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• SAT weighted rank (2003): 23rd out of 25 states and the District of Columbia
• ACT weighed rank (2003): N/A
• ALEC Academic Achievement Ranking: 41st out of 50 states and the District of Columbia
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Texas offers public school choice through the Public Education Grant (PEG), but there are significant limitations. Texas has a strong charter school law.

In 1995, then-Governor George W. Bush signed Senate Bill 1 to authorize charter schools and to set up home-rule school districts. Under this legislation, the Texas State Board of Education could authorize up to 20 open enrollment charters with institutions of higher education, nonprofit organizations, or governmental entities. School district boards may convert an existing public school to a charter school if there is sufficient support from parents and teachers.[2]

School districts may form Home-Rule Charter Districts. A Home-Rule Charter District can be initiated through a petition and a two-thirds vote of school board members. A commission must be formed to adopt a proposal. This proposal must be submitted to the Texas Secretary of State. If the Secretary of State determines that it would engender a change in district governance, the proposal must be approved by the U.S. Department of Justice or the U.S. District Court for the District of Columbia. Finally, the charter must be approved by a majority of the voters in the school district.[3] No Home-Rule Charter Districts have been established.[4]

Created in 1995, the Public Education Grant (PEG) offers students the opportunity to transfer out of schools that the state has rated as "low-performing" or in which 50 percent or more of the students have not passed the Texas Assessment of Academic Skills (TAAS) tests in two of the preceding three years. A student may apply to transfer to another school within the district or one outside of the district. The law does not require schools to accept PEG transfers.[5]

In 1996, then-District Superintendent of Schools Rod Paige initiated an innovative plan to allow students in overcrowded Houston schools the option of transferring to nonsectarian private schools. This practice, called "educational contracting," was expanded in 1998 to provide similar options for students who were struggling in failing schools. Since then, the Houston school board voted several times to enable more students to participate in this program.[6]

During the 1997 legislative session, the enactment of House Bill 318 significantly improved the state's charter school bill by raising the cap on open enrollment charters to 120 and allowing for an unlimited number of charters for schools serving at-risk students.[7] An amendment by then-Representative Ron Wilson (D-131) would have allowed PEG participants who were rejected by a public school to attend private school at public expense. The amendment, however, was withdrawn. [8]

A poll conducted in 1998 by Scripps Howard found that 54 percent of Texans surveyed supported legislation to create a voucher program to allow students in poor-performing public schools to attend private schools.[9]

In 1999, H.B. 2118 was introduced to provide "opportunity scholarships" for students in poorly performing schools in the state's seven largest school districts. The schools' districts would have had to provide transportation, and the vouchers would have been worth the per-pupil expenditure in the district. Only 10 percent of the students in a school would have been eligible to participate. The bill died in committee.[10]

Another bill introduced in 1999, S.B. 10, would have initiated a program in the state's six most urban counties to provide vouchers for low-income students who were struggling academically. The bill was approved by the Senate Education Committee but was not taken up by the full Senate.[11]

The state's first private scholarship program, the Texas CEO Foundation, began in San Antonio in 1992 with support from USAA, the San Antonio Express News, David Robinson of the San Antonio Spurs, and Children First America.[12] Since 1998, CEO Horizon, a private organization in San Antonio, has made a scholarship available to every low-income child in the predominantly Hispanic Edgewood Independent School District to attend a school of choice.

