EDU-45-12-00013-P Licensure of Non-Degree Granting Private Proprietary Schools

11/7/12 N.Y. St. Reg. EDU-45-12-00013-P

NEW YORK STATE REGISTER

VOLUME XXXIV, ISSUE 45

November 07, 2012

RULE MAKING ACTIVITIES

EDUCATION DEPARTMENT

PROPOSED RULE MAKING

NO HEARING(S) SCHEDULED

 

I.D No. EDU-45-12-00013-P

Licensure of Non-Degree Granting Private Proprietary Schools

PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:

Proposed Action:

Amendment of Part 126 of Title 8 NYCRR.

Statutory authority:

Education Law, sections 207 (not subdivided), 305(1) and 5001-5010; and L. 2012, ch. 381

Subject:

Licensure of non-degree granting private proprietary schools.

Purpose:

To implement the provisions of chapter 381 of the Laws of 2012.

Substance of proposed rule (Full text is posted at the following State website:www.acces.nysed.gov/bpss/):

The Commissioner of Education proposes to amend Part 126 of the Commissioner's Regulations to implement Education Law sections 5001 through 5010, as amended by Chapter 381 of the Laws of 2012, effective January 30, 2013.

The following is a summary of the major provisions of the proposed rule.

The title of this Part has been amended to read "Licensed Private Career Schools or Licensed Private Schools".

Section 126.1 is amended to clarify the definitions for curriculum, course, gross tuition, school, reviewed financial statement, audited financial statement and Certified English as a Second Language School to be consistent with the new law. This section also adds new definitions for practical experience and occupationally required credential.

Section 126.2(d) is amended to clarify that scholarship funds must be collected and applied according to the disbursement method as set forth in Section 5002(1)(b-1) of the Education Law.

Section 126.3 is amended to eliminate the references to registration.

Section 126.4(a) is amended to make clear that where the department retains an expert or outside consultant to review the curriculum of a school, the school shall bear the expense, in addition to any curriculum or course application fee.

Section 126.6(a) is amended to indicate that each applicant instead of the school shall submit teaching and management personnel applications. Section 126.6(c) of the Commissioner's Regulations is amended to indicate that all teacher licenses issued after December 15, 2012 would no longer be restricted to a single school location as private career schools licenses presently are.

Section 126.6(d) of the Commissioner's Regulations is amended to allow a school director to apply for a private school agent certificate without incurring the agent application fees. This section also clarifies the preparation requirements for directors; eliminates the references to registered business schools consistent with the new law; and eliminates the references to directors whose education and practical experience were approved prior to July 1, 1973.

Section 126.6(e) eliminates the reference to registered schools.

Section 126.6(f) sets forth the requirements for teacher licenses and permits in licensed private career schools, as appropriate, and eliminates the requirements for registered business schools/computer training facilities.

Section 126.6(n) indicates that in cases where the curricula/courses offered require the assistance of a vendor demonstrator, the need for a demonstrator must be included and approved in the specific course or curriculum approval.

Section 126.7 is amended to require that the enrollment agreement include a provision for the method or methods of payment, including, as appropriate, the disbursement schedule for each type of financial assistance available which shall meet the requirements set forth in section 5002(1)(b-1) of the Education Law.

Section 126.8(a) is amended to indicate that schools that are not financially viable are subject to having their licenses suspended or revoked, or the Commissioner may require the cessation of student enrollment. This section is also amended to eliminate the prior requirements and to require schools to submit to the Commissioner an annual financial statement that requires schools that receive $500,000 or more or whose combined State and Federal student financial aid is $100,000 or more to submit an audited financial statement. For schools which receive less than $500,000 and less than $100,000 in combined Federal and State student financial aid in a school fiscal year shall submit an unaudited reviewed financial statement or an audited financial statement to the commissioner for that fiscal year, provided that a reviewed financial statement cannot be submitted for two consecutive fiscal years. An audited financial statement must also be filed for the year following the fiscal year for which a reviewed financial statement was filed.

Section 126.9 is amended to require schools to include in their catalog a weekly tuition chart for each program that indicates the amount of a refund due a student upon withdrawal and the disbursement schedule for each type of financial assistance available. It also eliminates the option of allowing a school to submit an attestation that the catalog or bulletin meets all of the requirements.

