Education

Administration

Rule 626: Carson Smith Opportunities Scholarship Program

Effective Date: 10/08/2026

Admin. Code Reference: R277-626

Rule Type: Current Rule

NOTICE OF SUBSTANTIVE CHANGE

TYPE OF FILING: Amendment

Filing ID: 58165

Rule or section number:

R277-626

1. Agency Information

Title catchline:

Education, Administration

Building:

Board of Education

Street address:

250 E 500 S

City, state:

Salt Lake City, UT

Mailing address:

PO Box 144200

City, state and zip:

Salt Lake City, UT 84114-4200

2. Contact Persons

Name:

Phone:

Email:

Elisse Newey

801-538-7500

Elisse.newey@schools.utah.gov

Please address questions regarding information on this notice to the persons listed above.

3. General Information

A. Rule or section catchline:

R277-626. Carson Smith Opportunities Scholarship Program

B. Purpose of the new rule or reason for the change:

These rule amendments are due to the passage of SB 54 during the 2026 General Session.

C. Summary of the new rule or change:

These amendments update the requirements for the scholarship's accessibility and administration, notably eliminating family income-based eligibility requirements, removing sibling eligibility, and more closely aligning the program's allowable expenses with the Utah Fits All Scholarship Program.

To protect consumers and ensure proper stewardship of funds, the bill also places several new administrative requirements directly on the Scholarship Granting Organization (SGO).

These amendments also remove the oversight categorization of "Category 4".

4. Legislative Action Information

A. Are any changes in this filing

because of state legislative action?

Changes are because of legislative action.

B. If yes, any bill number and

session:

SB 54 (2026 General Session)

5. Fiscal Information

Provide an estimate and written explanation of the aggregate anticipated cost or savings to:

A. State budget:

This amendment is not expected to have fiscal impact on state government revenues or expenditures.

Striking the internal oversight category does not have any fiscal impacts.

Any fiscal impacts due to this rule change were captured in the fiscal note for SB 54 (2026).

B. Local governments:

This amendment is not expected to have fiscal impact on local governments' revenues or expenditures.

Striking the internal oversight category does not have any fiscal impacts.

Any fiscal impacts due to this rule change were captured in the fiscal note for SB 54 (2026).

C. Small businesses ("small business" means a business employing 1-49 persons):

This amendment is not expected to have fiscal impact on small businesses' revenues or expenditures.

Striking the internal oversight category does not have any fiscal impacts.

Any fiscal impacts due to this rule change were captured in the fiscal note for SB 54 (2026).

D. Non-small businesses ("non-small business" means a business employing 50 or more persons):

There are no non-small businesses in the industry in question, Elementary and Secondary Schools (North American Industry Classification System (NAICS) 611110). Because there are no non-small businesses, they do not account for any service delivery for Elementary and Secondary Schools. Therefore, non-small businesses are not expected to receive increased or decreased revenues per year. This proposed rule change is not expected to have any fiscal impact on non-small businesses' revenues or expenditures because there are no applicable non-small businesses, and it does not require any expenditures of, or generate revenue for non-small businesses.

E. Persons other than small businesses, non-small businesses, state, or local government entities ("person" means any individual, partnership, corporation, association, governmental entity, or public or private organization of any character other than an agency):

This amendment is not expected to have fiscal impact on revenues or expenditures for persons other than small businesses, businesses, or local government entities.

Striking the internal oversight category does not have any fiscal impacts.

Any fiscal impacts due to this rule change were captured in the fiscal note for SB 54 (2026).

F. Compliance costs for affected persons:

There are no compliance costs for affected persons.

Striking the internal oversight category does not have any fiscal impacts.

Any fiscal impacts due to this rule change were captured in the fiscal note for SB 54 (2026).

6. Regulatory Impact Summary Table

Enter the cost or savings in the relevant cell. If there is no cost or savings, enter, "$0." If a cost or savings is inestimable, enter, "inestimable."

