43-1602

43-1602. Certification as a school tuition
organization

(Eff. 1/1/11)

A. A nonprofit organization in this state that is exempt or has applied for
exemption from federal taxation under section 501(c)(3) of the internal revenue code may
apply to the department of revenue for certification as a school tuition organization,
and the department shall certify the school tuition organization if it meets the
requirements prescribed by this chapter. An organization must apply for certification on
a form prescribed and furnished on request by the department.

B. The department shall:

1. Maintain a public registry of currently certified school tuition organizations.

2. Make the registry available to the public on request.

3. Post the registry on the department's official website.

C. The department shall send written notice by certified mail to a school tuition
organization if the department determines that the school tuition organization has
engaged in any of the following activities:

1. Failing or refusing to allocate at least ninety per cent of annual revenues for
educational scholarships or tuition grants.

2. Failing or refusing to file the annual reports required by section 43-1604.

3. Limiting availability of scholarships to students of only one school.

4. Encouraging, facilitating or knowingly permitting taxpayers to engage in actions
prohibited by this article.

5. Awarding, restricting or reserving educational scholarships or tuition grants
for use by a particular student based solely on the recommendation of the donor.

D. A school tuition organization that receives notice from the department pursuant
to subsection C of this section has ninety days to correct the violation identified by
the department in the notice. If a school tuition organization fails or refuses to comply
after ninety days, the department may remove the organization from the list of certified
school tuition organizations and shall make available to the public notice of removal as
soon as possible. An organization that is removed from the list of certified school
tuition organizations must notify any taxpayer who attempts to make a contribution that
the contribution is not eligible for the tax credit and offer to refund all donations
received after the date of the notice of termination of certification.

E. A school tuition organization may request an administrative hearing on the
revocation of its certification as provided by title 41, chapter 6, article 10. Except
as provided in section 41-1092.08, subsection H, a decision of the department is subject
to judicial review pursuant to title 12, chapter 7, article 6.