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A07859 Summary:

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A07859 Text:

 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         7859--A
 
                               2011-2012 Regular Sessions
 
                   IN ASSEMBLY
 
                                      May 19, 2011
                                       ___________
 
        Introduced  by  M.  of  A.  GLICK  -- (at request of the State Education
          Department) -- read once and  referred  to  the  Committee  on  Higher
          Education  -- committee discharged, bill amended, ordered reprinted as
          amended and recommitted to said committee
 
        AN ACT to amend the education law,  in  relation  to  the  licensure  of

          private  proprietary  schools; and providing for the repeal of certain
          provisions upon the expiration thereof
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1. The article heading of article 101 of the education law is
     2  amended to read as follows:
     3                         LICENSED PRIVATE [TRADE AND
     4                CORRESPONDENCE] CAREER SCHOOLS AND CERTIFIED
     5                    ENGLISH AS A SECOND LANGUAGE SCHOOLS
     6    § 2. Legislative intent. The legislature  hereby  finds  and  declares
     7  that  there  is  a  growing need to protect students enrolled in certain
     8  non-degree granting proprietary schools from inadequate job training and
     9  school closure, which disrupts the academic progress of  these  students

    10  and jeopardizes their tuition funds. Given the growing needs and demands
    11  of  business and industry, the legislature further finds and declares it
    12  necessary to align the state education department's current oversight of
    13  these schools with these significantly increasing needs. The legislature
    14  finds it necessary for the department to review these  schools'  curric-
    15  ulums  and instruction to help ensure students receive adequate training
    16  to obtain employment and to successfully perform their occupation in the
    17  workplace. It also finds it necessary for the department to intervene in
    18  certain school closures where teach out plans  may  not  be  efficiently
    19  implemented and students may not complete training.
    20    The  legislature  also finds it necessary for the department to review
    21  these schools for financial viability to prevent school  closure,  which

    22  will,  in  turn,  preserve  tuition  funds and federal and state funding
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD08579-13-1
        A. 7859--A                          2
 
     1  sources. This act is also necessary to increase the  accountability  and
     2  transparency of these schools by allowing students to check on whether a
     3  school is approved or whether a teacher at such school is licensed.
     4    The  legislature  intends  for  this act to increase competition among
     5  these schools, which will, in turn,  improve  the  quality  of  training
     6  offered  at  these schools and the quality of student performance in the
     7  workplace.  This act will provide the  department  with  the  tools  and

     8  resources  necessary  to effectively supervise these schools for compli-
     9  ance and to reimburse students for tuition and other related costs  when
    10  these  schools  close  as  a  result of fiscal failure or noncompliance,
    11  which will overall strengthen student protection.
    12    § 3. Section 5001 of the education law, as added by chapter 817 of the
    13  laws of 1972, the section heading, subdivision 1, paragraph h of  subdi-
    14  vision  2  and paragraph b of subdivision 4 as amended and paragraphs i,
    15  j, k, l and m of subdivision 2 and subdivisions 2-a and 2-b as added  by
    16  chapter 434 of the laws of 1999, paragraph b of subdivision 2 as amended
    17  and subdivisions 5, 6, 7, 8 and 9 as added by chapter 887 of the laws of
    18  1990,  paragraph  d of subdivision 2 and subdivision 4 as amended, para-
    19  graphs a, b, c and d of subdivision 9 as added and subdivisions 5, 6, 7,

    20  8 and 9 as renumbered by chapter 604 of the laws of 1993, paragraph e of
    21  subdivision 2 as amended by chapter 439 of the laws of 1980,  and  para-
    22  graph  f  of subdivision 2 as amended by chapter 13 of the laws of 2010,
    23  is amended to read as follows:
    24    § 5001. Licensed  private  career  schools  [and  registered  business
    25  schools/computer   training  facilities].  1.  Schools  required  to  be
    26  licensed [or registered]. No private school [or computer training facil-
    27  ity] which charges tuition or fees  [for]  related  to  instruction  and
    28  which  is  not  exempted  hereunder  shall  be operated by any person or
    29  persons, firm, corporation, or private organization for the  purpose  of
    30  teaching  or giving instruction in any subject or subjects, unless it is

    31  licensed [or registered] by the department. As used  in  this  article[,
    32  the following terms shall have the following meanings]:
    33    a.  ["Licensed]  "licensed private career school" or "licensed private
    34  school" shall mean any entity offering to instruct or teach any  subject
    35  by  any  plan  or method including written, visual or audio-visual meth-
    36  ods[.], and shall include any institution licensed or  registered  as  a
    37  registered  business  school or computer training facility on the effec-
    38  tive date of the chapter of  the  laws  of  two  thousand  twelve  which
    39  amended  this subdivision. Following such effective date, there shall be
    40  no distinction between institutions previously  defined  as  "registered

    41  business  schools"  or "computer training facilities" and other licensed
    42  private schools, and any reference  in  law  to  a  registered  business
    43  school  or  computer  training facility shall be deemed a reference to a
    44  licensed private career school. Institutions holding  a  valid  business
    45  school  registration on such effective date, including computer-training
    46  facilities, shall have such registrations replaced by the  commissioner,
    47  at no cost, with licenses valid until the expiration date listed on such
    48  previous registration; and
    49    b.  ["Registered  business  school"  shall  mean  a  school in which a
    50  curriculum primarily provides a sequence of  courses  that  may  include
    51  accounting or bookkeeping, marketing, business arithmetic, business law,

    52  business     English,     shorthand,     typing,    computer    business
    53  applications/programming, or substantially all  said  courses,  for  the
    54  purpose  of  preparing  an  individual  to pursue a business occupation;
    55  provided, however, that a registered business school program may include
    56  instruction in English as a second language  at  a  beginning  or  basic
        A. 7859--A                          3

     1  level,  provided  such  instruction shall not constitute more than fifty
     2  percent of such program. Such authorization shall apply to all  students
     3  who  commence  instruction in a registered business school program prior
     4  to July first, nineteen hundred ninety-one. A business school registered

     5  under  this  section  shall employ only teachers licensed by the depart-
     6  ment,  whose  qualifications  are  substantially  equivalent  to   those
     7  required of teachers of equivalent subjects in public secondary schools.
     8    c.  "Computer  training  facility"  shall  mean  any  entity primarily
     9  engaged in providing training on the use, language,  programs,  applica-
    10  tion,  networking  and technical repair of computers] "certified English
    11  as a second language school" or "certified  ESL  school"  shall  mean  a
    12  language  school  conducted  for-profit  which  provides  instruction in
    13  English as a second language and which accepts no public  funds  and  is
    14  certified pursuant to paragraph f of subdivision four of this section.

    15    2. Exempt schools. The following schools are exempted from the licens-
    16  ing requirement of this section:
    17    a. institutions authorized to confer degrees in this state;
    18    b.  schools[, other than correspondence schools,] providing kindergar-
    19  ten,  nursery,  elementary  or  secondary  education,   except   schools
    20  conducted  for  profit  which provide instruction in English as a second
    21  language or preparation for  high  school  equivalency  examinations  to
    22  out-of-school youth or adults;
    23    c. schools operated by governmental agencies or authorities;
    24    d. schools which engage exclusively in training of students with disa-
    25  bilities as defined in section forty-four hundred one of this chapter;
    26    e.  schools  conducted on a not-for-profit basis by firms or organiza-
    27  tions for the training of their own employees only, provided  that  such

    28  instruction is offered at no charge to such employees, or by a fraternal
    29  society or benevolent order for its members or their immediate relatives
    30  only;
    31    f.  schools  which provide instruction in the following subjects only:
    32  religion, dancing, music, painting, drawing, sculpture, poetry, dramatic
    33  art, languages, reading comprehension,  mathematics,  recreation,  yoga,
    34  martial  arts, pilates and athletics, including the training of students
    35  to teach such subjects, provided, however, that  schools  conducted  for
    36  the  purpose  of  training personal trainers shall be excluded from this
    37  exemption and shall be required to obtain licensure;
    38    g. schools in which the course of instruction is licensed,  registered
    39  or  approved  under  any  other  section of this chapter or by any other
    40  department or agency of the state;

    41    h. schools which provide instruction designed solely for giving flight
    42  training and/or related ground school instruction;
    43    i. schools in which instruction designed solely to prepare  applicants
    44  for admission to professional licensing examinations administered by the
    45  department  pursuant  to title eight of this chapter, and applicants for
    46  examination for admission to the practice of law;
    47    j. schools which offer continuing education  courses  exclusively  for
    48  individuals  licensed  by the department pursuant to title eight of this
    49  chapter and for individuals admitted to the practice of law;
    50    k. schools which provide instruction given exclusively to employees of
    51  a person or organization which has contracted  with  another  person  or
    52  organization to provide such instruction at no cost to the employees;
    53    l. conferences, trade shows, workshops, seminars, institutes or cours-

    54  es  of  study  offered  and  sponsored either jointly or individually by
    55  recognized trade, business or professional organizations for the benefit
    56  of their membership; [or those offered to the general public by individ-
        A. 7859--A                          4

     1  uals, firms or organizations which neither conduct such activities for a
     2  duration of more than five consecutive days  nor  more  frequently  than
     3  twice in any one calendar year;]
     4    m. schools that limit their total conferences, trade shows, workshops,
     5  seminars,  institutes or other course offerings to no more than twice in
     6  one calendar year with each of those offerings for  no  more  than  five
     7  days;

