BILL ANALYSIS Ó
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|Hearing Date:July 2, 2012 |Bill No:AB |
| |2296 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Curren D. Price, Jr., Chair
Bill No: AB 2296Author:Block
As Amended:June 27, 2012 Fiscal: Yes
SUBJECT: California Private Postsecondary Education Act of 2009.
SUMMARY: This bill expands the requirements to be met by private
postsecondary educational institutions subject to state oversight
under the California Private Postsecondary Education Act of 2009 by
expanding disclosures related to unaccredited programs; expanding
disclosure requirements for all regulated institutions; establishing
more stringent criteria for determining gainful employment and
calculating job placement rates; and increasing institutional
documentation and reporting requirements around completion rates, job
placement/license exam passage rates, and salary/wage information for
graduates.
NOTE : This bill was referred to the Senate Education Committee, first,
and was passed out of that Committee by a vote of 7 to 2. There were
amendments made in Senate Education Committee to address some of the
concerns of opponents, but not all.
Existing law:
1) Until January 1, 2016, establishes the California Private
Postsecondary Education Act (Act) of 2009, which provides for the
approval, regulation, and enforcement of private postsecondary
educational institutions by the Bureau for Private Postsecondary
Education (Bureau). (Education Code (EC) § 94800-94950)
2) Establishes under the Act fair business practices which prohibit a
private postsecondary educational institution subject to the Act
from, among other things, offering an unaccredited doctoral degree
program without disclosing to prospective students, prior to their
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enrollment, that the degree program is unaccredited and whether the
degree is issued in a field that requires licensure in California,
and any known limitations of the degree, including whether or not
it is recognized for licensure or certification in California and
other states. (EC § 94897)
3) Specifies requirements regarding enrollment agreements and
disclosures including that a student enroll solely by executing an
enrollment agreement and that prospective students be provided with
a school catalog and a School Performance Fact Sheet. The Act
establishes minimum requirements and disclosures to be made in
these documents. (EC §§ 94902-94912)
4) Specifies various disclosure and reporting requirements around
completion, placement, licensure and salary of students/graduates
and establishes various definitions for this purpose. Among other
things, it defines "graduates employed in the field" as graduates
gainfully employed within six months of graduation in a position
for which the skills obtained through the education and training
provided by the institution are required or provided a significant
advantage to the graduate in obtaining the position. Also requires
that the information used to substantiate the reported job
placement, license passage, and completion rates be documented and
maintained by the institution for five years from the date of the
publication of the rates and authorizes this information to be
retained by the institution in an electronic format. The Act also
requires institutions to submit an annual report to the Bureau that
includes specified information. (EC §§ 94928-94899.8)
This bill expands the requirements to be met by private postsecondary
educational institutions subject to state oversight under the
California Private Postsecondary Education Act of 2009. Specifically
it:
Unaccredited Programs
1)Expands the requirements to be met by an institution that offers an
unaccredited program. More specifically it:
a) Extends the fair business practice prohibitions related to
unaccredited doctoral programs to include unaccredited associate,
baccalaureate and masters degree programs.
b) Expands the disclosures required of an institution to include
disclosure of the following:
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i) Whether or not a graduate of the degree program will be
eligible to sit for the applicable licensure exam in California
and other states.
ii) That a degree from an unaccredited institution is not
recognized for some employment positions, including, but not
limited to, positions with the State of California.
iii) That students attending an unaccredited institution are
ineligible for federal financial aid programs
2)Requires the school catalog to disclose whether or not the
institution is accredited and if it is not, to disclose all the
information outlined above.
Additional Disclosure
3)Expands the information to be provided to students, in the
enrollment agreement, school catalog, and Student Performance Fact
Sheet. Specifically it:
a) Requires that the School Performance Fact Sheet provided by an
institution, and its annual report to the Bureau, include the
institution's most recent three-year cohort default rate and the
percentage of students receiving federal student loans (if the
institution participates in federal financial aid programs) and a
list of occupations for which each of the institution's
educational programs is intended to train students using US
Department of Labor Occupational Classification codes.
b) Requires that the Enrollment Agreement disclose to the student
that the School Performance Fact Sheet is to include the cohort
default rate information and requires other conforming changes in
the enrollment agreement.
4)Expands disclosure to require the institution to provide on its Web
site, if one is maintained, the school catalog, School Performance
Fact Sheets, student brochures, the institution's most recent annual
report submitted to the Bureau, and a link to the Bureau website, as
specified.
