The rules for K-12 education in Texas are changing, and fast. Two new laws that took effect for the 2025-2026 school year are reshaping how public schools are funded and what kinds of learning options districts can offer. If you’re a district leader who has been considering virtual or hybrid programs, this is the time to act.
This article breaks down what Senate Bill 569 and the Texas Education Freedom Accounts program mean for your district, how districts can access and use the funding, and why so many districts across Texas are now moving quickly to build out their virtual programs. We also introduce a platform that a growing number of districts are using to make that transition without starting from scratch.
Senate Bill 569 is the biggest change to Texas’s virtual education policy in years. Passed in 2025, it repeals Texas Education Code Chapter 30A, which governed the old Texas Virtual School Network (TXVSN). The new Chapter 30B is a modern framework that gives districts more flexibility.
The old TXVSN framework was limited and made it difficult for districts to build comprehensive virtual programs. SB 569 changes that by allowing districts to offer virtual and hybrid instruction in several ways. Districts can now offer individual supplemental courses, full-time virtual programs within existing campuses, and, with TEA authorization, entirely new full-time virtual or hybrid campuses.
State Senator Paul Bettencourt, who authored the bill, said it replaces "a patchwork of outdated virtual learning laws with a clear structure." He said he hopes that the number of students learning online in Texas will double by the 2028-2029 school year.
The new law gives districts three main ways to offer virtual instruction:
1. Individual virtual or hybrid courses: Your district can offer standalone courses online, either live (synchronous) or on-demand (asynchronous). A virtual course is one where instruction is delivered primarily online, while a hybrid course requires students to be in person for less than 90% of the time. You can offer these courses right away, without special permission from the TEA, as long as they meet the Texas Essential Knowledge and Skills standards and the National Standards for Quality Online Courses.
2. Full-time virtual or hybrid programs: You can also run a full-time virtual or hybrid program from within an existing school. This is a great option if you want to serve a large group of online learners without the overhead of opening a new campus. This is allowed as long as the online program enrolls less than half of the school’s total student population.
3. Full-time virtual or hybrid campuses: If you want to open a dedicated virtual or hybrid school, you will need to go through a new TEA authorization process. The state is finalizing the rules for this process during the 2025-2026 school year.
The most important part of SB 569 for many districts is how it handles funding. Under the new law, districts receive the same per-student funding for virtual and hybrid programs as they do for in-person instruction. This removes a major financial barrier that previously made it difficult to justify launching a virtual school.
For full-time virtual or hybrid campuses, your Average Daily Attendance (ADA) is calculated by multiplying the number of enrolled students by your district’s average attendance rate. To generate this funding, students need to receive at least 120 minutes of instruction per day for half-day attendance, or 240 minutes for full-day attendance. Your district must maintain documentation to support daily attendance records, which can include daily progress in a learning management system, teacher-student interactions, or assignment completion.
This means your choice of virtual classroom platform has a direct impact on your district’s budget. More on that below.
SB 569 also includes rules to ensure virtual learning is treated as a serious educational option. Schools cannot discourage students from enrolling in virtual programs, and student requests to learn online cannot be denied unless the cost is too high or the course doesn’t fit their graduation plan. Teachers also cannot be forced to teach online without their consent and proper training.
At the same time, Texas has introduced the Education Freedom Accounts (TEFA) program. This program works differently from SB 569. Instead of funding districts, it gives money directly to eligible families to spend on a range of educational expenses.
TEFA funds can be used for private school tuition, virtual school tuition, homeschooling materials, tutoring, and other approved costs. For the 2026-2027 school year, the program provides about $10,474 per student for private school, with different amounts for homeschoolers and students with disabilities.
Not every family is eligible for TEFA; eligibility depends on household income, special needs status, and whether the student was previously enrolled in public school. Families can find the details on the official TEFA website.
For school districts, TEFA presents both a challenge and an opportunity. When students use TEFA funds to attend private or homeschools, your district’s enrollment and funding go down. However, if your district offers a strong virtual program, you can attract and retain students who might otherwise leave, and even draw students from other districts.
Together, SB 569 and TEFA give Texas school districts a strong reason to build out their virtual school options. And they are! Cypress-Fairbanks Independent School District in the Houston area is launching three new virtual schools to meet family demand. Northside ISD in San Antonio is planning a fully online campus. These districts recognize that virtual learning is a mainstream option that families want.
Virtual school enrollment in Texas has grown by 1,200% in the last decade. As of early 2026, over 62,000 Texas students are learning online. The new laws are designed to support this trend.
The reality for district leaders is that families are already choosing virtual schools. The only question is whether they are choosing yours. SB 569 now makes it financially possible to build a program that keeps those students in your district.
Launching a virtual program isn’t as simple as giving teachers a video conferencing link. Districts that have tried that know it leads to disengaged students and frustrated teachers.
Successful virtual schools invest in platforms designed specifically for education. There is a big difference between a meeting tool with a few education features and a platform built from the ground up for teaching. That difference shows up in student engagement, teacher confidence, attendance rates, and the ADA funding that keeps your program running.
Engageli is an active learning platform built for education. It was designed by educators to bring the collaborative energy of an in-person classroom online, and it has been tested and refined over more than 50 million K-12 classroom hours.
