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AB48' Summary by Nancy Herbst
AB48' Summary by Nancy Herbst
The California Private Postsecondary Education Act of 2009:
What it May Mean for Your School
The former Private Postsecondary and Vocational Education Reform Act of 1989, which became inoperative on July 1, 2007, and repealed on January 1, 2008, was administered by the former Bureau for Private Postsecondary and Vocational Education (BPPVE).  On October 11, 2009, Governor Arnold Schwarzenegger signed Assembly Bill 48, which recast and revised the former act as the California Private Postsecondary Education Act of 2009. The bill, which was first introduced in December 2008, will establish the Bureau for Private Postsecondary Education (BPPE) as a successor agency to the BPPVE.  Due to loan provisions in AB 48, the BPPE was pre-staffed prior to January 1, 2010.  Accordingly, it is expected that the BPPE will be well prepared to administer the regulations as of January 1, 2010.
The purpose of the Act does not differ from its predecessor.  It is to ensure minimum educational quality standards and opportunities and meaningful student protections.  In addition, the Act sets forth the regulatory structure that provides (1) a means for stakeholders to have a voice and be heard in policymaking and (2) accountability and oversight by the Legislature.  And perhaps more importantly, the purpose of the Act is to prevent the deception of the public resulting in fraudulent or substandard degrees. 
This article highlights only some of the important features of the Act and includes page and line number references to AB 48.  Readers may access AB 48 by clicking here. It is organized in two general areas – (1) the status of approvals and (2) deadlines and responsibilities for the schools.
The Status of Approvals
              At the sunset of the Private Postsecondary and Vocational Education Reform Act, many schools were either approved, had applied for renewal of their approval to operate, or had applied for approval.  For those schools who were approved to operate, they are granted a three-year extension of that approval from the expiration date as of June 30, 2007.  For example, if your school was approved through November 5, 2011, then the school’s expiration date for such approval is now November 5, 2014 (pg. 23, lines 30-32).
              If, as of January 1, 2006, the school had submitted an application to renew its approval to operate, such application is deemed granted with an expiration year of 2012.  The month and day will be the same as the existing approval to operate.  For example, if the institution’s approval was to expire on November 5, 2006, and the institution had on file by June 30, 2007 an application to renew, the application is deemed approved with an expiration date of November 5, 2012.  (Page 23, lines 33-39.)
              If the school had submitted an application to renew its approval to operate during the period January 1, 2006, to June 30, 2007, such application is deemed granted with an expiration year of 2013.  The month and day will be the same as the existing approval to operate.  For example, if the institution’s approval was to expire on November 5, 2007, and the institution had on file by June 30, 2007 an application to renew, the application is deemed approved with an expiration date of November 5, 2013. 
(Page 23, line 33-36 and pg. 24, lines 1-3).
              In cases where an application for renewal is deemed granted under this Act, the school must notify in writing to any potential student that, while it was approved
to operate by the BPPVE, its application for reapproval to operate has not been reviewed by the BPPE.  Such notice must be provided to potential students prior to entering into any enrollment agreement with the school (pg. 24, lines 4-10).
              For those schools that had an application for approval to operate pending before the BPPVE as of its sunset, they may continue to operate for a period of time.  It is the responsibility of the school to submit a new application for approval within six months of the date that the BPPE makes the application available.  (The BPPE has the right to determine that the pending application is sufficient and no additional application is required.)  (Page 25, lines 25-37.)  If the school is not advised that its pending application is accepted and it does not submit an application within six months of the application becoming available, then the school arguably will be in violation of the Act.
Good news for those schools that began operations after July 1, 2007 – they may continue to operate for a period of time as long as they comply with the Act.  They must submit an application for approval to operate within six months of the application becoming available by the BPPE (pg. 25, line 38 to pg. 26, line 5).  Again, if the school does not submit an application within six months of the applica­tion becoming available, then the school arguably will be in violation of the Act.
Some institutions may be exempt from the Act, including, state and regionally accredited schools, as well as certain other religious and specialized educational providers (pg. 32, line 11 to pg. 35, line 14).  In addition, a school can be granted approval to operate solely by means of its accreditation.  These schools are not exempt from the Act itself but are not required to go through an approval or renewal process.  Instead, they must demonstrate continued capacity to meet the minimum operating standards and provide verification to the BPPE of its accreditation.  (Page 40, line 27 to pg. 41, line 15.) 