Fiscal Cost

FY2027

FY2028

FY2029

FY2030

FY2031

State Budget

Local Governments

Small Businesses

Non-Small Businesses

Other Persons

Total Fiscal Cost

Fiscal Benefits

FY2027

FY2028

FY2029

FY2030

FY2031

State Budget

Local Governments

Small Businesses

Non-Small Businesses

Other Persons

Total Fiscal Benefits

Net Fiscal Benefits

7. Regulatory Impact Analysis Approval

The State Superintendent of the Utah State Board of Education, Molly Hart, has reviewed and approved this regulatory impact analysis.

8. Family Impact Information

A. The agency has considered this rule's impact on family health, stability, and formation:

☒

9. Citation Information

Provide citations to the statutory authority for the rule. If there is also a federal requirement for the rule, provide a citation to that requirement:

Utah Constitution, Article X, Section 3

Subsection 53E-3-401(4)

Title 53E, Chapter 7, Part 4

11. Public Notice Information

The public may submit written or oral comments to the agency identified in box 1.

A. Comments will be accepted until:

10/01/2026

12. Effective Date Information

This rule change MAY become effective on:

(NOTE: This is the date the agency anticipates making the filing effective. It is NOT the effective date)

10/08/2026

13. Agency Authorization Information

Agency head or

designee and title:

Elisse Newey, Deputy Superintendent of

Policy

Date:

08/14/2026

R277. Education, Administration.

R277-626. Carson Smith Opportunities Scholarship Program.

R277-626-1. Authority[,] and Purpose[, and Oversight Category].

(1) This rule is authorized by:

(a) Utah Constitution Article X, Section 3, which vests general control and supervision over public education in the Board;

(b) Subsection 53E-3-401(4), which allows the Board to make rules to execute the Board's duties and responsibilities under the Utah Constitution and state law; and

(c) Section 53E-7-404, which requires the Board to make rules to implement the Carson Smith Opportunities Scholarship Program.

(2) The purpose of this rule is to provide guidelines for contracted scholarship granting organizations and the Superintendent to implement the Carson Smith Opportunities Scholarship Program.

[(3) This Rule R277-626 is categorized as Category 4 as described in Rule R277-111.

]

R277-626-2. Definitions.

(1) "Eligible student" has the same meaning as defined in Section 53E-7-401.

(2) "Home-based scholarship student" has the same meaning as defined in Section 53E-7-401.

(3) "Program donation" means a donation to a scholarship granting organization in accordance with Section 53E-7-405.

(4) "Qualifying provider has the same meaning as defined in Section 53E-7-401.

(5) "Qualifying school" has the same meaning as defined in Section 53E-7-401.

(6) "Request for proposals" or "RFP" has the same meaning as defined Subsection 63G-6a-103(70).

(7) "Scholarship expense" has the same meaning as defined in Section 53E-7-401.

(8)(a) "Scholarship granting organization" or "SGO" has the same meaning as defined in Section 53E-7-401.

(b) An SGO may not be a qualifying school or qualifying provider.

(9) "Scholarship student" has the same meaning as defined in Section 53E-7-401.

R277-626-3. Superintendent Responsibilities.

(1) The Superintendent shall conduct an RFP for an SGO in accordance with Subsection 53E-7-404(2).

(2) The Superintendent shall provide all information required to the Utah State Tax Commission in accordance with Subsection 53E-7-404(3)(c).

(3) The Superintendent shall provide a tax credit certificate form, in accordance with Subsection 53E-7-404(2)(a) for use by an approved SGO.

(4) The Superintendent shall annually recommend to the Board a program donations cap for approval in accordance with Subsection 53E-7-407(4).

(5)(a) The Superintendent shall monitor an SGO chosen under Subsection (1) to ensure compliance with state law, including Title 53E, Chapter 7, Part 4, Carson Smith [Opportunities Scholarship Program]Opportunity Scholarship and this Rule R277-626.

(b) The Superintendent may recommend remedial action against an SGO in accordance with Rule R277-114 and Subsection 53E-7-404(5).

(6)(a) The Superintendent shall:

(i) recommend qualifying schools to the Board for approval in accordance with Subsection 53E-7-408(6); and

(ii) require, as a condition for approval, that a qualifying school reimburse scholarship money to an SGO if an eligible student discontinues enrollment early.

