Amended in Senate April 6, 2016

Senate Bill No. 1192

Introduced by Senator Hill

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(Principal coauthors: Assembly Members Medina and Salas)

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February 18, 2016

An act to amend begin delete Section 94885 of end delete begin insert Sections 94809, 94848, 94874.2, 94878, 94879, 94885, 94885.1, 94885.5, 94899, 94905, 94909, 94923, and 94944 of, to amend the heading of Article 14 (commencing with Section 94923) of Chapter 8 of Part 59 of Division 10 of Title 3 of, to add Sections 94922.5, 94923.5, and 94935.5 to, to add Chapter 8.1 (commencing with Section 94952) to Part 59 of Division 10 of Title 3 of, and end insert begin insert to add and repeal Article 20.5 (commencing with Section 94949.5) to Chapter 8 of Part 59 of Division 10 of Title 3 of, end insert the Education Code, relating to private postsecondary begin delete education. end delete begin insert education, and making an appropriation therefor. end insert

LEGISLATIVE COUNSEL’S DIGEST

SB 1192, as amended, Hill. Private postsecondary education: California Private Postsecondary Education Act of 2009.

Existing law, the California Private Postsecondary Education Act of 2009, provides, among other things, for student protections and regulatory oversight of private postsecondary institutions in the state. The act is enforced by the Bureau for Private Postsecondary Education within the Department of Consumer Affairs. begin delete The act requires, except as provided, institutions covered by the act that offer a degree to receive accreditation by an accreditation agency recognized by the United States Department of Education or have an accreditation plan, approved by the bureau, for the institution to become fully accredited within 5 years of the bureau’s issuance of a provisional approval to operate to the institution, as specified. end delete begin insert The act exempts an institution from its provisions if any of a list of specific criteria are met. end insert begin insert Existing law repeals the act on January 1, 2017. end insert

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This bill would recast and revise various provisions of the act. The bill would authorize bureau staff who, during an inspection of an institution, detect a violation of the act, or regulations adopted pursuant to the act, to issue the institution a citation before leaving the institution, as specified. The bill would require the Director of Consumer Affairs to appoint an enforcement monitor, no later than March 1, 2017, to, among other duties, monitor and evaluate the bureau’s enforcement of the act and submit written reports to the department and the Legislature on his or her findings and conclusions, as specified. The bill would increase the amount of a fine that may be issued to a person for operating an institution without proper approval to operate from $50,000 to $100,000. The bill would, to the extent authorized by federal law, require a private postsecondary institution that does not maintain a physical presence in California and offers distance education to California students to register with the bureau and file a surety bond, as specified.

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The act establishes the Student Tuition Recovery Fund and requires the bureau to adopt regulations governing the administration and maintenance of the fund, including requirements relating to assessments on students and student claims against the fund, and establishes that the moneys in this fund are continuously appropriated to the bureau for specified purposes.

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This bill would make a California student of a Corinthian Colleges, Inc., institution, who meets all of the other eligibility requirements, eligible for recovery from the fund. To the extent that the bill expands the purposes of the fund, the bill would make an appropriation. The bill would establish the Office of Student Assistance and Relief, which would, among other duties, administer the fund, serve as a point of contact to address the needs of private postsecondary students, establish an Internet Web site that contains specified information for the benefit of these students, and work, in consultation with specified state and federal agencies, to determine the extent of resources available for these students and what actions state agencies need to take to ensure the protection of the public from the closure of private postsecondary educational institutions.

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This bill would correct an inaccurate cross-reference in that provision relating to accreditation and would make other technical nonsubstantive changes.

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Vote: majority. Appropriation:  begin delete no end delete begin insert yes end insert . Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program: no.

The people of the State of California do enact as follows:

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begin insert SECTION 1. end insert   

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begin insert Section 94809 of the end insert begin insert Education Code end insert begin insert is amended
to read: end insert

94809.  

(a) An institution that had an application for an
approval to operate pending with the former Bureau for Private
Postsecondary and Vocational Education on June 30, 2007, may
continue to operate until a decision is made in regard to the
institution regarding the application for approval to operate, but
shall comply with, and is subject to, this chapter.

(b) An institution that did not have a valid approval to operate
issued by, and did not have an application for approval to operate
pending with, the former Bureau for Private Postsecondary and
Vocational Education on June 30, 2007, that began operations
between July 1, 2007, and January 1, 2010, may continue to operate
unless a denial of approval to operate has been issued and has
become final, but shall comply with, and is subject to, this chapter.

(c) Students seeking to enroll in institutions operating under
subdivisions (a) and (b) shall be notified by the institution, in
writing and prior to executing an enrollment agreement, that the
institution’s application for approval to operate has not been
reviewed by the bureau.

(d) (1) An institution that is denied an approval to operate
pursuant to subdivision (a) or (b) may file an appeal pursuant to
the procedures established in Section 94888.

(2) An institution that has filed an appeal begin insert pursuant to paragraph
(1) end insert may continue to operate during the appeal process but must
disclose in a written statement approved by the bureau, to all
current and prospective students, that the institution’s application
for approval to operate was denied by the bureau because the
bureau determined the application did not satisfy the requirements
to operate in California, that the institution is appealing the
bureau’s decision, and that the loss of the appeal may result in the
institution’s closure.

