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Amend CSSB 280 (house committee printing) as follows:
(1) Strike PART 1 of ARTICLE 8 of the bill (page 45, line 11, through page 55, line 26) and substitute the following:
PART 1. SUBSTANTIVE CHANGES REGARDING CAREER
SCHOOLS AND COLLEGES
SECTION 8.01. Section 132.001, Education Code, is amended
by amending Subdivisions (1)-(8), (10), and (12) and adding
Subdivision (13) to read as follows:
(1) "Career school or college" ["Proprietary school"]
means any business enterprise operated for a profit[,] or on a
nonprofit basis[,] that maintains a place of business within this
state[,] or solicits business within this state, [and] that is not
specifically exempted by this chapter, and:
(A) that offers or maintains a course or courses
of instruction or study; or
(B) at which place of business such a course or
courses of instruction or study are [is] available through
classroom instruction or by distance education [correspondence],
or both, to a person for the purpose of training or preparing the
person for a field of endeavor in a business, trade, technical, or
industrial occupation, or for avocational or personal improvement.
(2) "Owner" of a career school or college [proprietary
school] means:
(A) in the case of a career school or college
owned by an individual, that individual;
(B) in the case of a career school or college
owned by a partnership, all full, silent, and limited partners;
(C) in the case of a career school or college
owned by a corporation, the corporation, its directors, officers,
and each shareholder owning shares of issued and outstanding stock
aggregating at least 10 percent of the total of the issued and
outstanding shares;
(D) in the case of a career school or college in
which the ownership interest is held in trust, the beneficiary of
that trust; or
(E) in the case of a career school or college
owned by another legal entity, a person who owns at least 10 percent
ownership interest in the entity.
(3) "School employee" means any person, other than an
owner, who directly or indirectly receives compensation from a
career [proprietary] school or college for services rendered.
(4) "Representative" means a person employed by a
career [proprietary] school or college, whether the school or
college is located within or without this state, to act as an agent,
solicitor, broker, or independent contractor to directly procure
students for the school or college by solicitation within or
without this state at any place.
(5) "Agency administrator" means the agency
administrator of the Texas Workforce Commission or a person,
knowledgeable in the administration of regulating career
[proprietary] schools and colleges, designated by the agency
administrator to administer this chapter.
(6) "Notice to the career school or college"
[proprietary school"] means written correspondence sent to the
address of record for legal service contained in the application
for a certificate of approval. "Date of Notice" means the date the
notice is mailed by the commission.
(7) "Support" or "supported" means the primary source
and means by which a career [proprietary] school or college derives
revenue to perpetuate its operation.
(8) "Person" means any individual, firm, partnership,
association, corporation, or other private entity or combination
[thereof].
(10) "Small career school or college" [proprietary
school"] means a career [proprietary] school or college that does
not receive any payment from federal funds under 20 U.S.C. Section
1070 et seq. and its subsequent amendments or a prepaid federal or
state source as compensation in whole or in part for any student
tuition and fees or other charges and either:
(A) has an annual gross income from student
tuition and fees that is less than or equal to $100,000 for programs
regulated by the agency;
(B) exclusively offers programs to assist
students to prepare for an undergraduate or graduate course of
study at a college or university; or
(C) exclusively offers programs to assist
students, who have obtained, or who are in the process of obtaining,
degrees after completing an undergraduate or graduate course of
study at a college or university, to prepare for an examination.
(12) "Division" means the division of education of
[in] the commission.
(13) "Distance education" means a formal education
process in which:
(A) the student and instructor are separated by
physical distance; and
(B) a variety of communication technologies may
be used to deliver synchronous or asynchronous instruction to the
student.
SECTION 8.02. Subchapter A, Chapter 132, Education Code, is
amended by adding Section 132.0015 to read as follows:
Sec. 132.0015. REFERENCE TO PROPRIETARY SCHOOL. A
reference in this code or another law to a proprietary school means
a career school or college.