Completion, Placement, Licensure and Salary Rates
5)Deletes the condition that an institution makes an express or
implied claim of potential earnings after completing the program to
trigger the requirement that they report salary and wage
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information.
6)Expands the authority of the Bureau to collect any information from
an institution for purposes of reporting job placement and license
exam passage rates, salary information, and cohort default rates,
and ensure by regulation that the information is collected and
reported if the Bureau determines the information is useful to
students, based upon the most credible and verifiable available
data, and does not impose undue compliance burdens on an
institution.
7)Provides that "graduates employed the field" means graduates who are
gainfully employed in a single position within six months after a
student completes the applicable educational program. For
occupations for which the state requires passing an examination, the
period of employment shall begin within six months of the
announcement of the examination results for the first examination
available after a student completes an applicable educational
program.
8)Specifies that the Bureau shall define specific measures and
standards for determining whether a student is gainfully employed in
a single position pursuant Item # 7) above, and may set hourly and
weekly employment standards and utilize any job classification
methodology the Bureau determines appropriate for this purpose,
including, but not limited to, the United States Department of
Labor's Standard Occupational Classification codes.
9)Requires, if applicable, that the most recent three-year cohort
default rate reported by the United State Department of Education
for the institution and the percentage of enrolled students
receiving federal student loans be provided by an institution as
part of its annual report to the Bureau.
10)Provides that nothing shall limit the Bureau's authority to collect
information from an institution to comply with this section and
ensure, by regulation and other lawful means, that the information
required, and the manner in which it is collected and reported, is
all of the following:
a) Useful to students.
b) Useful to policymakers.
c) Based upon the most credible and verifiable data available.
d) Does not impose undue compliance burdens on an institution.
11)Provides that in addition to the information already used to
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substantiate the rates and information calculated as specified, that
the information be retained in an electronic format and made
available to the Bureau upon request, and that the Bureau shall
identify the specific information that an institution is required to
document and maintain to substantiate rates and information.
12)Makes various technical and clarifying changes.
FISCAL EFFECT: According to the Assembly Committee on Appropriations
analysis dated May 9, 2012, there will be minor absorbable costs to
the Bureau in order to modify enforcement procedures consistent with
the new disclosure requirements on institutions.
COMMENTS:
1.Purpose. This measure is sponsored by the Author . According to the
Author, this bill is intended to respond to issues raised in a joint
hearing of the Assembly Higher Education Committee and the Senate
Business, Professions and Economic Development Committee in February
2012. Specific issues raised included the need to increase
transparency among the private colleges and universities regulated
by the Bureau and to ensure that prospective students have all the
information necessary to make informed decisions about their pursuit
of postsecondary education.
The Author further states that existing law, as it relates to certain
disclosures, only currently applies to unaccredited private
postsecondary institutions that offer doctoral degrees. This
measure would extend important information to potential students,
such as a school's accreditation status and the ability to sit for a
licensure exam.
This bill would also require the Bureau to define specific measures
and standards for determining whether a student is gainfully
employed and to authorize the Bureau to set any hourly and weekly
employment standards and utilize any job classification methodology
it determines appropriate for this purpose, including, but not
limited to the US Department of Labor Occupational Classification
codes.
The Author further notes that current language for gainful employment
centers on the idea that the education received provided a
"significant advantage." This measure seeks to more clearly define
the benefit of one's education and the amount of time that one works
in order to hold gainful employment.
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2. Background.
a) The California Private Postsecondary Education Act of 2009
(Act). After numerous legislative attempts to remedy the laws
and structure governing regulation of private postsecondary
institutions, AB 48 (Portantino, Chapter 310, Statutes of 2009),
established the Act and created the Bureau within DCA for the
purpose of regulating private postsecondary educational
institutions that provide educational services in California.