Researchers at Mathematica Policy Research, Inc., and Harvard University's Program on Education Policy and Governance released a study of San Antonio's Horizon Program in 1999. The study showed that, contrary to critics' claims, the voucher program did not "cream" the best students from the public school system and that there was no significant academic or economic difference between the students who entered the Horizon program and those who remained in the public school system.[13]

In 2001, the legislature passed H.B. 6, which capped the number of schools chartered by the state at 215. The law also placed numerous new requirements on charter schools, including standards that board members must meet and restrictions on the use of charter school funds. In addition, the law stipulates that charter schools must use a lottery system for enrollment and gives additional authority to the state Commissioner of Education. Despite these new restrictions, the law makes it easier for universities to obtain charters, placing no limit on the number of university-run charter schools.[14]

Three choice bills were introduced during the 2001 legislative session: House Bills 1240, 2666, and 2489. H.B. 1240 would have provided vouchers for poor-performing students in the six largest school districts: Dallas, Houston, Fort Worth, Austin, Northside, and El Paso. Students would have been eligible for the vouchers if they qualified to participate in the federal free and reduced-price lunch program and performed poorly on the state assessment tests or if they had been denied a transfer through the PEG program. The bill required the state education commissioner to report an evaluation of the voucher program to the legislature by December 2004.

H.B. 2666 would have created a statewide private school voucher program in the event that the U.S. Congress passed voucher legislation. Students participating in a federal voucher program would have been able to supplement a federal voucher with local and state funding to attend a private school. The program would have been governed by federal law and regulations created by the Texas Commissioner of Education. H.B. 2489 would have provided tax credits for corporate contributions to scholarship funds. All three bills died in committee.[15]

In 2001, Houston's Knowledge Is Power Program (KIPP) Academy, a charter school, had the highest passing rates of all middle schools in the city on state assessment tests. In math, the KIPP students scored in the 81st percentile of the nation on the Stanford-9 test.[16]

In 2002, researchers at the Manhattan Institute for Policy Research concluded that, in addition to helping individual students who participate in the program, the Horizon scholarship program spurred improvements in the public school system. After controlling for differences in resources and demographic characteristics, analysts found that, from 1998 to 2001, Edgewood District students' improvement on the state's TAAS test exceeded or was equal to that of students in 85 percent of all Texas school districts. Edgewood students also fared well when compared to other Hispanic and low-income populations.[17] In 2002, the program served 1,713 students (approximately 12 percent of Edgewood's student population), providing vouchers that ranged from $3,600 to $4,800.[18]

Research conducted by the Texas Public Policy Foundation found that, although students who enter a charter school experience a first-year decline in test scores, students who remain in charter schools for consecutive years achieve strong academic gains. The performance of students enrolled in charter schools for two years improved at a greater rate than did the performance of students in traditional public schools.[19]

Students at Houston's KIPP charter school made gains on test scores that surpassed the achievement of students at other area schools, according to a report released in October 2002 by New American Schools. Encouraged by the results experienced by its three schools that opened last year, KIPP announced plans to open 19 new campuses across the country in 2003.[20]

In December 2002, then-State Representative Ron Wilson (D-131) pre-filed H.B. 293, a school choice bill that would have provided vouchers to low-income students from six of the state's large urban districts to attend a private school. In order to participate, students must qualify for the federal free and reduced-price lunch program and must have performed poorly on the state assessment or have been denied a transfer through the PEG program. Representative Wilson also introduced a similar bill, H.B. 658, in 2003. Neither bill progressed.[21]

H.B. 944, enacted in 2003, prohibits discrimination against home-school students in higher education. The law requires colleges and universities to use the same admission standards for home-school students that they use for public school students.[22]

Companion bills H.B. 3474 and S.B. 1822 were introduced in 2003 to create a study of the privately funded voucher program in operation in San Antonio's Edgewood Independent School District. The study would have reviewed the vouchers' effects on taxpayers, students using the vouchers, and students not using the vouchers. Neither bill received any action.[23]

H.B. 2465 would have created the Education Freedom Pilot Program for districts with over 40,000 students, the majority of whom qualify for the free and reduced-priced lunch program. The House Committee on Public Education approved H.B. 2465 by a vote of 5 to 3, but the bill received no further action.[24]

H.B. 2563 would have created a tax credit for corporations that donate money to scholarship organizations. The bill specifies that organizations receiving the donations cannot award more than $3,700 annually per student. The bill did not receive a vote.[25]

