BILL ANALYSIS Ó
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|Hearing Date:July 1, 2013 |Bill No:AB |
| |834 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Ted W. Lieu, Chair
Bill No: AB 834Author:Williams
As Amended:June 25, 2013 Fiscal: Yes
SUBJECT: Private postsecondary education: School Performance Fact
Sheets.
SUMMARY: Authorizes a law school accredited by the American Bar
Association, and owned by an institution operating under the Bureau of
Private Postsecondary Education within the Department of Consumer
Affairs, to satisfy the current disclosure requirements of the School
Performance Fact Sheet by instead doing the following: complying with
ABA disclosure requirements; reporting to the National Association for
Law Placement; and making completion, Bar passage, placement, and
salary and wage data available to prospective students prior to
enrollment through the application process administered by the Law
School Admission Council.
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) within the Department of Consumer Affairs (DCA).
(Education Code (EC) § 94800-94950)
2) States Legislative intent that enacting the Act is designed to
ensure: (EC § 94801)
a) Minimum educational quality standards and opportunities for
success for California students attending private postsecondary
schools in California.
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b) Meaningful student protections through essential avenues of
recourse for students.
c) A regulatory structure that provides for an appropriate level
of oversight.
d) A regulatory governance structure that ensures that all
stakeholders have a voice and are heard in policymaking by the
Bureau.
e) A regulatory governance structure that provides for
accountability and oversight by the Legislature through program
monitoring and periodic reports.
f) Prevention of the deception of the public that results from
conferring, and use of, fraudulent or substandard degrees.
1) Exempts the following from the Act: (EC § 94871)
a) An institution that offers solely avocational or recreational
educational programs.
b) An institution offering educational programs sponsored by a
bona fide trade, business, professional, or fraternal
organization, solely for that organization's membership.
c) A postsecondary educational institution established, operated,
and governed by the federal government or by this state or its
political subdivisions.
d) An institution offering either test preparation for
examinations required for admission to a postsecondary
educational institution or continuing education or license
examination preparation, if the institution or the program is
approved, certified, or sponsored by a government agency, other
than the Bureau, that licenses persons in a particular
profession, occupation, trade, or career field, a
state-recognized professional licensing body, such as the State
Bar of California, that licenses persons in a particular
profession, occupation, trade, or career field or a bona fide
trade, business, or professional organization.
e) An institution owned, controlled, and operated and maintained
by a religious organization lawfully operating as a nonprofit
religious corporation whose instruction is limited to the
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principles of that religious organization and the diploma or
degree granted is limited to evidence of completion of that
education. Provides that an institution described above shall
offer degrees and diplomas only in the beliefs and practices of
the church, religious denomination, or religious organization and
shall not award degrees in any area of physical science.
Provides that any degree or diploma granted by an institution
owned, controlled, and operated and maintained by a religious
organization lawfully operating as a nonprofit religious
corporation shall contain on its face, in the written description
of the title of the degree being conferred, a reference to the
theological or religious aspect of the degree's subject area.
Provides that a degree shall reflect the nature of the degree
title, such as "associate of religious studies," "bachelor of
religious studies," "master of divinity," or "doctor of
divinity."
f) An institution that does not award degrees and that solely
provides educational programs for total charges of two thousand
five hundred dollars ($2,500) or less when no part of the total
charges is paid from state or federal student financial aid
programs.
g) A law school that is accredited by the Council of the Section
of Legal Education and Admissions to the Bar of the American Bar
Association or a law school or law study program that is subject
to the approval, regulation, and oversight of the Committee of
Bar Examiners.
h) A nonprofit public benefit corporation that is qualified under
Section 501(c)(3) of the United States Internal Revenue Code, is
organized specifically to provide workforce development or
rehabilitation services and is accredited by an accrediting
organization for workforce development or rehabilitation services
recognized by the Department of Rehabilitation.
i) An institution that is accredited by the Accrediting
Commission for Senior Colleges and Universities, Western
Association of Schools and Colleges, or the Accrediting
Commission for Community and Junior Colleges, Western Association
of Schools and Colleges.
