certificates in 2027–2028. Certificate-program rules are due August 1, 2027, after consultation with the statutory advisory committee. The board must evaluate the effects of a possible county-by-county wage definition by December 1, 2026; the act does not itself order that switch. Final law, sections 14–16.

Workforce information and grants: the education agency, coordinating board and workforce commission must coordinate career-and-technical education grants—including JET, P-TECH, TRUE and federal Perkins programs—to align funding, reduce duplication and support career pathways. The workforce commission must work with employers on enhanced wage filings covering wages, industry, occupation, full- or part-time status, primary-employment county and remote work. It must assess regional labor needs every two years with a ten-year outlook and provide results to officials, colleges and public schools by March 1 of odd-numbered years. Data-sharing and contracting provisions support that work; this briefing does not assert that the required reports have already been delivered. Final law, sections 9–11.

Administration: the bill updates the public-junior-college definition to refer to districts in Education Code Chapter 130, allows the board to adopt manuals or policy documents by reference as rules, and authorizes financial-aid rules. Federal-aid administration rules need not use negotiated rulemaking. Specified formula-alignment rules and certain 2025–2026 financial-aid rules may use emergency procedures without the usual statutory emergency finding; this is not a blanket waiver of all rulemaking requirements. Final law, sections 3–6 and 13; Emergency-rule procedures.

What changed during passage: the Senate substitute dropped a proposed separate FAST tuition-exemption section and added the credential tests, grant coordination and workforce package. Both indexed Senate floor amendments were adopted April 10: Creighton added Windham and proposed additional postsecondary-outcome and board-led labor reports; Paxton proposed out-of-state transfer reporting. The House substitute kept Windham but removed those additional Senate reporting provisions, while adding financial-aid rulemaking authority and its temporary emergency procedure. The separate workforce-commission labor assessment remained. The House committee text’s operative provisions match enrollment after Senate concurrence May 12. Introduced; Senate substitute; Senate-passed; House substitute; Creighton amendment; Paxton amendment; Version index; Amendment index; Final law.

Compare the published text versions in the official text index. A change is not attributed to a specific amendment here without a verified record.

More eligible students may receive no-cost dual credit, while colleges gain credit for certain private-college transfers. Earnings-based funding may encourage programs linked to better-paying work, but credentials failing the tests may generate less state formula funding. Employers and agencies face additional data work. Actual benefits depend on rules, data quality, student outcomes and funding—not simply passage of the act. Final law.

The April 17 House-substitute fiscal note—the version whose operative text matches the final law—estimates a $13,465,906 net benefit to state general-revenue-related funds in 2026–2027. That is a forecast of net savings, not a new appropriation. It assumes $22,214,500 in annual savings from 6,347 associate degrees no longer qualifying for formula funding, offset by about $13.35 million and $13.40 million in added transfer funding in those two years and workforce-commission costs of about $2.65 million and $1.56 million. It estimates 19 additional full-time-equivalent positions in 2026 and 14.5 in 2027. Expanded FAST costs could not be determined. No significant local-government fiscal effect was anticipated. House fiscal note.

The fiscal model’s $30,000 wage threshold and five-year associate-degree return period are assumptions, not dollar or five-year limits enacted in this bill. Earlier estimates changed with the proposals: the introduced version projected $26.75 million in two-year costs; the Senate substitute projected $13.47 million in net savings; the Senate-passed version, including extra reporting later removed, projected $12.85 million in net savings. None guarantees realized savings or measures every private compliance cost. Introduced fiscal note; Senate committee fiscal note; Senate-passed fiscal note; Final law.