N.Y. Education Law § 5002: Standards for licensed private career schools

§ 5002. Standards for licensed private career schools. Any school

licensed pursuant to section five thousand one of this article shall be

organized and conducted only as a school and shall be subject to the

jurisdiction of the department exclusively, or in conjunction with such

other state agency or department or district attorney upon which

jurisdiction has also been conferred by law. Such schools shall be

subject to and comply with the provisions of this section.

1. Standards. a. No program of such schools shall be conducted in a

factory or commercial establishment, except where the use of facilities

or equipment of such factory or commercial establishment is permitted

for necessary or desirable educational purposes and objectives.

b. For every such school, the commissioner shall set forth in

regulation standards governing all of the following:

(1) criteria for admission, which shall provide that students at least

possess a high school diploma or its equivalent or demonstrate the

ability to benefit from the instruction, except that in the case of

students who do not possess a high school diploma or its equivalent,

certification of the students' ability to benefit from instruction shall

be provided to the commissioner as provided in paragraph c of this

subdivision;

(2) the standards and the methods of instruction;

(3) the equipment available for instruction with the maximum

enrollment that such equipment and physical plant will accommodate;

(4) the qualifications and experience of teaching and management

personnel;

(5) the form and content of the student enrollment agreement or

contract, provided that such agreement or contract shall be written in

the same language as that principally used in the sales presentation;

(6) the methods of collecting tuition;

(7) eligibility criteria for programs that will require licensure;

(8) the sufficiency and suitability of the resources available for the

support of such school; and

(9) counseling provided to students.

b-1. (1) Student loans or other financial aid funds received from

federal, state, or local governments or administered under the federal

student financial assistance programs governed by Title IV of the Higher

Education Act of nineteen hundred sixty-five, 20 U.S.C. section 1070 et

seq., as amended, must be collected and applied in the manner as

controlled by the applicable federal, state or local regulations.

(2) Student loans or other financial aid funds received from private

entities, including, but not limited to, banks, financing companies, and

other lending sources must be collected or disbursed in the following

manner:

(A) Loans or other financial aid payments for amounts of five thousand

dollars or less may be disbursed as a single disbursement, regardless of

course length.

(B) Loans or other financial aid payments for amounts greater than

five thousand dollars that reflect a class term of less than six months

shall have two equal disbursements. The disbursement schedule for such

loans or payments shall be as follows: one-half of the tuition amount

released initially, and the remainder released halfway through the

course term.

(C) Loans or other financial aid payments for amounts greater than

five thousand dollars that reflect a class term of greater than six

months, but less than twelve months must have three equal disbursements.

The disbursement schedule for such loans or payments shall be as

follows: one-third of the tuition amount released initially, the second

disbursement shall be released one-third of the way through the length

of the training, and the remainder released two-thirds of the way

through the course term.

(D) Loans of other financial aid payments for amounts greater than

five thousand dollars that reflect a class term greater than twelve

months shall have four equal disbursements. The disbursement schedule

for such loans or payments shall be as follows: one-quarter of the

tuition amount released initially, the second disbursement shall be

released one quarter of the way through the length of the training; the

third disbursement shall be released halfway through the length of the

training, and the remainder shall be released three-quarters of the way

through the training.

(3) No school may enter into any contract or agreement with or receive

any students loan or financial aid funds from private entities,

including, but not limited to, banks, financing companies, and any other

private lending sources unless the private entity has a disbursement

policy that, at a minimum, meets the requirements of subparagraph two of

this paragraph.

(4) The term private entity referenced in subparagraphs two and three

of this paragraph shall not be construed to include a friend or family

member of the student who is not in the routine business of providing

student loans or financial aid funds. The provision of such a loan or

fund by a private entity shall also not include the payment of the

student's tuition or fees by use of a credit card.

c. Notwithstanding any other provisions of this article to the

contrary, the commissioner shall define alternative educational and

curriculum standards for any program of less than forty hours designed

exclusively for non-occupational, personal enrichment purposes.

d. Admission of students under the ability to benefit provision.

