1. (a) In this section:

   1. (1) "Coordinating board" means the Texas Higher Education Coordinating Board.
   2. (2) "Gift aid" means a grant, scholarship, exemption, waiver, or other financial aid awarded to a student without a requirement to repay the aid or earn the aid through work.

2. (b) The coordinating board shall develop a financial aid displacement advisory for use by institutions of higher education under this section that contains:

   1. (1) a statement bordered by a line one point in weight in a font not less than 14 points in size in the following form:

      "Financial aid displacement occurs when a student's financial aid is reduced due to receipt of a private scholarship or other reasons identified in this advisory. This practice occurs in Texas and should be taken into consideration while applying for financial aid. The institution to which you are applying is providing in this application a list of recommendations describing how to maximize your financial aid and ensure that you are prepared when financial aid displacement occurs. You are encouraged to reach out to the institution to which you are applying to receive advice on how to avoid financial aid displacement."; and

   2. (2) a list of the most common reasons, as identified by the coordinating board, for which the amount of gift aid awarded may be revised or reduced under this chapter.

3. (c) Each institution of higher education shall include in the institution's admission application form or provide in the institution's admission application form a link to the financial aid displacement advisory developed under Subsection (b) and, in plain language:

   1. (1) how to apply for gift aid at the institution;
   2. (2) the timeline for financial aid processes at the institution, including application deadlines, suggested deadlines to report gift aid, and other deadlines of which the institution determines a prospective student should be made aware;
   3. (3) a list of recommendations to aid a prospective student in maximizing gift aid awards, as determined by the institution;
   4. (4) a list of recommendations for a prospective student to ensure the student's gift aid will not be reduced; and
   5. (5) contact information for an employee or office at the institution from whom a prospective student may seek advice regarding gift aid.
4. (d) The coordinating board shall adopt rules necessary to implement this section.

Added by Acts 2025, 89th Leg., R.S., Ch. 1038 (S.B. 2995), Sec. 1, eff. September 1, 2025.