j) An institution that has been accredited, for at least 10
years, by an accrediting agency that is: recognized by the United
States Department of Education (DOE); has operated continuously
in this state for at least 25 years has not filed for bankruptcy
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protection pursuant to Title 11 of the United States Code during
its existence; has a cohort default rate on guaranteed student
loans does not exceed 10 percent for the most recent three years,
as published by the DOE; maintains a composite score of 1.5 or
greater on its equity, primary reserve, and net income ratios, as
provided under Section 668.172 of Title 34 of the Code of Federal
Regulations; provides a pro rata refund of unearned institutional
charges to students who complete 75 percent or less of the period
of attendance; provides to all students the right to cancel the
enrollment agreement and obtain a refund of charges paid through
attendance at the second class session, or the 14th day after
enrollment, whichever is later; submits to the Bureau copies of
its most recent IRS Form 990, the institution's Integrated
Postsecondary Education Data System Report of the United States
Department of Education, and its accumulated default rate; and is
incorporated and lawfully operates as a nonprofit public benefit
corporation and is not managed or administered by an entity for
profit.
aa) Flight instruction providers or programs that provide flight
instruction pursuant to Federal Aviation Administration (FAA)
regulations and does not require students to enter into written
or oral contracts of indebtedness and does not require prepayment
of instruction-related costs in excess of $2,500.
bb) An institution that is accredited by a regional accrediting
agency recognized by DOE so long as the institution complies with
requirements related to student tuition recovery.
1) Requires that the Bureau establishes a process whereby an
institution that is exempt from the Act and Bureau regulation
verification that the institution is exempt. (EC § 94874.7)
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
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
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a school catalog and a School Performance Fact Sheet (Fact Sheet).
The Act establishes minimum requirements and disclosures to be made
in these documents.
(EC §§ 94902-94912)
4) Requires a Fact Sheet to contain, at a minimum, the following: (EC
§ 94910)
a) Completion rates.
b) Placement rates if the educational program is designed to lead
to, or the institution makes any express or implied claim related
to preparing students for, a recognized career, occupation,
vocation, job, or job title.
c) License examination passage rates for programs leading to
employment for which passage of a state licensing examination is
required.
d) Salary or wage information.
e) Provides that if a program is too new to provide data for any
of the categories listed the institution shall state on its Fact
Sheet: "This program is new. Therefore, the number of students
who graduate, the number of students who are placed, or the
starting salary you can earn after finishing the educational
program are unknown at this time. Information regarding general
salary and placement statistics may be available from government
sources or from the institution, but is not equivalent to actual
performance data."
f) A description of the manner in which the figures above are
calculated or a statement informing the reader of where he or she
may obtain a description of the manner in which the figures are
calculated.
g) A statement informing the reader of where he or she may obtain
from the institution a list of the employment positions
determined to be within the field for which a student received
education and training for the calculation of job placement
rates.
h) A statement informing the reader of where he or she may obtain
from the institution a list of the objective sources of
information used to substantiate the salary disclosure.
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i) The following statements:
i) "This fact sheet is filed with the Bureau for Private
Postsecondary Education. Regardless of any information you may
have relating to completion rates, placement rates, starting
salaries, or license exam passage rates, this fact sheet
contains the information as calculated pursuant to state law."
ii) "Any questions a student may have regarding this fact
sheet that have not been satisfactorily answered by the
institution may be directed to the Bureau for Private
Postsecondary Education at (address), Sacramento, CA (ZIP
Code), (Internet Web site address), (telephone and fax
numbers)."
j) If the institution participates in federal financial aid
programs, the most recent three-year cohort default rate reported
by the DOE for the institution and the percentage of enrolled
students receiving federal student loans.
1) Specifies various disclosure and reporting requirements around
completion, placement, licensure and salary of students/graduates
and establishes various definitions for this purpose. Requires
institutions to submit an annual report to the Bureau that includes
specified information also included in the Fact Sheet. (EC §§
94928-94929.8)
2) Requires the Legislative Analyst's Office (LAO), by October 1,
2013, to report to the Legislature and the Governor on the
appropriateness of the exemptions provided in the Act. Requires
the Bureau of State Audits (BSA) to conduct a performance audit to
evaluate the effectiveness and efficiency of the Bureau's
operations and report the results of that audit to the Legislature
and the Governor. (EC § 94949)
This bill:
1) Exempts law schools from having to comply with the requirements of
the Fact Sheet, if the school is accredited by the Council of the
Section of Legal Education and Admissions to the Bar of the
American Bar Association (ABA), is owned by an institution
authorized to operate by the Bureau, and reports graduate salary
information and other information to the National Association for
Law Placement (NALP).