(1) Certification. Each school admitting students who do not possess

at least a high school diploma or its equivalent shall certify to the

satisfaction of the commissioner that such prospective students have

been administered and passed an examination which has been approved by

the commissioner to determine their ability to benefit from the chosen

curriculum prior to admission to the curriculum or course of study. Such

examination shall, whenever possible, be a nationally recognized test

appropriate for the course of instruction which has been approved by the

commissioner. The examination results of each such student who is

admitted shall be made available to the commissioner at a time

prescribed by the commissioner and, together with the student's original

answer sheet, shall be maintained by the school in the student's

permanent record. For any student failing to achieve the necessary score

on such examination for enrollment, the school shall be required to

provide such student with a listing of appropriate counseling and

educational opportunities available to the student at no cost, as

determined by the commissioner. Where appropriate, the commissioner may

accept such other entrance requirement documentation such as

prerequisite coursework, professional or vendor certifications, personal

interviews, and/or attestations of equivalent knowledge in lieu of the

examination requirement.

(2) Counseling. Each school offering curricula which admit students

who do not possess a high school diploma or its equivalent shall develop

a plan to be approved by the commissioner for the counseling of such

students on an individual basis on matters including but not limited to

the student's ability to progress in the curriculum, the student's

financial aid rights and responsibilities, the availability of programs

to earn a high school equivalency diploma, including programs provided

at no cost to the student, and the potential of the training to prepare

the student for available employment opportunities within the region.

(3) Compliance. (A) The commissioner shall monitor compliance with

this paragraph and verify the examination and counseling process and

student examination scores. Such procedures may include but not be

limited to an annual, statistically significant, random sampling of the

examinations taken by prospective students of each school administering

such examinations.

(B) In the event that the commissioner determines that the school is

out of compliance with the examination process and counseling, the

commissioner shall require that examinations and counseling for students

admitted under the ability to benefit provision and the counseling

required by subparagraph two of this paragraph be conducted off the

premises of the school by an entity approved by the commissioner for

such period of time as the commissioner deems appropriate, the cost of

which shall be incurred by the school.

2. Inspections. a. Every school licensed pursuant to this article

shall maintain adequate and accurate records for a period of not less

than seven years at its principal place of business within this state.

Such records shall be maintained in a manner and form prescribed by the

commissioner and shall be made available to the department and the

higher education services corporation upon request.

b. In addition to other requirements in this article, the information

to be made a part of the record shall include, but not be limited to:

(1) names and addresses of each enrolled student;

(2) the course of study offered by the institution;

(3) the name and address of its faculty, together with a record of the

educational qualifications of each;

(4) the graduation date of each student; and

(5) for each student who fails to complete his or her program, the

student's last date of attendance and, if applicable, the amount of any

refund paid to, or on behalf of, the student and the date the refund was

made.

c. The commissioner shall conduct periodic unscheduled inspections of

licensed private career schools to monitor compliance with the

provisions of this article or the rules or regulations promulgated

thereunder or any final order or decision of the commissioner made

pursuant to this article. The department shall conduct an inspection of

each school at least once every licensure period. All schools shall

provide upon request of the department, any and all records necessary to

review compliance with the provisions of this article.

d. Student permanent records, as defined in the regulations of the

commissioner, shall be maintained for a period of twenty years.

3. Tuition liability. a. The tuition charge for programs approved for

participation in student financial aid general award programs pursuant

to articles thirteen and fourteen of this chapter shall be apportioned

on the basis of terms, quarters or semesters. For the purposes of this

section, the terms "term", "quarter" and "semester" shall be defined in

regulations by the commissioner.

b. The tuition refund policy for the first term or quarter of any

program at schools licensed pursuant to section five thousand one of

this article shall be as follows:

(1) For programs which are divided into quarters of up to fourteen

weeks, the school shall evenly divide the total tuition charges among

the number of quarters. After instruction is begun in a school, if a

student withdraws or is discontinued, the school may retain no more

than:

(i) zero percent of the quarter's tuition if the termination is during

the first week of instruction; or

(ii) twenty-five percent of the quarter's tuition if the termination

is during the second week of instruction; or

(iii) fifty percent of the quarter's tuition if the termination is

during the third week of instruction; or

(iv) seventy-five percent of the quarter's tuition if the termination

is during the fourth week of instruction; or

(v) one hundred percent of the quarter's tuition if the termination

occurs after the fourth week of instruction.