     8    n.  schools  which provide instruction exclusively to persons employed
     9  full-time or part-time in  the  field  in  which  instruction  is  being
    10  offered,  where the instruction is provided to meet continuing education
    11  standards required for professional licensure as defined by law in  this
    12  state; and
    13    o.  schools in candidacy status pursuant to subparagraph (iv) of para-
    14  graph b of subdivision four of this section.
    15    2-a. Schools exempted pursuant to subdivision two of this section  may
    16  waive  such  exemption  and  apply  for  a  license  [or  registration];
    17  provided, however, that the review of such applications shall be left to
    18  the discretion of the commissioner.
    19    2-b. Programs offered by licensed private career  schools  [or  regis-

    20  tered  business  schools to private businesses where there is no tuition
    21  liability] to employees of a person or organization which has contracted
    22  with another person or organization to provide such  instruction  at  no
    23  cost  to  the  employees  shall  be exempt from the requirements of this
    24  article, provided that the following requirements are met:
    25    a. Only employees of the [private business]  employer  for  which  the
    26  program is being offered may enroll in classes that make up the program.
    27    b. Certificates or diplomas awarded to students in the program may not
    28  reference in any way the department.
    29    c. Prior to the commencement of the program, such schools shall submit
    30  to  the  department  a  disclosure form, prescribed by the commissioner,

    31  copies of which shall  be  provided  to  all  students  in  such  exempt
    32  program,  which shall include but not be limited to the following infor-
    33  mation:
    34    (i) a description of the location and time period in which the program
    35  will be offered;
    36    (ii) a statement that the students enrolled in the program  shall  not
    37  be  subject  to  any  tuition  liability  for  the program, even if such
    38  students do not complete the program;
    39    (iii) a statement that the program  being  provided  to  the  [private
    40  business]  employer  has  not been approved by the department and is not
    41  under the department's jurisdiction and that the students in the program
    42  have been advised of the fact; and
    43    (iv) the signatures of the school director or owner of the school  and

    44  the  representative  of  the  [private  business] employer for which the
    45  program is being offered certifying the accuracy of  the  statements  on
    46  the form.
    47    d.  Any  additional student openings in a program deemed exempt by the
    48  department may be made available to students  not  affiliated  with  the
    49  [private  business] employer on the condition that such students execute
    50  a disclosure form as prescribed in paragraph c of this subdivision. Such
    51  admitted students shall only constitute up to ten percent of the  exempt
    52  program's total capacity.
    53    4.  Application, renewal application and application fees. a. Applica-
    54  tion and renewal application for a license as a  private  career  school
    55  [or  registration  as  a  business  school] required by the commissioner

    56  shall be filed on forms  prescribed  and  provided  by  the  department.
        A. 7859--A                          5
 
     1  Except as provided in subparagraph (iii) of paragraph e of this subdivi-
     2  sion, each renewal application for [a private business school registered
     3  pursuant to this section or for] a private career school licensed pursu-
     4  ant to this section shall include an audited financial statement audited
     5  according  to  generally  accepted  auditing standards by an independent
     6  certified public accountant or  an  independent  public  accountant  and
     7  statistical reports certified by the owner or operator of the school, as
     8  required  by  the commissioner; provided, however, that the commissioner
     9  shall accept a copy of a current financial statement previously filed by

    10  a school with any other  governmental  agency  in  compliance  with  the
    11  provisions of any federal or state laws, or rules or regulations if such
    12  statement  contains  all of the information required under this subdivi-
    13  sion and conforms to this subdivision's requirements of auditing, review
    14  and certification. Any required audit of the financial  statement  shall
    15  be  a  condition of licensure [or registration] and shall be paid for by
    16  the school, and the results of the  audit  shall  be  forwarded  to  the
    17  commissioner.  Applications  not  accompanied  by the audits and reports
    18  required pursuant to  this  subdivision  shall  not  be  considered  for
    19  approval  by the commissioner. Initial applications shall be accompanied
    20  by financial reports as required by the commissioner. [The  commissioner

    21  shall act on an initial application for a license or registration within
    22  one  hundred  twenty  days  of  receipt  of a complete application.] The
    23  applicant shall receive a written approval or denial together  with  the
    24  reasons for a denial of such application.
    25    b.  (i)  An  initial  license [or registration] issued pursuant to the
    26  provisions of this article shall be valid for a period of two  years.  A
    27  renewal  of  license [or registration] issued pursuant to the provisions
    28  of this article shall be valid for a period of four years. [All  license
    29  and  registration  fees for a renewal shall be double the amounts listed
    30  in paragraph g of this subdivision.]
    31    (ii) Every applicant and renewal applicant shall pay to the department

    32  a nonrefundable, nontransferable application fee. The  initial  applica-
    33  tion  fee for new schools shall be five thousand dollars, of which three
    34  thousand dollars shall accrue to the credit  of  the  proprietary  voca-
    35  tional  school supervision account and two thousand dollars shall accrue
    36  to the tuition reimbursement account. For additional licensed  locations
    37  of  currently  operating schools, the application fee shall be two thou-
    38  sand five hundred dollars, which shall  accrue  to  the  credit  of  the
    39  proprietary  vocational school supervision account. For renewal applica-
    40  tions, the fee shall be based on gross annual tuition income  as  deter-
    41  mined by the annual financial statements required in paragraph a of this

    42  subdivision  for  the  most  recent school fiscal year, according to the
    43  following schedule:
 
    44       GROSS ANNUAL TUITION INCOME           FEE
 
    45       0-$199,999                            $   750.00
    46       $200,000-$499,999                     $ 1,500.00
    47       $500,000-$999,999                     $ 2,225.00
    48       $1,000,000-$4,999,999                 $ 4,500.00
    49       $5,000,000-$9,999,999                 $ 9,000.00
    50       $10,000,000 or above                  $18,000.00
 
    51    Such renewal fees shall accrue to the credit of the proprietary  voca-
    52  tional  school  supervision  account.  If the evaluation of a particular

    53  course or facility requires the services of an expert  not  employed  by
        A. 7859--A                          6
 
     1  the  department,  the department shall retain such expert and the school
     2  shall reimburse the department for the reasonable cost of such services.
     3    (iii)  Each school shall display, near the entrance to the school [and
     4  under glass], the license [or registration] which has been issued to it.
     5  Such authorization shall be displayed only  during  the  period  of  its
     6  validity.
     7    (iv)  A  school  which has applied for a private career school license
     8  may request candidacy status for one time only. Candidacy  status  shall
     9  not  be  issued  to  schools offering programs to train students to pass

    10  licensure examinations such as  appearance  enhancement  tests,  achieve
    11  nurse  aide or nurse assistant certification, or pass examinations lead-
    12  ing to licensure in any other profession or occupation determined by the
    13  commissioner to require full licensure status.   Candidacy status  shall
    14  allow  a  school  to  operate unlicensed for an initial period of twelve
    15  months during the licensure application process, which may  be  extended
    16  to a maximum, non-renewable period of eighteen months, under the follow-
    17  ing conditions:
    18    (1) the prospective school submits a candidate school application fee,
    19  separate from the school application fee, of five thousand dollars which
    20  shall  accrue  to the credit of the proprietary vocational school super-

    21  vision account;
    22    (2) the school shall not represent that it is  licensed  or  that  its
    23  programs are approved through the department;
    24    (3)  to  every  prospective  student,  the  school shall disseminate a
    25  statement, provided by the department, that the facilities, instructors,
    26  and programs being provided have not been approved and are not under the
    27  department's jurisdiction during the candidacy  period.  Such  statement
    28  shall  indicate  that students attending candidate schools shall have no
    29  recourse through the department's student complaint process nor have any
    30  restitution available from the tuition reimbursement  account.  Students
    31  shall  sign  an attestation to the receipt of this statement. The school

    32  shall retain the signed attestation and provide the student with a  copy
    33  of such signed statement;
    34    (4)  the  school  shall  demonstrate financial viability through means
    35  deemed appropriate by the commissioner. Such means may  include  submit-
    36  ting an audited financial statement based on the most recently completed
    37  fiscal year; securing and maintaining a performance bond, payable to the
    38  commissioner, in an amount appropriate to eliminate any liability to the
    39  tuition  reimbursement account in the event the school ceases operation;
    40  limiting the collection of tuition funds until  each  student  completes
    41  the program of study; or other means acceptable to the commissioner; and
    42    (5) any breach of the above conditions shall result in the disapproval

    43  of  the  school's  licensure application and the forfeiture of candidate
    44  status. Continued operation after this  disapproval  shall  subject  the
    45  school to the disciplinary action prescribed under paragraph b of subdi-
    46  vision six of section five thousand three of this article.
    47    (6)  On or before the end of the initial twelve-month period of candi-
    48  dacy status, the commissioner shall review the school's application  for
    49  licensure  and  documentation  relating to the school's candidacy status
    50  and shall determine whether such candidacy status should be extended  to
    51  the  full  eighteen months and whether the school may continue to enroll
    52  students beyond the eighteen-month period or  the  school's  application

    53  for licensure will be initially disapproved for failure to meet required
    54  standards.
    55    c.  An  application for renewal of any license [or registration] shall
    56  be submitted at least one hundred twenty days prior  to  the  expiration
        A. 7859--A                          7
 