SECTION 8.03. Section 132.002, Education Code, is amended
by amending Subsections (a) and (d) and adding Subsections (e) and
(f) to read as follows:
(a) The following schools or educational institutions may
be exempted [are specifically exempt] from this chapter by the
commission under Subsection (d) [and are not within the definition
of "proprietary school"]:
(1) a school or educational institution supported by
taxation from either a local or state source;
(2) a nonprofit school [schools] owned, controlled,
operated, and conducted by a bona fide religious, denominational,
eleemosynary, or similar public institution [institutions] exempt
from property taxation under the laws of this state[, but such
schools may choose to apply for a certificate of approval
hereunder, and upon approval and issuance, are subject to this
chapter as determined by the commission];
(3) a school or training program that offers
instruction of purely avocational or recreational subjects as
determined by the commission;
(4) a course or courses of instruction or study
sponsored by an employer for the training and preparation of its own
employees, and for which no tuition fee is charged to the student;
(5) a course or courses of study or instruction
sponsored by a recognized trade, business, or professional
organization for the instruction of the members of the organization
with a closed membership;
(6) a private college [colleges] or university
[universities] that awards [award] a recognized baccalaureate, or
higher degree, and that maintains [maintain] and operates [operate]
educational programs for which a majority of the credits given are
transferable to a college, junior college, or university supported
entirely or partly by taxation from either a local or state source;
(7) a school or course that is otherwise regulated and
approved under and pursuant to any other law or rulemaking process
of this state or approved for continuing education credit by an
organization that accredits courses for the maintenance of a
license, except as provided by Subsection (c);
(8) an aviation school [schools] or instructor
[instructors] approved by and under the supervision of the Federal
Aviation Administration;
(9) a school that offers intensive review of a
student's acquired education, training, or experience to prepare
the student for an examination, other than a high school
equivalency examination, that the student by law may not take
unless the student has completed or substantially completed a
particular degree program, or that the student is required to take
as a precondition for enrollment in or admission to a particular
degree program;
(10) a private school offering primary or secondary
education, which may include a kindergarten or prekindergarten
program, and that satisfies the compulsory attendance requirements
of Section 25.085 pursuant to Section 25.086(a)(1);
(11) a course or courses of instruction by bona fide
electrical trade associations for the purpose of preparing students
for electrical tests required for licensing and for the purpose of
providing continuing education to students for the renewal of
electrical licenses;
(12) a nonprofit arts organization that has as its
primary purpose the provision of instruction in the dramatic arts
and the communications media to persons younger than 19 years of
age;
(13) a course or training program conducted by a
nonprofit association of air conditioning and refrigeration
contractors approved by the Air Conditioning and Refrigeration
Contractors Advisory Board to provide instruction for technical,
business, or license examination preparation programs relating to
air conditioning and refrigeration contracting, as that term is
defined by Chapter 1302, Occupations Code [the Air Conditioning and
Refrigeration Contractor License Law (Article 8861, Vernon's Texas
Civil Statutes)];
(14) a course of instruction by a plumbing trade
association to prepare students for a plumbing test or program
required for licensing, certification, or endorsement or to provide
continuing education approved by the Texas State Board of Plumbing
Examiners; and
(15) a course of instruction in the use of
technological hardware or software if the course is offered to a
purchaser of the hardware or software or to the purchaser's
employee by a person who manufactures and sells, or develops and
sells, the hardware or software, and if the seller is not primarily
in the business of providing courses of instruction in the use of
the hardware or software, as determined by the commission.
(d) A school or educational institution is exempt from
regulation under this chapter only if:
(1) the owner of the school or educational
institution:
(A) applies to the commission for an exemption
under this section; and
(B) provides to the commission any information
considered necessary by the commission to support the owner's
application for an exemption; and
(2) the commission declares that the school or
educational institution is exempt after finding that the school or
institution is a school or institution listed in Subsection (a).