Deadlines , Responsibilities, and Restrictions for the Schools
              Compensation Plans.  If you are a school that utilizes a referral recognition program – watch out!  Under the Act, schools are limited to providing “token” gifts to students when referring a prospective student.  The token gift cannot be in the form of money, cannot be worth more than $100, and is limited to one gift per student per year.  (Page 42, lines 30 – 36.)  In addition, there are strong limitations to compensation plans for student recruiters.  Specifically, employees cannot be paid on commission, bonus, quota, or other similar method unless (1) the academic program can be completed within 90 days or (2) if the compensation plans are consistent with federal regulations for those schools participating in federal student financial aid programs.  (Page 42, line 36 to pg. 44, line 12.)  And don’t forget that all recruiters must be employees of the school (pg. 47, lines 15-17).
              Websites.  Some schools may want to get a hold of their website technicians for this one.  No school’s website may require personal information before allowing the individual access to information pertaining to a school’s educational program that is required to be in the catalog or pursuant to certain consumer information requirements (pg. 44, lines 13-19).
              Student Information and Transcripts.  If you are not recording your student information electronically, you may want to reconsider this now.  Schools must maintain student information and transcripts permanently!  This is a change from the previous requirement of five years.  Transcripts must include the name of the degree or certificate granted, the date in which it was granted, the courses and units taken of which the degree or certificate is comprised, and grades issued for such courses.  (Page 46, lines 25 – 35.)
              School Performance Fact Sheet.  As of January 1, institutions must develop, maintain, and make available to prospective students a School Performance Fact Sheet (pg. 52, lines 22-26).  All data utilized for any calculations must be maintained, either in electronic or paper format, for five years from the date the data was published (pg. 61, lines 32-35).  Information that must be incorporated in the School Performance Fact Sheet includes, but is not limited to:
1.                Completion rates (the number of graduates divided by the number of students available for graduation or as reported to the Department of Education – IPEDS – pg. 61, lines 1-7);
2.                Job Placement rates (the number of graduates employed in the field divided by the number of graduate available for employment in the field – pg. 61, lines 11-15);
3.                License examination passage rates for those programs that lead to employment that require passing a state examination (pg. 52, lines 33-36);
4.                Salary/wage calculations (total number of graduates employed in the field and the annual wages of the graduates – pg. 61, lines 27-30).  In addition, if a program offering leads to a particular career, then wage and salary information for such career as provided in the Occupational Employment Statistics issued by the Employment Development Department shall be provided, where available (pg. 53, lines 5-19);
5.                In cases where the educational program is too new to have such statistical data, then the institution must state “This program is new. Therefore, the number of students who graduate, the number of students who are placed, or the starting salary you can earn after finishing the educational program are unknown at this time. Information regarding general salary and placement statistics may be available from government sources or from the institution, but is not equivalent to actual performance data.”  (Page 53, lines 11-19);
6.                The following statement “This fact sheet is filed with the Bureau for Private Postsecondary Education. Regardless of any information you may have relating to completion rates, placement rates, starting salaries, or license exam passage rates, this fact sheet contains the information as calculated pursuant to state law” and “Any questions a student may have regarding this fact sheet 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)” must also be included. (Page 53, lines 36 to page 54, line 5.)
Each of the items disclosed in the School Performance Fact Sheet must include a space for the student to initial (pg. 47, lines 32-39), a copy is to be maintained by the institution, and a copy provided to the prospective student.
Enrollment Agreements.  An individual is considered enrolled only after executing an enrollment agreement that is signed by both the student and the institution.  However, before any enrollment can be completed, the prospective student must first have received, and provide written acknowledgement of such receipt, the school’s catalog and the School Performance Fact Sheet.  In addition, certain information must be included in the enrollment agreement, including, but not limited to:
1.                The name and contact information of the school;
2.                Specific Information on the educational program, including the number of hours required to complete the program;
3.                A description of the total charges, including a breakdown of those charges that are nonrefundable, and the student’s obligation to the Student Tuition Recovery Fund (nonrefundable fee);
4.                The institution’s cancellation, withdraw, and refund policies and procedures;
5.                A statement regarding a student’s obligations to repay student loans plus interest and the right to refunds; and
6.                Certain language required by federal and state financial aid agencies pertaining to student loans, grants, repayment plans, and collection actions.
