Relating to the misuse of money received for an open-enrollment charter school to support an out-of-state school.

HB 1878 prohibits Texas open-enrollment charter schools from using state funds received for their operations to support schools located outside Texas. The bill specifically bans charter school operators from spending these funds on out-of-state institutions, with an exception for contracted goods or services provided to the charter school itself. Violations trigger a penalty where the state commissioner withholds three times the misused amount from future funding, and repeated violations (including spending $100,000+ in violation) can lead to charter revocation. The law takes effect September 1, 2025.