(3) If the bureau determines that the continued operation of an
institution poses a significant risk of harm to students, the bureau
shall make an emergency decision pursuant to Section 94938.

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begin insert SEC. 2. end insert   

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begin insert Section 94848 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94848.  

“Licensure” includes any license, certificate, permit,
or similar credential that a person must hold to lawfully engage in
a profession, occupation, trade, or career field. begin insert “Licensure” shall
also include required certification or registration that a person
must hold to lawfully engage in a profession, occupation, trade,
or career field. end insert

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begin insert SEC. 3. end insert   

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begin insert Section 94874.2 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94874.2.  

Beginning January 1, 2016, an institution that is
approved to participate in veterans’ financial aid programs pursuant
to Section 21.4253 of Title 38 of the Code of Federal Regulations
that is not an independent institution of higher education, as defined
in subdivision (b) of Section 66010, begin delete may not claim an exemption
from this chapter. end delete begin insert shall not be exempt from this chapter. end insert

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begin insert SEC. 4. end insert   

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begin insert Section 94878 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94878.  

(a) The bureau shall establish an Internet Web site that
includes at least all of the following information:

(1) An explanation of the bureau’s scope of authority.

(2) (A) A directory of approved institutions, and a link, if
feasible, to the Internet Web site of each institution.

(B) For each institution, the directory shall be developed in a
manner that allows the user to search by institution and shall
include all of the following information:

(i) The status of the institution’s approval to operate.

(ii) The information provided by the institutions, including, but
not limited to, the annual report, as required by Section 94934,
including the school catalog and the School Performance Fact
Sheet. The School Performance Fact Sheet shall be maintained on
the directory for at least five years after the date of its submission
to the bureau.

(iii) If a law school satisfies the requirements of this chapter
regarding a School Performance Fact Sheet by complying with
the requirements of Section 94910.5, the bureau shall include the
information provided by the institution pursuant to Section 94910.5
on its Internet Web site and shall maintain the information in the
same manner as required by clause (ii).

(iv) The disciplinary history of the institution, which shall
include, but shall not be limited to, all of the following:

(I) Pending formal accusations filed by the bureau.

(II) Suspensions, revocations, citations, fines, infractions,
probations, pending litigation filed by the bureau, and final
judgments resulting from litigation filed by the bureau.

(III) Pending or final civil or criminal cases filed by the Attorney
General, a city attorney, or a district attorney in this state, or filed
in any state by an attorney general or a federal regulatory or
prosecutorial agency begin delete if the case would be actionable under
California or federal law, end delete of which the bureau has received notice.

(IV) Final administrative actions by the United States
Department of Education, including orders requiring restitution to
students.

(V) All disciplinary actions ordered by an accreditation agency,
including any order to show cause, of which the bureau has
received notice pursuant to Section 94934 or other information
otherwise publicly available of which the bureau has received
notice.

(b) The bureau shall maintain the Internet Web site described
in subdivision (a). The bureau shall ensure that the information
specified in subdivision (a) is kept current. The bureau shall update
the Internet Web site at least annually, to coincide with the
submission of annual reports by the institutions pursuant to Section
94934.

(c) (1) The bureau shall post on its Internet Web site a list of
all institutions that were denied approval to operate, after the denial
is final, and describe in clear and conspicuous language the reason
the institution was denied approval. The bureau shall include with
this list the statement provided in paragraph (2) on its Internet Web
site.

(2) “The following institutions were denied approval to operate
by the Bureau for Private Postsecondary Education for failing to
satisfy the standards relating to educational quality, or consumer
protection, or both. These unlicensed institutions are not operating
in compliance with the law, and students are strongly discouraged
from attending these institutions.”

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begin insert SEC. 5. end insert   

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begin insert Section 94879 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94879.  

The bureau shall conduct an outreach program to
secondary school begin delete pupils end delete begin insert students end insert as well as prospective and current
private postsecondary students, to provide them with information
on how to best select a private postsecondary institution, how to
enter into enrollment agreements, how to make informed decisions
in the private postsecondary education marketplace, and how to
contact the bureau for assistance. The bureau may accomplish the
purposes of this section in cooperation with other federal, state,
or local entities, or any combination of these entities.

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begin insert SEC. 6. end insert   

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begin insert Section 94885 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94885.  

(a) The bureau shall adopt by regulation minimum
operating standards for an institution that shall reasonably ensure
that all of the following occur:

(1) The content of each educational program can achieve its
stated objective.

(2) The institution maintains specific written standards for
student admissions for each educational program and those
standards are related to the particular educational program.

(3) The facilities, instructional equipment, and materials are
sufficient to enable students to achieve the educational program’s
goals.

(4) The institution maintains a withdrawal policy and provides
refunds.

(5) The directors, administrators, and faculty are properly
qualified.

(6) The institution is financially sound and capable of fulfilling
its commitments to students.

(7) That, upon satisfactory completion of an educational
program, the institution gives students a document signifying the
degree or diploma awarded.

(8) Adequate records and standard transcripts are maintained
and are available to students.