     1  date  of  the current authorization to operate accompanied by the nonre-
     2  fundable application fee and  such  certified  statistical  reports  and
     3  annual financial statements required pursuant to this subdivision.
     4    d.  When  complete and timely application has been made for renewal of
     5  any license [or  registration],  the  school  shall  receive  a  written
     6  approval  or  denial,  together  with the reasons for denial of renewal,
     7  from the commissioner no less than thirty days prior to  the  date  such

     8  license [or registration] expires.
     9    e.  Financial statements and statistical reports. (i) Licensed private
    10  career schools and [registered business] candidate schools shall  submit
    11  such  certified  statistical  reports and annual financial statements as
    12  required by the  commissioner.  The  commissioner  may  require  audited
    13  statistical  reports  upon  a  determination  that a school has provided
    14  false or inaccurate certified statistical reports. The financial  state-
    15  ments  shall  be  based  on the fiscal year of the school and shall also
    16  include an itemized account of tuition refunds due and owing to past  or
    17  presently  enrolled students. Statistical reports shall include, but not
    18  be limited to, enrollment, completion and placement  data.  The  commis-
    19  sioner  shall  use  such  financial  statements  and statistical reports

    20  submitted for the purposes of licensure [and registration]  of  schools,
    21  establishing  fees or assessments pursuant to this article and determin-
    22  ing standards pursuant to paragraph b of  subdivision  five  of  section
    23  five thousand two of this article. The attorney general, the comptroller
    24  and  the  president  of  the higher education services corporation shall
    25  have access to this information when it is necessary  to  perform  their
    26  duties as required by state law.
    27    (ii)  Any  school which received [in excess of two hundred fifty] five
    28  hundred thousand dollars or more in gross tuition  in  a  school  fiscal
    29  year  shall  be required to submit to the commissioner an annual audited
    30  financial statement [to the commissioner] prepared  in  accordance  with

    31  generally  accepted accounting principles for that fiscal year. In addi-
    32  tion, any school which has a gross tuition of [two hundred  fifty]  less
    33  than five hundred thousand dollars [or less] in a school fiscal year but
    34  whose  combined  state  and  federal  student financial aid in such year
    35  [exceeds] equals one hundred thousand dollars or more shall also  submit
    36  an  annual  audited  financial  statement  to  the commissioner for that
    37  fiscal year.
    38    (iii) Schools whose gross tuition is [two  hundred  fifty]  less  than
    39  five  hundred  thousand  dollars  [or  less] in a school fiscal year and
    40  which receive less than one hundred thousand dollars in state and feder-
    41  al student financial aid in a school fiscal year  shall  file  with  the

    42  commissioner  an unaudited financial statement in a format prescribed by
    43  the commissioner, provided, however, that any such  school  [with  gross
    44  tuition  in  excess  of fifty thousand dollars shall have filed at least
    45  one audited financial statement after the first year of  its  operation.
    46  The  statement shall be signed by the president or chief executive offi-
    47  cer and the chief fiscal officer of the school who  shall  certify  that
    48  the  statements  are  true and accurate] shall file an audited financial
    49  statement the fiscal  year  after  a  reviewed  financial  statement  is
    50  submitted.  For  such schools, audited financial statements are required
    51  every two years, at minimum, with reviewed financial statements  allowed

    52  during the alternate year. Upon a determination by the commissioner that
    53  a  school has submitted false or inaccurate statements or that a signif-
    54  icant, unsubstantiated  decline  in  gross  tuition  has  occurred,  the
    55  commissioner  may  require  any such school to file an audited financial
        A. 7859--A                          8
 
     1  statement pursuant to this paragraph even during  alternate  years  when
     2  reviewed statements would ordinarily be allowed.
     3    f.  Alternate  licensing provision. The commissioner shall issue regu-
     4  lations which define alternate licensing or  certification  requirements
     5  for the following:
     6    (1)  correspondence schools in which all approved programs and courses
     7  are under three hundred hours;
     8    (2) schools which are eligible for exemption under  this  section  but

     9  which elect to be licensed;
    10    (3) non-profit schools exempt from taxation under section 501(c)(3) of
    11  the  internal  revenue  code  whose programs are funded entirely through
    12  donations from individuals or  philanthropic  organizations,  or  endow-
    13  ments, and interest accrued thereon; and
    14    (4) language schools conducted for-profit which provide instruction in
    15  English as a second language and which accept no public funds.
    16    [g.  Application  fee. Every applicant and renewal applicant shall pay
    17  to the department a nonrefundable, nontransferable fee  based  on  gross
    18  annual  tuition  income as determined by the annual financial statements
    19  required in paragraph a of this subdivision for the most  recent  school
    20  fiscal year, according to the following schedule:


    21       GROSS ANNUAL TUITION INCOME            FEE

    22       0-$199,999                             $ 250.00
    23       $200,000-$499,999                      $ 500.00
    24       $500,000-$999,999                      $ 750.00
    25       $1,000,000-$4,999,999                 $1,500.00
    26       $5,000,000-$9,999,999                 $3,000.00
    27       $10,000,000 or above                  $6,000.00

    28    Such  fees  shall  accrue  to the credit of the proprietary vocational
    29  school supervision account. If the evaluation of a particular course  or
    30  facility  requires the services of an expert not employed by the depart-
    31  ment, the department shall retain such expert and the school shall reim-

    32  burse the department for the reasonable cost of such services.]
    33    5. Required  disclosure  for  licensure.  a.  The  commissioner  shall
    34  require that each applicant for a license for the operation of a private
    35  [vocational  or  business] career school disclose the following informa-
    36  tion:
    37    (1) Whether the applicant, or any  corporation,  partnership,  associ-
    38  ation or organization or person holding an ownership or control interest
    39  in  such  school,  or any employee responsible in a supervisory capacity
    40  for the administration of student funds or governmental funds, has  been
    41  convicted of a crime defined in this article, or any other crime involv-
    42  ing  the  operation  of  any  educational  or  training  program, or, in
    43  connection with the operation of any such program, a crime involving the

    44  unlawful acquisition, use, payment  or  expenditure  of  educational  or
    45  training program funds; and
    46    (2)  Whether  the  applicant, or any corporation, partnership, associ-
    47  ation or organization or person holding an ownership or control interest
    48  in such school, or any employee responsible in  a  supervisory  capacity
    49  for  the  administration of student funds or governmental funds has been
    50  convicted:
    51    (A) in this state of any of the  following  felonies  defined  in  the
    52  penal law: bribery involving public servants; commercial bribery; perju-
    53  ry  in  the  second  degree;  rewarding official misconduct; larceny, in
        A. 7859--A                          9
 
     1  connection with the provision of services  or  involving  the  theft  of
     2  governmental  funds;  offering a false instrument for filing, falsifying

     3  business records; tampering with public records; criminal usury;  scheme
     4  to defraud; or defrauding the government; or
     5    (B)  in  any  other  jurisdiction of an offense which is substantially
     6  similar to any of the felonies defined in clause (A)  of  this  subpara-
     7  graph  and  for  which a sentence to a term of imprisonment in excess of
     8  one year was authorized and is authorized in this  state  regardless  of
     9  whether such sentence was imposed; and
    10    (3)  Whether  the  applicant, or any corporation, partnership, associ-
    11  ation or organization or person holding an ownership or control interest
    12  in such school, or any employee responsible in  a  supervisory  capacity
    13  for  the administration of student funds or governmental funds, has been
    14  finally determined in any administrative or  civil  proceeding  to  have
    15  committed  a violation of any provision of this article or any rules and

    16  regulations promulgated pursuant thereto, or any related order or deter-
    17  mination of the commissioner, or of any  similar  statute,  rule,  regu-
    18  lation, order or determination of another jurisdiction pertaining to the
    19  licensure and operation of any educational or training program; and
    20    (4)  Whether  any  school owned or operated by the applicant closed or
    21  ceased operation and, if so, whether at the  time  of  the  closing  the
    22  applicant  was  subject  to a pending disciplinary action, disallowance,
    23  fine or other penalty and whether it  owed  refunds  to  any  government
    24  agency or students.
    25    b.  No  application  for any license pursuant to this article shall be
    26  denied by reason of disclosure  pursuant  to  this  subdivision  of  the
    27  applicant,  or any corporation, partnership, association or organization
    28  or person holding an ownership or control interest in  such  school,  or

    29  any  employee  responsible  in  a  supervisory capacity for the adminis-
    30  tration of student funds or governmental funds unless  the  commissioner
    31  makes  a  written  determination  that  there  is  a direct relationship
    32  between one or more of such previous offenses and the license sought, or
    33  that issuance of the license would create an unreasonable risk to  prop-
    34  erty  or  to the safety, education or welfare of specific individuals or
    35  the general public. In making such determination, the commissioner shall
    36  be guided by the factors set forth in section seven hundred  fifty-three
    37  of  the  correction law. For purposes of this subdivision, "ownership or
    38  control interest" means: with respect to a school that is  organized  as
    39  or  owned by a corporation, a position as an officer or director of such
    40  corporation; or, with respect to a school that is organized as or  owned

    41  by  a partnership, a position as a partner; or any other interest total-
    42  ing ten percent or more, whether direct or indirect, in the total equity
    43  or assets of such school.
    44    c. The commissioner may deny, suspend, revoke or decline to renew  any
    45  license:  (1)  if  the significance of the convictions or administrative
    46  violations warrant such action [or]; (2) if the commissioner  determines
    47  that  a school did not make any disclosure required by this subdivision;
    48  or (3) if the commissioner determines that a school's  financial  condi-
    49  tion may result in the interruption or cessation of instruction or jeop-
    50  ardize student tuition funds.
    51    6.  If, during the [two year] period for which a license [or registra-