(e) After a school or educational institution is declared
exempt by the commission under this section, the commission may
inspect the school or institution or require the owner of the school
or institution to provide any information the commission considers
necessary for the commission to ensure the school or institution's
continued compliance with the requirements of the exemption.
(f) A school or educational institution listed in
Subsection (a) may seek a certificate of approval under
[Notwithstanding the exemptions listed in Subsection (a), a dispute
resolution organization, as defined by Section 154.001, Civil
Practice and Remedies Code, may seek a certificate of approval
pursuant to] Subchapter C.
SECTION 8.04. Section 132.051(b), Education Code, is
amended to read as follows:
(b) Any contract entered into with any person for a course
of instruction by or on behalf of any person operating any career
[proprietary] school or college to which a certificate of approval
has not been issued pursuant to this chapter is unenforceable in any
action brought thereon. Any note, other instrument of
indebtedness, or contract relating to payment for educational
services obtained from a career school or college that does not hold
a certificate of approval issued under this chapter is
unenforceable in any action brought on the note, instrument, or
contract.
SECTION 8.05. Section 132.055, Education Code, is amended
to read as follows:
Sec. 132.055. CRITERIA. The commission may approve the
application of such career [proprietary] school or college when the
school or college is found, upon investigation at the premises of
the school or college, to have met the following criteria:
(a) The courses, curriculum, and instruction are of
such quality, content, and length as may reasonably and adequately
achieve the stated objective for which the courses, curriculum, or
instruction are offered. Before a school or college conducts a
course of instruction in court reporting, the school or college
must produce evidence that the school or college has obtained
approval for the curriculum from the Court Reporters Certification
Board.
(b) There is in the school or college adequate space,
equipment, instructional material, and instructor personnel to
provide training of good quality.
(c) Educational and experience qualifications of
directors, administrators, and instructors are adequate.
(d) The school or college maintains a written record
of the previous education and training of the applicant student and
clearly indicates that appropriate credit has been given by the
school or college for previous education and training, with the new
training period shortened where warranted through use of
appropriate skills or achievement tests and the student so
notified.
(e) A copy of the course outline; schedule of tuition,
fees, refund policy, and other charges; regulations pertaining to
absence, grading policy, and rules of operation and conduct;
regulations pertaining to incomplete grades; the name, mailing
address, and telephone number of the commission for the purpose of
directing complaints to the agency; the current rates of job
placement and employment of students issued a certificate of
completion; and notification of the availability of the cost
comparison information prepared under Section 132.021(b) through
the commission will be furnished the student prior to enrollment.
(f) Except as provided by Section 132.062, on
completion of training, the student is given a certificate by the
school or college indicating the course and that training was
satisfactorily completed.
(g) Adequate records as prescribed by the commission
are kept to show attendance and progress or grades, and
satisfactory standards relating to attendance, progress, and
conduct are enforced.
(h) The school or college complies with all local,
city, county, municipal, state, and federal regulations, such as
fire, building, and sanitation codes. The commission may require
such evidence of compliance as is deemed necessary.
(i) The school or college is financially sound and
capable of fulfilling its commitments for training.
(j) The school's or college's administrators,
directors, owners, and instructors are of good reputation and
character.
(k) The school or college has, maintains, and
publishes in its catalogue and enrollment contract the proper
policy for the refund of the unused portion of tuition, fees, and
other charges in the event the student enrolled by the school or
college fails to take the course or withdraws or is discontinued
therefrom at any time prior to completion.
(l) The school or college does not utilize erroneous
or misleading advertising, either by actual statement, omission, or
intimation as determined by the commission.
(m) Such additional criteria as may be required by the
commission.
(n) The school or college does not use a name like or
similar to an existing [tax supported] school or college unless the
commission approves the school's or college's use of the name [in
the same area].
(o) The school or college furnishes to the commission
the current rates of students who receive a certificate of
completion and of job placement and employment of students issued a
certificate of completion.
