Can a Parent Co-op be an eligible service provider?
Parent Co-ops are not forbidden to be providers in Utah Fits All nor are their services inherently not eligible for parents. However, members and leaders of parent co-ops need to be fully aware of the law because they risk coming in violation by the nature of the organization.
First to address if a Co-op can be a service provider, yes they can but they must be aware of the law. They are required to have an EIN, if the organization is a nonprofit they are still required to have an EIN to be an eligible service provider. But, if the organization is run by parents who are home-based scholarship students or a home school student solely in relation to the parent's child they cannot be a provider. This poses an issue for parent co-ops to be aware of because the co-op cannot be run by the parent of a homeschooler or the family member of a homeschooler.
So if a co-op is registered as a business with an EIN and run by an individual who is not the parent of a home-based scholarship student or related to the parent of a home-based scholarship student they can be an eligible service provider.
Can a parent use scholarship funds to pay a parent co-op?
The section of Utah state code that affects parent co-op offerings and services is below:
“A private program or service intending to receive scholarship funds shall: agree to not refund, rebate, or share scholarship funds with scholarship students or scholarship students' parents in any manner except remittances or refunds processed through the financial administrator to a scholarship account in accordance with this part and procedures that the program manager establishes.” - 53F-6-409(3)
Generally speaking, parent co-op’s exist to pool money across multiple families to purchase in bulk. Parents and service providers are forbidden to mix funds across students. This means that if a co-op wants to bulk purchase 500 boxes of colored pencils, those boxes of colored pencils would then have to be individually purchased by the student's account. The parent cannot spend scholarship funds to go into a pool of money that mixes funds with other students to make a purchase.
Another section of Utah state code that affects parent co-op offerings and services is:
“To be an eligible service provider, a private program or service: may not act as a consultant, clearing house, or intermediary that connects a scholarship student with or otherwise facilitates the student's engagement with a program or service that another entity provides.” - 53F-6-409(1)
In other words, if a parent co-op purchases curriculum or classes in bulk for parents to then individually purchase they are acting as an intermediary that is connecting the parent to a third party service. Classes and curriculum must be purchased from the organization that creates them.
Lastly for original classes and curriculum taught by a co-op themselves. These classes are allowed and encouraged. However, if the class is taught by a parent of a home based scholarship student that parent cannot be paid with scholarship funds if their own student is taking the class.
What should I do if I am a parent in a co-op?
Odyssey highly encourages co-ops with parents who want to use UFA funds to apply to be eligible service providers. This is the most effective way we can determine if the organization qualifies to receive UFA funds. Please be aware that due to the legal nuances co-op applications and offerings will take Odyssey longer to process and approve. As for reimbursements for parent co-ops spending cannot violate any of the guidelines stated above and the sections of law below. Reimbursements to co-ops will require the parent to prove the purchase is not in violation of these sections of law.
Relevant Sections of Utah State Code:
“The following are not eligible service providers: a parent of a home-based scholarship student or a home school student solely in relation to the parent's child” -53F-6-409(6)(a)
“The parent of a scholarship student may not receive scholarship funds as payment for the parent's time spent educating the parent's child.” - 53F‑6‑402(7)(d)
“To be an eligible service provider, a private program or service:
shall provide to the program manager and financial administrator:
(i) a federal employer identification number;
(ii) the provider's address and contact information;
(iii) a description of each program or service the provider proposes to offer directly to a scholarship student; and
(iv) subject to Subsection (2), any other information as required by the program manager;
shall comply with the antidiscrimination provisions of 42 U.S.C. Sec. 2000d; and
may not act as a consultant, clearing house, or intermediary that connects a scholarship student with or otherwise facilitates the student's engagement with a program or service that another entity provides.” - 53F-6-409(1)
“A private program or service intending to receive scholarship funds shall: agree to not refund, rebate, or share scholarship funds with scholarship students or scholarship students' parents in any manner except remittances or refunds processed through the financial administrator to a scholarship account in accordance with this part and procedures that the program manager establishes.” - 53F-6-409(3)