2) Provides that notwithstanding any other law, a law school that
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meets the criteria above shall be deemed to satisfy the Fact Sheet
requirements by doing both of the following:
a) Complying with Standard 509 of the 2012-13 American Bar
Association's Standards and Rules of Procedure for Approval of
Law Schools.
b) Providing completion, placement, bar passage, and salary and
wage information of graduates to prospective students prior to
enrollment through the law school application process
administered by the Law School Admission Council (LSAC).
FISCAL EFFECT: Unknown. This bill is keyed fiscal by Legislative
Counsel.
COMMENTS:
1. Purpose. This bill is sponsored by Education Management
Corporation (EDMC). According to the Author, the U.S. DOE
requirement that an institution have "state authorization" in order
to be eligible for Title IV federal student financial aid is
prompting at least one law school in California, exempt from Bureau
approval, to seek Bureau approval to maintain Title IV eligibility.
As a result, that school will be subject to the Bureau's Student
Performance Fact Sheet (Fact Sheet) requirements.
According to information provided by the Author and the Sponsor,
the Fact Sheet was designed to ensure that prospective students
would receive graduate outcome information prior to enrolling in an
institution. The theory behind the Fact Sheet was that, because
every Bureau-approved institution would be required to provide
similarly calculated data in an established format, students would
be able to make comparative analysis and, ultimately, informed
educational choices. While many Bureau-regulated institutions are
already required by their accreditor to report student outcome
data, there is currently no consistent format (across accrediting
agency and educational program) for reporting this data to
students. The Author adds that in the absence of the Fact Sheet,
students would not be able to make apples-to-apples comparisons of
educational program outcomes, particularly for institutions and
programs accredited by different accrediting agencies.
This bill is designed to address an unanticipated problem for
Western State College of Law at Argosy University, owned by EDMC,
and ensure that students attending this institution do not receive
duplicative and potentially conflicting data regarding enrollment
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and outcomes, simply because the institution is no longer exempt
like all other law schools. According to the Author, the Fact
Sheet requirements would require different calculations than those
established by the American Bar Association (ABA) and National
Association for Law Placement (NALP) and would ultimately provide
less data to students than they are already provided through the
Law School Admission Council (LSAC) application process.
Under ABA Standard 509, ABA accredited law schools are required to
provide detailed student enrollment and graduate outcome
information to prospective students and to the general public. Law
schools also report employment and salary outcomes for graduates to
NALP. Prospective students access this data through the law school
application process administered by the LSAC. Through the LSAC
website, students are provided a single point of entry to access
this data in order to make comparative analysis of the law schools
to which they are considering applying. According to the Author,
if Western State College of Law becomes the only law school to seek
Bureau approval, the school would be the only law school providing
students with a Fact Sheet, potentially undermining a primary
purpose of the Fact Sheet which is to allow students to make
apples-to-apples comparisons of institutional outcomes prior to
enrollment.
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,
required all unaccredited colleges in California to be approved
by the new Bureau, and all nationally accredited colleges to
comply with numerous student protections. Not all private
institutions were and 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,
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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 LAO and the 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
program.
In 2010, 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
DOE Program Integrity regulations, 34 C.F.R. Parts 600, et seq.).
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), close to 20 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. In the past
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few years, 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 recent economic downturn,
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 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.
a) "State Authorization" and the California Response. Complying
with all of the new federal Title IV regulations that took effect
in 2010 has proven challenging to schools and states alike.