(p) The school or college furnishes to the commission
for approval or disapproval student admission requirements for each
course or program offered by the school or college.
(q) The school or college furnishes to the commission
for approval or disapproval the course hour lengths and curriculum
content for each course offered by the school or college.
(r) The school or college does not owe a penalty under
Section 132.152, 132.155, or 132.157.
SECTION 8.06. Section 132.061, Education Code, is amended
to read as follows:
Sec. 132.061. REFUND POLICY. (a) Except as provided by
Subsection (g), as a condition for granting certification each
career [proprietary] school or college must maintain a cancellation
and settlement policy that must provide a full refund of all monies
paid by a student if:
(1) the student cancels the enrollment agreement or
contract within 72 hours (until midnight of the third day excluding
Saturdays, Sundays, and legal holidays) after the enrollment
contract is signed by the prospective student; or
(2) the enrollment of the student was procured as the
result of any misrepresentation in advertising, promotional
materials of the school or college, or representations by the owner
or representatives of the school or college.
(b) Except as provided by Subsection (g), as a condition for
granting certification each career [proprietary] school or college
must maintain a policy for the refund of the unused portion of
tuition, fees, and other charges in the event the student, after
expiration of the 72-hour cancellation privilege, fails to enter
the course, withdraws, or is discontinued therefrom at any time
prior to completion, and such policy must provide:
(1) refunds for resident courses and synchronous
distance education courses will be based on the period of
enrollment computed on the basis of course time expressed in clock
hours;
(2) the effective date of the termination for refund
purposes in residence schools or colleges will be the earliest of
the following:
(A) the last date of attendance, if the student
is terminated by the school or college;
(B) the date of receipt of written notice from
the student; or
(C) 10 school days following the last date of
attendance;
(3) if tuition and fees are collected in advance of
entrance, and if, after expiration of the 72-hour cancellation
privilege, the student does not enter the residence school or
college, not more than $100 shall be retained by the school or
college;
(4) for the student who enters a residence or a
synchronous distance education course of not more than 12 months in
length, terminates, or withdraws, the school or college may retain
$100 of tuition and fees and the minimum refund of the remaining
tuition and fees will be:
(A) during the first week or one-tenth of the
course, whichever is less, 90 percent of the remaining tuition and
fees;
(B) after the first week or one-tenth of the
course, whichever is less, but within the first three weeks or
one-fifth of the course, whichever is less, 80 percent of the
remaining tuition and fees;
(C) after the first three weeks or one-fifth of
the course, whichever is less, but within the first quarter of the
course, 75 percent of the remaining tuition and fees;
(D) during the second quarter of the course, 50
percent of the remaining tuition and fees;
(E) during the third quarter of the course, 10
percent of the remaining tuition and fees; or
(F) during the last quarter of the course, the
student may be considered obligated for the full tuition and fees;
(5) for residence or synchronous distance education
courses more than 12 months in length, the refund shall be applied
to each 12-month period paid, or part thereof separately, and the
student is entitled to a refund as provided by Subdivision (4);
(6) refunds of items of extra expense to the student,
such as instructional supplies, books, student activities,
laboratory fees, service charges, rentals, deposits, and all other
such ancillary miscellaneous charges, where these items are
separately stated and shown in the data furnished the student
before enrollment, will be made in a reasonable manner acceptable
to the commission;
(7) refunds based on enrollment in residence and
synchronous distance education schools or colleges will be totally
consummated within 60 days after the effective date of termination;
(8) refunds for asynchronous distance education
[correspondence] courses will be computed on the basis of the
number of lessons in the course;
(9) the effective date of the termination for refund
purposes in asynchronous distance education [correspondence]
courses will be the earliest of the following:
(A) the date of notification to the student if
the student is terminated;
(B) the date of receipt of written notice from
the student; or
(C) the end of the third calendar month following
the month in which the student's last lesson assignment was
received unless notification has been received from the student
that the student wishes to remain enrolled;
(10) if tuition and fees are collected before any
lessons have been completed, and if, after expiration of the
72-hour cancellation privilege, the student fails to begin the
course, not more than $50 shall be retained by the school or
college;
(11) in cases of termination or withdrawal after the
student has begun the asynchronous distance education
[correspondence] course, the school or college may retain $50 of
tuition and fees, and the minimum refund policy must provide that
the student will be refunded the pro rata portion of the remaining
tuition, fees, and other charges that the number of lessons
completed and serviced by the school or college bears to the total
number of lessons in the course; and
(12) refunds based on enrollment in asynchronous
distance education [correspondence] schools or colleges will be
totally consummated within 60 days after the effective date of
termination.