In April 2003, a virtual charter school bill, H.B. 1554, was killed in the House by a vote of 75 to 66.[26] Its companion, S.B. 933, was passed in the Senate and sent to the House, where it passed in the Education Committee on a 5-3 vote. The whole House did not take it up.[27] The bills would have allowed universities to contract with private companies to operate on-line schools.[28]

H.B. 2224, introduced by Representative Harold Dutton (D-Houston), would have repealed some of the state's oversight provisions regarding charter schools. The bill, which passed the House on May 1, 2003, would have required the Texas State Board of Education to approve any governing standards for charters proposed by the education commissioner. The bill's supporters claimed that too many restrictions have been placed on charter schools because of a small number of schools that have failed.[29] The bill was not taken up by the Senate.[30]

Developments in 2004 and 2005
In March 2004, the Texas Public Policy Foundation and the Milton & Rose D. Friedman Foundation released a compilation of essays arguing for and against school choice in Texas. Entitled “Putting the Sides Together: School Choice in Texas?,” this research includes the work of parental choice advocates and opponents.[31] In the compilation, Manhattan Institute expert Jay P. Greene, Ph.D., reports, "What is striking about the recent research on school choice is not just its quality but that it consistently reveals positive benefits from school choice."

During the 2004 legislative session Texas State Senator Leticia R. Van de Putte (D-78) introduced S.B. 15, to prohibit the use of any state or local tax money for private schools. It died in committee [32]

In his 2005 State of the State address, Gov. Rick Perry (R) spoke strongly in favor of expanding educational options for Texas children. "Every child is entitled to a public education," he said, "but public education is not entitled to every child. Let's give children who need a second chance new choices that can forever change their future. Let's give them school choice."[33]

State Representative Linda Harper-Brown (R-105) introduced H.B. 1263 in February 2005. The bill would create a pilot voucher program for low-income students, special education students, or students who have dropped out of school or been victims of school violence. The number of students allowed to participate in the program would increase each year by a number equal to 5 percent of the public school population.[34] The House Education Committee approved the bill, but the full House never considered it. Instead, the bill’s language was inserted into a larger bill (S.B. 422), which passed out of the Senate and out of the House Committee on Public Education.[35] 

In April, Rep. Frank Corte (R-122) introduced H.B. 12, which would also create a voucher program for students who live in low-income areas. The bill is with the House Committee on Public Education.[36]Another voucher bill, H.B. 3042, was also introduced in April and is pending in the same committee.[37] Vouchers under this legislation would be worth up to $5,500.

In January 2005, Sen. Judith Zaffirini (D-Laredo) introduced S.B. 151, which would assist dual-enrollment students with tuition and fees as they attend classes at postsecondary institutions.[38] The bill passed the Senate on April 28, 27 to 4.

H.B. 2, a charter school bill, was introduced in early February.[39] The bill would close all charter schools in the state except for those in which 30 percent of students posted gains in achievement over the past school year. Charter school advocates say the bill would bring needed accountability to the state’s schools.[40] The bill passed the House in March by a 75 to 69 vote, with 2 abstaining. The Senate Education Committee is reviewing the bill.

In April, Rep. Brian McCall (R-Plano) introduced H.B. 386, a bill to allow home-schooled students to take classes at public schools or participate in extracurricular activities. Rep. McCall said, "They're taxpayers. They pay property taxes for the schools, and if they choose to participate in part of what their local schools have to offer, they should be able to."[41] The bill passed the House Committee on Public Education near the end of the session in late May.[42]

On April 6, the Hispanic Council for Reform and Educational Options (HCREO) led a rally of hundreds of parents on the steps of the Capitol in Austin. Gov. Perry, Lt. Gov. David Dewhurst, and House Speaker Tom Craddick were in attendance.[43] At the rally, HCREO President Rebecca Huffman said, “Change is never easy and change can be painful.… It is often difficult for those within the system to recognize the changes that need to take place. Those inside the system will fight the hardest against these changes that will benefit everyone.”[44]