The Act made many substantive changes that both created a new,
solid foundation for oversight and responded to the major
problems with the Former Act. The Act as created by AB 48
requires all unaccredited colleges in California to be approved
by the new Bureau, and all nationally accredited colleges to
comply with numerous student protections. It is important to
note that not all private institutions are covered by the
provisions of the Act; full and partial exemptions are provided
for low-cost programs, recreational schools, schools accredited
by regional accrediting agencies, among other types of
institutions. For those institutions that are covered by the
Act, they are required to follow a Bureau evaluation and approval
process, required to abide by numerous "fair business practices"
aimed at protecting students, required to disclose information to
students in enrollment agreements and catalogs, required to
participate in a Student Tuition Recovery Fund (STRF), and
required to pay application and annual fees to the Bureau to
support the oversight structure. The Act also establishes
processes for penalties for non-compliance, providing the Bureau
authority to perform site visits and investigations, order fines
and student tuition refunds, and ultimately suspend or revoke an
institution's approval to operate. Finally, the Act requires
evaluation and reporting from the Legislative Analyst's Office
(LAO) and the Bureau of State Audits (BSA).
b) Concerns Regarding Private Postsecondary Institutions. Media
outlets, efforts at the Federal level and increased scrutiny by
state legislatures have recently highlighted unease about the
operations and functions of private postsecondary schools. While
the sector serves upwards of ten percent of postsecondary
students and provides a path to higher education that may not
always be available for all students, there are increased
questions about these institutions and their accurate
representation of what they are able to offer students. There
are also concerns that schools provide training at a steep cost
that does not balance the earnable income an individual may be
eligible for based on that training or upon completion of a
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program.
Last fall, the U.S. Department of Education (DOE) adopted new
rules to rein in the recruiting practices of for-profit colleges
by changing standards for students to use federal Title IV money
at these institutions. The effort gained momentum following a
report by the U.S. Government Accountability Office (GAO) that
found potential deception by schools to students about graduation
and job placement rates in the process of getting them to enroll
and sign up for state and federal loans. Using undercover
testing, GAO found some schools encouraging students to falsify
their financial aid applications in order to qualify for federal
grants. Other schools misrepresented their programs' graduation
rates, job-placement rates and costs while recruiting students.
According to the National Conference of State Legislatures
(NCSL), 17 states are considering legislation to further regulate
these institutions. In California, for-profit schools now face
restriction on the ability to receive state monies in the form of
Cal Grants, which provide over $20 million more annually to the
schools than to community colleges. Just recently, Maryland's
House and Senate enacted measures that would eliminate all state
aid to for-profit schools, ban commissions or bonuses for student
recruiting, and make all for-profit schools in the state
contribute to a fund to protect students if any college in their
group breaches a contract.
Recent budgetary and capacity issues in California's public
postsecondary schools, coupled with the current economic crisis
have led to growth in enrollment at private postsecondary
schools, as employees are increasingly out of work and more
inclined to enter training programs in the hopes of obtaining
gainful employment at a cost they may not be able to make up once
they are employed. This Committee, at its March 2009 hearing
entitled "The Role of Private Education Institutions in Preparing
California's Diverse Workforce: Meeting the Challenges of our
Workforce and Job Training Needs" examined the ability of private
postsecondary institutions to fill the career preparation needs
of California's workforce and evaluated policy options that allow
them to expand their workforce development programs with the
requisite amount of oversight required to protect students. The
private postsecondary school sector has responded to additional
regulation and oversight proposals by noting that career colleges
are an essential part of the solution for restoring this
country's global, educational, and economic standing, citing the
role these schools play in helping to lower unemployment, boost
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global competitiveness, fill jobs in key industries, and increase
the number of college graduates by 2020. According to federal
data, more than 2.2 million students enrolled in a private
for-profit institution in the fall of 2009, almost 25 percent
more than the previous year.
c) Accreditation. Accreditation is a voluntary, non-governmental
peer review process used to determine academic quality. Under
federal law, the United States Department of Education (USDE)
establishes the general standards for accreditation agencies and
is required to publish a list of recognized accrediting agencies
that are deemed reliable authorities on the quality of education
provided by their accredited institutions. While accredited and
unaccredited education and training programs are allowed to
operate in California, only accredited institutions are
authorized to participate in federal and state financial aid
programs.
i) Unaccredited Institutions : There are likely thousands of
unaccredited for-profit and non-profit private postsecondary
institutions operating throughout the country. These
institutions are not eligible to participate in state or
federal student financial aid programs and are, therefore, not
regulated by the federal government. Oversight of unaccredited
institutions is solely the responsibility of states. The
Bureau maintains responsibility for oversight of unaccredited
institutions in California. It is unclear exactly how many
unaccredited institutions are operating in California, as the
Bureau does not currently track accreditation status of
approved institutions. Estimates based on the limited
available information would put the number of unaccredited
school locations in California near 1000. It is also unclear
as to the number of institutions offering unaccredited degrees
and the number that are providing career technical training or
vocational certificate programs.
ii) Accredited institutions : Accredited institutions are
somewhat easier to track as many of these institutions
participate in federal and/or state financial aid programs.