(c) In lieu of the refund policy herein set forth, for
programs of instruction not regularly offered to the public, the
commission may, for good cause shown, amend, modify, or substitute
the terms of a career school's or college's [proprietary school's]
policy due to the specialized nature and objective of the school's
or college's [school's] course of instruction.
(d) If a course of instruction is discontinued by the career
[proprietary] school or college and this prevents the student from
completing the course, all tuition and fees paid are then due and
refundable.
(e) If a refund is not made within the period required by
this section, the career [proprietary] school or college shall pay
a penalty. If the refund is made to a lending institution, the
penalty shall also be paid to that institution and applied against
the student's loan. The commission annually shall establish the
level of the penalty at a level sufficient to provide a deterrent to
the retention of student funds. The commission may exempt a school
or college from the payment of the penalty if the school or college
makes a good faith effort to refund the tuition, fees, and other
charges but is unable to locate the student. The school or college
shall provide to the commission on request documentation of the
effort to locate the student.
(f) A career [proprietary] school or college shall record a
grade of "incomplete" for a student who withdraws but is not
entitled to a refund under Subsection (b)(4)(F) if the student
requests the grade at the time the student withdraws and the student
withdraws for an appropriate reason unrelated to the student's
academic status. A student who receives a grade of incomplete may
re-enroll in the program during the 12-month period following the
date the student withdraws and complete those incomplete subjects
without payment of additional tuition.
(g) A program that is 40 hours or less of class time, or a
seminar or workshop, is exempt from the 72-hour rule provided by
Subsection (a). The career [proprietary] school or college shall
maintain a policy for the refund of the unused portion of tuition,
fees, and other charges in the event the student fails to enter the
course, withdraws from the course, or is discontinued from the
class at any time before completion of the course as provided by
this section. The policy must provide that:
(1) refunds are based on the period of enrollment
computed on the basis of course time expressed in clock hours;
(2) the effective date of the termination for refund
purposes is the earlier of:
(A) the last date of attendance; or
(B) the date the school or college receives
written notice from the student that the student is withdrawing
from the class; and
(3) the student will be refunded the pro rata portion
of tuition, fees, and other charges that the number of class hours
remaining in the course after the effective date of the termination
bears to the total number of class hours in the course.
(h) A closing career school or college shall make a full
refund to each student of the school or college who is owed a refund
under this section.
(i) Each owner of a closing career school or college to
which a certificate of approval has not been issued under this
chapter is personally liable for the amount of any refund owed to a
student under Subsection (h).
SECTION 8.07. Sections 132.152(c)-(i), Education Code, are
amended to read as follows:
(c) If, after examination of a possible violation and the
facts relating to that possible violation, the commission concludes
that a violation has occurred, the commission shall issue a
preliminary report that states the facts on which the conclusion is
based, the fact that an administrative penalty is to be imposed
[recommended], and the amount of the penalty to be assessed
[recommended]. Not later than the 10th day after the date on which
the commission issues the preliminary report, the commission shall
send a copy of the report [by certified mail] to the person charged
with the violation, together with a statement of the right of the
person to a hearing relating to the alleged violation and the amount
of the penalty.