Section 126.10 is amended to delete the references to registration and the requirement that the commissioner shall act on an initial application for a license or registration within 120 days of receipt of a complete application. This section also requires that upon transfer or assignment of any interest totaling 25 percent or more, the school shall be deemed a new school required to submit a new school application and obtain a new license pursuant to the requirements of this Part. The previous school license shall remain in effect until the new license is issued or denied or the previous license expires or is revoked, whichever comes first. This section also requires any school which received $500,000 or more in gross tuition in a school fiscal year to submit to the commissioner an annual audited statement of revenue prepared in accordance with generally accepted accounting principles for that fiscal year. In addition, this section clarifies the requirements for an English as a Second Language school.

Section 126.12 is amended to reflect that the certificate will be effective for three years instead of two and to require a $200 fee instead of $100, except that the school director may apply for an agent's certificate without incurring the application fee.

Section 126.17 is amended to provide that new schools, which did not operate in the year prior to licensure, will have no gross tuition upon which to be assessed until either the end of their first fiscal year or March 31 of the year after the school was licensed, whichever comes first. For schools whose fiscal year end comes before March 31 of the year after the school was licensed, the school shall submit a complete financial statement in compliance with the provisions set forth in Education Law section 5001(4)(e) is required. For schools whose fiscal year ends later than March 31 after their initial licensure date, the school shall submit an unaudited reviewed income statement for the time period between initial licensure and March 31 detailing the amount of gross tuition received during that period. Thereafter, complete financial statements shall be required.

Text of proposed rule and any required statements and analyses may be obtained from:

Mary Gammon, NYS Education Department, Office of Counsel, Room 148, Washington Avenue, Albany, NY 12234, [phone], email: [e-mail]

Data, views or arguments may be submitted to:

Carole Yates, NYS Education Department, Bureau of Proprietary School Supervision, Room 1613, 99 Washington Avenue, Albany, NY 12234, [phone], email: [e-mail]

Public comment will be received until:

45 days after publication of this notice.

Regulatory Impact Statement

1. STATUTORY AUTHORITY:

Education Law section 207 grants general rule-making authority to the Regents to carry into effect State educational laws and policies.

Subdivision (1) of section 305 of the Education Law empowers the Commissioner of Education to be the chief executive officer of the state system of education and authorizes the Commissioner to execute educational policies determined by the Regents.

Article 101 of the Education Law (Sections 5001 through 5010 of the Education Law), as amended by Chapter 381 of the Laws of 2012, authorizes the State Education Department to license and regulate non-degree granting proprietary schools consistent with the requirements in Article 101 of the Education Law.

2. LEGISLATIVE OBJECTIVES:

The proposed amendment carries out the legislative objectives of the above-referenced statutes by implementing the requirements of Chapter 381 of the Laws of 2012.

3. NEEDS AND BENEFITS:

Chapter 381 of the Laws of 2012 amended Article 101 of the Education Law (sections 5001 through 5010) to eliminate the distinction between licensed private schools and registered business schools, replace the phrase "licensed private schools" with the more descriptive "licensed private career schools", adjust fees, which have not changed since 1990, and establish a candidate school category that would allow a school to operate legally while it is in the process of obtaining a non-degree-granting proprietary school license.

Section 5001 of the Education Law provides for the consolidation of registered business schools and licensed private schools into one designation, eliminating the artificial distinction between these types of schools and reflecting the current heterogeneous nature of training programs offered at these schools. This section also clarifies the exemptions for certain schools from the licensure requirements and exempts conferences, trade shows, workshops and such other courses of study from the licensing requirements. Candidate school status is also allowed as a practical means for prospective schools to operate legally prior to meeting all the requirements of full licensure. This section also amends the specific fees for initial and renewal applications for such licensure. Renewal fees are increased to reflect the State Education Department's current cost of supervising these schools and to meet the prospective costs for reimbursing tuition for a significant number of students when these students' schools close due to fiscal failure or non-compliance. Initial application fees are set at certain amounts and fees for renewal are based on the school's gross annual tuition income. Renewal fees are accrued to the credit of the proprietary vocational school supervision account.