(9) The institution is maintained and operated in compliance
with this chapter and all other applicable ordinances and laws.

(b) Except as provided in Section begin delete 94855.1, end delete begin insert 94885.1, end insert an
institution offering a degree must satisfy one of the following
requirements:

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(i)

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begin insert (1) end insert  Accreditation by an accrediting agency recognized by the
United States Department of Education, with the scope of that
accreditation covering the offering of at least one degree program
by the institution.

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(ii)

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begin insert (2) end insert  An accreditation plan, approved by the bureau, for the
institution to become fully accredited within five years of the
bureau’s issuance of a provisional approval to operate to the
institution. The provisional approval to operate to an unaccredited
degree-offering institution shall be in compliance with Section
94885.5.

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begin insert SEC. 7. end insert   

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begin insert Section 94885.1 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94885.1.  

(a) An institution that is not accredited by an
accrediting agency recognized by the United States Department
of Education and offering at least one degree program, and that
has obtained an approval to operate from the bureau on or before
January 1, 2015, shall be required to satisfy at least one of the
following no later than July 1, 2015:

(1) Accreditation by an accrediting agency recognized by the
United States Department of Education, with the scope of that
accreditation covering the offering of at least one degree program
by the institution.

(2) Compliance with subdivision (b).

(b) The bureau shall identify institutions that are subject to
subdivision (a) and notify those institutions by February 1, 2015,
of the accreditation requirements pursuant to this section and that
the institution is required provide the following information to the
bureau if the institution plans to continue to offer a degree program
after July 1, 2015:

(1) An accreditation plan that, at a minimum, identifies an
accrediting agency recognized by the United States Department
of Education from which the institution will seek accreditation,
with the scope of that accreditation covering the offering of at least
one degree program, and outlines the process by which the
institution will achieve accreditation candidacy or pre-accreditation
by July 1, 2017, and full accreditation by July 1, 2020.

(2) Evidence of having achieved accreditation candidacy or
pre-accreditation by July 1, 2017.

(3) Evidence of having obtained full accreditation by July 1,
2020.

(4) Any additional documentation the bureau deems necessary.

(c) An institution that satisfies the requirements of subdivision
(b) shall comply with all of the following:

(1) Notify students seeking to enroll in the institution, in writing,
prior to the execution of the student’s enrollment agreement, that
the institution’s approval to offer a degree program is contingent
upon the institution being subsequently accredited.

(2) A visiting committee, empaneled by the bureau pursuant to
Section 94882, shall review the institution by January 1, 2017, and
determine if the institution is likely to achieve full accreditation
by July 1, 2020. If the visiting committee finds the institution
deficient in its accreditation plan, the bureau may prohibit the
institution from enrolling new students in its degree program or
programs, and require the execution of a teach-out plan for its
enrolled students.

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(d) (1) The bureau may, upon the submission of sufficient
evidence that an unaccredited institution is making strong progress
toward obtaining accreditation, grant an institution’s request for
an extension of time, not to exceed two years, to obtain
pre-accreditation, accreditation candidacy, or accreditation.

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(2) Evidence submitted to the bureau pursuant to paragraph
(1) shall include, but is not limited to, an amended accreditation
plan identifying why pre-accreditation, accreditation candidacy,
or accreditation outlined in the original plan submitted to the
bureau was not achieved, steps the institution is taking to comply
with this section, and documentation from an accrediting agency
demonstrating the institution’s ability to achieve pre-accreditation,
accreditation candidacy, or accreditation.

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(d)

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begin insert ( end insert begin insert e) end insert  Any institution that fails to comply with the requirements
of this section by the dates provided, as required, shall have its
approval to operate automatically suspended on the applicable
date. The bureau shall issue an order suspending the institution
and that suspension shall not be lifted until the institution complies
with the requirements of this section. A suspended institution shall
not enroll new students in any of its degree programs, and shall
execute a teach-out plan for its enrolled students.

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(e)

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begin insert ( end insert begin insert f) end insert  The bureau shall adopt emergency regulations for purposes
of implementing this section. The adoption of these regulations
shall be deemed to be an emergency and necessary for the
immediate preservation of the public peace, health and safety, or
general welfare for purposes of Sections 11346.1 and 11349.6 of
the Government Code. These emergency regulations shall become
law through the regular rulemaking process within one year of the
enactment of this section.

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(f)

end delete

begin insert ( end insert begin insert g) end insert   This section shall remain in effect until January 1, 2021,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2021, deletes or extends that date.

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begin insert SEC. 8. end insert   

end insert

begin insert Section 94885.5 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94885.5.  

(a) If an institution that has not been accredited by
an accrediting agency recognized by the United States Department
of Education seeks to offer one or more degree programs, the
institution shall satisfy the following requirements in order to be
issued a provisional approval to operate from the bureau:

(1) The institution may not offer more than two degree programs
during the term of its provisional approval to operate.

(2) The institution shall submit an accreditation plan, approved
by the bureau, for the institution to become fully accredited within
five years of issuance of its provisional approval to operate. The
plan shall include, at a minimum, identification of an accreditation
agency recognized by the United States Department of Education,
from which the institution plans to seek accreditation, and outline
the process by which the institution will achieve accreditation
candidacy or pre-accreditation within two years, and full
accreditation within five years, of issuance of its provisional
approval.