(2) For programs organized by terms of fifteen, sixteen, seventeen or

eighteen weeks apiece, the school shall evenly divide the total tuition

charges among the number of terms. After instruction is begun in a

school, if a student withdraws or is discontinued, the school may retain

no more than:

(i) zero percent of the term's tuition if the termination is during

the first week of instruction; or

(ii) twenty percent of the term's tuition if the termination is during

the second week of instruction; or

(iii) thirty-five percent of the term's tuition if the termination is

during the third week of instruction; or

(iv) fifty percent of the term's tuition if the termination is during

the fourth week of instruction; or

(v) seventy percent of the term's tuition if the termination is during

the fifth week of instruction; or

(vi) one hundred percent of the term's tuition if the termination

occurs after the completion of the fifth week of instruction.

c. (1) The tuition refund policy for the second term or quarter of any

program at schools licensed pursuant to section five thousand one of

this article shall be as follows:

(A) For programs which are divided into quarters of up to fourteen

weeks, the school shall evenly divide the total tuition charges among

the number of quarters. After instruction is begun in a school, if a

student withdraws or is discontinued, the school may retain no more

than:

(i) twenty-five percent of the quarter's tuition if the termination is

during the first week of instruction; or

(ii) fifty percent of the quarter's tuition if the termination is

during the second week of instruction; or

(iii) seventy-five percent of the quarter's tuition if the termination

is during the third week of instruction; or

(iv) one hundred percent of the quarter's tuition if the termination

occurs after the third week of instruction.

(B) For programs organized by terms of fifteen, sixteen, seventeen or

eighteen weeks apiece, the school shall evenly divide the total tuition

charges among the number of terms. After instruction is begun in a

school, if a student withdraws or is discontinued, the school may retain

no more than:

(i) twenty percent of the term's tuition if the termination is during

the first week of instruction; or

(ii) thirty-five percent of the term's tuition if the termination is

during the second week of instruction; or

(iii) fifty percent of the term's tuition if the termination is during

the third week of instruction; or

(iv) seventy percent of the term's tuition if the termination is

during the fourth week of instruction; or

(v) one hundred percent of the term's tuition if the termination

occurs after the completion of the fourth week of instruction.

(2) Notwithstanding the provisions of subparagraph one of this

paragraph, the tuition refund policy set forth in paragraph b of this

subdivision shall apply unless the school demonstrates that there are no

significant educational changes in the educational program of the

student, such changes as defined in regulations of the commissioner.

d. The tuition refund policy for the third and any subsequent term or

quarter of any program licensed pursuant to section five thousand one of

this article shall be the policy set forth in subparagraph one of

paragraph c of this subdivision.

e. No program shall have a term in excess of eighteen weeks.

f. The amount of the refund shall be calculated based on the last day

of student attendance.

g. (1) Any refund due to a student shall be paid by the school within

forty-five days of the date on which the student withdraws from the

program. For the purposes of this article, such date shall be the

earliest of (i) the date on which the student gives written notice to

the school or (ii) the date on which the student is deemed to have

withdrawn pursuant to subparagraph two of this paragraph.

(2) If a student has failed to attend classes for a period of thirty

calendar days, the school shall send by regular mail a notice to the

student that the student shall be deemed to have withdrawn from the

program if the student does not notify the school to the contrary within

twelve days from the date on which the letter is sent. If the student

fails to respond within such twelve-day period, the student shall be

deemed to have withdrawn and the school shall notify the higher

education services corporation that the student has withdrawn and the

date of the withdrawal.

h. Schools shall submit, for approval by the commissioner, the school

catalog with a weekly tuition liability chart for each program that

indicates the amount of refund due the student in the event of

withdrawal.

i. Upon payment of a refund to a lender, the school shall forthwith

send a notice to a person designated by the president of the higher

education services corporation upon a form approved by the president

that such refund was made.

j. If the higher education services corporation fails to receive the

notice required by paragraph i of this subdivision, it shall forthwith

notify the student of his or her right to a refund and the commissioner

of such failure. Upon receipt of such notification, the commissioner

shall take appropriate action against the school.