Section 5001 sets forth procedures for working with schools that are not financially viable to protect the tuition reimbursement account. The method of assessing schools is changed from more complicated regular and special assessment formulas to one based on the number of quarterly assessments paid, whereby newer schools with the potential to fail would pay a higher assessment than schools with a history of satisfactory licensed operation. Section 5001(4)(e), relating to annual audited financial statements, is amended to change the gross tuition criteria for submission of such statements to the commissioner and the filing schedule for such statements to bring the non-degree sector into parity with schools in the degree-granting and public school sectors. This section also authorizes the commissioner to deny, suspend, revoke or decline to renew any license if the Commissioner determines that a school's financial condition may result in the interruption or cessation of instruction or jeopardize student tuition funds. If the Commissioner determines that the financial condition may result in interruption or cessation of instruction or jeopardize student tuition funds, the Commissioner may place the school on probation for a period of no more than one year and the school shall be required to submit a report on its financial condition to the Commissioner.

Section 5002 is amended to restrict the amount of private loan payments for tuition that a school could receive on behalf of a student prior to their completing a program, thereby limiting students' loan liability as well as the tuition reimbursement account's liability for payment of loan funds for tuition payments, which is the most significant portion of the loan. This section also increases the maintenance of record requirement from 6 to 7 years. Section 5002(1)(d)(1) also relates admission of students under the ability to benefit provision is amended to authorize the Commissioner to accept other entrance requirement documentation, such as prerequisite coursework, professional or vendor certifications, personal interviews and/or attestations of equivalent knowledge in lieu of the examination requirement. Section 5002(3)(h) is amended to require schools to submit for approval a school catalog that contains a weekly tuition liability chart for each program that indicates the amount of refund due a student upon withdrawal. This section emphasizes that in addition to paying the curriculum application fee, schools will be required to pay the cost of an expert or independent consultant for an outside evaluation of a particular course or facility of the school. This section is also amended to establish a curriculum/course application fee to fund the State Education Department's curriculum unit. Fees from school and personnel license applications do not cover the cost of curriculum review, as some schools have only a handful of courses or curricula that require approval while others have between 400 and 700. Schools requiring the most evaluation would pay more, those with few programs would pay less. Section 5002(6) is also amended so that all teacher licenses would no longer be restricted to a single school location, as private career school teacher licenses currently are. This will result in a more mobile and efficient teacher pool for schools to draw from for faculty members, reduced expense for processing teacher applications and a reduced workload for the State Education Department's Bureau of Proprietary School Supervision ("the Bureau").

Section 5003 is amended to establish more practical timeframes for disciplinary proceedings by prescribing procedures for handling written complaints by students attending candidacy schools alleging failure of the school to disclose its candidacy status and the implications and to obtain the required attestation from the student. If such a violation is found, the school is required to provide the student a full refund of all monies received from the student. Section 5003(6) is also amended to increase the fines established in 1990 so they reflect the State Education Department's current cost of school oversight and expands the list of violations that may result in the imposition of a civil penalty, including failure to offer an approved course or program.

Section 5004 is amended to increase the amount of gifts and other non-monetary consideration a school may provide to students or former students from $25 to $75. Subdivision 4 of section 5004 would be amended to increase private school agent fees from $100 to $200, while extending the term of a private school agent's certificate from 2 years to 3 years.

Section 5006 is amended to allow the State Education Department to intervene more effectively when a private career education school ceases instruction. Currently, schools that are closing are required to develop teachout plans that arrange to have students continue to receive instruction from other private career schools upon closure of the school. The State Education Department's experience is that schools that must close have little incentive to establish teachouts, so authorizing the State Education Department to arrange for a teachout plan would provide greater protection for students. This section also authorizes the Commissioner to prescribe the educational qualifications and practical experience for teachers and directors in these schools.

Section 5007 is amended to expand the expenses eligible for reimbursement for students whose schools are closing. This section provides refunds of tuition, fees and book charges paid by or on behalf of the students in cash or through loans, excluding funding obtained through government agencies and authorizes the Commissioner to refund expenditures for fees, books and tuition to students of schools that have closed. The provisions for special assessments for new schools in section 5007(10) are also amended to be consistent with the assessment changes in section 5001, and to reflect the State Education Department's experience with assessing schools that have not been in operation for an entire year. The requirement in section 5007(11) for an annual fund audit of the tuition reimbursement account would be changed to mandate a two-year audit.

