BILL ANALYSIS Ó
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THIRD READING
Bill No: AB 834
Author: Williams (D)
Amended: 5/12/14 in Senate
Vote: 27 - Urgency
SENATE BUSINESS, PROF. & ECON. DEVELOP. COMM. : 10-0, 7/1/13
AYES: Lieu, Emmerson, Block, Corbett, Galgiani, Hernandez,
Hill, Padilla, Wyland, Yee
SENATE EDUCATION COMMITTEE : 9-0, 4/30/14
AYES: Liu, Wyland, Block, Correa, Galgiani, Hancock, Hueso,
Huff, Monning
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : Not relevant
SUBJECT : Private postsecondary education: School Performance
Fact Sheets
SOURCE : Education Management Corporation
DIGEST : This bill exempts a law school that meets specified
conditions from having to submit a School Performance Fact Sheet
(Fact Sheet) to the Bureau for Private Postsecondary Education
(BPPE).
ANALYSIS :
Existing law:
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1.Until January 1, 2015, establishes the California Private
Postsecondary Education Act of 2009 (Act), which provides for
the approval, regulation, and enforcement of private
postsecondary educational institutions by the BPPE.
2.Requires the BPPE to establish an Internet Web site that
includes a directory of approved institutions with a link to
the Internet Web site of each institution.
3.Specifies that, among other things, the Act requires a
regulated institution to provide a prospective student with a
Fact Sheet containing information on completion rates,
placement rates, license examination passage rates, salary or
wage information, the most recent three-year cohort default
rate and the percentage of enrolled students receiving federal
student loans (if the institution participates in federal
financial programs) and other specified information.
4.Exempts the following from the Act:
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, as specified.
E. An institution owned, controlled, and operated and
maintained by a religious organization, as specified.
F. An institution that does not award degrees and that
solely provides educational programs for total charges of
$2,500 or less when no part of the total charges is paid
from state or federal student financial aid programs.
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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 (ED), and meets other
criteria.
AA. Flight instruction providers or programs that provide
flight instruction pursuant to Federal Aviation
Administration (FAA) regulations, as specified.
BB. An institution that is accredited by a regional
accrediting agency recognized by the ED so long as the
institution complies with requirements related to student
tuition recovery.
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 ABA; is owned by an institution authorized
to operate by the BPPE; reports graduate salary information
and other information to the National Association for Law
Placement (NALP); and is approved to operate by the BPPE
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pursuant to statutes outlining provisions applicable to
otherwise exempt institutions.
2.Provides that notwithstanding any other law, a law school that
meets the criteria above shall be deemed to satisfy the Fact
Sheet requirements by doing all of the following:
A. Complying with Standard 509 of the 2012-13 ABA's
Standards and Rules of Procedure for Approval of Law
Schools, as that standard may be amended.
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).
C. Providing prospective students any additional
information required on a Fact Sheet not already reported
via #A and #B above including, but not limited to:
(1) The most recent three-year cohort default rate for
the law school as reported by the ED, and if applicable,
requiring that the rate be disaggregated from the parent
institution's reported rate.
(2) The percentage of enrolled students receiving
federal student loans.
A. Providing the required information to prospective
students, at a minimum, by clearly posting it in a
conspicuous location on the law school's Internet Web site.
B. Providing to the BPPE, annually, the information, as
specified, that is required to be disclosed; and requiring
the BPPE to include the information provided by the law
school on its Internet Web site, as specified.
Background
Fact Sheets . This bill exempts law schools that meet specified
criteria from having to submit a Fact Sheet to the BPPE. As law
schools are generally exempt from the Act, this requirement only
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applies to a law school that voluntarily chooses to come under
BPPE's oversight. Recognizing that exempt institutions may not
have this information available, the new law does not require
the first Fact Sheet to report any data from the period prior to
the date of the issuance of the approval to operate, but does
require the institution to disclose that the information is not
available on all documents required by the Act. In addition,
the institution is still required to report available data
collected and calculated in accordance with the Act, regardless
of the purpose for which the data was collected. Upon receiving
an approval to operate, however, an institution is required to
begin collection and calculation of all information required by
the Act for the Fact Sheets. The Fact Sheet must be provided to
prospective students, filed with the BPPE, and posted on the
institution's Web site no later than the first August 1 after
the institution is approved to operate and annually thereafter.
Sunset Review . The Senate Business, Professions and Economic
Development Committee is currently undertaking a comprehensive
review of the Act and the BPPE as a part of the Sunset Review
process. The Committee reviewed the Sunset Report prepared by
the BPPE and the background paper prepared by Committee staff at
an informational hearing on April 21, 2014. One issue
highlighted in the background paper was specifically in regard
to law school disclosures. The recommendation was "to amend the
Act to authorize a law school accredited by the ABA, and owned
by an institution operating under the BPPE, to satisfy the
current disclosure requirements of the 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. The Committees may wish to ensure
that any specific information required on the Fact Sheet that
may help students make informed decisions is also disclosed by a
law school under the BPPE's authority."
The provisions of this bill are generally consistent with this
recommendation.
Comments
According to the author's office, the ED requirement that an
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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 BPPE approval, to seek
BPPE approval to maintain Title IV eligibility. As a result,
that school will be subject to the BPPE Fact Sheet requirements.
This bill proposes an exemption for a school which is
voluntarily coming under the Act in order to meet the
requirements for state authorization and be allowed to
participate in federal financial aid programs. This bill is
specifically designed to address an issue for Western State
College of Law, owned by the Education Management Corporation
(EDMC). According to the author's office, EDMC is planning to
apply for BPPE approval in the near future, and is seeking to
ensure this statutory change is in effect prior to the ED
implementation of state authorization requirements (July 1,
2014).
EDMC notes that Western State College of Law has one of the
highest Bar passage rates in the state, most recently with
almost 90% passage for first time test takers, as well as a
large base of over 11,000 alumni. EDMC states that in reviewing
the BPPE'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.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 5/19/14)
Education Management Corporation (source)
Public Advocates, Inc.
ARGUMENTS IN SUPPORT : Public Advocates states that by
aligning the requirements for disclosure by law schools, this
bill will provide law school applicants with access to law
school information that is easily accessible and obvious.
ASSEMBLY FLOOR : 42-24, 5/24/13
AYES: Alejo, Ammiano, Atkins, Bloom, Blumenfield, Bocanegra,
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Bonilla, Bradford, Brown, Ian Calderon, Campos, Chau, Chesbro,
Dickinson, Eggman, Fong, Fox, Garcia, Gatto, Gomez, Gordon,
Roger Hernández, Jones-Sawyer, Levine, Lowenthal, Medina,
Mitchell, Mullin, Muratsuchi, Nazarian, Pan, Perea, Quirk,
Rendon, Salas, Stone, Ting, Weber, Wieckowski, Williams,
Yamada, John A. Pérez
NOES: Achadjian, Allen, Bigelow, Chávez, Conway, Cooley, Dahle,
Donnelly, Beth Gaines, Gorell, Hagman, Harkey, Jones, Linder,
Logue, Maienschein, Mansoor, Melendez, Morrell, Nestande,
Olsen, Patterson, Quirk-Silva, Wagner
NO VOTE RECORDED: Bonta, Buchanan, Daly, Frazier, Gray, Grove,
Hall, Holden, V. Manuel Pérez, Skinner, Waldron, Wilk,
Vacancy, Vacancy
MW:nl 5/20/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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