In addition, the following language must be included verbatim:
1.                Prior to signing this enrollment agreement, you must be given a catalog or brochure and a School Performance Fact Sheet, which you are encouraged to review prior to signing this agreement. These documents contain important policies and performance data for this institution. This institution is required to have you sign and date the information included in the School Performance Fact Sheet relating to completion rates, placement rates, license examination passage rates, and salaries or wages, prior to signing this agreement.
I certify that I have received the catalog, School Performance Fact Sheet, and information regarding completion rates, placement rates, license examination passage rates, and salary or wage information included in the School Performance Fact sheet, and have signed, initialed, and dated the information provided in the School Performance Fact
Sheet.       
_____________________________________
                                                                                    Signature
2.                Any questions a student may have regarding this enrollment agreement 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).
3.                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).”
I understand that this is a legally binding contract. My signature below certifies that I have read, understood, and agreed to my rights and responsibilities, and that the institution’s cancellation and refund policies have been clearly explained to me.                                                                                                                                             _____________________________________
                                                                                    Signature
(Page 55, line 14 to pe. 56, line 14.)
For a complete list, visit page 54, line 6 to page 56, line 14.
School Catalog.  The institution’s school catalog must contain an array of information including, but not limited to:
1.                Contact information for the school;
2.                The address(es) where class sessions will be held;
3.                Its approval status with the BPPE;
4.                If the school participates in federal and/or state financial aid programs, then this must be disclosed along with all associated consumer information as required by those programs;
5.                Descriptions of programs and courses offered, and any requirements for programs and courses (including internships, externships, and credit/course hours);
6.                Eligibility requirements for any licensure in a professional for which an educational program was designed;
7.                Faculty information, including their qualifications;
8.                Policies and procedures pertaining to admissions; cancellations, drops and withdrawals from courses and programs; probation; dismissal; attendance; leaves of absences; and tuition and other charges;
9.                Whether the institution has a pending bankruptcy petition, is a debtor-in-possession, and does or had a petition filed by or against it under Chapter 11 of the U.S. Bankruptcy Code;
10.           A description of the students’ rights and responsibilities under the Student Tuition Recovery Fund; and
11.           A statement regarding a student’s obligations to repay student loans plus interest and the right to refunds.
(Page 49, line 19 to pg. 51, line 27.)
In addition, the following language must be included verbatim:
1.                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) (pg. 49, lines 28-32).
2.                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 (pg. 49, lines 33-36).
3.                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) (pg. 49, line 37 to pg. 50, line 2).
4.                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 (pg. 51, line 30 to pg. 52, line 7).
Fonts.  For any statements required under AB 48 made in the catalog, School Performance Fact Sheet, or enrollment agreement, such statements cannot be printed in a font size smaller than the font size used in the majority of the document. The school catalog may be provided electronically (i.e., available through the school’s website) (pg. 49, lines 15-21). 
Student Tuition Recovery Fund (STRF).  The Act provides for the continuation of the Student Tuition Recovery Fund (pg. 25, lines 3-5).  However, the BPPE has until January 1, 2011 to adopt appropriate regulations to govern the STRF and, according to Joanne Wenzel of the Department of Consumer Affairs, schools should not resume collecting these student fees until instructed to do so by the BPPE.
Site Visits and Annual Reports.  Under the Act, the BPPE may conduct announced and unannounced site visits at least every two years.  In addition, on the first of every July, institutions must submit to the BPPE an annual report that includes information on degrees, number of students, and additional information (pg. 56, lines 1-21).  However, the BPPE has until January 1, 2011 to adopt regulations for such visits and format/delivery requirements for the annual plan.
Conclusion
              The California Private Postsecondary Education Act of 2009 is a lengthy (~75 pages) and some­what complex document.  In addition, the regulations are fluid so as to provide for future amendments, the adoption of emergency regulations, and the development of procedures and guidelines.  This summary is intended only as an introduction of the many types of requirements that may now, or shortly will, be facing your institution.
 
Nancy Herbst is the Executive Director for the International Professional School of Education located in San Diego.  She has ten years experience working in higher education and more than 15 years working in higher education and employment law.  She also served as production manager for The Higher Education Law Bulletin and was a contributor to Preventive Law for Schools and Colleges.  In addition, she provides consulting services for schools regarding accreditation, financial aid, governance, and other issues facing higher education.
                                                                
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