The proposed amendment implements these provisions.

4. COSTS:

(a) Costs to State government: The amendment will not impose any additional costs on State government including the State Education Department beyond those imposed by statute.

(b) Costs to local governments: The amendment will not impose any additional costs on local governments.

5. LOCAL GOVERNMENT MANDATES:

The proposed amendment does not impose any mandatory program, service, duty, or responsibility upon local government, including school districts or BOCES.

6. PAPERWORK:

There are no additional paperwork requirements beyond those imposed by statute.

7. DUPLICATION:

The amendment does not duplicate any existing State or Federal requirements.

8. ALTERNATIVES:

The proposed amendment implements Chapter 381 of the Laws of 2012. Therefore, no alternatives were considered.

9. FEDERAL STANDARDS:

There are no Federal standards that establish requirements for the certification of teacher assistants for service in the State's public schools.

10. COMPLIANCE SCHEDULE:

It is anticipated that the proposed amendment will be adopted at the January Regents meeting and will become effective on January 30, 2013.

Regulatory Flexibility Analysis

(a) Small Businesses:

1. EFFECT OF THE RULE: This rule will affect all private, non-degree granting proprietary schools that seek to be licensed by the State Education Department pursuant to Article 101 of the Education Law. Approximately 200 schools are pending licensure under this section. It is anticipated that almost all will be small businesses. In addition, the rule will affect all certified English as a Second Language (ESL) schools, most of which are small businesses.

2. COMPLIANCE REQUIREMENTS: There are no compliance requirements beyond those imposed by Chapter 381 of the Laws of 2012.

Chapter 381 of the Laws of 2012 amended Article 101 of the Education Law (sections 5001 through 5010) to eliminate the distinction between licensed private schools and registered business schools, replace the phrase "licensed private schools" with the more descriptive "licensed private career schools", adjust fees, which have not changed since 1990, and establish a candidate school category that would allow a school to operate legally while it is in the process of obtaining a non-degree-granting proprietary school license.

Section 5001 of the Education Law provides for the consolidation of registered business schools and licensed private schools into one designation, eliminating the artificial distinction between these types of schools and reflecting the current heterogeneous nature of training programs offered at these schools. This section also clarifies the exemptions for certain schools from the licensure requirements and exempts conferences, trade shows, workshops and such other courses of study from the licensing requirements. Candidate school status is also allowed as a practical means for prospective schools to operate legally prior to meeting all the requirements of full licensure. This section also amends the specific fees for initial and renewal applications for such licensure. Renewal fees are increased to reflect the State Education Department's current cost of supervising these schools and to meet the prospective costs for reimbursing tuition for a significant number of students when these students' schools close due to fiscal failure or non-compliance. Initial application fees are set at certain amounts and fees for renewal are based on the school's gross annual tuition income. Renewal fees are accrued to the credit of the proprietary vocational school supervision account.

Section 5001 sets forth procedures for working with schools that are not financially viable to protect the tuition reimbursement account. The method of assessing schools is changed from more complicated regular and special assessment formulas to one based on the number of quarterly assessments paid, whereby newer schools with the potential to fail would pay a higher assessment than schools with a history of satisfactory licensed operation. Section 5001(4)(e), relating to annual audited financial statements, is amended to change the gross tuition criteria for submission of such statements to the commissioner and the filing schedule for such statements to bring the non-degree sector into parity with schools in the degree-granting and public school sectors. This section also authorizes the commissioner to deny, suspend, revoke or decline to renew any license if the Commissioner determines that a school's financial condition may result in the interruption or cessation of instruction or jeopardize student tuition funds. If the Commissioner determines that the financial condition may result in interruption or cessation of instruction or jeopardize student tuition funds, the Commissioner may place the school on probation for a period of no more than one year and the school shall be required to submit a report on its financial condition to the Commissioner.

