1. Each educational assistance organization shall:

(1) Notify the state treasurer of its intent to provide scholarship accounts to qualified students;

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(2) Demonstrate to the state treasurer that it is exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended;

(3) Provide a state treasurer-approved receipt to taxpayers for contributions made to the organization;

(4) Ensure that grants are distributed to scholarship accounts of qualified students in the following order:

(a) Qualified students that have an approved “individualized education plan” (IEP) developed under the federal Individuals with Disabilities Education Act (IDEA), 20 U.S.C. § 1400, et seq., as amended, or qualified students living in a household whose total annual income does not exceed an amount equal to one hundred percent of the income standard used to qualify for free and reduced price lunches;

(b) Qualified students living in a household whose total annual income does not exceed an amount equal to two hundred percent of the income standard used to qualify for free and reduced price lunches; and

(c) All other qualified students;

(5) Ensure that:

(a) One hundred percent of its revenues from interest or investments is spent on scholarship accounts;

(b) At least ninety percent of its revenues from qualifying contributions is spent on scholarship accounts; and

(c) Marketing and administrative expenses do not exceed the following limits of its remaining revenue from contributions:

a. Ten percent for the first two hundred fifty thousand dollars;

b. Eight percent for the next five hundred thousand dollars; and

c. Three percent thereafter;

(6) Distribute scholarship account payments either four times per year or in a single lump sum at the beginning of the year as requested by the parent of a qualified student, not to exceed a total grant amount equal to the state adequacy target as defined in section 163.011 and calculated by the department of elementary and secondary education, in the form of a deposit into the scholarship account of the qualified student;

(7) Provide the state treasurer, upon request, with criminal background checks on all its employees and board members and exclude from employment or governance any individual who might reasonably pose a risk to the appropriate use of contributed funds;

(8) Demonstrate its financial accountability by:

(a) Submitting to the state treasurer annual audit financial statements by a certified public accountant within six months of the end of the educational assistance organization’s fiscal year; and

(b) Having an auditor certify that the report is free of material misstatements; and

(9) Ensure that participating students take the state achievement tests or nationally norm-referenced tests that measure learning gains in math and English language arts, and provide for value-added assessment, in grades that require testing under the statewide assessment system set forth in section 160.518;

(10) Allow costs of the testing requirements to be covered by the scholarships distributed by the educational assistance organization;

(11) Provide the parents of each student who was tested with a copy of the results of the tests on an annual basis, beginning with the first year of testing;

(12) Provide the test results to the state treasurer on an annual basis, beginning with the first year of testing;

(13) Report student information that would allow the state treasurer to aggregate data by grade level, gender, family income level, and race;

(14) Provide rates of high school graduation, college attendance, and college graduation for participating students to the state treasurer in a manner consistent with nationally recognized standards;

(15) Provide to the state treasurer the results from an annual parental satisfaction survey, including information about the number of years that the parent’s child has participated in the scholarship program. The annual satisfaction survey shall ask parents of scholarship students to express:

(a) Their level of satisfaction with the child’s academic achievement, including academic achievement at the schools the child attends through the scholarship program versus academic achievement at the school previously attended;

(b) Their level of satisfaction with school safety at the schools the child attends through the scholarship program versus safety at the schools previously attended;

(16) Demonstrate its financial viability, if it is to receive donations of fifty thousand dollars or more during the school year, by filing with the state treasurer before the start of the school year a surety bond payable to the state in an amount equal to the aggregate amount of contributions expected to be received during the school year or other financial information that demonstrates the financial viability of the educational assistance organization.

2. The annual audit required under this section shall include:

(1) The name and address of the educational assistance organization;

(2) The name and address of each qualified student for whom a parent opened a scholarship account with the organization;

(3) The total number and total dollar amount of contributions received during the previous calendar year; and

(4) The total number and total dollar amount of scholarship accounts opened during the previous calendar year.

3. The state treasurer shall:

(1) Ensure compliance with all student privacy laws for data in the state treasurer’s possession;

(2) Collect all test results;

(3) Provide the test results and associated learning gains to the public via a state website after the third year of test and test-related data collection. The findings shall be aggregated by the students’ grade level, gender, family income level, number of years of participation in the scholarship program, and race; and

(4) Provide graduation rates to the public via a state website after the third year of test and test-related data collection.

4. An educational assistance organization may contract with private financial management firms to manage scholarship accounts with the supervision of the state treasurer.