By Kubiak H.B. No. 2322
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the regulation and operation of proprietary schools.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 32.61, Education Code, is amended to read
1-5 as follows:
1-6 No person shall:
1-7 (1) operate a school without a certificate of approval
1-8 issued by the Administrator;
1-9 (2) solicit prospective students without being bonded
1-10 as required by this Chapter;
1-11 (3) accept contracts or enrollment applications from a
1-12 representative who is not bonded as required by this Chapter;
1-13 (4) utilize advertising designed to mislead or deceive
1-14 prospective students;
1-15 (5) fail to notify the Administrator of the
1-16 discontinuance of the operation of any school within 72 hours of
1-17 cessation of classes and make available accurate records as
1-18 required by this Chapter;
1-19 (6) fail to secure and file within 30 days an
1-20 increased bond as required by this Chapter;
1-21 (7) negotiate any promissory instrument received as
1-22 payment of tuition or other charge prior to completion of 75
1-23 percent of the course, provided that prior to such time, the
2-1 instrument may be transferred by assignment to a purchaser who
2-2 shall be subject to all the defenses available against the school
2-3 named as payee;
2-4 (8) fail to provide financial statements or other
2-5 documentary evidence of school financial standing when so requested
2-6 by the Administrator, provided that all copies of such documents
2-7 shall be promptly returned to the school following inspection and
2-8 thereafter made readily available for such further review as may be
2-9 required by the Administrator;
2-10 (9) <(8)> violate any provision of this Chapter.
2-11 SECTION 2. Section 32.34, Education Code, is amended by
2-12 adding subsection (g) to read as follows:
2-13 (g) Except as provided in Subsection (f), a school is not
2-14 subject to on-site visits by the Administrator more often than once
2-15 every three years unless, during any such three-year period, the
2-16 school has substantially violated the provisions of this Chapter or
2-17 applicable substantive rules and regulations of the Central
2-18 Education Agency. The Administrator shall provide the school or
2-19 its owner at least forty-eight (48) hours advance notice of any
2-20 on-site visit.
2-21 SECTION 3. Section 32.71, Education Code, is amended to read
2-22 as follows:
2-23 Sec. 32.71. Certificate and Registration Fees
2-24 (a) Certificate and registration fees, except those charged
2-25 pursuant to Subsection (d) of this section, shall be collected by
3-1 the Administrator and deposited with the State Treasurer<. Each
3-2 fee shall be in an amount set by the Administrator and approved by
3-3 the State Board of Education in an amount not to exceed 150 percent
3-4 of each fee in> according to the following schedule:
3-5 (1) the initial fee for a school is $2,000;
3-6 (2) the first annual renewal fee and each subsequent
3-7 renewal fee for a school <is> shall be the greater of $500 or the
3-8 amount determined by applying a percentage, not to exceed <0.3> 0.1
3-9 percent, to the gross tuition and fees, excluding refunds as
3-10 provided by Section 32.39 of this code, of the school;
3-11 (3) the initial registration fee for a representative
3-12 is $60;
3-13 (4) the annual renewal fee for a representative is
3-14 $30;
3-15 (5) the fee for a change of a name of a school or
3-16 owner is $100;
3-17 (6) the fee for a change of an address of a school is
3-18 $180;
3-19 (7) the fee for a change in the name or address of a
3-20 representative or a change in the name or address of a school that
3-21 causes the reissuance of a representative permit is $10;
3-22 (8) the application fee for an additional course is
3-23 $150, except for seminar and workshop courses, for which the fee is
3-24 $25;
3-25 (9) the application fee for a director, administrative
4-1 staff member, or instructor is $15;
4-2 (10) the application fee for the authority to grant
4-3 degrees is $2,000;
4-4 (11) the application fee for an additional degree
4-5 course is $250; and
4-6 (12) the fee for an inspection required by rule of the
4-7 State Board of Education of classroom facilities that are separate
4-8 from the main campus is $250.
4-9 (b) The commissioner of education shall periodically review
4-10 and recommend adjustments in the level of fees to the State Board
4-11 of Education and the legislature.
4-12 (c) For purpose of this section, the gross amount of annual
4-13 student fees and tuition for a proprietary school is the amount
4-14 determined by the State Board of Education based on any report
4-15 submitted by the school to the Central Education Agency or other
4-16 information obtained by the agency.
4-17 (d) In connection with the regulation of any school or
4-18 course through a memorandum of understanding pursuant to Section
4-19 32.12(c) of this code, the Administrator shall set an application
4-20 and annual renewal fee, not to exceed $2,000. The fee shall be
4-21 approved by the State Board of Education to be an amount reasonably
4-22 calculated to cover the administrative costs associated with
4-23 assuming the additional regulation.
4-24 (e) The fee for an investigation at a school to resolve a
4-25 complaint filed against the school is $400. The fee may be charged
5-1 only if:
5-2 (1) the complaint could not have been resolved by
5-3 telephone or written correspondence only;
5-4 (2) a representative of the Central Education Agency
5-5 visits the school as a part of the complaint resolution process;
5-6 and
5-7 (3) the school is found to be at fault.
5-8 (f) The Administrator, with the approval of the State Board
5-9 of Education, may increase any fee authorized under this section at
5-10 a rate not to exceed the increase in the National Consumer Price
5-11 Index For All Urban Consumers. The calculation of the index in
5-12 effect on September 1, 1989 shall be the base for calculating the
5-13 rate at which fees may increase. Fee increases under this
5-14 subsection do not have to be made annually.
5-15 SECTION 4. Section 32.91, Education Code, is amended to read
5-16 as follows:
5-17 (a) At the time that each school pays its annual renewal
5-18 fee, in the years provided by Subsection (c) of this section, the
5-19 State Board of Education shall also collect a fee from the school
5-20 for deposit to the credit of a special fund in the state treasury
5-21 to be called the proprietary school tuition protection fund.
5-22 (b) The amount of the fee is determined by applying a
5-23 percentage to each school's annual renewal fee. The percentage is
5-24 the rate as determined by the board that, when applied to the total
5-25 of all renewal fees, will result in the collection of $250,000 for
6-1 deposit in the fund in the first two years that the fee is
6-2 collected.
6-3 (c) Beginning on January 1, 1990, the board shall collect
6-4 the fee for two years. If on January 1, 1993, or any subsequent
6-5 year the amount in the fund is less than $200,000, the board shall
6-6 collect a fee during that year, in no more than quarterly
6-7 installments, by applying a percentage to each school's annual
6-8 renewal fee at a rate that will bring the balance of the fund to
6-9 $250,000.
6-10 (d) The state treasurer shall invest the fund in the same
6-11 manner as other state funds. Sufficient funds from and including
6-12 all interest earned on the investment of the tuition protection
6-13 fund shall be appropriated to the Central Education Agency
6-14 <administration> and used solely for the purpose outlined in this
6-15 section.
6-16 SECTION 5. The importance of this legislation and the
6-17 crowded condition of the calendars in both houses create an
6-18 emergency and an imperative public necessity that the
6-19 constitutional rule requiring bills to be read on three several
6-20 days in each house be suspended, and this rule is hereby suspended,
6-21 and that this Act take effect and be in force from and after its
6-22 passage, and it is so enacted.