(b) The Superintendent shall post a list of approved qualifying schools on the Board website.

(7)(a) The Superintendent shall monitor SGO employees and officers in accordance with Subsection 53E-7-410(2).

(b) The Superintendent shall initiate corrective action against an SGO if an employee or officer of the SGO is facing charges for, or has been convicted or pled guilty or no contest to a violation of the following state laws or laws of another jurisdiction:

(i) any felony; or

(ii) an offense involving fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct.

R277-626-4. SGO Responsibilities.

(1) An SGO approved in accordance with Subsection R277-626-3(1) shall administer the program in accordance with Section 53E-7-405.

(2)(a) An SGO shall maintain separate accounts for all scholarship donations, including any interest or other income from the scholarship funds.

(b) An SGO may not comingle the scholarship funds with any other funds and may only use funds from the account to cover scholarship expenses.

(3) Before awarding a scholarship, an SGO shall verify an eligible student's primary Utah residency using state tax data or other acceptable

state-approved documentation.

(4) An SGO shall establish and enforce firm deadlines by which a parent or eligible student must accept or decline a scholarship offer.

[(3)](5)(a)(i) [Prior to]Before an SGO paying expenses for tuition and fees, a parent of an eligible student shall personally approve a funds

transfer to the qualifying school or qualifying provider.

(ii) A student may not approve a funds transfer under a power of attorney from the student's parent.

(iii) After approval as required under Subsection (3)(a)(i), an SGO shall pay costs for tuition and school fees for an eligible student directly to a qualifying school or qualifying provider.

(b) An SGO may disburse reimbursements to an eligible student's parent upon proof of payment of other approved scholarship expenses.

(6) An SGO shall ensure that allowable scholarship expenditures for extracurricular activities and physical education do not exceed 20% of

a scholarship student's total award amount.

(7) An SGO shall establish and maintain a formal, written appeals process for a parent or eligible student to contest a denied scholarship

expense reimbursement request.

[(3)](8) If an eligible student discontinues enrollment in a qualifying school or qualifying provider, the SGO shall:

(a) notify the Superintendent; and

(b) obtain reimbursement of scholarship money from the qualifying school or qualifying provider.

(9) An SGO may not charge application or processing fees to a scholarship student or a scholarship student's parent, and may not pass on

any third-party management or administrative fees to a scholarship student's account.

(10) To ensure program transparency, an SGO shall publicly disclose on the SGO's website all third-party contracts and associated

administrative fees related to the management of the program.

[(4)](11) An SGO shall provide the following information to the Superintendent biannually by January 31 and July 31:

(a) the amount of tuition and fees each qualifying school or qualifying provider charges annually;

(b) financial records of the SGO annually, including administrative costs incurred by the SGO to administer the program;

(d) the number of first time scholarship students annually;

(e) the amount disbursed for scholarship expenses annually, provided with any detail requested by the Superintendent;

(f) the standards used by the SGO to determine whether a student is an eligible student;

(g) data reflecting savings to the state and LEAs, if any, as a result of scholarship students exiting the public school system;

(h) demographic information on scholarship students, including:

(i) name;

(ii) date of birth;

(iii) gender;

(iv) race; and

(v) last public school attended, if applicable;

(i) whether the SGO has received complaints of discrimination, and any steps taken by the SGO to remedy the complaints; and

(j) any other information requested by the Superintendent to facilitate monitoring of the program and preparation of the annual report required by Section 53E-1-202.1.

[(5)](12) An SGO may not have a personal or professional relationship with a qualifying school or qualifying provider or an employee of a

qualifying school or qualifying provider that would create a conflict of interest, favoritism, or bias in making awards from program donations.

[(6)](13) An SGO is subject to monitoring and corrective action in the same manner as a recipient under Rule R277-114.

KEY: special needs opportunity scholarship

Date of Last Change: [July 9, 2024]2026

Notice of Continuation: October 7, 2025

Authorizing, and Implemented or Interpreted Law: Art X, Sec 3; 53E-3-401(4); Title 53E, Chapter 7, Part 4

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