(3) The institution shall submit to the bureau all additional
documentation the bureau deems necessary to determine if the
institution will become fully accredited within five years of
issuance of its provisional approval to operate.

(b) If an institution is granted a provisional approval to operate
pursuant to subdivision (a), the following is required:

(1) Students seeking to enroll in that institution shall be notified
in writing by the institution, prior to the execution of the student’s
enrollment agreement, that the institution’s approval to operate is
contingent upon it being subsequently accredited.

(2) Within the first two years of issuance of the provisional
approval, a visiting committee, empaneled by the bureau pursuant
to Section 94882, shall review the institution’s application for
approval and its accreditation plan, and make a recommendation
to the bureau regarding the institution’s progress to achieving full
accreditation.

(3) The institution shall provide evidence of accreditation
candidacy or pre-accreditation within two years of issuance of its
provisional approval, and evidence of accreditation within five
years of issuance of its provisional approval, with the scope of that
accreditation covering the offering of at least one degree program.

(c) An institution required to comply with this section that fails
to do so by the dates provided, as required, shall have its
provisional approval to operate automatically suspended on the
applicable date. The bureau shall issue an order suspending the
institution and that suspension shall not be lifted until the institution
complies with the requirements of this section. A suspended
institution shall not enroll new students in any of its degree
programs and shall execute a teach-out plan for its enrolled
students.

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(d) The bureau may grant an institution’s request for an
extension of time, not to exceed two years, to obtain
pre-accreditation, accreditation candidacy, or accreditation
pursuant to the requirements outlined in subdivision (d) of Section
94885.1.

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(d)

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begin insert ( end insert begin insert e) end insert  An institution issued a provisional approval under this section
is required to comply with all other laws and regulations.

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(e)

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begin insert ( end insert begin insert f) end insert  The bureau shall adopt emergency regulations for purposes
of implementing this section. The adoption of these regulations
shall be deemed to be an emergency and necessary for the
immediate preservation of the public peace, health and safety, or
general welfare for purposes of Sections 11346.1 and 11349.6 of
the Government Code. These emergency regulations shall become
law through the regular rulemaking process within one year of the
enactment of this section.

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begin insert SEC. 9. end insert   

end insert

begin insert Section 94899 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94899.  

If an institution offers an educational program in a
profession, occupation, trade, or career field that requires begin delete licensure
in this state, end delete begin insert licensure, including required certification or
registration, in this state, end insert the institution shall have an educational
program approval from the appropriate begin delete state licensing end delete begin insert licensing,
certifying, or registration end insert agency to conduct that educational
program in order that a student who completes the educational
program, except as provided in Section 94905, is eligible to sit for
any required licensure begin delete examination. end delete begin insert examination or meet the
requirements for certification or registration. end insert

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begin insert SEC. 10. end insert   

end insert

begin insert Section 94905 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94905.  

(a) During the enrollment process, an institution
offering educational programs designed to lead to positions in a
profession, occupation, trade, or career field requiring begin delete licensure end delete
begin insert licensure, including required certification or registration, end insert in this
state shall exercise reasonable care to determine if the student will
not be eligible to obtain begin delete licensure end delete begin insert licensure, including required
certification or registration, end insert in the profession, occupation, trade,
or career field at the time of the student’s graduation and shall
provide all students enrolled in those programs with a written copy
of the requirements for begin delete licensure end delete begin insert licensure, including required
certification or registration, end insert established by the state, including
any applicable course requirements established by the state. begin insert An
institution shall provide all students enrolled in these educational
programs with information about voluntary certification or
registration being the preferred industry practice. end insert If the minimum
course requirements of the institution exceed the minimum
requirements for state begin delete licensure, end delete begin insert licensure, as defined in Section
94848, end insert the institution shall disclose this information, including a
list of those courses that are not required for state begin delete licensure. end delete
begin insert licensure, as defined in Section 94848. end insert The institution shall not
execute an enrollment agreement with a student that is known to
be ineligible for licensure, begin insert as defined in Section 94848, end insert unless the
student’s stated objective is other than begin delete licensure. end delete begin insert licensure, as
defined in Section 94848. end insert

(b) During the enrollment process, an institution may discuss
internships and student jobs available to the student during the
student’s attendance at the institution. If the institution discusses
internships and student jobs, the institution shall disclose the
number of requests for internship and student job placement
assistance received by the institution during the immediately
preceding calendar year and the number of actual placements
during that year.

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begin insert SEC. 11. end insert   

end insert

begin insert Section 94909 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94909.  

(a) Except as provided in subdivision (d), prior to
enrollment, an institution shall provide a prospective student, either
in writing or electronically, with a school catalog containing, at a
minimum, all of the following:

(1) The name, address, telephone number, and, if applicable,
Internet Web site address of the institution.

(2) Except as specified in Article 2 (commencing with Section
94802), a statement that the institution is a private institution and
that it is approved to operate by the bureau.

(3) The following statements:

(A) “Any questions a student may have regarding this catalog
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).”

