(a) Subject to the availability of federal or state appropriated funds, the commissioner of state health services shall administer a program under which grants are awarded to assist school districts and local health departments, hospitals, health care systems, universities, or nonprofit organizations that contract with school districts with the costs of school-based health centers in accordance with this section.
(b) The commissioner of state health services, by rules adopted in accordance with this section, shall establish procedures for awarding grants. The rules must provide that:
(1) grants are awarded annually through a competitive process to:
(A) school districts; and
(B) local health departments, hospitals, health care systems, universities, or nonprofit organizations that have contracted with school districts to establish and operate school-based health centers;
(2) subject to the availability of federal or state appropriated funds, each grant is for a term of five years; and
(3) a preference is given to school-based health centers in school districts that are located in rural areas or that have low property wealth per student.

(c) All health care programs should be designed to meet the following goals:
(1) reducing student absenteeism;
(2) increasing a student’s ability to meet the student’s academic potential; and
(3) stabilizing the physical well-being of a student.
(d) A school district, local health department, hospital, health care system, university, or nonprofit organization may not receive more than $250,000 per state fiscal biennium through grants awarded under this section.
(e) To be eligible to receive a grant, a school district, local health department, hospital, health care system, university, or nonprofit organization must provide matching funds in accordance with rules adopted under Subsection (b). The matching funds may be obtained from any source available to the district, local health department, hospital, health care system, university, or nonprofit organization, including in-kind contributions, community or foundation grants, individual contributions, and local governmental agency operating funds.
(e-1) A grant under this section may not be given to a nonprofit organization that offers reproductive services, contraceptive services, counseling, or referrals, or any other services that require a license under Chapter 245, Health and Safety Code, or that is affiliated with a nonprofit organization that is licensed under Chapter 245, Health and Safety Code.
(e-2) A school district, local health department, hospital, health care system, university, or nonprofit organization receiving a grant under this section may use the grant funds to:
(1) establish a new school-based health center;
(2) expand an existing school-based health center; or
(3) operate a school-based health center.
(f) The commissioner of state health services shall adopt rules establishing standards for health care centers funded through grants that place primary emphasis on delivery of health services and secondary emphasis on population-based models that prevent emerging health threats.
(g) The commissioner of state health services shall require client surveys to be conducted in school-based health centers funded through grants awarded under this section.