(d) Not later than the 20th day after the date on which the
[person receives the] report is sent, the person charged must
either make a written request for a hearing or remit the amount of
the administrative penalty to the commission. Failure either to
request a hearing or to remit the amount of the administrative
penalty within the time provided by this subsection results in a
waiver of a right to a hearing under this section. If the person
charged requests a hearing, the hearing shall be conducted in the
same manner as a hearing on the denial of certificate of approval
under Section 132.101. If the hearing results in a finding that a
violation has occurred, the commission shall:
(1) provide to the person written notice of:
(A) the findings established at the hearing; and
(B) the amount of the penalty; and
(2) enter an order requiring the person to pay the
amount of the penalty [by an administrative law judge of the State
Office of Administrative Hearings. The administrative law judge
shall make findings of fact and conclusions of law and promptly
issue to the commission a proposal for a decision about the
occurrence of the violation and the amount of the proposed penalty.
Based on the findings of fact, conclusions of law, and proposal for
decision, the commission by order may:
[(1) find that a violation has occurred and impose a
penalty; or
[(2) find that a violation has not occurred].
(e) [The notice of the commission's order given to the
person under Chapter 2001, Government Code, must include a
statement of the person's right to judicial review of the order.
[(f)] Not later than the 30th day after the date the person
receives the order entered by the commission under Subsection (d)
[commission's order is final under Section 2001.144, Government
Code], the person shall:
(1) pay the amount of the penalty;
(2) remit [pay] the amount of the penalty to the
commission for deposit in an escrow account and file a petition for
judicial review contesting the occurrence of the violation, the
amount of the penalty, or both the occurrence of the violation and
the amount of the penalty; or
(3) without paying the amount of the penalty, file a
petition for judicial review contesting the occurrence of the
violation, the amount of the penalty, or both the occurrence of the
violation and the amount of the penalty and file with the court a
sworn affidavit stating that the person is financially unable to
pay the amount of the penalty.
(f) The commission's order is subject to judicial review in
the same manner as an appeal of a decision to deny a certificate of
approval under Section 132.102.
(g) If on review the court does not sustain the occurrence
of the violation or finds that the amount of the penalty should be
reduced, the commission shall remit the appropriate amount to the
person charged with the violation not later than the 30th day after
the date the court's judgment becomes final. [Within the period
prescribed by Subsection (f), a person who acts under Subsection
(f)(3) may:
[(1) stay enforcement of the penalty by:
[(A) paying the amount of the penalty to the
court for placement in an escrow account; or
[(B) giving to the court a supersedeas bond
approved by the court that is in the amount of the penalty and that
is effective until all judicial review of the commission's order is
final; or
[(2) request the court to stay enforcement of the
penalty by:
[(A) filing with the court a sworn affidavit of
the person stating that the person is financially unable to pay the
amount of the penalty and is financially unable to give the
supersedeas bond; and
[(B) giving a copy of the affidavit to the
commission by certified mail.]
(h) If the court sustains the occurrence of the violation:
(1) the court:
(A) shall order the person to pay the amount of
the penalty; and
(B) may award to the commission the attorney's
fees and court costs incurred by the commission in defending the
action; and
(2) the commission shall remit the amount of the
penalty to the comptroller for deposit in the general revenue fund.
[The commission may file with the court a contest to an affidavit
received under Subsection (g)(2) not later than the fifth day after
the date the commission receives the copy. The court shall hold a
hearing on the facts alleged in the affidavit as soon as practicable
and shall stay the enforcement of the penalty on finding that the
alleged facts are true. The person who files an affidavit has the
burden of proving that the person is financially unable to pay the
amount of the penalty and to give a supersedeas bond.]
(i) If the person does not pay the amount of the penalty
after the commission's order becomes final for all purposes [and
the enforcement of the penalty is not stayed], the commission may
refer the matter to the attorney general for collection of the
amount of the penalty.