Specifically, 34. C.F.R. § 600.9 requires, among other things,
that a school be legally authorized by a state to operate
educational programs beyond secondary education and have a
process to review and act appropriately on complaints concerning
postsecondary institutions. The impact in California has been a
years-long struggle for clarity from DOE by all higher education
institutions potentially facing the loss of their eligibility for
student assistance under Title IV, including for-profit
institutions operating under larger corporate umbrellas, as well
as non-profit educational institutions. Schools were initially
required to be in compliance with the "state authorization" rule
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by July 1, 2011, however DOE granted extensions for compliance if
an institution was able to demonstrate that it was making
progress toward obtaining the necessary state authorization. In
the federal register, press releases and through a "Dear
Colleague" letter, DOE indicated that:
"While the Secretary has designated amended § 600.9(a) and
(b) as being effective July 1, 2011, we recognize that a
State may be unable to provide appropriate State
authorizations to its institutions by that date. We are
providing that the institutions unable to obtain State
authorization in that State may request a one-year extension
of the effective date of these final regulations to July 1,
2012, and if necessary, an additional one-year extension of
the effective date to July 1, 2013. To receive an extension
of the effective date of amended § 600.9(a) and (b) for
institutions in a State, an institution must obtain from the
State an explanation of how a one-year extension will permit
the State to modify its procedures to comply with amended §
600.9."
In the case of California, institutions submitted a letter from
the Administration supporting the institution's request for an
extension from having to comply with the new rules. Subsequent
extensions were granted, however indications from DOE are that no
further extensions will be granted and institutions must meet the
requirements by July 1, 2014.
The 2013-14 Budget (SB 71 and AB 76) included statutory
clarification that a previously exempt accredited institution now
has the authority to apply to the Bureau for approval and be
regulated by the Bureau. Specifically, the language in the
Budget Trailer Bills provides that an institution exempt from all
or part of the Act may apply to the Bureau for an approval to
operate, but only subject to all of the following:
Upon issuing an approval to operate to an institution,
the Bureau is authorized to regulate that institution through
the full set of powers granted, and duties imposed, by the Act
in the same manner as those powers and duties would apply to
an institution that is not exempt from this chapter.
Notwithstanding any other law, upon issuance of an
approval to operate, the institution is no longer eligible for
exemption unless authorized by subsequent legislation.
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Upon issuance of an approval to operate, an institution
is subject to all provisions of the Act, and any regulations
except that with respect to the placement and salary or wage
data required to be collected, calculated, and reported under
the Act, an institution is not required to report on its first
Fact Sheet any data from the period prior to the date of the
issuance of the approval to operate, since the institution was
not required to collect and likely does not have the required
data available. An institution is still, though, required to
report available data collected and calculated in accordance
with the Act, regardless of the purpose for which the data was
collected. If the required data is unavailable, the
institution shall also disclose that it is not available on
all documents required by the Act and regulations. However,
upon receiving an approval to operate, an institution has to
begin to collect and calculate all information required by the
Act.
An institution receiving an approval to operate must
provide the Fact Sheet to prospective students, file that fact
sheet with the Bureau, and post it on the institution's Web
site no later than the first August 1 after the institution is
approved to operate and no later than August 1 of each year
thereafter.
It is anticipated that a number of previously exempt
institutions, including for-profit entities like the University
of Phoenix and Argosy University under EDMC, which were exempt
based on accreditation, will apply to the Bureau.
1. 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
and training to numerous students, many seeking to become employed
as licensed professionals under the various DCA licensing boards
and bureaus. As such, the Committee is focused on ensuring that
the state's workforce development needs are met through the timely
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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 Committee on Higher Education 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 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 was also provided at the hearing and 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 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
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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.
2. Related Legislation This Session. AB 330 (Chau) would require
postsecondary educational institutions to provide their net price
calculators and average student debt per graduate to the California
Student Aid Commission (CSAC) as a condition of eligibility for the
Cal Grant Program, requires CSAC to provide this information on its
website in a searchable database, and requires a for-profit
institution to include this information in its School Performance
Fact Sheet. ( Status: This bill is pending in the Assembly
Committee on Higher Education.)
AB 534 (Wieckowski) would require public and private postsecondary
educational institutions to provide entrance and exit counseling,
as specified, for students enrolled at their institutions regarding
student loans offered by the institution or a private lender, and
prohibits a lender from accepting an application for a private
student loan without first receiving certification that the
counseling was conducted by the appropriate postsecondary
institution, which may charge a fee to the lender for this service.
( Status: This bill was held in the Assembly Committee on
Appropriations.)