Accredited institutions include both non-profit and for-profit
education and training programs.
(1) Accredited non-profit institutions are commonly
referred to as independent institutions and are recognized
in California law as a segment of California higher
education, alongside public institutions. Independent
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institutions are defined in the Education Code as private
institutions "that grant undergraduate degrees, graduate
degrees, or both, and that are formed as non-profit
corporations in this state and are accredited by an agency
recognized by the United States Department of Education."
Historically, many independent institutions have been exempt
from state-level regulation. Non-profit institutions that
are unaccredited do not fall within the definition of
"independent institutions" and have generally been regulated
by the state.
(2) Accredited for-profit institutions , also commonly
referred to as proprietary colleges or for-profit colleges,
include academic and vocational institutions of
postsecondary education that are privately owned or owned by
a publicly traded company and whose net earnings can benefit
a shareholder or individual. Prior to the declines seen
this year in new student enrollments at many for-profit
colleges, largely due to new federal regulations and a
slowing economy, there had been tremendous growth in the
number of students attending, and the amount of public
financial aid funds directed to for-profit education and
training programs. Between 2004 and 2009, according to the
USDE, the number of students attending accredited for-profit
institutions increased by over 88 percent nationwide; with
the sector serving approximately 2.2 million students in
2009. According to the US Government Accountability Office,
during the 2009-2010 academic year, for-profit colleges
received almost $32 billion in grants and loans provided to
students under federal student aid programs. Additionally,
of the $4.4 billion awarded between 2009 and 2011 in federal
veteran students' benefits, 37 percent went to for-profit
colleges, which enrolled about 25% of students. In
California, an estimated $93.3 million was paid to Cal Grant
recipients attending for-profit institutions in 2009-10.
iii) There are two different types of accreditation:
(1) Regional Accreditation : There are six
USDE-recognized regional accrediting agencies. Each
regional accreditor encompasses public and the vast majority
of non-profit private (independent) postsecondary
educational institutions in the region it serves.
California's regional accrediting agency is the Western
Association of Schools and Colleges (WASC). There are a
handful of WASC-accredited for-profit private institutions
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operating in California. Many regionally accredited
for-profit institutions have main campuses in other parts of
the country and are, therefore, accredited by one of the
other five regional accreditors.
(2) National Accreditation : National accreditation is
not based on geography, but more focused to evaluate
specific types of schools and colleges. For example, the
Accrediting Commission of Career Schools and Colleges of
Technology examines career schools and technology programs.
The Distance Education and Training Council accredits
colleges that offer distance education. The idea behind
national accreditation is to allow non-traditional colleges
(trade schools, religious schools, certain online schools)
to be compared against similarly designed institutions.
Different standards and categories are measured, depending
on the type of school in question.
While accreditation remains a primary method for evaluating and
assuring educational quality, concerns regarding the disparate
quality and reliability of USDE-approved accrediting agencies
have led the USDE advisory committee on accreditation to look at
changes to the role of accreditation. Potential changes include
structuring accreditation based on institution type or mission
rather than geography so that accreditors can more easily
distinguish between colleges of varying quality, and defining a
common set of data such as licensure, job placement, and
completion rates that the federal government would collect and
share with accreditors to minimize institutional reporting and
ensure consistency. Further, while accreditation can be used as
a measure of program quality, consumer protections fall outside
of the scope of accreditation. States are responsible for
enacting laws that protect students against fraud and abuse.
3. Oversight of the Private Postsecondary Education Sector. This
Committee has been extensively involved with policy issues and
legislation surrounding regulation of the private higher education
sector. This Committee has worked to assure oversight and support
of high-quality programs and institutions, to ensure fair business
practices and to protect students from fraud and abuse within the
sector. This Committee is also responsible for protecting
California consumers from unethical and harmful professional and
business practices and has played a lead role in developing and
defining standards for the relationship between private
postsecondary education and training programs and the students
these institutions serve. The private sector provides education
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and training to numerous students, many seeking to become employed
as licensed professionals under the various Department of Consumer
Affair's licensing boards and bureaus. As such, the Committee is
focused on ensuring that the state's workforce development needs
are met through the timely approval of quality programs and that
students in these programs have all of the tools and resources
necessary to maintain awareness about their rights and protections,
while also receiving valid and realistic information about programs
before entering into contracts with the schools.