    52  tion] is granted, the commissioner determines that a school's  financial
    53  condition  may result in the interruption or cessation of instruction or
    54  jeopardize student tuition funds, the commissioner may, upon  notice  to
    55  the  school,  place the school on probation for a period of no more than
    56  [thirty days] one year, during which time the school and the  department
        A. 7859--A                         10
 
     1  must  make  efforts  to  resolve the problems at the school.  The school
     2  shall submit a report on its financial  condition  to  the  commissioner
     3  within  the time prescribed by the commissioner. Such report shall be in
     4  the  form  and  shall include content prescribed by the commissioner and

     5  shall be reviewed by the commissioner to determine the  school's  finan-
     6  cial  viability.  The  commissioner  may  suspend or revoke the school's
     7  license, as well as require the cessation of student enrollment, upon  a
     8  determination that the school's financial condition continues to threat-
     9  en  its  ability  to  educate students and/or the student tuition funds.
    10  Alternatives for the school to demonstrate a  fiscally  sound  operation
    11  may  include securing and maintaining a performance bond, payable to the
    12  commissioner, in an appropriate amount to eliminate any liability to the
    13  tuition reimbursement account should the school cease operation,  limit-
    14  ing  the  collection  of  tuition funds until each student completes the

    15  program of study, or other means acceptable to the commissioner.  If  no
    16  resolution  can be attained, a hearing, pursuant to subdivisions two and
    17  three of section five thousand three of this article will be  scheduled.
    18  Such  probation  may include additional monitoring, inspections, limita-
    19  tions on enrollment, teaching out some or  all  of  a  school's  present
    20  students or temporary cessation of instruction.
    21    7.  No  license  [or registration] granted under this section shall be
    22  transferable or assignable without the  approval  of  the  commissioner.
    23  [Any]  Upon  transfer or assignment of any interest totaling [ten] twen-
    24  ty-five percent or more, whether direct or indirect, in the total equity
    25  or assets of a school, such school shall be deemed a [transfer  of  such

    26  school's license or registration. The commissioner shall approve or deny
    27  a transfer or assignment based on the requirements set forth in subdivi-
    28  sions three and four of this section.  Such approval or denial, together
    29  with  the  reasons  for  denial,  shall be transmitted in writing within
    30  ninety days of the receipt of the complete application  by  the  commis-
    31  sioner.  Upon  a showing of good cause as to why the applicant could not
    32  obtain the commissioner's approval prior to a  transfer  or  assignment,
    33  the  commissioner  shall  temporarily approve the transfer or assignment
    34  for a period not to exceed forty-five days and for such additional peri-
    35  ods as the commissioner may deem appropriate]  new  school  required  to

    36  submit  a  new  school  application and obtain a new license pursuant to
    37  this article. Provided, however, that upon such a substantial change  in
    38  interest,  the  previous school license shall remain in effect until the
    39  new license is issued or denied or the previous license  expires  or  is
    40  revoked, whichever occurs first.
    41    8.  No  licensed [or registered] school shall discontinue operation or
    42  surrender its license  [or  registration]  unless  thirty  days  written
    43  notice  of  its  intention  to  do so and a plan for maintenance of safe
    44  keeping of the records of the school is provided  to  the  commissioner.
    45  However,  upon  good  cause shown, the commissioner may waive the thirty
    46  days notice requirement.

    47    9. Annual supervision fund and tuition  reimbursement  [fund]  account
    48  assessment.    a.  The  commissioner shall annually assess each school a
    49  total percentage of that school's gross tuition pursuant to  subdivision
    50  three of section five thousand two of this article, as determined by the
    51  annual  [financial  statement  or  annual]  audited  financial statement
    52  required by this article. This  assessment  shall  be  based  upon  each
    53  school's  gross  tuition from the previous year, and shall be payable to
    54  the commissioner in equal quarterly installments which shall be  due  on
    55  June first, September first, December first and March first.
        A. 7859--A                         11
 
     1    b. (i) [Beginning April first, nineteen hundred ninety-one, such] Such

     2  annualized  assessment shall be one percent  for schools which have paid
     3  less than sixteen quarters of assessments, but  such  annual  assessment
     4  shall not fall below five hundred dollars.
     5    (ii)  [Beginning  July first, nineteen hundred ninety-four, such] Such
     6  annualized assessment shall be [nine-tenths] eight-tenths of one percent
     7  for schools which have paid sixteen or more quarters of assessments, but
     8  such annual assessment shall not fall below five hundred dollars.
     9    [(iii) Beginning April first, nineteen  hundred  ninety-five,  and  in
    10  each  succeeding  year, such annualized assessment shall be eight-tenths
    11  of one percent.]
    12    c. (i) Of the total assessment provided for herein, five-tenths of one

    13  percent shall accrue to the credit of the tuition reimbursement  account
    14  pursuant  to  section  five  thousand  seven  of  this article for those
    15  schools which have paid less than sixteen quarters  of  assessments.  Of
    16  the  total  assessment  provided  for schools which have paid sixteen or
    17  more quarters of assessments, three-tenths of one percent  shall  accrue
    18  to  the  credit  of the tuition reimbursement [fund] account pursuant to
    19  section five thousand seven of this article.   For  schools  paying  the
    20  minimum five hundred dollars annual assessment, none shall accrue to the
    21  tuition reimbursement account.
    22    (ii)  The balance of the total assessment provided for herein shall be
    23  dedicated  to  fund  the  department's  supervision  and  regulation  of

    24  licensed  private  schools [and registered business schools] pursuant to
    25  an annual appropriation and an annual plan of  expenditure  prepared  by
    26  the  commissioner and approved by the director of the budget. [Following
    27  the close of each fiscal year, the commissioner,  in  consultation  with
    28  the  director  of  the  budget,  shall  determine  if the balance in the
    29  proprietary vocational school supervision  fund  for  such  fiscal  year
    30  exceeded  the amount required for the support of the department's super-
    31  visory activities taking into account projected  revenues  and  expendi-
    32  tures  for  the  subsequent fiscal year. To the extent that a surplus is
    33  identified, the commissioner, with the approval of the director  of  the

    34  budget,  shall  direct  the  transfer  of  such  surplus  to the tuition
    35  reimbursement fund.]
    36    d. Payments made within thirty days following the due  date  shall  be
    37  subject  to  interest  at  one  percent above the prevailing prime rate.
    38  Thereafter, late payments may result in suspension of licensure  by  the
    39  commissioner.  Payments required by this subdivision shall be considered
    40  a condition of licensure [or registration].
    41    § 4. Section 5002 of the education law, as added by chapter 887 of the
    42  laws of 1990, subparagraph 3 of paragraph b and paragraph d of  subdivi-
    43  sion 1, subparagraph 2 of paragraph g of subdivision 3 and subdivision 6
    44  as  amended and paragraph c of subdivision 1 and paragraph d of subdivi-
    45  sion 2 as added by chapter 604 of the  laws  of  1993,  paragraph  c  of

    46  subdivision 2, paragraph a of subdivision 4 and subdivision 7 as amended
    47  and  paragraph  e  of  subdivision 4 and paragraph c of subdivision 6 as
    48  added by chapter 434 of the laws of 1999, paragraph f of  subdivision  4
    49  as  added by chapter 457 of the laws of 2003 and subparagraph 2 of para-
    50  graph b of subdivision 5 as amended by chapter 301 of the laws of  1996,
    51  is amended to read as follows:
    52    § 5002. Standards  for licensed private career schools [and registered
    53  business schools]. Any  school  licensed  [or  registered]  pursuant  to
    54  section  five  thousand  one  of  this  article  shall  be organized and
    55  conducted only as a school and shall be subject to the  jurisdiction  of
    56  the  department  exclusively,  or  in  conjunction with such other state
        A. 7859--A                         12
 

     1  agency or department or district attorney upon  which  jurisdiction  has
     2  also  been conferred by law. Such schools shall be subject to and comply
     3  with the provisions of this section.
     4    1.  Standards.  a.  No program of such schools shall be conducted in a
     5  factory or commercial establishment, except where the use of  facilities
     6  or  equipment  of  such factory or commercial establishment is permitted
     7  for necessary or desirable educational purposes and objectives.
     8    b. For every such school, the commissioner shall set  forth  in  regu-
     9  lation standards governing all of the following:
    10    (1) criteria for admission, which shall provide that students at least
    11  possess a high school diploma or its equivalent or demonstrate the abil-
    12  ity to benefit from the instruction, except that in the case of students
    13  who  do  not  possess  a  high school diploma or its equivalent, certif-

    14  ication of the students' ability to benefit from  instruction  shall  be
    15  provided to the commissioner as provided in paragraph c of this subdivi-
    16  sion;
    17    (2) the standards and the methods of instruction;
    18    (3)  the  equipment available for instruction with the maximum enroll-
    19  ment that such equipment and physical plant will accommodate;
    20    (4) the qualifications  and  experience  of  teaching  and  management
    21  personnel;
    22    (5)  the  form  and  content  of  the  student enrollment agreement or
    23  contract, provided that such agreement or contract shall be  written  in
    24  the same language as that principally used in the sales presentation;
    25    (6) the methods of collecting tuition;
    26    (7) eligibility criteria for programs that will require licensure;
    27    (8) the sufficiency and suitability of the resources available for the
    28  support of such school; and