SECTION 8.08. Chapter 132, Education Code, is amended by
adding Subchapter J to read as follows:
SUBCHAPTER J. CEASE AND DESIST ORDERS
Sec. 132.301. HEARING; NOTICE. (a) The commission may set
a hearing on whether to issue a cease and desist order against a
person under Section 132.303 if:
(1) the commission has reason to believe that the
person is operating a career school or college without a
certificate issued by the commission in violation of Section
132.151; and
(2) the person has not responded to more than one
written notice from the commission regarding the person's
noncompliance with Section 132.151.
(b) The commission shall serve on the person a statement of
charges and a notice of hearing, including a copy of the applicable
rules of the commission.
Sec. 132.302. HEARING. Except as agreed by the parties with
prior written approval of the commission, a hearing under this
subchapter must be held not earlier than the fifth day or later than
the 30th day after the date of service of the statement and notice
required under Section 132.301.
Sec. 132.303. CEASE AND DESIST ORDER. After a hearing held
under this subchapter, the commission may issue against the person
charged with operating a career school or college without a
certificate issued by the commission an order that requires that
the person immediately cease and desist from violating this
chapter.
Sec. 132.304. ENFORCEMENT; REFERRAL TO THE ATTORNEY
GENERAL. The commission may refer the matter to the consumer
protection division of the attorney general's office for
enforcement if the commission has reason to believe that a person
has violated or failed to respond to a cease and desist order issued
under this subchapter.
Sec. 132.305. EFFECT OF PRIOR PROCEEDINGS. The commission
may proceed under this chapter or any other applicable law without
regard to prior proceedings.
Sec. 132.306. RULES. The commission shall adopt rules as
necessary to implement this subchapter.
SECTION 8.09. Subchapter I, Chapter 132, Education Code, is
amended by adding Section 132.2415 to read as follows:
Sec. 132.2415. TUITION TRUST ACCOUNT. (a) The Texas
Workforce Commission depository bonds guaranty trust account is
renamed the career school or college tuition trust account. The
career school or college tuition trust account is the account
designated to receive all amounts related to the protection of
career school or college tuition. The balance of the trust account
may not exceed $1 million.
(b) The commission may collect annually a fee from each
career school or college to be deposited to the credit of the career
school or college tuition trust account. The total amount of the
fees collected in a year shall be set by the commission in the
amount estimated as necessary to pay the liabilities of the trust
account during that year, not to exceed 0.2 percent of the gross
amount of tuition and fees charged by career schools and colleges in
that year, excluding amounts refunded under Section 132.061.
(c) If, at the end of a fiscal year, the commission
determines that the commission has collected fees under this
chapter in excess of the amount necessary to defray the expense of
administering this chapter, the commission may transfer any portion
of the excess amount to the career school or college tuition trust
account.
(d) From money in the career school or college tuition trust
account, the commission shall attempt to provide a full refund to
each student of a closed career school or college of the amount owed
to the student as determined under Section 132.061. The commission
may provide a partial refund to a student only if the commission
determines that the amount in the trust account is insufficient to
provide a full refund to the student. The commission shall consider
the following factors in determining the amount of a partial refund
to be paid to a student:
(1) the amount of money in the trust account;
(2) the cost and number of claims against the trust
account resulting from closure of the school or college;
(3) the average cost of a claim paid from the trust
account in the past; and
(4) the availability of other licensed career schools
or colleges at which the student may complete the student's
training.
(e) Notwithstanding Subsection (b), in the state fiscal
year ending August 31, 2004, the commission may collect a fee under
Subsection (b) only if on January 1 of that year the amount in the
career school or college tuition trust account is less than
$300,000. This subsection expires September 1, 2005.
SECTION 8.10. Section 132.242, Education Code, is amended
to read as follows:
Sec. 132.242. CLOSED SCHOOL OR COLLEGE. (a) If a career
[proprietary] school or college closes, the commission shall
attempt to arrange for students of the closed school or college to
attend another career [proprietary] school or college.
