TEFA School Voucher Final Rules: What Online Course and Program Providers Need to Know
- Accessible Education
- Dec 2
- 8 min read
Part 8 of the TEFA School Voucher Stakeholder Series
The Texas Education Freedom Account (TEFA) program creates significant opportunities for online education providers to serve Texas families. The final rules include a critical change that dramatically expands the market for online learning: the removal of the "for-credit" requirement. This change, combined with clarifications about vendor classification and approval requirements, opens the door for a wide range of online educational offerings.
Here's what online course and program providers need to know.
The Most Significant Change: "For-Credit" Requirement Removed
The single most important change for online education providers is the revision to the definition of eligible online courses:
Proposed rule: Defined as a single, "for-credit" instructional offering
Final rule: Changed to "Online educational course or program" and the "for-credit" requirement was removed
What This Means for Your Business
This change dramatically expands what families can purchase with TEFA funds.
Previously eligible (under proposed rules):
Credit-bearing courses counting toward graduation
Courses aligned with formal academic transcripts
Programs providing official credit hours
Now eligible (under final rules):
All of the above, PLUS:
Non-credit enrichment courses
Supplemental learning programs
Test preparation courses
Skill-building programs
Elective and exploratory courses
Summer learning programs
Remedial or acceleration courses
Interest-based learning (coding, art, music, etc.)
Career exploration programs
Bottom line: If it's educational, it can qualify, regardless of whether it produces formal academic credit.
Your Classification: Vendor of Educational Products or Services
Online course and program providers are classified as "Vendors of educational products or services" under the final rules.
What This Classification Means
You're in the same category as tutors, therapists, and other service providers
You're distinct from "education service providers" (private schools, PreK/K programs)
You provide specific services rather than full-time enrollment
You must meet vendor-specific requirements for approval
This classification is appropriate for the nature of online education: families typically purchase individual courses or programs rather than enrolling full-time.
Registration Requirement: Secretary of State
To participate as a vendor, you must be "registered with the secretary [of state] to do business in this state."
What This Means for Different Business Types
If you're an established business entity:
LLC, corporation, or partnership: Must be registered with Texas Secretary of State
Out-of-state entity: Must register to do business in Texas
Existing Texas registration: Verify it's current and in good standing
If you're a sole proprietor:
Operating under your personal name: May not need separate registration
Operating under a business name: Likely need to register
Check with the Secretary of State to confirm your status
Action Items
Visit the Texas Secretary of State website
Verify your current registration status
Complete registration if needed
Maintain ongoing compliance (annual reports, registered agent, etc.)
Important: This requirement ensures you're a legitimate business entity authorized to operate in Texas.
No Physical Location Requirement
Unlike education service providers (private schools), online providers are not required to have a physical location in Texas or maintain Texas-resident staff beyond what's required for your Secretary of State registration.
What This Means
As an online provider, you can:
Operate from anywhere
Serve Texas TEFA families remotely
Maintain staff in any location
Provide fully virtual services
The only Texas requirement: Registration with the Secretary of State to do business in the state.
This makes TEFA accessible to national online education providers who want to serve Texas families.
Criminal Background Screening Requirements
All vendors must comply with background screening requirements to protect student safety:
Who Must Be Screened
You must ensure that no individual who will interact with a participating child "by reason of their employment" has disqualifying criminal history or has engaged in reportable conduct.
This includes personnel who have:
Online interactions with students (instructors, tutors)
Electronic interactions (messaging, email, learning platform communication)
In-person interactions (if your program includes any face-to-face components)
Interim Compliance Method
Because the full reportable conduct search engine is not yet operational, use the registry established under Education Code §22A.051 (the do-not-hire registry) for screening purposes.
Practical Implementation
For small providers:
Screen yourself if you'll interact with students
Screen any employees or contractors with student contact
Maintain records of screening completion
For larger providers:
Implement systematic screening for all instructional personnel
Create onboarding procedures that include background checks
Document compliance for potential audits
Important: "Interaction" includes all forms of communication, video calls, learning platform messages, email support, chat functions, etc.