    29    (9) counseling provided to students.
    30    b-1.  (1)  Student  loans  or  other financial aid funds received from
    31  federal, state, or local governments or administered under  the  federal
    32  student financial assistance programs governed by Title IV of the Higher
    33  Education Act of nineteen hundred sixty-five, 20 U.S.C.  section 1070 et
    34  seq.,  as  amended,  must  be  collected  and  applied  in the manner as
    35  controlled by the applicable federal, state or local regulations.
    36    (2) Student loans or other financial aid funds received  from  private
    37  entities, including, but not limited to, banks, financing companies, and
    38  other  lending  sources  must be collected or disbursed in the following
    39  manner:

    40    (A) Loans or other financial aid payments for amounts of five thousand
    41  dollars or less may be disbursed as a single disbursement, regardless of
    42  course length.
    43    (B) Loans or other financial aid payments  for  amounts  greater  than
    44  five  thousand dollars that reflect a class term of less than six months
    45  shall have two equal disbursements. The disbursement schedule  for  such
    46  loans  or  payments  shall be as follows: one-half of the tuition amount
    47  released initially, and  the  remainder  released  halfway  through  the
    48  course term.
    49    (C)  Loans  or  other  financial aid payments for amounts greater than
    50  five thousand dollars that reflect a class  term  of  greater  than  six

    51  months, but less than twelve months must have three equal disbursements.
    52  The  disbursement  schedule  for  such  loans  or  payments  shall be as
    53  follows:  one-third of the tuition amount released initially, the second
    54  disbursement shall be released one-third of the way through  the  length
    55  of  the  training,  and  the  remainder  released  two-thirds of the way
    56  through the course term.
        A. 7859--A                         13
 
     1    (D) Loans of other financial aid payments  for  amounts  greater  than
     2  five  thousand  dollars  that  reflect  a class term greater than twelve
     3  months shall have four equal disbursements.  The  disbursement  schedule
     4  for  such  loans  or  payments  shall  be as follows: one-quarter of the

     5  tuition  amount  released  initially,  the  second disbursement shall be
     6  released one quarter of the way through the length of the training;  the
     7  third  disbursement  shall be released halfway through the length of the
     8  training, and the remainder shall be released three-quarters of the  way
     9  through the training.
    10    (3) No school may enter into any contract or agreement with or receive
    11  any  students loan or financial aid funds from private entities, includ-
    12  ing, but not limited to,  banks,  financing  companies,  and  any  other
    13  private  lending  sources  unless  the private entity has a disbursement
    14  policy that, at a minimum, meets the requirements of subparagraph two of
    15  this paragraph.

    16    (4) The term private entity referenced in subparagraphs two and  three
    17  of  this  paragraph shall not be construed to include a friend or family
    18  member of the student who is not in the routine  business  of  providing
    19  student  loans  or  financial aid funds. The provision of such a loan or
    20  fund by a private entity shall also  not  include  the  payment  of  the
    21  student's tuition or fees by use of a credit card.
    22    c. Notwithstanding any other provisions of this article to the contra-
    23  ry, the commissioner shall define alternative educational and curriculum
    24  standards  for any program of less than forty hours designed exclusively
    25  for non-occupational, personal enrichment purposes.
    26    d. Admission of students under the ability to benefit provision.

    27    (1) Certification. Each school admitting students who do  not  possess
    28  at  least  a  high school diploma or its equivalent shall certify to the
    29  satisfaction of the commissioner that  such  prospective  students  have
    30  been  administered  and passed an examination which has been approved by
    31  the commissioner to determine their ability to benefit from  the  chosen
    32  curriculum prior to admission to the curriculum or course of study. Such
    33  examination  shall,  whenever  possible, be a nationally recognized test
    34  appropriate for the course of instruction which has been approved by the
    35  commissioner. The examination results of each such student who is admit-
    36  ted shall be made available to the commissioner at a time prescribed  by
    37  the commissioner and, together with the student's original answer sheet,
    38  shall be maintained by the school in the student's permanent record. For

    39  any  student  failing to achieve the necessary score on such examination
    40  for enrollment, the school shall be required  to  provide  such  student
    41  with  a  listing of appropriate counseling and educational opportunities
    42  available to the student at no cost, as determined by the  commissioner.
    43  Where  appropriate,  the  commissioner  may  accept  such other entrance
    44  requirement documentation such as prerequisite coursework,  professional
    45  or  vendor  certifications,  personal interviews, and/or attestations of
    46  equivalent knowledge in lieu of the examination requirement.
    47    (2) Counseling. Each school [admitting] offering curricula which admit
    48  students who do not possess a high  school  diploma  or  its  equivalent
    49  shall  develop  a  plan to be approved by the commissioner for the coun-

    50  seling of such students on an individual basis on matters including  but
    51  not  limited to the student's ability to progress in the curriculum, the
    52  student's financial aid rights and responsibilities, the availability of
    53  programs to earn a high school equivalency diploma,  including  programs
    54  provided at no cost to the student, and the potential of the training to
    55  prepare  the  student  for available employment opportunities within the
    56  region.
        A. 7859--A                         14
 
     1    (3) Compliance. (A) The commissioner  shall  monitor  compliance  with
     2  this  paragraph  and  verify  the examination and counseling process and
     3  student examination scores. Such  procedures  may  include  but  not  be
     4  limited  to an annual, statistically significant, random sampling of the
     5  examinations  taken by prospective students of each school administering

     6  such examinations.
     7    (B) [Such procedures shall  provide  that  the  examinations  of  each
     8  school be inspected on site at least once annually.
     9    (C)]  In the event that the commissioner determines that the school is
    10  out of compliance with  the  examination  process  and  counseling,  the
    11  commissioner shall require that examinations and counseling for students
    12  admitted  under  the  ability  to  benefit  provision and the counseling
    13  required by subparagraph two of this  paragraph  be  conducted  off  the
    14  premises  of  the  school  by an entity approved by the commissioner for
    15  such period of time as the commissioner deems appropriate, the  cost  of
    16  which shall be incurred by the school.
    17    2.  Inspections.  a.  Every  school  licensed pursuant to this article
    18  shall maintain adequate and accurate records for a period  of  not  less

    19  than  [six]  seven  years at its principal place of business within this
    20  state. Such records shall be maintained in a manner and form  prescribed
    21  by  the  commissioner  and shall be made available to the department and
    22  the higher education services corporation upon request.
    23    b. In addition to other requirements in this article, the  information
    24  to be made a part of the record shall include, but not be limited to:
    25    (1) names and addresses of each enrolled student;
    26    (2) the course of study offered by the institution;
    27    (3) the name and address of its faculty, together with a record of the
    28  educational qualifications of each;
    29    (4) the graduation date of each student; and
    30    (5)  for  each  student  who fails to complete his or her program, the
    31  student's last date of attendance and, if applicable, the amount of  any

    32  refund paid to, or on behalf of, the student and the date the refund was
    33  made.
    34    c.  The commissioner shall conduct periodic unscheduled inspections of
    35  licensed private career schools [and  registered  business  schools]  to
    36  monitor  compliance  with the provisions of this article or the rules or
    37  regulations promulgated thereunder or any final order or decision of the
    38  commissioner made pursuant to this article. The department shall conduct
    39  an inspection of each school at  least  once  every  [three  years.  The
    40  department  shall annually inspect schools: (1) having a high percentage
    41  of students admitted under ability to benefit criteria as determined  by
    42  the  commissioner; (2) having a high student loan default rate as deter-

    43  mined by the commissioner in a manner consistent with federal standards;
    44  or (3) which are the subject of a high volume of complaints by  students
    45  or  other  parties]  licensure  period.  All  schools shall provide upon
    46  request of the department, any  and  all  records  necessary  to  review
    47  compliance with the provisions of this article.
    48    d.  Student  permanent  records,  as defined in the regulations of the
    49  commissioner, shall be maintained for a period of twenty years.
    50    3. Tuition liability. a. The tuition charge for programs approved  for
    51  participation  in  student financial aid general award programs pursuant
    52  to articles thirteen and fourteen of this chapter shall  be  apportioned
    53  on  the  basis of terms, quarters or semesters. For the purposes of this
    54  section, the terms "term", "quarter" and "semester" shall be defined  in

    55  regulations by the commissioner.
        A. 7859--A                         15
 
     1    b.  The  tuition  refund  policy  for the first term or quarter of any
     2  program at schools licensed [or registered]  pursuant  to  section  five
     3  thousand one of this article shall be as follows:
     4    (1)  For  programs  which  are divided into quarters of up to fourteen
     5  weeks, the school shall evenly divide the total  tuition  charges  among
     6  the  number  of  quarters.  After instruction is begun in a school, if a
     7  student withdraws or is discontinued, the  school  may  retain  no  more
     8  than:
     9    (i) zero percent of the quarter's tuition if the termination is during
    10  the first week of instruction; or
    11    (ii)  twenty-five  percent of the quarter's tuition if the termination
    12  is during the second week of instruction; or

    13    (iii) fifty percent of the quarter's tuition  if  the  termination  is
    14  during the third week of instruction; or
    15    (iv)  seventy-five percent of the quarter's tuition if the termination
    16  is during the fourth week of instruction; or
    17    (v) one hundred percent of the quarter's tuition  if  the  termination
    18  occurs after the fourth week of instruction.
    19    (2)  For programs organized by terms of fifteen, sixteen, seventeen or
    20  eighteen weeks apiece, the school shall evenly divide the total  tuition
    21  charges  among  the  number  of  terms.  After instruction is begun in a
    22  school, if a student withdraws or is discontinued, the school may retain
    23  no more than:
    24    (i) zero percent of the term's tuition if the  termination  is  during
    25  the first week of instruction; or
    26    (ii) twenty percent of the term's tuition if the termination is during
    27  the second week of instruction; or