(b) The expense incurred by a career [proprietary] school or
college in providing a teachout that is directly related to
educating a student placed in the school or college under this
section, including the applicable tuition for the period for which
the student has paid tuition, shall be paid from the career
[proprietary] school or college tuition trust account [protection
fund].
(c) If the student cannot be placed in another career
[proprietary] school or college, the student's tuition and fees
shall be refunded under Section 132.061(d).
(d) If a student does not accept a place that is available
and reasonable in another career [proprietary] school or college,
the student's tuition and fees shall be refunded under the refund
policy maintained by the closing career [proprietary] school or
college under Section 132.061[(b)].
(e) For each closed career school or college, refunds shall
be paid from the career school or college [If the amount of the
closed proprietary school's bond under Section 132.060 is less than
the amount required for student refunds under Subsections (c) and
(d), the refunds shall be paid from the proprietary school] tuition
trust account [protection fund] in an amount not to exceed $150,000
[$50,000].
(f) If another career [proprietary] school or college
assumes responsibility for the closed career school's or college's
[proprietary school's] students with no significant changes in the
quality of training, the student is not entitled to a refund under
Subsection (c) or (d).
(g) Attorney's fees, court costs, or damages may not be paid
from the career [proprietary] school or college tuition trust
account [protection fund].
SECTION 8.11. The change in law made by this part to Section
132.051(b), Education Code, applies only to a note or other
instrument issued, or a contract entered into, on or after the
effective date of this Act. A note or other instrument issued, or a
contract entered into, before the effective date of this Act is
governed by the law in effect on the date the note or other
instrument was issued or the contract was entered into, and the
former law is continued in effect for that purpose.
SECTION 8.12. The change in law made by this part to Section
132.055, Education Code, applies only to an application for a
certificate of approval filed with the Texas Workforce Commission
on or after the effective date of this Act. An application for a
certificate of approval filed before the effective date of this Act
is governed by the law in effect on the date the application was
filed, and the former law is continued in effect for that purpose.
SECTION 8.13. The changes in law made by this part to
Section 132.061(b), Education Code, apply only to the refund policy
of a career school or college to which a certificate of approval is
granted or renewed by the Texas Workforce Commission on or after the
effective date of this Act.
SECTION 8.14. The changes in law made by this part to
Section 132.152, Education Code, apply only to an alleged violation
of Section 132.151, Education Code, that occurs on or after the
effective date of this Act. An alleged violation that occurs before
the effective date of this Act is governed by the law in effect on
the date the alleged violation occurred, and the former law is
continued in effect for that purpose.
SECTION 8.15. On or after the effective date of this part,
any amount remaining in or payable to the credit of the tuition
protection fund under Section 132.241, Education Code, as that
section existed before repeal by this Act, shall be transferred to
the credit of the career school or college tuition trust account
established under Section 132.2415, Education Code, as added by
this part.
(2) Strike SECTIONS 8.14 and 8.15 of the bill (page 59, line
22, through page 65, line 13).
(3) Strike SECTION 8.23 of the bill (page 69, line 24,
through page 72, line 20).
(4) Renumber the SECTIONS of ARTICLE 8 appropriately.
(5) Strike SECTION 9.01 of the bill (page 88, lines 15-22)
and substitute the following:
SECTION 9.01. The following laws are repealed:
(1) Section 132.060, Education Code;
(2) Sections 132.152(j)-(m), Education Code;
(3) Section 132.241, Education Code;
(4) Section 201.002, Labor Code;
(5) Section 203.102, Labor Code;
(6) Section 301.006, Labor Code, as added by Section
5.82(a), Chapter 76, Acts of the 74th Legislature, Regular Session,
1995;
(7) Section 301.061(c), Labor Code; and
(8) Section 302.005(k), Labor Code.