(a) Each year, the commissioner shall determine the accreditation status of each school district.
(b) In determining the accreditation status of a school district, the commissioner:
(1) shall evaluate and consider:
(A) performance on achievement indicators described by § 39.053; and
(B) performance under the financial accountability rating system developed under Subchapter D; and
(2) may evaluate and consider:
(A) the district’s compliance with statutory requirements and requirements imposed by rule of the commissioner or State Board of Education under specific statutory authority that relate to:
(i) reporting data through the Public Education Information Management System (PEIMS) or other reports required by state or federal law or court order;
(ii) the high school graduation requirements under § 28.025; or
(iii) an item listed under Sections 7.056(e)(3)(C)-(I) that applies to the district;
(B) the effectiveness of the district’s programs for special populations; and
(C) the effectiveness of the district’s career and technology program.

(c) Based on a school district’s performance under Subsection (b), the commissioner shall:
(1) assign each district an accreditation status; or
(2) revoke the accreditation of the district and order closure of the district.
(d) A school district’s accreditation status may be raised or lowered based on the district’s performance or may be lowered based on the performance of one or more campuses in the district that is below a standard required under this subchapter.
(e) The commissioner shall notify a school district that receives an accreditation status of accredited-warned or accredited-probation or a campus that performs below a standard required under this subchapter that the performance of the district or campus is below a standard required under this subchapter. The commissioner shall require the district to notify the parents of students enrolled in the district and property owners in the district of the district’s accreditation status and the implications of that accreditation status.
(f) A school district that is not accredited may not receive funds from the agency or hold itself out as operating a public school of this state.
(g) This chapter may not be construed to invalidate a diploma awarded, course credit earned, or grade promotion granted by a school district before the commissioner revoked the district’s accreditation.