    28    (iii)  thirty-five percent of the term's tuition if the termination is
    29  during the third week of instruction; or
    30    (iv) fifty percent of the term's tuition if the termination is  during
    31  the fourth week of instruction; or
    32    (v) seventy percent of the term's tuition if the termination is during
    33  the fifth week of instruction; or
    34    (vi)  one  hundred  percent  of  the term's tuition if the termination
    35  occurs after the completion of the fifth week of instruction.
    36    c. (1) The tuition refund policy for the second term or quarter of any
    37  program at schools licensed [or registered]  pursuant  to  section  five
    38  thousand one of this article shall be as follows:
    39    (A)  For  programs  which  are divided into quarters of up to fourteen
    40  weeks, the school shall evenly divide the total  tuition  charges  among

    41  the  number  of  quarters.  After instruction is begun in a school, if a
    42  student withdraws or is discontinued, the  school  may  retain  no  more
    43  than:
    44    (i) twenty-five percent of the quarter's tuition if the termination is
    45  during the first week of instruction; or
    46    (ii)  fifty  percent  of  the  quarter's tuition if the termination is
    47  during the second week of instruction; or
    48    (iii) seventy-five percent of the quarter's tuition if the termination
    49  is during the third week of instruction; or [.]
    50    (iv) one hundred percent of the quarter's tuition if  the  termination
    51  occurs after the third week of instruction.
    52    (B)  For programs organized by terms of fifteen, sixteen, seventeen or
    53  eighteen weeks apiece, the school shall evenly divide the total  tuition
    54  charges  among  the  number  of  terms.  After instruction is begun in a

    55  school, if a student withdraws or is discontinued, the school may retain
    56  no more than:
        A. 7859--A                         16
 
     1    (i) twenty percent of the term's tuition if the termination is  during
     2  the first week of instruction; or
     3    (ii)  thirty-five  percent of the term's tuition if the termination is
     4  during the second week of instruction; or
     5    (iii) fifty percent of the term's tuition if the termination is during
     6  the third week of instruction; or
     7    (iv) seventy percent of the  term's  tuition  if  the  termination  is
     8  during the fourth week of instruction; or
     9    (v)  one  hundred  percent  of  the  term's tuition if the termination
    10  occurs after the completion of the fourth week of instruction.
    11    (2) Notwithstanding the provisions of subparagraph one of  this  para-

    12  graph, the tuition refund policy set forth in paragraph b of this subdi-
    13  vision  shall  apply  unless  the  school demonstrates that there are no
    14  significant educational  changes  in  the  educational  program  of  the
    15  student, such changes as defined in regulations of the commissioner.
    16    d.  The tuition refund policy for the third and any subsequent term or
    17  quarter of any program licensed [or registered] pursuant to section five
    18  thousand one of this article shall be the policy set forth  in  subpara-
    19  graph one of paragraph c of this subdivision.
    20    e. No program shall have a term in excess of eighteen weeks.
    21    f.  The amount of the refund shall be calculated based on the last day
    22  of student attendance.
    23    g. (1) Any refund due to a student shall be paid by the school  within
    24  forty-five  days  of  the  date  on which the student withdraws from the

    25  program. For the purposes of this article, such date shall be the earli-
    26  est of (i) the date on which the student gives  written  notice  to  the
    27  school or (ii) the date on which the student is deemed to have withdrawn
    28  pursuant to subparagraph two of this paragraph.
    29    (2)  If  a student has failed to attend classes for a period of thirty
    30  calendar days, the school shall send by regular mail  a  notice  to  the
    31  student  that  the  student  shall  be deemed to have withdrawn from the
    32  program if the student does not notify the school to the contrary within
    33  twelve days from the date on which the letter is sent.  If  the  student
    34  fails  to  respond  within  such twelve-day period, the student shall be
    35  deemed to have withdrawn and the school shall notify the  higher  educa-
    36  tion services corporation that the student has withdrawn and the date of
    37  the withdrawal.

    38    h.  Schools shall submit, for approval by the commissioner, the school
    39  catalog with a weekly tuition liability  chart  for  each  program  that
    40  indicates  the  amount  of  refund due the student in the event of with-
    41  drawal.
    42    i. Upon payment of a refund to a lender, the  school  shall  forthwith
    43  send  a  notice  to  a  person designated by the president of the higher
    44  education services corporation upon a form  approved  by  the  president
    45  that such refund was made.
    46    [i.]  j. If the higher education services corporation fails to receive
    47  the notice required by paragraph [h] i of  this  subdivision,  it  shall
    48  forthwith  notify  the  student  of his or her right to a refund and the
    49  commissioner of such failure. Upon receipt  of  such  notification,  the

    50  commissioner shall take appropriate action against the school.
    51    4.  Curriculum  approval.  a. An application and fee shall be made for
    52  the initial approval of a curriculum or course and  shall  include  such
    53  information  as  the  commissioner  may  require by regulation. Approval
    54  shall be valid for a period not to exceed four years.   The  application
    55  fee  for  any curriculum of one hundred clock hours or more shall be two
    56  hundred fifty dollars. The application fee for any course of  less  than
        A. 7859--A                         17
 
     1  one  hundred  clock hours shall be one hundred dollars. Such application
     2  fees shall accrue to the credit of  the  proprietary  vocational  school
     3  supervision account.

     4    b. In approving curriculum, the commissioner shall take into consider-
     5  ation the following:
     6    (1)  that  the entrance requirements demonstrate that students possess
     7  the skills, competencies and prerequisite knowledge needed  to  progress
     8  in the curriculum;
     9    (2)  that  the content will enable the student to develop those skills
    10  and competencies required for employment in the  occupational  area  for
    11  which the curriculum was developed;
    12    (3)  that  the  school will utilize appropriate instructional methods;
    13  [and]
    14    (4) that the instructional equipment used  within  the  curriculum  is
    15  comparable  to  the  equipment currently used by business or industry in
    16  the occupational area for which the curriculum was developed; and
    17    (5) that a curriculum may include instruction in English as  a  second

    18  language  at a beginning or basic level, provided such instruction shall
    19  not constitute more than fifty percent of such program.
    20    c. (1) If the evaluation of a particular course or  facility  requires
    21  the services of an expert not employed by the department, the department
    22  shall  retain such expert [and the school shall reimburse the department
    23  for the reasonable cost of such services] at  the  school's  expense  in
    24  addition  to  the  application  fees  prescribed  in paragraph a of this
    25  subdivision.
    26    (2) If, in the interest of expediting the approvals, a school requests
    27  the department to employ an outside consultant, the school shall  [reim-
    28  burse  the department for] pay the [reasonable] cost of such services in

    29  addition to the application fees  prescribed  in  paragraph  a  of  this
    30  subdivision.
    31    d. The commissioner shall act on applications for approval of a course
    32  or  curriculum  within  one hundred twenty days of receipt of a complete
    33  application and, in the case of a denial, shall set forth in writing the
    34  reasons for such denial.
    35    e. Notwithstanding paragraphs b, c and d of this subdivision,  curric-
    36  ulum  certified  by a nationally recognized vendor as defined in commis-
    37  sioner's regulations shall be recognized by the department in lieu of an
    38  expert evaluation when such curriculum is adopted by  a  school  in  the
    39  original  format  provided by the vendor as long as the proposed curric-
    40  ulum is a stand alone program and not part  of  a  larger  comprehensive
    41  course.
    42    f.  Notwithstanding  any  other provision of the law, a not-for-profit

    43  [registered business] licensed  career  school,  that  is  eligible  for
    44  participation  in  the tuition assistance program and which has national
    45  accreditation, may, for the purpose of calculation of federal  financial
    46  aid  amounts  only,  measure  students' academic progress in an approved
    47  curriculum in non-degree granting credit hours, based  upon  a  national
    48  accrediting  agency's  conversion and approval of clock hours to non-de-
    49  gree credit hours. For the purposes of this paragraph, "national accred-
    50  itation" shall mean accreditation by a national  accrediting  agency  as
    51  defined in the commissioner's regulations.
    52    5. Application for reapproval. a. An application and fee shall be made
    53  for  reapproval  of  a  curriculum  or course. Such application shall be
    54  considered timely if submitted at least one hundred twenty days prior to

    55  the expiration of the current approval.  The  application  fee  for  any
    56  curriculum of one hundred clock hours or more shall be two hundred fifty
        A. 7859--A                         18
 
     1  dollars.  The  application  fee  for any course of less than one hundred
     2  clock hours shall be one hundred dollars, provided that no fee shall  be
     3  assessed  for the submission of a reapproval application without change.
     4  Such application fee shall accrue to the credit of the proprietary voca-
     5  tional school supervision account.
     6    b. Curriculum  reapproval  standards.  (1) The commissioner shall pre-
     7  scribe by regulation, standards for reapproval after the first  year  of
     8  licensure,  of any curriculum or course based upon factors including but