Qualification Standards for Instructors
If your online courses are taught by educators, the final rules specify qualification requirements:
Who Qualifies as an Educator
Instructors qualify if they are:
"An educator employed by or a retired educator formerly employed by":
A school district
An open-enrollment charter school
An accredited private school in Texas
An accredited institution of higher education
AND they hold:
A current teaching license or certification from the State Board for Educator Certification, OR
A current teaching credential from a private school accrediting organization
Key Requirements
Credentials must be current (active, not expired)
Must be in good standing
Retired educators must still maintain current credentials
What If Your Instructors Don't Meet These Criteria?
The educator qualification applies specifically to tutors and teaching service employees. If your online courses:
Are self-paced without live instruction
Use instructional designers rather than classroom teachers
Employ subject matter experts without teaching credentials
You may still qualify as a vendor of educational products or services, but you should clarify your instructor qualifications during the approval process and ensure you meet any applicable standards.
Technology Requirements and Expenses
The final rules include provisions that benefit online education providers:
Technological Devices
Families can use TEFA funds to purchase technological devices that are:
Required by you as a vendor, OR
Prescribed by a physician to facilitate education
Subject to: An annual limit of 10% of the total amount transferred to the child's account
What This Means for Your Services
If your online courses require:
Specific tablets or computers
Webcams or headsets
Software subscriptions
Digital tools or applications
Families can use TEFA funds to purchase these items (within the 10% cap) if you require them for participation.
Best Practices
Be clear about technology requirements:
List required vs. optional equipment
Specify minimum device specifications
Clarify which items families need to purchase vs. what's included
Provide guidance on using the 10% allocation efficiently
Consider bundling options:
Course + required software subscription
Program enrollment + technology package
Full-year access + necessary tools
Course Pricing and Fee Structure
Understanding how families will pay for your courses helps you structure your offerings:
Payment Through Approved System
TEFA participants must purchase approved expenses using a comptroller-approved payment system.
This means:
You'll need to integrate with the approved payment system
Direct payments outside the system are not permitted
Standard e-commerce payment processors may not be usable for TEFA transactions
Action item: Once the Comptroller announces the approved payment system, prepare for integration.
Pricing Considerations
For families at approved private schools:
Have access to full base funding (~$8,000-$10,000+)
Can use TEFA funds for supplemental online courses
May have remaining funds after tuition for enrichment
For homeschooling families:
Limited to $2,000 total annual funding
Need to budget across all educational expenses
Highly price-sensitive
May prefer course bundles or subscription models
For families with children with disabilities:
May have up to $30,000 available
Often seek specialized courses or interventions
May need therapeutic or adaptive approaches
Strategic consideration: Offer tiered pricing or course packages that work for different family budgets.
Course-Specific Fees
The final rules expanded the definition of "tuition and fees" to include "course specific fees" to the extent they are related to educational instruction.
What This Covers
If your courses have additional fees for:
Lab materials or kits
Required textbooks or workbooks
Specialized software licenses
Project supplies
Assessment or testing fees
Certification exam fees
These course-specific fees are covered by TEFA funds as long as they're related to educational instruction.
Structuring Your Offerings
Option 1 - All-inclusive pricing:
Course fee includes all materials and resources
Simpler for families to budget
May be more attractive
Option 2 - Separate fees:
Base course fee + materials fee
Families pay for what they need
More flexibility but more complex
Recommendation: Whatever structure you choose, be transparent about all costs upfront.