(B) “As a prospective student, you are encouraged to review
this catalog prior to signing an enrollment agreement. You are also
encouraged to review the School Performance Fact Sheet, which
must be provided to you prior to signing an enrollment agreement.”

(C) “A student or any member of the public may file a complaint
about this institution with the Bureau for Private Postsecondary
Education by calling (toll-free telephone number) or by completing
a complaint form, which can be obtained on the bureau’s Internet
Web site (Internet Web site address).”

(4) The address or addresses where class sessions will be held.

(5) A description of the programs offered and a description of
the instruction provided in each of the courses offered by the
institution, the requirements for completion of each program,
including required courses, any final tests or examinations, any
required internships or externships, and the total number of credit
hours, clock hours, or other increments required for completion.

(6) If the educational program is designed to lead to positions
in a profession, occupation, trade, or career field requiring licensure
in this state, a notice to that effect and a list of the requirements
for eligibility for licensure.

(7) Information regarding the faculty and their qualifications.

(8) A detailed description of institutional policies in the
following areas:

(A) Admissions policies, including the institution’s policies
regarding the acceptance of credits earned at other institutions or
through challenge examinations and achievement tests, admissions
requirements for ability-to-benefit students, and a list describing
any transfer or articulation agreements between the institution and
any other college or university that provides for the transfer of
credits earned in the program of instruction. If the institution has
not entered into an articulation or transfer agreement with any
other college or university, the institution shall disclose that fact.

(B) Cancellation, withdrawal, and refund policies, including an
explanation that the student has the right to cancel the enrollment
agreement and obtain a refund of charges paid through attendance
at the first class session, or the seventh day after enrollment,
whichever is later. The text shall also include a description of the
procedures that a student is required to follow to cancel the
enrollment agreement or withdraw from the institution and obtain
a refund consistent with the requirements of Article 13
(commencing with Section 94919).

(C) Probation and dismissal policies.

(D) Attendance policies.

(E) Leave-of-absence policies.

(9) The schedule of total charges for a period of attendance and
an estimated schedule of total charges for the entire educational
program.

(10) A statement reporting whether the institution participates
in federal and state financial aid programs, and if so, all consumer
information that is required to be disclosed to the student pursuant
to the applicable federal and state financial aid programs.

(11) A statement specifying that, if a student obtains a loan to
pay for an educational program, the student will have the
responsibility to repay the full amount of the loan plus interest,
less the amount of any refund, and that, if the student has received
federal student financial aid funds, the student is entitled to a refund
of the moneys not paid from federal student financial aid program
funds.

(12) A statement specifying whether the institution has a pending
petition in bankruptcy, is operating as a debtor in possession, has
filed a petition within the preceding five years, or has had a petition
in bankruptcy filed against it within the preceding five years that
resulted in reorganization under Chapter 11 of the United States
Bankruptcy Code (11 U.S.C. Sec. 1101 et seq.).

(13) If the institution provides placement services, a description
of the nature and extent of the placement services.

(14) A description of the student’s rights and responsibilities
with respect to the Student Tuition Recovery Fund. This statement
shall specify that it is a state requirement that a student who pays
his or her tuition is required to pay a state-imposed assessment for
the Student Tuition Recovery Fund. This statement shall also
describe the purpose and operation of the Student Tuition Recovery
Fund and the requirements for filing a claim against the Student
Tuition Recovery Fund.

(15) The following statement:

 

“NOTICE CONCERNING TRANSFERABILITY OF
CREDITS AND CREDENTIALS EARNED AT OUR
INSTITUTION

 
The transferability of credits you earn at (name of institution)
is at the complete discretion of an institution to which you
may seek to transfer. Acceptance of the (degree, diploma, or
certificate) you earn in (name of educational program) is also
at the complete discretion of the institution to which you may
seek to transfer. If the (credits or degree, diploma, or
certificate) that you earn at this institution are not accepted at
the institution to which you seek to transfer, you may be
required to repeat some or all of your coursework at that
institution. For this reason you should make certain that your
attendance at this institution will meet your educational goals.
This may include contacting an institution to which you may
seek to transfer after attending (name of institution) to
determine if your (credits or degree, diploma, or certificate)
will transfer.”

 

(16) A statement specifying whether the institution, or any of
its degree programs, are accredited by an accrediting agency
recognized by the United States Department of Education. If the
institution is unaccredited and offers an associate, baccalaureate,
master’s, or doctoral degree, or is accredited and offers an
unaccredited program for an associate, baccalaureate, master’s, or
doctoral degree, the statement shall disclose the known limitations
of the degree program, including, but not limited to, all of the
following:

(A) Whether a graduate of the degree program will be eligible
to sit for the applicable licensure exam in California and other

begin delete states. end delete begin insert states or become certified or registered as required for the
applicable profession, occupation, trade, or career field in
California. end insert

(B) A degree program that is unaccredited or a degree from an
unaccredited institution is not recognized for some employment
positions, including, but not limited to, positions with the State of
California.

(C) That a student enrolled in an unaccredited institution is not
eligible for federal financial aid programs.

(b) If the institution has a general student brochure, the
institution shall provide that brochure to the prospective student
prior to enrollment. In addition, if the institution has a
program-specific student brochure for the program in which the
prospective student seeks to enroll, the institution shall provide
the program-specific student brochure to the prospective student
prior to enrollment.