     9  not limited to the following, as appropriate:
    10    (i) for each curriculum or course, the percentage of students who have
    11  dropped out;
    12    (ii) the acquisition of a specified minimum level  of  skills  by  the
    13  students; and
    14    (iii) for each curriculum or course, the percentage of students placed
    15  in occupations related to the instruction, where applicable.
    16    (2)  Such standards shall be consistent with those applied to all non-
    17  degree career education programs.
    18    c. Reapproval contingency. Reapproval of a curriculum or course  shall
    19  be  contingent upon a demonstration by the applicant that the curriculum
    20  or course has met the curriculum reapproval standards set forth in  this
    21  subdivision.  Except as otherwise provided in paragraph d of this subdi-
    22  vision, no such curriculum or course or substantially similar curriculum

    23  or course may be given without reapproval by the commissioner.
    24    d. When timely and complete application is made for the reapproval  of
    25  a  curriculum or course, and no written denial is made thirty days prior
    26  to the date of expiration of the existing approval,  the  curriculum  or
    27  course  shall be deemed to be approved for the period of the curriculum.
    28  If the application is denied, the commissioner shall set forth in  writ-
    29  ing the reasons for such denial.
    30    e.  The  commissioner may provide in regulations for reapproval proce-
    31  dures, consistent with this subdivision, for applications submitted less
    32  than one hundred twenty days from the expiration date.
    33    f. The commissioner shall act upon enrollment agreements and  catalogs
    34  within  ninety  days  of  receipt, and, in the case of denial, shall set
    35  forth in writing the reasons for such denial. If the commissioner  fails

    36  to  act  within  ninety days, a catalog shall be deemed approved for one
    37  year and an enrollment agreement shall  be  deemed  approved  until  the
    38  commissioner acts upon it.
    39    6. a. Teachers and directors. No person shall be employed by a private
    40  career  school  as  a  director  or  teacher who is not licensed in such
    41  capacity by the department pursuant to regulations of the  commissioner,
    42  which  shall  take  into  consideration such factors as moral character,
    43  educational qualifications and  practical  experience.  The  application
    44  shall  include  a  statement, signed by the president or chief executive
    45  officer of the school, certifying that to the best of his or  her  know-
    46  ledge,  the applicant is able to meet the educational qualifications and
    47  practical experience set forth in the commissioner's  regulations.  Such

    48  application shall be considered timely if mailed to the commissioner and
    49  postmarked  four  days  prior  to  employment  at the school and must be
    50  completed within twenty days thereafter;  provided,  however,  that  the
    51  commissioner  may, for good cause shown, extend the time within which to
    52  complete the application. When  a  complete  application  is  made,  the
    53  commissioner  shall  act upon such application within thirty days. If no
    54  written denial is made within the thirty days, the application shall  be
    55  deemed  to  be approved until the commissioner acts upon it or until the
    56  end of the term or semester, whichever occurs first. If a written denial
        A. 7859--A                         19
 
     1  is made after the thirty day period,  the  commissioner  may  allow  the
     2  applicant to teach at the school for the remainder of the term or semes-

     3  ter if the commissioner determines that the removal of the teacher would
     4  not  be  in the best educational interest of the students. This subdivi-
     5  sion shall not apply to directors or teachers employed on or before July
     6  first, nineteen hundred seventy-two. Teachers'  licenses  issued  on  or
     7  after  [January first, nineteen hundred eighty-seven] the effective date
     8  of the chapter of the laws of two thousand  twelve  which  amended  this
     9  paragraph  shall  be valid at all [registered business] licensed private
    10  career schools for the courses, curricula, or occupations  indicated  on
    11  the  license.  Teachers  holding  valid  private school teacher licenses
    12  valid at only one school location shall have them replaced, at no  cost,

    13  with  licenses  valid  at  any  licensed  school  in the same subject or
    14  subjects and with the same expiration date as was listed on the previous
    15  teaching license.
    16    b. A school director shall have  access  to  all  student  and  school
    17  records  which  shall  be maintained in accordance with this article and
    18  the regulations of the commissioner and shall make such  records  avail-
    19  able  to  the  commissioner  or the commissioner's designee upon request
    20  during an on-site school inspection.
    21    c. Notwithstanding paragraph a of this subdivision, a teacher who  has
    22  been  certified  as  an  instructor by a nationally recognized vendor as
    23  defined in commissioner's regulations may  be  deemed  qualified  as  an
    24  instructor  by  the department, provided such teacher shall only provide

    25  instruction in the course or courses for which he or she holds  vendor's
    26  certification. A teacher authorized by this paragraph will be subject to
    27  all licensing fees required by the department for licensed teachers.
    28    7. Advertising. a. The commissioner is authorized to commence a disci-
    29  plinary  proceeding  pursuant  to  this  article  for false, misleading,
    30  deceptive or fraudulent advertising pursuant to regulations  promulgated
    31  by  the commissioner which shall be consistent with article twenty-two-A
    32  of the general business law. The department shall issue guidelines as to
    33  appropriate advertising content.  In  developing  such  guidelines,  the
    34  department  shall  consider  advertising for similar programs offered by
    35  various educational institutions. In  a  disciplinary  action  or  other
    36  proceeding,  such  guidelines  shall  not  be  presumptive evidence that

    37  particular advertising is appropriate.
    38    b. Beginning on January first, two thousand, all schools shall include
    39  in their advertising, promotional material, or letterhead the  statement
    40  "Licensed  by the State of New York" [or "Registered by the State of New
    41  York", as appropriate], and an  accompanying  symbol  to  indicate  such
    42  status,  issued  by  the  commissioner pursuant to section five thousand
    43  nine of this article.
    44    8. The higher education services corporation  shall  adopt  rules  and
    45  regulations  to  effectuate  the  cessation  of collection activities by
    46  lenders or by the corporation in  cases  in  which  a  licensed  private
    47  [vocational]  career  school  [or a registered business school] at which
    48  the student enrolled has closed or ceased its teaching activities during

    49  the academic period for which the loan was made or guaranteed.
    50    § 5. Section 5003 of the education law, as added by chapter 887 of the
    51  laws of 1990, subparagraph 1 of paragraph c of subdivision 1  and  para-
    52  graphs d and e of subdivision 6 as amended by chapter 604 of the laws of
    53  1993,  paragraph   d of subdivision 1 as added and paragraphs b and f of
    54  subdivision 6 as amended by chapter 434 of the laws of 1999, is  amended
    55  to read as follows:
        A. 7859--A                         20
 
     1    § 5003. Disciplinary actions, hearings and penalties.  1. Disciplinary
     2  action.  a. The commissioner for good cause, after affording a school an
     3  opportunity for a hearing, may take disciplinary action  as  hereinafter
     4  provided against any school authorized to operate under this article.

     5    b. Good cause shall include, but not be limited to, any of the follow-
     6  ing:
     7    (1)  fraudulent  statements  or representations to the department, the
     8  public or any student in connection with any activity of the school;
     9    (2) violation of any provision of this article or  regulation  of  the
    10  commissioner;
    11    (3) conviction or a plea of no contest on the part of any owner, oper-
    12  ator, director or teacher:
    13    (A) of any of the following felonies defined in the penal law: bribery
    14  involving  public  servants;  commercial  bribery; perjury in the second
    15  degree; rewarding official misconduct; larceny, in connection  with  the
    16  provision  of  services  or  involving  the theft of governmental funds;
    17  offering a false instrument for  filing,  falsifying  business  records;
    18  tampering  with  public  records;  criminal usury; scheme to defraud; or
    19  defrauding the government; or

    20    (B) in any other jurisdiction of an  offense  which  is  substantially
    21  similar  to  any  of the felonies defined in clause (A) of this subpara-
    22  graph and for which a sentence to a term of imprisonment  in  excess  of
    23  one  year  was  authorized and is authorized in this state regardless of
    24  whether such sentence was imposed; or
    25    (4) incompetence of any owner or operator to operate a school.
    26    c. (1) Any person who believes he or  she  has  been  aggrieved  by  a
    27  violation  of  this section, except a person aggrieved by the actions or
    28  omissions of a candidate school, shall have the right to file a  written
    29  complaint  within:  (A)  two  years of the alleged violation; or (B) one
    30  year of receiving notification from the higher education services corpo-
    31  ration or any other guarantee agency that the student has defaulted on a

    32  student loan payment; provided, however, that no complaint may be  filed
    33  after  three  years  from the date of the alleged violation. The commis-
    34  sioner shall maintain a written record of each complaint that  is  made.
    35  The commissioner shall also send to the complainant a form acknowledging
    36  the  complaint and requesting further information if necessary and shall
    37  advise the director of the school that a complaint has  been  made  and,
    38  where appropriate the nature of the complaint.
    39    (2) The commissioner shall within twenty days of receipt of such writ-
    40  ten  complaint  commence  an  investigation of the alleged violation and
    41  shall within ninety days of the receipt of such written complaint, issue
    42  a written finding. The commissioner shall furnish such findings  to  the
    43  person who filed the complaint and to the chief operating officer of the

    44  school  cited in the complaint. If the commissioner finds that there has
    45  been a violation of this section, the commissioner shall take  appropri-
    46  ate action.
    47    (3)   The   commissioner  may  initiate  an  investigation  without  a
    48  complaint.
    49    [d. During the initial two year licensing period, before  the  commis-
    50  sioner  may bring enforcement proceedings against a licensed entity, the
    51  following shall be taken into consideration:
    52    (1) whether such entity has demonstrated that the regulations  promul-
    53  gated  under  this chapter are unduly burdensome given the nature of the
    54  instruction provided by such entity;
        A. 7859--A                         21