Section 5002 is amended to restrict the amount of private loan payments for tuition that a school could receive on behalf of a student prior to their completing a program, thereby limiting students' loan liability as well as the tuition reimbursement account's liability for payment of loan funds for tuition payments, which is the most significant portion of the loan. This section also increases the maintenance of record requirement from 6 to 7 years. Section 5002(1)(d)(1) also relates admission of students under the ability to benefit provision is amended to authorize the Commissioner to accept other entrance requirement documentation, such as prerequisite coursework, professional or vendor certifications, personal interviews and/or attestations of equivalent knowledge in lieu of the examination requirement. Section 5002(3)(h) is amended to require schools to submit for approval a school catalog that contains a weekly tuition liability chart for each program that indicates the amount of refund due a student upon withdrawal. This section emphasizes that in addition to paying the curriculum application fee, schools will be required to pay the cost of an expert or independent consultant for an outside evaluation of a particular course or facility of the school. This section is also amended to establish a curriculum/course application fee to fund the State Education Department's curriculum unit. Fees from school and personnel license applications do not cover the cost of curriculum review, as some schools have only a handful of courses or curricula that require approval while others have between 400 and 700. Schools requiring the most evaluation would pay more, those with few programs would pay less. Section 5002(6) is also amended so that all teacher licenses would no longer be restricted to a single school location, as private career school teacher licenses currently are. This will result in a more mobile and efficient teacher pool for schools to draw from for faculty members, reduced expense for processing teacher applications and a reduced workload for the State Education Department's Bureau of Proprietary School Supervision ("the Bureau").

Section 5003 is amended to establish more practical timeframes for disciplinary proceedings by prescribing procedures for handling written complaints by students attending candidacy schools alleging failure of the school to disclose its candidacy status and the implications and to obtain the required attestation from the student. If such a violation is found, the school is required to provide the student a full refund of all monies received from the student. Section 5003(6) is also amended to increase the fines established in 1990 so they reflect the State Education Department's current cost of school oversight and expands the list of violations that may result in the imposition of a civil penalty, including failure to offer an approved course or program.

Section 5004 is amended to increase the amount of gifts and other non-monetary consideration a school may provide to students or former students from $25 to $75. Subdivision 4 of section 5004 would be amended to increase private school agent fees from $100 to $200, while extending the term of a private school agent's certificate from 2 years to 3 years.

Section 5006 is amended to allow the State Education Department to intervene more effectively when a private career education school ceases instruction. Currently, schools that are closing are required to develop teachout plans that arrange to have students continue to receive instruction from other private career schools upon closure of the school. The State Education Department's experience is that schools that must close have little incentive to establish teachouts, so authorizing the State Education Department to arrange for a teachout plan would provide greater protection for students. This section also authorizes the Commissioner to prescribe the educational qualifications and practical experience for teachers and directors in these schools.

Section 5007 is amended to expand the expenses eligible for reimbursement for students whose schools are closing. This section provides refunds of tuition, fees and book charges paid by or on behalf of the students in cash or through loans, excluding funding obtained through government agencies and authorizes the Commissioner to refund expenditures for fees, books and tuition to students of schools that have closed. The provisions for special assessments for new schools in section 5007(10) are also amended to be consistent with the assessment changes in section 5001, and to reflect the State Education Department's experience with assessing schools that have not been in operation for an entire year. The requirement in section 5007(11) for an annual fund audit of the tuition reimbursement account would be changed to mandate a two-year audit.

The proposed amendment implements these provisions.

3. PROFESSIONAL SERVICES: The proposed amendment will not require schools to obtain professional services in order to comply, beyond those imposed by the statute.

4. COMPLIANCE COSTS: The proposed amendment will not impose any additional costs beyond those imposed by Chapter 381 of the Laws of 2012, except that the proposed amendment increases the application for teachers' permits and licenses, directors' permits and licenses, renewals thereof, and amendments of temporary permits and licenses from $50 to $100.

5. ECONOMIC AND TECHNOLOGICAL FEASIBILITY: The proposed amendment does not impose any additional technological requirements on small businesses.

6. MINIMIZING ADVERSE IMPACT: The proposed amendment implements Chapter 381 of the Laws of 2012 relating to the licensure of private non-degree proprietary schools. The statutory amendments make no exception for schools that are located in rural areas of the State. Moreover, the State Education Department believes that uniform requirements are needed, regardless of the location of the school, to ensure that all proprietary schools comply with the current best practices for this sector and to preserve the tuition reimbursement account in accordance with Chapter 381 of the Laws of 2012. Because of the nature of the proposed rule, alternative approaches for small businesses were not considered.