(c) An institution shall provide the school catalog to any person
upon request. In addition, if the institution has student brochures,
the institution shall disclose the requested brochures to any
interested person upon request.

(d) An accredited institution is not required to provide a School
Performance Fact Sheet to a prospective student who is not a
California resident, not residing in California at the time of his or
her enrollment, and enrolling in an accredited distance learning
degree program offered by the institution, if the institution complies
with all federal laws, the applicable laws of the state where the
student is located, and other appropriate laws, including, but not
limited to, consumer protection and student disclosure
requirements.

begin insert

begin insert SEC. 12. end insert   

end insert

begin insert The heading of Article 14 (commencing with Section
94923) of Chapter 8 of Part 59 of Division 10 of Title 3 of the end insert begin insert
Education Code end insert begin insert is amended to read: end insert

 

Article 14.  begin delete Student Tuition Recovery Fund end delete begin insert Office of Student
Assistance and Relief end insert

 

begin insert

begin insert SEC. 13. end insert   

end insert

begin insert Section 94922.5 is added, immediately preceding
Section 94923, to the end insert begin insert Education Code end insert begin insert , to read: end insert

begin insert

begin insert 94922.5. end insert   

(a) The Office of Student Assistance and Relief is
hereby established in order to promote the success of students
attending private postsecondary educational institutions.

(b) Duties of the office include, but are not limited to, providing
assistance to private postsecondary students, conducting proactive
outreach to these students, administering the Student Tuition
Recovery Fund, and overseeing the registration of institutions
pursuant to Section 94952. The office shall serve as a primary
point of contact to address the needs of private postsecondary
education students.

(c) The office shall establish and maintain an Internet Web site
to provide information to private postsecondary students about
their rights and protections available to them. The office shall
provide information on its Internet Web site about free services
available to private postsecondary students offered by local
nonprofit community service organizations with demonstrated
experience in assisting students in areas including, but not limited
to, legal services and student loan matters. Each local nonprofit
community service organization shall be a 501(c)(3) tax-exempt
organization in good standing with the Internal Revenue Service
and in compliance with all applicable laws and requirements.

(d) The office shall work, in consultation with state and federal
agencies, including, but not limited to, the Student Aid Commission,
the Office of the Chancellor of the California Community Colleges,
the Department of Veterans Affairs, the federal Consumer
Financial Protection Bureau, and the United States Department
of Education, to determine the extent of options and resources
available to private postsecondary students and criteria that
indicates what additional steps state agencies need to take to
ensure the protection of the public from the closure of a private
postsecondary educational institution.

end insert

begin insert

begin insert SEC. 14. end insert   

end insert

begin insert Section 94923 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94923.  

(a) The Student Tuition Recovery Fund relieves or
mitigates economic loss suffered by a student while enrolled in begin delete an
educational program, as defined in Section 94837, at end delete an institution
not exempt from this article pursuant to Article 4 (commencing
with Section 94874), who, at the time of his or her enrollment,
was a California resident or was enrolled in a California residency
program, prepaid tuition, and suffered economic loss.

(b) The begin delete bureau shall adopt by regulation procedures governing
the administration and maintenance of the end delete Student Tuition
Recovery begin delete Fund, including requirements relating to assessments
on students and student claims against the Student Tuition
Recovery Fund. The regulations end delete begin insert Fund end insert shall provide begin delete for end delete awards to
students who suffer economic loss.

The begin delete regulations shall ensure that the end delete following students, and any
other students deemed appropriate, are eligible for payment from
the Student Tuition Recovery Fund:

(1) Any student who was enrolled at an institution, at a location
of the institution, or in an educational program offered by the
institution, at the time that institution, location, or program was
closed or discontinued, as applicable, who did not choose to
participate in a teach-out plan approved by the bureau or did not
complete a chosen teach-out plan approved by the bureau.

(2) Any student who was enrolled at an institution or a location
of the institution within the 120-day period before the closure of
the institution or location of the institution, or who was enrolled
in an educational program within the 120-day period before the
program was discontinued, if the bureau determines there was a
significant decline in the quality or value of that educational
program during that time period.

(3) Any student who was enrolled at an institution or a location
of the institution more than 120 days before the closure of the
institution or location of the institution, in an educational program
offered by the institution as to which the bureau determines there
was a significant decline in the quality or value of the program
more than 120 days before closure.

begin insert

(4) A student who was enrolled at a California campus of a
Corinthian Colleges, Inc., institution or was a California student
enrolled in an online program offered by an out-of-state campus
of a Corinthian Colleges, Inc., institution, who also meets all of
the other eligibility requirements, if the student was enrolled as
of June 20, 2014, or withdrew within 120 days of that date or any
greater period determined by the bureau pursuant to this section.

end insert begin delete

(4)

end delete

begin insert (5 end insert begin insert ) end insert  A student to whom an institution has been ordered to pay a
refund by the bureau but has failed to do so.

begin delete

(5)

end delete

begin insert ( end insert begin insert 6) end insert  A student to whom an institution has failed to pay or
reimburse loan proceeds under a federal student loan program as
required by law, or has failed to pay or reimburse proceeds received
by the institution in excess of tuition and other costs.

begin delete

(6)

end delete

begin insert ( end insert begin insert 7) end insert  A student who has been awarded restitution, a refund, or
other monetary award by an arbitrator or court, based on a violation
of this chapter by an institution or representative of an institution,
but who has been unable to collect the award from the institution.
The bureau shall review the award or judgment and shall ensure
the amount to be paid from the fund does not exceed the student’s
economic loss.

