IC 20-51-3
    Chapter 3. Scholarship Granting Organizations; Certification;Administration of Contributions

IC 20-51-3-1
Certification requirements
    Sec. 1. (a) A program qualifies for certification as a schoolscholarship program if:
        (1) the program:
            (A) is administered by a scholarship granting organization;and
            (B) has the primary purpose of providing school scholarshipsto eligible students; and
        (2) the scholarship granting organization administering theprogram:
            (A) applies to the department on the form and in the mannerprescribed by the department; and
            (B) enters into an agreement with the department to complywith this article.
    (b) A program may not be certified as a school scholarshipprogram if the program:
        (1) limits a recipient of a school scholarship to attendingspecific participating schools; or
        (2) limits the ability of a recipient of a school scholarship tochange attendance from one (1) participating school to anotherparticipating school.
As added by P.L.182-2009(ss), SEC.364.

IC 20-51-3-2
Department duties
    Sec. 2. The department shall certify all programs that meet thequalifications under section 1 of this chapter as school scholarshipprograms.
As added by P.L.182-2009(ss), SEC.364.

IC 20-51-3-3
Certification agreements
    Sec. 3. An agreement entered into under section 1 of this chapterbetween the department and a scholarship granting organization mustrequire the scholarship granting organization to do the following:
        (1) Provide a receipt to taxpayers for contributions made to thescholarship granting organization that will be used in a schoolscholarship program. The department of state revenue shallprescribe a standardized form for the receipt issued under thissubdivision. The receipt must indicate the value of thecontribution and part of the contribution being designated foruse in a school scholarship program.
        (2) Distribute at least ninety percent (90%) of the total amountof contributions as school scholarships to eligible students.
        (3) Distribute one hundred percent (100%) of any income

earned on contributions as school scholarships to eligiblestudents.
        (4) Conduct criminal background checks on all the scholarshipgranting organization's employees and board members andexclude from employment or governance any individual whomight reasonably pose a risk to the appropriate use ofcontributed funds.
        (5) Make the reports required by this chapter.
As added by P.L.182-2009(ss), SEC.364.

IC 20-51-3-4
Right to receive other contributions
    Sec. 4. An agreement entered into under section 1 of this chaptermay not prohibit a scholarship granting organization from receivingcontributions other than contributions described in section 3(1) ofthis chapter.
As added by P.L.182-2009(ss), SEC.364.

IC 20-51-3-5
Restrictions on certified scholarships
    Sec. 5. An agreement entered into under section 1 of this chaptermust prohibit a scholarship granting organization from distributingschool scholarships for use by an eligible student to:
        (1) enroll in a school that has:
            (A) paid staff or board members; or
            (B) relatives of paid staff or board members;
        in common with the scholarship granting support organization;
        (2) enroll in a school that the scholarship granting organizationknows does not qualify as a participating school; or
        (3) pay for the cost of education for a public school where theeligible student is entitled to enroll without the payment oftuition.
As added by P.L.182-2009(ss), SEC.364.

IC 20-51-3-6
Annual reports
    Sec. 6. (a) A scholarship granting organization certified under thischapter must publicly report to the department by August 1 of eachyear the following information regarding the organization'sscholarships awarded in the previous school year:
        (1) The name and address of the scholarship grantingorganization.
        (2) The total number and total dollar amount of contributionsreceived during the previous school year.
        (3) The:
            (A) total number and total dollar amount of scholarshipsawarded during the previous school year; and
            (B) total number and total dollar amount of schoolscholarships awarded during the previous school year.
The report must be certified under penalties of perjury by the chief

executive officer of the scholarship granting organization.
    (b) A scholarship granting organization certified under thischapter shall contract with an independent certified publicaccountant for an annual financial audit of the scholarship grantingorganization. The scholarship granting organization must provide acopy of the annual financial audit to the department and must makethe annual financial audit available to a member of the public uponrequest.
As added by P.L.182-2009(ss), SEC.364.

IC 20-51-3-7
Report forms
    Sec. 7. The department shall prescribe a standardized form forscholarship granting organizations to report information requiredunder this chapter.
As added by P.L.182-2009(ss), SEC.364.

IC 20-51-3-8
Suspension and termination of certification
    Sec. 8. The department may, in a proceeding under IC 4-21.5,suspend or terminate the certification of an organization as ascholarship granting organization if the department establishes thatthe scholarship granting organization has intentionally andsubstantially failed to comply with the requirements of this article oran agreement entered into under this article.
As added by P.L.182-2009(ss), SEC.364.

IC 20-51-3-9
Notice of suspension or termination
    Sec. 9. If the department suspends or terminates the certificationof an organization as a scholarship granting organization, thedepartment shall notify affected eligible students and their parents ofthe decision as quickly as possible. An eligible student affected bya suspension or termination of a scholarship granting organization'scertification remains an eligible student under this article until theend of the school year after the school year in which the scholarshipgranting organization's certification is suspended or terminated,regardless of whether the scholarship student currently meets thedefinition of an eligible student.
As added by P.L.182-2009(ss), SEC.364.

IC 20-51-3-10
Financial reviews; audits
    Sec. 10. The department may conduct either a financial review oran audit of a scholarship granting organization certified under thischapter if the department of state revenue has evidence of fraud.
As added by P.L.182-2009(ss), SEC.364.

IC 20-51-3-11
Rules    Sec. 11. The department shall adopt rules under IC 4-22-2 toimplement this article.
As added by P.L.182-2009(ss), SEC.364.