BILL ANALYSIS Ó AB 1996 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 1996 (Gordon) As Amended August 19, 2016 Majority vote -------------------------------------------------------------------- |ASSEMBLY: |78-0 |(May 12, 2016) |SENATE: |39-0 |(August 23, | | | | | | |2016) | | | | | | | | | | | | | | | -------------------------------------------------------------------- Original Committee Reference: HIGHER ED. SUMMARY: Provides an exemption from the California Private Postsecondary Education Act (Act), including exemption from oversight and student protections provided by the Bureau for Private Postsecondary Education (Bureau), for an institution that meets specified requirements. The Senate amendments: 1)Strike language that would have provided an exemption solely to JobTrain, Inc. and instead expand the exemption to include any institution that meets all of the following requirements: a) The institution maintains its status as a nonprofit institution accredited by the Accrediting Commission for Schools, Western Association of Schools and Colleges; AB 1996 Page 2 b) As of January 1, 2016, it has operated continuously in California for at least 50 years as a nonprofit entity, as defined. c) It does not award degrees or diplomas and it is paid from state or federal student financial aid programs for fewer than 20% of its students who receive vocational training; and, d) It did not previously seek approval from the Bureau through the pathway that exists in current law. 2)Require the Employment Development Department (EDD), in conjunction with the California Workforce Development Board to annually collect and report to the Bureau on all of the following, for an institution that claims an exemption pursuant to the aforementioned requirements: a) The number of students enrolled in the institution., and the number that have completed their respective training program offered by the institution; b) The number of students attaining training from the institution, using funds made available pursuant to the federal Workforce Innovation and Opportunity Act of 2014; and, c) The skills or competency attained through their respective program offered by the institution, and subsequent employment placement and retention information, including income. EXISTING LAW: Establishes the Bureau for Private Postsecondary AB 1996 Page 3 Education (BPPE), under the California Private Postsecondary Education Act (Act), until January 1, 2017; and, provides for the oversight and regulation of private postsecondary educational institutions (institutions) to ensure protection of the public and students. (Education Code Section 94800 et seq.) FISCAL EFFECT: Negligible fiscal impact determined by the Senate Appropriations Committee, pursuant to Senate Rule 28.8. COMMENTS: Background. BPPE is responsible for oversight of private postsecondary educational institutions operating with a physical presence in California. Established by AB 48 ((Portantino), Chapter 310, Statutes of 2009) after numerous legislative attempts to remedy the laws and structure governing regulation of private postsecondary institutions, the bill took effect January 1, 2010, to make many substantive changes that created a foundation for oversight and gave the BPPE enforcement tools to ensure schools comply with the law. AB 48 contained numerous exemptions to state-level oversight, including for avocational or recreational programs, educational programs offered for members of a business or professional association, preapprenticeship programs offered by specific types of organizations, test preparation providers, religious institutions, low-cost programs that do not receive public funds, Western Association of Schools and Colleges (WASC)-accredited institutions, specified nationally accredited nonprofit institutions, and flight schools. An exempt institution is not regulated by the BPPE. Students enrolled in exempt institutions are not protected by the Act, including the Student Tuition Recovery Fund (STRF) which provides reimbursement to students for BPPE-regulated institutions that violate the law or close abruptly. For example, Heald College, which was owned by Corinthian Colleges, Inc. (CCI), enjoyed an exemption from BPPE oversight due to its WASC-accreditation. When initially granted exemption, Heald College was a non-profit institution. It was subsequently AB 1996 Page 4 purchased by CCI, and the accreditation-based exemption was not affected by the change in ownership. When Heald closed abruptly and filed bankruptcy in 2015, students enrolled in the institution were not eligible to make tuition recovery claims against the STRF. Purpose of this bill. According to the author, JobTrain is a 50-year old nonprofit training and career development support center serving low income individuals in the Bay Area. JobTrain offers middle income job pathways for people who are often working two to three minimum wage jobs and who cannot afford to personally pay for college or other training. According to the author, JobTrain had been previously granted an exemption from oversight by BPPE based on its accreditation from the Accrediting Commission for Schools, (WASC). JobTrain was notified by BPPE that its exemption expired on December 31, 2015. According to the author, in order to remain eligible to receive public funding under the Workforce Investment and Opportunity Act (WIOA) the institution must remain on the Eligible Training Provider List (ETPL). To be placed on the ETPL, an institution must either have an exemption or approval from the BPPE. Analysis Prepared by: Laura Metune / HIGHER ED. / (916) 319-3960 FN: 0004765