7. SMALL BUSINESS PARTICIPATION: The State Education Department posted the proposed regulation on its website and will ask for comments from all interested parties, including representatives from non-degree granting proprietary schools that may represent small businesses.

(b) Local Governments:

The proposed amendment relates to the licensure of private proprietary schools. It is clear from the nature of the proposed amendment that it does not impose any adverse economic impact, reporting, recordkeeping or other compliance requirements on local governments. No further steps were needed to ascertain that fact and none were taken. Accordingly, a regulatory flexibility analysis for local governments is not required and none has been prepared.

Rural Area Flexibility Analysis

1. TYPES AND ESTIMATED NUMBER OF RURAL AREAS:

The proposed rule will apply to all rural areas, including the 44 rural counties with less than 200,000 inhabitants and the 71 towns in urban counties with a population density of 150 per square mile or less. This rule will apply to all licensed private career schools. Currently, there are more than 450 licensed, registered or certified schools. Of these, approximately 20 are located in a rural area of the state.

2. REPORTING, RECORDKEEPING, AND OTHER COMPLIANCE REQUIREMENTS; AND PROFESSIONAL SERVICES:

Chapter 381 of the Laws of 2012 amended Article 101 of the Education Law (sections 5001 through 5010) to eliminate the distinction between licensed private schools and registered business schools, replace the phrase "licensed private schools" with the more descriptive "licensed private career schools", adjust fees, which have not changed since 1990, and establish a candidate school category that would allow a school to operate legally while it is in the process of obtaining a non-degree-granting proprietary school license.

Section 5001 of the Education Law provides for the consolidation of registered business schools and licensed private schools into one designation, eliminating the artificial distinction between these types of schools and reflecting the current heterogeneous nature of training programs offered at these schools. This section also clarifies the exemptions for certain schools from the licensure requirements and exempts conferences, trade shows, workshops and such other courses of study from the licensing requirements. Candidate school status is also allowed as a practical means for prospective schools to operate legally prior to meeting all the requirements of full licensure. This section also amends the specific fees for initial and renewal applications for such licensure. Renewal fees are increased to reflect the State Education Department's current cost of supervising these schools and to meet the prospective costs for reimbursing tuition for a significant number of students when these students' schools close due to fiscal failure or non-compliance. Initial application fees are set at certain amounts and fees for renewal are based on the school's gross annual tuition income. Renewal fees are accrued to the credit of the proprietary vocational school supervision account.

Section 5001 sets forth procedures for working with schools that are not financially viable to protect the tuition reimbursement account. The method of assessing schools is changed from more complicated regular and special assessment formulas to one based on the number of quarterly assessments paid, whereby newer schools with the potential to fail would pay a higher assessment than schools with a history of satisfactory licensed operation. Section 5001(4)(e), relating to annual audited financial statements, is amended to change the gross tuition criteria for submission of such statements to the commissioner and the filing schedule for such statements to bring the non-degree sector into parity with schools in the degree-granting and public school sectors. This section also authorizes the commissioner to deny, suspend, revoke or decline to renew any license if the Commissioner determines that a school's financial condition may result in the interruption or cessation of instruction or jeopardize student tuition funds. If the Commissioner determines that the financial condition may result in interruption or cessation of instruction or jeopardize student tuition funds, the Commissioner may place the school on probation for a period of no more than one year and the school shall be required to submit a report on its financial condition to the Commissioner.