More recently, on February 14, 2012, this Committee held a Joint
Hearing with the Assembly Higher Education Committee to evaluate
and review the work of the Bureau in regulating private
postsecondary schools and programs and receive information from
those California entities that are involved with the private
postsecondary education sector and, through the information
provided by regulators, students, institutions and national policy
experts, identify areas for improving inter-agency coordination,
reducing regulatory duplication, and increasing oversight where it
may be lacking.
From comments and information received at this hearing it is evident
that California's public institutions have reduced enrollments due
to major budget cuts, and that for-profit higher education
institutions continue to be in a position to play a role in
providing access and education for otherwise underserved students.
The challenge for the Legislature is to establish an oversight
structure like the Bureau that supports innovative programs but
prevents predatory practices.
It was indicated that as the number of students served by private
postsecondary institutions has increased, so has the focus on
fraudulent practices and low academic standards. There have been
numerous high-profile federal investigations into the practices of
for-profit institutions in recent years. Among the most notable
were the United States Government Accountability Office (GAO)
series of investigations raising concerns regarding the amount of
federal student aid dollars directed to for-profit institutions,
the misleading and deceptive recruitment practices at certain
institutions, and substandard academic performance expectations in
some for-profit programs.
Federal data also provided, raised important questions about program
cost and student outcomes within the sector. Students from
for-profit institutions have higher default rates on federal
student loans than in other sectors, accounting for nearly half of
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all defaults. According to data from the National Bureau of
Economic Research (NBER), for-profit student defaults are 8.7%
higher than four-year publics and non-profits and 5.7% higher than
for community colleges. Student satisfaction information showed
for-profit students are less likely to believe their education was
worth the price paid. While NEBR data, which attempted to adjust
for student population differences, indicated for-profit students
have higher probability of staying with a program through the first
year and are somewhat more likely than community college students
to obtain an AA degree, they are less likely to continue to
higher-level college courses and to gain a BA degree. Further NEBR
indicated that for-profit students are more likely to be idle (not
working and no longer enrolled in school) six years after starting
college, and are more likely to have experienced substantial
unemployment since leaving school.
While evidence of dishonesty in marketing, high student debt, low
completion rates, and general questions surrounding quality have
focused the vast majority of state and federal conversations
regarding the sector on regulatory oversight, the industry argued
against painting all schools with the same brush and that there are
high-quality programs offered at many for-profit institutions.
4. Similar and Related Legislation.
AB 611 (Gordon, Chapter 103, Statutes of 2011) sets forth certain
disclosure requirements pertaining to accreditation status,
licensure, and related limitations for unaccredited doctoral
programs.
SB 619 (Fuller, Chapter 309, Statutes of 2011) exempts flight
instructors or flight schools that do not require the upfront
payment of tuition or fees, and that do not require students to
enter into a contract of indebtedness in order to receive training,
from Bureau regulation.
AB 1013 (Assembly Committee on Higher Education, Chapter 167,
Statutes of 2011) makes clarifying changes to the Act and related
Bureau oversight.
SB 498 (Liu) of 2011 abolished the Bureau and transferred the
Bureau's powers and duties under the Act to the California
Postsecondary Education Commission. The bill was held in this
Committee.
SB 675 (Wright) of 2011 required that private postsecondary
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institutions subject to the Act administer a test of English
language proficiency to a nonnative speaker of English, as defined,
prior to enrolling the student. The bill failed passage in this
Committee.
AB 797 (Conway) of 2011, exempted schools of cosmetology, as
defined, from the Act. The bill was held in Assembly Committee on
Higher Education.
AB 1889 (Portantino) of 2010, contained provisions regarding
doctoral degrees offered by unaccredited institutions, the
calculation of placement rates, and Bureau employment requirements.
AB 1889 was vetoed by Governor Schwarzenegger due to concerns over
Bureau employment requirements.
AB 2393 (Ammiano) of 2010, altered the definition of "graduates
employed in the field" for apprenticeship and nursing programs.
The bill was vetoed by the Governor Schwarzenegger.