(c) Any student who is required to pay a Student Tuition
Recovery Fund assessment who pays tuition equal to or greater
than the required assessment shall be deemed to have paid the
required assessment, whether or not his or her enrollment
agreement specifies collection of the required assessment, and
whether or not the institution identifies any money collected from
the student as a Student Tuition Recovery Fund assessment.

(d)  begin delete The bureau shall establish regulations ensuring, as
permissible under California law, that a end delete begin insert A end insert student who suffers
educational opportunity losses, whose charges are paid by a
third-party payer, is eligible for educational credits under the fund.

(e) The bureau may seek repayment to the Student Tuition
Recovery Fund from an institution found in violation of the law
for which a student claim was paid. An institution shall not be
eligible to renew its approval to operate with the bureau if the
repayment is not made to the bureau as requested.

(f)  begin delete The bureau shall, by regulation, define “economic loss.” The
regulation shall ensure that the definition of end delete begin insert For purposes of this
section, end insert “economic loss” includes, but is not necessarily limited
to, pecuniary loss, which is the sum of the student’s tuition, all
other institutional charges as defined in Section 94844, the cost of
equipment and materials required for the educational program as
defined in Section 94837, interest on any student loan used to pay
for such charges, collection costs, penalties, and any license or
examination fees the student paid to the institution but is unable
to recover. Economic loss shall also include the amount the
institution collected and failed to pay to third parties on behalf of
the student for license fees or any other purpose. Economic loss
does not include Student Tuition Recovery Fund assessments,
unless the student is entitled to a full refund under Section 94919
or 94920, room and board, supplies, transportation, application
fees, or nonpecuniary damages such as inconvenience, aggravation,
emotional distress, or punitive damages. Economic loss does not
include legal fees, attorney fees, court costs, or arbitration fees.
Nothing in this subdivision shall prevent the bureau from further
defining economic loss to include loss of educational opportunity.

begin insert

begin insert SEC. 15. end insert   

end insert

begin insert Section 94923.5 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 94923.5. end insert   

It is the intent of the Legislature to require, to the
extent authorized by federal law, a private postsecondary
educational institution that does not maintain a physical presence
in California and offers distance education to California students
to file a surety bond for the benefit of its California students who
suffer economic loss.

end insert

begin insert

begin insert SEC. 16. end insert   

end insert

begin insert Section 94935.5 is added to the end insert begin insert Education Code end insert begin insert , to
read: end insert

begin insert

begin insert 94935.5. end insert   

(a) Bureau staff who, during an inspection of an
institution, detect a violation of this chapter, or regulations adopted
pursuant to this chapter, that is not a minor violation, may issue
the institution a citation before leaving the institution.

(b) The citation may contain either or both of the following:

(1) An order of abatement that may require an institution to
demonstrate how future compliance with this chapter, or
regulations adopted pursuant to this chapter, will be accomplished.

(2) Notwithstanding Section 125.9 of the Business and
Professions Code, an administrative fine not to exceed five
thousand dollars ($5,000) for each violation. Assessment of the
administrative fine shall be based on all of the following
considerations:

(A) The nature and seriousness of the violation.

(B) The persistence of the violation.

(C) The good faith of the institution.

(D) The history of previous violations.

(E) The purposes of this chapter.

(F) The potential harm to students.

(c) (1) The citation shall be in writing and describe the nature
of the violation and the specific provision of this chapter, or
regulation adopted pursuant to this chapter, that is alleged to have
been violated.

(2) The citation shall inform the institution of its right to request,
in writing, a hearing within 30 days of the issuance of the citation.

(3) If a hearing is requested, the bureau shall select an informal
hearing pursuant to Article 10 (commencing with Section
11445.10) of Chapter 4.5 of Part 1 of Division 3 of Title 2 of the
Government Code or a formal hearing pursuant to Chapter 5
(commencing with Section 11500) of Part 1 of Division 3 of Title
2 of the Government Code.

(4) If a hearing is not requested, payment of the administrative
fine is due 30 days from the date of service and shall not constitute
an admission of the violation charged.

(5) If a hearing is conducted and payment of an administrative
fine is ordered, the administrative fine is due 30 days from when
the final order is entered.

(6) The bureau may enforce the administrative fine as if it were
a money judgment pursuant to Title 9 (commencing with Section
680.010) of Part 2 of the Code of Civil Procedure.

(d) All administrative fines shall be deposited in the Private
Postsecondary Education Administration Fund.

end insert

begin insert

begin insert SEC. 17. end insert   

end insert

begin insert Section 94944 of the end insert begin insert Education Code end insert begin insert is amended to
read: end insert

94944.  