Section 5002 is amended to restrict the amount of private loan payments for tuition that a school could receive on behalf of a student prior to their completing a program, thereby limiting students' loan liability as well as the tuition reimbursement account's liability for payment of loan funds for tuition payments, which is the most significant portion of the loan. This section also increases the maintenance of record requirement from 6 to 7 years. Section 5002(1)(d)(1) also relates admission of students under the ability to benefit provision is amended to authorize the Commissioner to accept other entrance requirement documentation, such as prerequisite coursework, professional or vendor certifications, personal interviews and/or attestations of equivalent knowledge in lieu of the examination requirement. Section 5002(3)(h) is amended to require schools to submit for approval a school catalog that contains a weekly tuition liability chart for each program that indicates the amount of refund due a student upon withdrawal. This section emphasizes that in addition to paying the curriculum application fee, schools will be required to pay the cost of an expert or independent consultant for an outside evaluation of a particular course or facility of the school. This section is also amended to establish a curriculum/course application fee to fund the State Education Department's curriculum unit. Fees from school and personnel license applications do not cover the cost of curriculum review, as some schools have only a handful of courses or curricula that require approval while others have between 400 and 700. Schools requiring the most evaluation would pay more, those with few programs would pay less. Section 5002(6) is also amended so that all teacher licenses would no longer be restricted to a single school location, as private career school teacher licenses currently are. This will result in a more mobile and efficient teacher pool for schools to draw from for faculty members, reduced expense for processing teacher applications and a reduced workload for the State Education Department's Bureau of Proprietary School Supervision ("the Bureau").

Section 5003 is amended to establish more practical timeframes for disciplinary proceedings by prescribing procedures for handling written complaints by students attending candidacy schools alleging failure of the school to disclose its candidacy status and the implications and to obtain the required attestation from the student. If such a violation is found, the school is required to provide the student a full refund of all monies received from the student. Section 5003(6) is also amended to increase the fines established in 1990 so they reflect the State Education Department's current cost of school oversight and expands the list of violations that may result in the imposition of a civil penalty, including failure to offer an approved course or program.

Section 5004 is amended to increase the amount of gifts and other non-monetary consideration a school may provide to students or former students from $25 to $75. Subdivision 4 of section 5004 would be amended to increase private school agent fees from $100 to $200, while extending the term of a private school agent's certificate from 2 years to 3 years.

Section 5006 is amended to allow the State Education Department to intervene more effectively when a private career education school ceases instruction. Currently, schools that are closing are required to develop teachout plans that arrange to have students continue to receive instruction from other private career schools upon closure of the school. The State Education Department's experience is that schools that must close have little incentive to establish teachouts, so authorizing the State Education Department to arrange for a teachout plan would provide greater protection for students. This section also authorizes the Commissioner to prescribe the educational qualifications and practical experience for teachers and directors in these schools.

Section 5007 is amended to expand the expenses eligible for reimbursement for students whose schools are closing. This section provides refunds of tuition, fees and book charges paid by or on behalf of the students in cash or through loans, excluding funding obtained through government agencies and authorizes the Commissioner to refund expenditures for fees, books and tuition to students of schools that have closed. The provisions for special assessments for new schools in section 5007(10) are also amended to be consistent with the assessment changes in section 5001, and to reflect the State Education Department's experience with assessing schools that have not been in operation for an entire year. The requirement in section 5007(11) for an annual fund audit of the tuition reimbursement account would be changed to mandate a two-year audit.

The proposed amendment implements these provisions.

3. COSTS:

The proposed amendment will not impose any additional costs beyond those imposed by Chapter 381 of the Laws of 2012, except that the proposed amendment increases the application for teachers' permits and licenses, directors' permits and licenses, renewals thereof, and amendments of temporary permits and licenses from $50 to $100.

4. MINIMIZING ADVERSE IMPACT:

The proposed amendment implements Chapter 381 of the Laws of 2012 relating to the licensure of proprietary schools. The amendments make no exception for schools that are located in rural areas on the State. The State Education Department believes that uniform requirements are needed, regardless of the location of the school, to ensure that all proprietary schools comply with the current best practices for this sector and to preserve the tuition reimbursement account in accordance with Chapter 381 of the Laws of 2012. Because of the nature of the proposed rule, alternative approaches for schools located in rural areas were not considered.

5. RURAL AREA PARTICIPATION:

The State Education Department has posted the proposed regulation on its website and will ask for comments from all interested parties, including proprietary schools located in the rural areas of the State.

Job Impact Statement

The purpose of the proposed amendment is to amend the licensure requirements for private, non-degree granting proprietary schools to implement Chapter 381 of the Laws of 2012. Because it is evident from the nature of the proposed amendment that it will have no impact on jobs and employment opportunities, no further steps were needed to ascertain that fact and none were taken. Accordingly, a job impact statement is not required and one has not been prepared.