5.Arguments in Support. A number of groups representing advocates for
civil right, students, consumers, and foster youth ( Student and
Consumer Advocates ) strongly support this measure. The Student
Advocates believe that this bill will ensure that students are able
to make informed decisions when choosing a postsecondary education
program and that it provides a critical component of the state's
consumer protection role and its commitment to promoting quality
education and career preparation beyond high school. Student and
Consumer Advocates explain that students need meaningful, accurate
information about postsecondary schools when they are choosing where
to invest their precious time and resources. "Without such
performance information, the postsecondary educations market does
not work. Students are susceptible to aggressive and sometimes
deceptive marketing and run a greater risk of attending low-quality
programs or programs that do not match their needs, increasing the
chances they will drop out or default on their student loans. AB
2296 will help to close inadvertent loopholes in the current law and
provide students who attend institutions covered by the ÝBureau]
with more accurate consumer information. Doing so will benefit
students and schools as well as taxpayers who are investing in many
of these schools through the CalGrant program.
"In particular, AB 2296 will correct the currently misleading job
placement definition and salary disclosure requirement. Whether a
school's graduates are able to get the type of job for which a
school says it prepares student's is a critical measure of a
school's performance, particularly for vocational programs that make
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express or implied claims about graduates' employment options."
In addition to considering job placement rates, the Student and
Consumer Advocates further explain that when students are weighing
whether to assume potentially life-altering debt for school it is
also notable to look at the salaries earned by a program's
graduates. "Under current law, however, schools are able to easily
skirt the salary disclosure requirements and only report the
salaries generally earned in the occupations for which they claim to
train students, often misleading students into thinking those
salaries are actually being earned by their graduates. Under AB
2296, schools will instead disclose to students the salaries of
their own graduates so that prospective students can make informed
choices."
The Student and Consumer Advocates also indicate that this measure
will ensure that schools provide other elements of easily-available
information to students that are left out of the currently required
disclosures. This includes the percentage of school graduates who
default on their student loans (referred to as the "Cohort Default
Rate" (CDR)). A high CDR reflects that a school did not prepare its
students for jobs that would allow them to repay their loans and is
used as a way to measure school quality and determine eligibility.
Other information provided includes whether their school or program
is not accredited and of the limitations of going to an unaccredited
school or program.
The Legal Aid Foundation of Los Angeles (Legal Aid LA) writes in
support of this bill because most of the alleged student protections
in current law are illusory and do not offer any meaningful
protections for the student enrolled in proprietary postsecondary
schools. "Some of the disclosures provided for in current law are
misleading and insulate the institutions from liability for
misleading prospective students in the recruitment process.
Students who are enrolling in these courses of instructions are
going to be on the hook for repaying $20,000 to $100,000 in student
loans if they complete the program of instruction. So prospective
students who have so much at stake, need as much meaningful
information as possible and a chance to consider such information
before signing any enrollment agreement for a postsecondary school.
If students do not get a job which permits them to repay the loan,
they will be suffering from the impact of this decision possibly
well into retirement."
According to Legal Aid LA , this bill will provide more meaningful
information about prospective salaries after completing the course,
more meaningful/specific definition of jobs that can be counted as a
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placement for specific course of instructions, and information
regarding the most recent default rate of the school.
6.Arguments in Opposition. The California Association of Private
Postsecondary Schools (CAPPS) writes in opposition to this measure
and points out that the Act was very carefully written and just last
year was fully implemented via a thorough regulatory process.
"Unfortunately, AB 2296 would make a number of significant and
onerous changes to the Act without providing ample time to determine
if the Act is working effectively. It is the understanding of CAPPS
that the language pertaining to approved only schools will not be
amended and is therefore still opposed." According to CAPPS, the
bill would require institutions to disclose "all known institutions"
of the non-accredited degree program, including limitations in all
50 states. If intended, argues CAPPS, this is a very high threshold
and arguably one that cannot be met. Interestingly, CAPPS points
out, similar language used in the bill is more in sync with current
law and states "any known limitation, while subtle, is confusing as
one section references 'any known' and the other section states 'all
known.'"
CAPPS further points out that the provisions applying to approved
schools would require these institutions to disclose to students any
employment limitations of the degree, including positions with the
State of California. "It's unrealistic for schools to know what
qualifications employers require, including accreditation status of
particular degrees.
"AB 2296 would also require Federal three year default rates to be
listed under the Student Performance Fact Sheet, yet this data is
not related to either Student performance or Institutional
performance. Three year rates are a complex repayment provision
relating to student loans and whether the student has made a payment
on their student loans years after they have graduated from the
Institution. Our sector is being targeted because 80-90% of all of
our students take out loans, which is a vastly higher percentage
than public and non-profit sectors of Higher Education."