Notwithstanding any other provision of law, the bureau
shall cite any person, and that person shall be subject to a fine not
to exceed begin delete fifty thousand dollars ($50,000), end delete begin insert one hundred thousand
dollars ($100,000), end insert for operating an institution without proper
approval to operate issued by the bureau pursuant to this chapter.

begin insert

begin insert SEC. 18. end insert   

end insert

begin insert Article 20.5 (commencing with Section 94949.5) is
added to Chapter 8 of Part 59 of Division 10 of Title 3 of the end insert begin insert
Education Code end insert begin insert , to read: end insert

begin insert

 

Article begin insert 20.5. end insert   Enforcement Monitor

 

begin insert 94949.5. end insert   

(a) (1) The director shall appoint an enforcement
monitor no later than March 1, 2017. The director may retain a
person for this position by a personal services contract. In this
connection, the Legislature finds, pursuant to Section 19130 of
the Government Code, that this is a new state function.

(2) The director shall supervise the enforcement monitor and
may terminate or dismiss him or her from this position. If the
monitor is terminated or dismissed, the director shall appoint a
replacement monitor within two months.

(3) The monitoring duty of the enforcement monitor shall be on
a continuing basis for a period of no more than two years from
the date of the initial enforcement monitor’s appointment.

(b) The enforcement monitor shall monitor and evaluate the
bureau’s enforcement efforts, with specific concentration on the
adequacy of bureau compliance inspections, handling and
processing of student complaints, and timely application of
sanctions or discipline imposed on institutions and persons in
order to protect the public.

(c) The enforcement monitor shall exercise no authority over
the bureau’s management or staff; however, the bureau and its
staff shall cooperate with the monitor and shall provide data,
information, and files as requested by the monitor to perform all
of his or her duties.

(d) The director shall assist the enforcement monitor in the
performance of his or her duties, and the monitor shall have the
same investigative authority as the director.

(e) The director shall specify additional duties of the
enforcement monitor.

(f) (1) The enforcement monitor shall submit to the department
and the Legislature, in compliance with Section 9795 of the
Government Code, an initial written report of his or her findings
and conclusions no later than July 1, 2018, and a subsequent
written report no later than November 1, 2018. The enforcement
monitor shall be available to make oral reports to the department
or the Legislature if requested to do so. The monitor may also
provide additional information to either the department or the
Legislature at his or her discretion or at the request of either the
department or the Legislature. The monitor shall make his or her
reports available to the public or the media. The monitor shall
make every effort to provide the bureau with an opportunity to
reply to any facts, findings, issues, or conclusions made in his or
her reports to the department or the Legislature with which the
bureau may disagree.

(2) The enforcement monitor shall issue a final written report
before January 1, 2019. The final report shall include final findings
and conclusions on the topics addressed in the initial report
submitted by the monitor pursuant to paragraph (1).

(g) The bureau shall pay for all of the costs associated with the
employment of the enforcement monitor.

begin insert 94949.6. end insert   

This article shall remain in effect only until March
1, 2019, and as of that date is repealed, unless a later enacted
statute, that is enacted before March 1, 2019, deletes or extends
that date.

end insert

begin insert

begin insert SEC. 19. end insert   

end insert

begin insert Chapter 8.1 (commencing with Section 94952) is
added to Part 59 of Division 10 of Title 3 of the end insert begin insert Education Code end insert begin insert ,
to read: end insert

begin insert

 

Chapter   begin insert 8.1. end insert Private Postsecondary Education Offered
Through Distance Learning

 

begin insert 94952. end insert   

To the extent authorized by federal law, a private
postsecondary educational institution that does not maintain a
physical presence in California and offers distance education to
California students shall register with the bureau and file a surety
bond in compliance with Section 94923.5.

end insert

begin delete

SECTION 1.  

Section 94885 of the Education Code is amended
to read:

94885.  

(a) The bureau shall adopt by regulation minimum
operating standards for an institution that shall reasonably ensure
that all of the following occur:

(1) The content of each educational program can achieve its
stated objective.

(2) The institution maintains specific written standards for
student admissions for each educational program and those
standards are related to the particular educational program.

(3) The facilities, instructional equipment, and materials are
sufficient to enable students to achieve the educational program’s
goals.

(4) The institution maintains a withdrawal policy and provides
refunds.

(5) The directors, administrators, and faculty are properly
qualified.

(6) The institution is financially sound and capable of fulfilling
its commitments to students.

(7) That, upon satisfactory completion of an educational
program, the institution gives students a document signifying the
degree or diploma awarded.

(8) Adequate records and standard transcripts are maintained
and are available to students.

(9) The institution is maintained and operated in compliance
with this chapter and all other applicable ordinances and laws.

(b) Except as provided in Section 94885.1, an institution offering
a degree must satisfy one of the following requirements:

(1) Accreditation by an accrediting agency recognized by the
United States Department of Education, with the scope of that
accreditation covering the offering of at least one degree program
by the institution.

(2) An accreditation plan, approved by the bureau, for the
institution to become fully accredited within five years of the
bureau’s issuance of a provisional approval to operate to the
institution. The provisional approval to operate to an unaccredited
degree-offering institution shall be in compliance with Section
94885.5.

end delete