4. Curriculum approval. a. An application and fee shall be made for

the initial approval of a curriculum or course and shall include such

information as the commissioner may require by regulation. Approval

shall be valid for a period not to exceed four years. The application

fee for any curriculum of one hundred clock hours or more shall be two

hundred fifty dollars. The application fee for any course of less than

one hundred clock hours shall be one hundred dollars. Such application

fees shall accrue to the credit of the proprietary vocational school

supervision account.

b. In approving curriculum, the commissioner shall take into

consideration the following:

(1) that the entrance requirements demonstrate that students possess

the skills, competencies and prerequisite knowledge needed to progress

in the curriculum;

(2) that the content will enable the student to develop those skills

and competencies required for employment in the occupational area for

which the curriculum was developed;

(3) that the school will utilize appropriate instructional methods;

(4) that the instructional equipment used within the curriculum is

comparable to the equipment currently used by business or industry in

the occupational area for which the curriculum was developed; and

(5) that a curriculum may include instruction in English as a second

language at a beginning or basic level, provided such instruction shall

not constitute more than fifty percent of such program.

c. (1) If the evaluation of a particular course or facility requires

the services of an expert not employed by the department, the department

shall retain such expert at the school's expense in addition to the

application fees prescribed in paragraph a of this subdivision.

(2) If, in the interest of expediting the approvals, a school requests

the department to employ an outside consultant, the school shall pay the

cost of such services in addition to the application fees prescribed in

paragraph a of this subdivision.

d. The commissioner shall act on applications for approval of a course

or curriculum within one hundred twenty days of receipt of a complete

application and, in the case of a denial, shall set forth in writing the

reasons for such denial.

e. Notwithstanding paragraphs b, c and d of this subdivision,

curriculum certified by a nationally recognized vendor as defined in

commissioner's regulations shall be recognized by the department in lieu

of an expert evaluation when such curriculum is adopted by a school in

the original format provided by the vendor as long as the proposed

curriculum is a stand alone program and not part of a larger

comprehensive course.

f. Notwithstanding any other provision of the law, a not-for-profit

licensed career school, that is eligible for participation in the

tuition assistance program and which has national accreditation, may,

for the purpose of calculation of federal financial aid amounts only,

measure students' academic progress in an approved curriculum in

non-degree granting credit hours, based upon a national accrediting

agency's conversion and approval of clock hours to non-degree credit

hours. For the purposes of this paragraph, "national accreditation"

shall mean accreditation by a national accrediting agency as defined in

the commissioner's regulations.

5. Application for reapproval. a. An application and fee shall be made

for reapproval of a curriculum or course. Such application shall be

considered timely if submitted at least one hundred twenty days prior to

the expiration of the current approval. The application fee for any

curriculum of one hundred clock hours or more shall be two hundred fifty

dollars. The application fee for any course of less than one hundred

clock hours shall be one hundred dollars, provided that no fee shall be

assessed for the submission of a reapproval application without change.

Such application fee shall accrue to the credit of the proprietary

vocational school supervision account.

b. Curriculum reapproval standards. (1) The commissioner shall pre-

scribe by regulation, standards for reapproval after the first year of

licensure, of any curriculum or course based upon factors including but

not limited to the following, as appropriate:

(i) for each curriculum or course, the percentage of students who have

dropped out;

(ii) the acquisition of a specified minimum level of skills by the

students; and

(iii) for each curriculum or course, the percentage of students placed

in occupations related to the instruction, where applicable.

