Where the new funding model came from: HB 2 and SB 568

Two bills from the 2025 legislative session rewrote how Texas funds special education. The change took effect September 1, 2026, and first applies to the 2026–27 school year.

The two bills carry the same special-education funding language. SB 568 was the standalone special-education funding bill; HB 2 was the session's omnibus public-school finance package, and Article 4 of HB 2 is its special-education portion. That Article 4 text and SB 568's funding provisions are word-for-word the same statute — the same eight tiers, the same service-group structure, the same transition rule, the same September 1, 2026 effective date. HB 2 is the vehicle that carried, so TEA implements the reform under the HB 2 name. For reading the law, the two are interchangeable. Below, "the statute" means both.

Everything on this page is the funding sections — TEC §48.102, §48.1021, and §48.1022. HB 2 is a large bill that touches much more than special education; none of that is in scope here.

The shift, in one sentence

Texas stopped funding special education by where a student is taught and started funding it by what the student's IEP requires.

What the old formula did

Before this change, a special-education student's funding weight came from an instructional arrangement — essentially a placement code. The statute listed them with fixed weights: homebound, hospital class, speech therapy, resource room, self-contained (mild/moderate and severe), off home campus, nonpublic day school, vocational adjustment class. A student in a resource room generated one weight; a student in a self-contained classroom generated another. The number was driven by the setting the student was assigned to.

That entire schedule is repealed. The amended §48.102 strikes the instructional-arrangement weights and the contact-hour rules that went with them.

What replaces it: two allotments that stack

The statute creates two special-education allotments, and a district can earn both for the same student.

1. The intensity-tier allotment — TEC §48.102. For each special-education student in average daily attendance, the district earns the basic allotment multiplied by a weight set for the highest tier of intensity of service the student qualifies for. The statute directs the commissioner to define eight tiers by rule. It fixes two of them at the ends: one tier specifically for students receiving only speech therapy as their instructional service, and one tier specifically for students whose ARD committee places them in a residential placement program. The six tiers in between are left to commissioner rule.

2. The service-group allotment — TEC §48.1021. This is new — there was no equivalent in the old formula. For each special-education student, the district earns an additional allotment for the service group the student's services fall into. The statute requires the commissioner to establish at least four service groups by rule. These fund certain instructional and related services on top of the foundational tier funding.

The two stack by design. Amended §48.103(c) makes it explicit: a district may receive funding under §48.102 and §48.1021 for the same student, for each provision the student qualifies under. The tier is the floor of support; the service group is a supplement layered above it.

What the statute tells the commissioner to weigh

The statute does not itself list the tiers or name the service groups — it hands the commissioner the criteria and the count, and leaves the detailed design to rule. For both the tiers (§48.102(c)) and the service groups (§48.1021(b)), the commissioner must consider the same four things:

1. the type, frequency, and nature of services provided to the student;
2. the certifications, licensures, or other qualifications required of the personnel serving the student;
3. any required provider-to-student ratios for the student to receive appropriate services; and
4. any equipment or technology the services require.

That is the whole statutory definition of intensity: services, staff credentials, staffing ratio, and equipment. The commissioner's framework — published in April 2026 — turns these four considerations into the actual rubric districts apply. That framework is a separate document, covered in the April 16, 2026 letter; this page stays with what the bills themselves say.

The transition year and the floor — TEC §48.1022

The statute does not set dollar values for any tier or service group. Those weights and amounts are set by the legislature in the General Appropriations Act and by commissioner formula — not in the bill. What the bill does instead is govern the first year of the new system.

For 2026–27 only, §48.1022 overrides the normal allotment math and directs the commissioner to:

• set the formulas so that the statewide sum of the §48.102 and §48.1021 allotments comes out approximately $250 million more than the old instructional-arrangement formula would have produced for that year, using the same basic allotment; and
• protect maintenance of effort under federal law while doing so.

That is the entire dollar instruction in the statute: a statewide target, not a price list. The transition provision (§48.1022(a)–(b)) expires September 1, 2027; the section itself expires September 1, 2028.

The practical consequence — no district comes out behind in the transition year, and the actual per-tier dollar values don't exist until after the year is over — isn't spelled out in the bill at this level of detail. It comes out of how TEA operationalized §48.1022, and it's covered in full in the April 16, 2026 letter.

What actually changed, in plain terms

• Funding stopped keying to placement/setting and started keying to what the IEP specifies — the services, staffing, ratios, and equipment a student needs.
• The single instructional-arrangement weight became two stacked allotments: an intensity tier (§48.102) and a service group (§48.1021), both earnable for the same student.
• The statute set the structure — eight tiers, at least four service groups, four defining considerations — and left the detailed rubric and the dollars to commissioner rule and to appropriations.
• 2026–27 is governed by a one-time transition rule (§48.1022) with a ~$250M statewide increase, expiring as the system goes fully live in 2027–28.