Types of Online Offerings That Qualify
With the "for-credit" requirement removed, consider the full range of offerings now eligible:
Academic Courses
Core subjects (math, science, English, history)
Advanced Placement (AP) courses
Dual credit preparation
Foreign languages
Advanced mathematics or sciences
Enrichment and Electives
Art and music instruction
Creative writing
STEM programs
Coding and computer science
Financial literacy
Test Preparation
SAT/ACT prep courses
PSAT preparation
State assessment preparation
College entrance exam strategies
Skill Development
Study skills and organization
Reading comprehension strategies
Writing improvement programs
Mathematical reasoning
Specialized Learning
Gifted and talented programs
Learning differences support
Dyslexia intervention
Acceleration programs
Credit recovery
Career and Technical Education
Career exploration programs
Technical skill development
Industry certification preparation
Professional skills training
Summer and Break Programs
Summer learning programs
Break enrichment courses
Year-round supplemental learning
Assessment and Accountability
Online providers should understand assessment requirements that may affect your students:
For Students in Private Schools (Grades 3-12)
Students enrolled in approved private schools must take annual assessments:
Nationally norm-referenced tests
Chapter 39 assessments (STAAR)
Alternative assessments (for children with disabilities)
What this means for you:
Your courses may need to align with assessment standards
Families may seek courses that prepare students for required assessments
Consider offering assessment-aligned curriculum
For Homeschooled Students
Homeschooled students are not required to take annual assessments.
What this means for you:
More flexibility in curriculum design
Families may choose courses based on interest rather than testing requirements
Still valuable to provide progress tracking and evaluation
Ready to Position Your Online Education Business for TEFA Success?
The TEFA program represents a significant opportunity for online education providers. The removal of the "for-credit" requirement opens the market to virtually any educational online offering, from academic courses to enrichment programs to test preparation.
Texas has a large and diverse student population, and TEFA will create thousands of families with educational funding seeking quality online options. Whether you provide comprehensive curriculum, specialized courses, or supplemental enrichment, there's likely a market segment of TEFA families who need what you offer.
But success in the TEFA marketplace requires more than great courses.
It requires:
Strategic pricing that works across different family funding levels
Vendor compliance systems that meet state requirements
Payment system integration with the Comptroller's approved platform
Marketing that speaks to homeschool, private school supplement, and hybrid education families
Documentation and record-keeping that's audit-ready from day one
The online education providers who capture this market early will be those who begin preparation now, before vendor applications open and before families start making purchasing decisions for the 2026-27 school year.
Through our ESA Consulting Services, Accessible Education helps online course and program providers navigate every phase of preparation:
Business Foundation & Compliance
Review your business structure for TEFA vendor participation
Implement background screening procedures for all personnel with student contact
Establish record-keeping systems for enrollment, payments, course completion, and audit readiness
Ensure instructor qualifications and credentials meet documentation standards
Strategic Course Development & Pricing
Expand course offerings to leverage the removal of the "for-credit" requirement
Develop tiered pricing strategies for different TEFA family segments (homeschool budget-conscious vs. private school supplementing)
Create course descriptions and marketing materials that emphasize educational value and outcomes
Clarify technology requirements and accessibility considerations for each offering
Payment System & Operations Setup
Prepare for integration with the Comptroller-approved payment system once announced
Develop customer support procedures specific to TEFA participant needs
Create enrollment workflows that capture required compliance documentation
Build systems to track and demonstrate educational services provided
Market Positioning & Launch
Identify your target TEFA family segment(s) and craft messaging that resonates
Develop marketing materials emphasizing the value propositions that matter most (flexibility, quality, accessibility, affordability, results, support)
Guide you through the vendor approval application process
Position your business for visibility when families begin researching options for fall 2026
The Keys to Success in the TEFA Marketplace
Understanding the different funding levels families have ($2,000 vs. $10,500)
Pricing strategically for your target segment
Providing clear value and measurable results
Maintaining compliance with vendor requirements
Integrating smoothly with program systems
The online education providers who begin planning now will be first to capture market share when TEFA families start making purchasing decisions. Early vendor approval means early visibility, and early visibility means enrollment advantage.
Let's discuss how to strategically position your online education business for the TEFA marketplace. Contact us, follow us on Facebook, Instagram, or subscribe to our newsletter for the latest updates and insights.