The American Career Colleges/West Coast University (ACC/WCU) is also
opposed to this measure and writes that their concerns surround the
issue of "Graduates employed in the field." ACC/WCU explains that
when developing the regulations to implement AB 48 (Portantino) the
panel that developed those regulations concluded that dictating
hourly and weekly employment standards was not a workable option.
"Dictating that level of specificity for gainful employment actually
hinders gainful employment because it makes it more difficult for
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schools to place students.
ACC/WCU argues that, "Ýe]mployers will not work with schools that make
it difficult to hire their graduates. Requiring a school to go
after employers and demand specific information about individual
employees will create a burden for the employer and discourages them
from hiring graduates. Former students will not want to be tracked
by their school after graduation. They will not want to continue to
provide specific data to their former school. This will make it
very difficult for schools to comply and will hurt students seeking
employment. It could actually increase the default rate rather than
improve it."
ACC/WCU believes that the regulations that were just completed less
than a year ago should be given an opportunity to work and that
although recent amendments seem to soften the gainful employment
requirements that were previously in the bill, the problem remains,
because the bill now directs the Bureau to create those burdensome
specific hourly and weekly standards.
7.Proposed Author's Amendments. According to the Author, many schools
focus their advertisements on students being able to work in a
particular career after graduation. Because of the importance of
this disclosure to students, schools, when disclosing data on
"graduates in the field," should not be permitted to include jobs
obtained by students that are not in "the field."
Allowing a school to do this would potentially inflate a student's
expectations as to what they can expect to obtain by enrolling in
the school. On the other hand, what actually qualifies as a
successful placement in a particular "field" is not always clear.
Job-related fields can be narrowly or broadly construed. As well,
how many hours and weeks of employment can fairly be deemed to be
"employment" can be narrowly or broadly construed..
For these reasons, the bill's statutory definition of "Graduates
employed in the field" must give the Bureau the flexibility to adopt
regulatory approaches to this disclosure based on its expertise
while offering the Bureau, students, and schools the certainty that
whatever approach the Bureau adopts is consistent with the
Legislature's aim of ensuring fair and accurate disclosures to
students.
The Author further states that prior to being heard by the Senate
Education Committee, the bill prescriptively bound the Bureau to use
specified numbers and a specified methodology for determining how
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schools would disclose the number of their graduates that obtained
jobs in the field. The amendments suggested by the Senate Education
Committee properly restore to the Bureau discretion to determine and
adjust those numbers and methodologies through regulatory action.
This allows the Bureau the flexibility to adjust the methodology
used over time, based upon its regulatory expertise. However, in
properly restoring that discretion to the Bureau, the bill currently
leaves the Bureau too little guidance as to how it should at minimum
do this important job so that the disclosure achieves the policy
aims of the Legislature in requiring it.
At a minimum, a statutory definition of "Graduates employed in the
field" needs to be clear that the Bureau 1) does not have the
discretion to develop a definition that would include jobs unrelated
to the field of study the student graduated from (this is the
problem with the current "graduates in the field" definition); 2)
does not have the discretion to treat full or part time employment
as indistinguishable, because they mean very different things to
students; and
3) does not have the discretion to consider only the number of hours
per day worked or the number of weeks worked because both are
essential to a job placement definition and are meaningful to
students.
Finally, the Author states, if the Bureau is to have regulatory
discretion in this important area, the Legislature should require
the accountability of a deadline by which the Bureau will exercise
its discretion. For these reasons, the Author is proposing
amendments which are provided in mock-up form with this analysis.
SUPPORT AND OPPOSITION:
Support:
Advancement Project
Asian Law Caucus
California Civil Right Coalition
California Faculty Association
California Federation of Teachers
California Labor Federation
California Nurses Association
California Physical Therapy Association
California Psychological Association
California State Students Association
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Center for Public Interest Law, University of San Diego School of Law
Children's Advocacy Institute, University of San Diego School of Law
Chinese for Affirmative Action
Consumer Action
Consumer Federation of California
Consumers Union of United States, Inc.
Institute for College Access and Success
LAW Project of Los Angeles
Legal Aid Foundation of Los Angeles
Public Advocates Inc.
Opposition:
American Career Colleges/West Coast University
California Association of Private Postsecondary Schools
Consultant:Bill Gage