(2) Such standards shall be consistent with those applied to all

non-degree career education programs.

c. Reapproval contingency. Reapproval of a curriculum or course shall

be contingent upon a demonstration by the applicant that the curriculum

or course has met the curriculum reapproval standards set forth in this

subdivision. Except as otherwise provided in paragraph d of this

subdivision, no such curriculum or course or substantially similar

curriculum or course may be given without reapproval by the

commissioner.

d. When timely and complete application is made for the reapproval of

a curriculum or course, and no written denial is made thirty days prior

to the date of expiration of the existing approval, the curriculum or

course shall be deemed to be approved for the period of the curriculum.

If the application is denied, the commissioner shall set forth in

writing the reasons for such denial.

e. The commissioner may provide in regulations for reapproval

procedures, consistent with this subdivision, for applications submitted

less than one hundred twenty days from the expiration date.

f. The commissioner shall act upon enrollment agreements and catalogs

within ninety days of receipt, and, in the case of denial, shall set

forth in writing the reasons for such denial. If the commissioner fails

to act within ninety days, a catalog shall be deemed approved for one

year and an enrollment agreement shall be deemed approved until the

commissioner acts upon it.

6. a. Teachers and directors. No person shall be employed by a private

career school as a director or teacher who is not licensed in such

capacity by the department pursuant to regulations of the commissioner,

which shall take into consideration such factors as moral character,

educational qualifications and practical experience. The application

shall include a statement, signed by the president or chief executive

officer of the school, certifying that to the best of his or her

knowledge, the applicant is able to meet the educational qualifications

and practical experience set forth in the commissioner's regulations.

Such application shall be considered timely if mailed to the

commissioner and postmarked four days prior to employment at the school

and must be completed within twenty days thereafter; provided, however,

that the commissioner may, for good cause shown, extend the time within

which to complete the application. When a complete application is made,

the commissioner shall act upon such application within thirty days. If

no written denial is made within the thirty days, the application shall

be deemed to be approved until the commissioner acts upon it or until

the end of the term or semester, whichever occurs first. If a written

denial is made after the thirty day period, the commissioner may allow

the applicant to teach at the school for the remainder of the term or

semester if the commissioner determines that the removal of the teacher

would not be in the best educational interest of the students. This

subdivision shall not apply to directors or teachers employed on or

before July first, nineteen hundred seventy-two. Teachers' licenses

issued on or after the effective date of the chapter of the laws of two

thousand twelve which amended this paragraph shall be valid at all

licensed private career schools for the courses, curricula, or

occupations indicated on the license. Teachers holding valid private

school teacher licenses valid at only one school location shall have

them replaced, at no cost, with licenses valid at any licensed school in

the same subject or subjects and with the same expiration date as was

listed on the previous teaching license.

b. A school director shall have access to all student and school

records which shall be maintained in accordance with this article and

the regulations of the commissioner and shall make such records

available to the commissioner or the commissioner's designee upon

request during an on-site school inspection.

c. Notwithstanding paragraph a of this subdivision, a teacher who has

been certified as an instructor by a nationally recognized vendor as

defined in commissioner's regulations may be deemed qualified as an

instructor by the department, provided such teacher shall only provide

instruction in the course or courses for which he or she holds vendor's

certification. A teacher authorized by this paragraph will be subject to

all licensing fees required by the department for licensed teachers.

7. Advertising. a. The commissioner is authorized to commence a

disciplinary proceeding pursuant to this article for false, misleading,

deceptive or fraudulent advertising pursuant to regulations promulgated

by the commissioner which shall be consistent with article twenty-two-A

of the general business law. The department shall issue guidelines as to

appropriate advertising content. In developing such guidelines, the

department shall consider advertising for similar programs offered by

various educational institutions. In a disciplinary action or other

proceeding, such guidelines shall not be presumptive evidence that

particular advertising is appropriate.

b. Beginning on January first, two thousand, all schools shall include

in their advertising, promotional material, or letterhead the statement

"Licensed by the State of New York", and an accompanying symbol to

indicate such status, issued by the commissioner pursuant to section

five thousand nine of this article.

8. The higher education services corporation shall adopt rules and

regulations to effectuate the cessation of collection activities by

lenders or by the corporation in cases in which a licensed private

career school at which the student enrolled has closed or ceased its

teaching activities during the academic period for which the loan was

made or guaranteed.