For a Texas district building a new virtual program, Engageli is a turn-key solution. It combines the virtual classroom, engagement tools, analytics, and AI assistance a virtual school needs into one platform, replacing the mix of separate tools many districts struggle to manage.
One of Engageli’s unique features is its patented table architecture. Students are seated at small virtual tables for real-time group work and discussion. Unlike breakout rooms, teachers can see and hear what is happening at every table at once, allowing them to provide support without leaving the main room.
This design is based on research and learning science showing that students learn better when they are actively collaborating with their peers. Engageli’s impact study found that its platform leads to 10x more student participation and 54% higher test scores compared to passive lecture-style teaching.
For a virtual school funded under SB 569, attendance tracking is everything. Every unverified instructional minute is a potential loss of funding.
Engageli automatically tracks attendance and engagement across seven different channels, creating a verifiable record of instructional minutes that meets state audit requirements. Administrators can see attendance patterns for the whole class, for each table, and for each student, making it easy to spot and support disengaged learners before they become chronically absent.
The financial impact is real. A 5% increase in attendance in a school of 1,000 students can recover up to $450,000 per year in ADA funding. Research shows students who feel connected and engaged in their virtual classroom are 25% less likely to be chronically absent. Engageli’s design directly supports the attendance numbers that keep a virtual program financially healthy.
Engageli also integrates with LMS platforms and provides simple, exportable reports for state audits and parent conferences.
Engageli’s built-in AI helps teachers manage the virtual classroom. It can flag students who are struggling, answer common questions, and create quick quizzes to check for understanding. This frees up teachers to focus on instruction, not administration.
This matters for virtual schools because teacher burnout and turnover are major challenges in online programs. Engageli reduces the cognitive load on teachers by consolidating tools and automating the routine work of monitoring engagement.
Engageli simplifies a district’s technology stack. Instead of separate tools for video conferencing (Zoom, Teams), classroom management (GoGuardian, ClassDojo), and engagement (Nearpod, Kahoot, Miro), Engageli combines them all into one platform. This reduces costs and makes life easier for teachers, students, and IT staff.
Engageli is designed for fast implementation. The platform's onboarding process includes 24/7 support and personalized training, and the interface is intuitive enough that even kindergarten and first-grade students can navigate it independently.
"Our kindergarten and first graders picked up Engageli right away. One of our teachers said, 'If my 5- and 6-year-olds can figure this out, anyone can!'"
- Christine Bowlby, Principal, Salem-Keizer School District
Salem-Keizer School District in Oregon runs a fully live online K-12 program for over 1,000 students. The district chose Engageli specifically because of its real student collaboration and discourse capabilities, its classroom management tools, and its data and reporting features.
The district has documented improvements in student engagement and reductions in off-task behavior. Their experience offers a practical model for Texas districts building similar programs.
Engageli is also the virtual classroom used by Stride, one of the largest online K-12 school providers in the country.
"Our K-12 teachers and learners are thrilled with the Engageli platform. Teachers use Engageli to foster virtual collaboration, equipping students with essential skills that they will need in both higher education and the modern workforce."
- Suzy Sivley, Product Manager, Stride Learning
The opportunity is here. Districts that move thoughtfully will be in the best position to serve their students and benefit from the new funding laws. Here are the key steps:
| Step | What it involves | Timeline |
| 1. Decide on a delivery model | Choose between individual courses, a full-time program within an existing campus, or a full-time virtual campus. | Immediate |
| 2. Submit course listings to TEA | If offering virtual courses, submit details via the Virtual Course Listing Form. | As soon as possible |
| 3. Establish local policies | Develop policies for daily attendance tracking, documentation, and PEIMS reporting that meet SB 569 requirements. | Before program launch |
| 4. Select a virtual classroom | Choose a purpose-built platform that supports verifiable attendance tracking, active learning, and LMS integration. | Before program launch |
| 5. Train teachers | Ensure teachers are trained and give their consent before teaching online. | Before program launch |
| 6. Monitor and report | Track ADA data, engagement metrics, and compliance documentation throughout the school year. | Ongoing |
Texas has opened the door for districts to build innovative, financially sustainable virtual programs. The funding is available, the rules are clear, and the demand from families is real and growing.
The difference between a virtual program that thrives and one that struggles comes down to the quality of the learning experience. Engaged students stay enrolled. Enrolled students generate funding. It’s a simple chain that starts with a classroom built for learning.
If your district is exploring virtual options, we invite you to take a look at Engageli. It is the only platform with published research behind its learning outcomes and a set of features designed specifically for the challenges and opportunities of K-12 virtual schools.
Book a personalized consultation to see how Engageli could work for your school district.
1. Texas Education Agency. “SB 569 Overview: Virtual and Hybrid Learning Guidance for the 2025-2026 School Year.”
2. DeGuzman, Colleen. “Texas passes virtual education law to strengthen online learning options.”
3. Texas Education Freedom Accounts. Educationfreedom.texas.gov
4. Government Technology. “Texas School District to Launch 3 Virtual Options to Meet Demand.”
5. Stride Learning. “Public Virtual Education Is Expanding in Texas.”