3. Prior Related Legislation. AB 2296 (Block, Chapter 585, Statutes
of 2012) expanded the disclosure requirements for institutions
under the Bureau related to unaccredited programs; expanded
disclosure requirements for all regulated institutions, established
more stringent criteria for determining gainful employment and
calculating job placement rates and increased institutional
documentation and reporting requirements around completion rates,
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job placement/license exam passage rates, and salary/wage
information for graduates.
SB 498 (Liu, 2011) would have abolished the Bureau and transferred
the Bureau's powers and duties under the Act to the California
Postsecondary Education Commission. ( Status: The bill was held by
the Senate Committee on Business, Professions and Economic
Development.)
SB 619 (Fuller, Chapter 309, Statutes of 2011) exempted 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.
SB 675 (Wright, 2011) would have required that private
postsecondary 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. ( Status: The bill failed
passage in the Senate Committee on Business, Professions and
Economic Development.)
AB 611 (Gordon, Chapter 103, Statutes of 2011) set forth certain
disclosure requirements pertaining to accreditation status,
licensure, and related limitations for unaccredited doctoral
programs.
AB 773 (Block, 2011) would have allowed the Bureau to revoke an
exemption of an institution which was exempt based on accreditation
but still required to comply with the Student Tuition Recovery Fund
requirements, if it determined that the institution had not in fact
complied with those requirements. ( Status: The bill was never
heard in a policy committee.)
AB 797 (Conway, 2011) would have exempted schools of cosmetology,
as defined, from the Act. ( Status: The bill was held in Assembly
Committee on Higher Education.)
AB 1013 (Assembly Committee on Higher Education, Chapter 167,
Statutes of 2011) made clarifying changes to the Act and related
Bureau oversight.
AB 1889 (Portantino, 2010) contained provisions regarding doctoral
degrees offered by unaccredited institutions, the calculation of
placement rates, and Bureau employment requirements. ( Status: The
bill was vetoed by the Governor due to concerns over Bureau
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employment requirements.)
AB 2393 (Ammiano, 2010) altered the definition of "graduates
employed in the field" for apprenticeship and nursing programs.
( Status: The bill was vetoed by the Governor, who indicated that
it put the state on the same path to overly confusing statutes and
guidelines that existed prior to the new Act.)
4. Arguments in Support. EDMC , the Sponsor of this bill, writes in
support, noting that Western State College of Law has one of the
highest Bar passage rates in the state, most recently with almost
90 percent passage for first time test takers, as well as a large
base of over 11,000 alumni. EDMC states that in reviewing the
Bureau's requirements, the law school noted that the Fact Sheet
requirements would result in prospective students receiving
duplicative and potentially conflicting data regarding enrollment
and outcomes. Western State College of Law is the only
ABA-accredited for profit law school in the state and ABA
disclosures remain the most relevant method for assessing and
comparing ABA-accredited law schools.
5. Staff Comments. This bill has not been heard by a previous policy
committee and the current language dealing with law schools and
Fact Sheets contained in the bill was only recently added.
This Committee is about to undertake a comprehensive review of the
Act and the Bureau during the Sunset Review Process, beginning with
the Bureau's submission of a Sunset Report to the Committee this
November, and including the preparation of a substantive Background
Paper by Committee staff, hearings, and sunset legislation during
2014. Simultaneously, the current exemptions provided under the
Act are the subject of a study being prepared by the LAO and due to
the Legislature on or before October 1 and for the most part, the
Legislature has refrained from approving additional exemptions
before considering the LAO's recommendations. The only recent
exemption from the Act was granted for flight schools that are
approved by the FAA and meet certain conditions.
The Sponsors indicate that EDMC is seeking to move forward on this
proposal in the current year because it is planning to apply to the
Bureau for approval to operate in the near future in order to meet
the federal requirements for "state authorization," thus
institutions like Argosy University and Western State College of
Law, for which EDMC is the parent company, would also be approved
by the Bureau and subject to the provisions of the Act, including
the Fact Sheet. In the absence of the change in statute as
AB 834
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proposed in this bill, the law school would be required to begin
providing Fact Sheets to prospective students, per the requirements
of institutions regulated by the Bureau by July 1, 2014.
NOTE: Double-referral to Senate Committee on Education.
SUPPORT AND OPPOSITION:
Support:
Education Management Group (EDMC)
Opposition:
None on file as of June 27, 2013.
Consultant:Sarah Mason