     1    (2) whether such entity has identified potential areas  of  noncompli-

     2  ance  with this chapter and any such regulation within sixty days of the
     3  licensing or registration date of such entity;
     4    (3) whether such entity has engaged in good faith discussions with the
     5  department  to  resolve  such  violations  and/or promulgate regulations
     6  which further the goals of this chapter.]
     7    (4) Notwithstanding the provisions of subparagraph one of  this  para-
     8  graph  or any other provision of this article to the contrary, a student
     9  at a candidate school shall have the right to file a  written  complaint
    10  from  an alleged violation of the provisions of clause three of subpara-
    11  graph (iv) of paragraph b of subdivision four of section  five  thousand
    12  one  of this article that require disclosure of candidacy status and its

    13  implications and a signed attestation by the student, within  two  years
    14  of  such  violation.  Upon a finding that such a violation has occurred,
    15  the candidate school shall be required to provide a refund of all monies
    16  and fees received from or on behalf of the student.  Appropriate  action
    17  shall  also  be  taken  against  the  candidate  school  pursuant to the
    18  provisions of subparagraph (iv) of paragraph b of  subdivision  four  of
    19  section five thousand one of this article.
    20    2.  Hearing  procedures. a. Upon a finding that there is good cause to
    21  believe that a candidate school under  the  provisions  of  subparagraph
    22  (iv)  of paragraph b of subdivision four of section five thousand one of

    23  this article, or a licensed school,  or  an  officer,  agent,  employee,
    24  partner  or  teacher,  has  committed  a  violation of this article, the
    25  commissioner shall initiate proceedings by serving a notice  of  hearing
    26  upon each and every such party subject to the administrative action. The
    27  school  or  such  party  shall  be  given  reasonable notice of hearing,
    28  including the time, place, and nature of the  hearing  and  a  statement
    29  sufficiently  particular  to  give  notice of the transactions or occur-
    30  rences intended to be proved, the material elements  of  each  cause  of
    31  action and the civil penalties and/or administrative sanctions sought.
    32    b.  Opportunity  shall be afforded to the party to respond and present
    33  evidence and argument on the issues involved in  the  hearing  including
    34  the  right  of cross examination. In a hearing, the school or such party

    35  shall be accorded the right to have its representative appear in  person
    36  or  by  or with counsel or other representative. Disposition may be made
    37  in any hearing by stipulation, agreed settlement, consent order, default
    38  or other informal method.
    39    c. (1) The commissioner shall designate an impartial  hearing  officer
    40  to conduct the hearing, who shall be empowered to:
    41    (A) administer oaths and affirmations; and
    42    (B)  regulate  the  course of the hearings, set the time and place for
    43  continued hearings, and fix the time for  filing  of  briefs  and  other
    44  documents; and
    45    (C)  direct  the school or such party to appear and confer to consider
    46  the simplification of the issues by consent; and
    47    (D) grant a request for an adjournment of the hearing only  upon  good
    48  cause shown.
    49    (2)  The strict legal rules of evidence shall not apply, but the deci-

    50  sion shall be supported by substantial evidence in the record.
    51    3. Decision after hearing. The  hearing  officer  shall  make  written
    52  findings  of  fact  and  conclusions of law, and shall also recommend in
    53  writing to the commissioner a final decision  including  penalties.  The
    54  hearing  officer  shall  mail  a  copy  of  his or her findings of fact,
    55  conclusions of law and recommended penalty to the party and his  or  her
    56  attorney,  or  representative.    The  commissioner shall make the final
        A. 7859--A                         22
 
     1  decision, which shall be based exclusively on evidence and other materi-
     2  als introduced at the hearing. If it is  determined  that  a  party  has
     3  committed  a  violation,  the commissioner shall issue a final order and
     4  shall impose penalties in accordance with this section. The commissioner

     5  shall  send  by  certified mail, return receipt requested, a copy of the
     6  final order to the party and his or her attorney, or representative. The
     7  commissioner shall, at the request of the school or such party,  furnish
     8  a  copy  of  the transcript or any part thereof upon payment of the cost
     9  thereof.
    10    4. Judicial review. Any order imposed  under  this  section  shall  be
    11  subject  to  judicial  review  under  article seventy-eight of the civil
    12  practice law and rules, but no such determination  shall  be  stayed  or
    13  enjoined  except  upon  application  to  the  court  after notice to the
    14  commissioner.
    15    5. Enforcement proceedings. The attorney general, in his  or  her  own
    16  capacity,  or at the request of the commissioner, may bring an appropri-
    17  ate action or proceeding in  any  court  of  competent  jurisdiction  to

    18  recover a fine or otherwise enforce any provision of this article.
    19    6.  Civil penalties and administrative sanctions. a. A hearing officer
    20  may recommend, and the commissioner may impose, a civil penalty  not  to
    21  exceed  [two]  three  thousand five hundred dollars for any violation of
    22  this article, including a school's failure to offer a course or  program
    23  as  approved  by  the commissioner.   In the case of a second or further
    24  violation committed within [the previous] five  years  of  the  previous
    25  violation,  the  liability shall be a civil penalty not to exceed [five]
    26  seven thousand five hundred dollars for each such violation.
    27    b. Notwithstanding the provisions of paragraph a of this  subdivision,

    28  a hearing officer may recommend, and the commissioner may impose a civil
    29  penalty  not  to  exceed [fifty] seventy-five thousand dollars or double
    30  the documented amount from which  the  school  benefited,  whichever  is
    31  greater,  for any of the following violations: (1) operation of a school
    32  without a license in violation of section  five  thousand  one  of  this
    33  article; (2) operation of a school knowing that the school's license has
    34  been  suspended  or  revoked; (3) use of false, misleading, deceptive or
    35  fraudulent advertising; (4) employment of recruiters on the basis  of  a
    36  commission,  bonus  or  quota, except as authorized by the commissioner;
    37  (5) directing or authorizing recruiters to offer guarantees of jobs upon
    38  completion of a course; (6) failure to make a tuition refund  when  such

    39  failure is part of a pattern of misconduct; (7) the offering of a course
    40  or program that has not been approved by the commissioner; (8) admitting
    41  students,  who  subsequently drop out, who were admitted in violation of
    42  the admission standards established  by  the  commissioner,  where  such
    43  admissions  constitute  a  pattern  of misconduct and where the drop out
    44  resulted at least in part from such violation; (9)  failure  to  provide
    45  the  notice of discontinuance and the plan required by subdivision seven
    46  of section five thousand one of this article; or (10) violation  of  any
    47  other  provision  of this article, or any rule or regulation promulgated
    48  pursuant thereto, when such violation constitutes part of a  pattern  of
    49  misconduct  which  significantly  impairs the educational quality of the
    50  program or programs being offered by the school.   For  each  enumerated

    51  offense,  a  second or further violation committed within [the previous]
    52  five years, shall be subject to a civil penalty not to exceed  [seventy-
    53  five thousand dollars] one and one-half times the amount of the previous
    54  violation for each such violation.
    55    c.  In  addition  to the penalties authorized in paragraphs a and b of
    56  this subdivision, a hearing officer may recommend and  the  commissioner
        A. 7859--A                         23
 
     1  may  impose  any  of the following administrative sanctions: (1) a cease
     2  and desist order; (2) a mandatory direction; (3) a suspension or revoca-
     3  tion of a license; (4) a probation order; or (5) an  order  of  restitu-
     4  tion.
     5    d.  Penalty  factors.  In the recommendation of any penalty, a hearing

     6  officer shall, at a minimum, give due consideration,  where  applicable,
     7  to  the  good faith of the violator[; the performance of the school with
     8  respect to student placement and retention rates, and students' acquisi-
     9  tion of skills;] and the gravity of the violation[; and the harm  caused
    10  to the student].
    11    e.  The  commissioner may suspend a license [or registration] upon the
    12  failure of a school to pay any fee, fine, penalty, settlement or assess-
    13  ment as required by this article unless such failure  is  determined  by
    14  the commissioner to be for good cause.
    15    f.  All  civil  penalties,  fines and settlements received after April
    16  first, nineteen hundred ninety shall accrue to the credit of the tuition
    17  reimbursement account established pursuant to section ninety-seven-hh of

    18  the state finance law.
    19    7. Criminal penalties. In addition to any  other  penalties  elsewhere
    20  prescribed:
    21    a.  Any  person  who  knowingly violates any of the provisions of this
    22  article shall be guilty of a class B misdemeanor punishable  in  accord-
    23  ance  with  the  penal  law.  If  the conviction is for a second offense
    24  committed within five years of the first  conviction  under  this  para-
    25  graph,  such  person shall be guilty of a class A misdemeanor punishable
    26  in accordance with the penal law.
    27    b. Any person who knowingly (1) falsifies or destroys school or  other
    28  business  records relating to the operation of the school with intent to
    29  defraud; (2) fails to make a tuition refund as required by section  five
    30  thousand  two  of  this article with the intent to defraud more than one
    31  person; or (3) operates a school without a  valid  license  required  by

    32  section  five  thousand one of this article shall be guilty of a class A
    33  misdemeanor punishable in accordance with the penal law.
    34    c. Any person who, having been convicted within the past five years of
    35  failing to make a tuition refund in violation  of  subparagraph  two  of
    36  paragraph  b of this subdivision, knowingly and intentionally engages in
    37  a scheme constituting a systematic ongoing course of  conduct  involving
    38  the  wrongful  withholding of refunds in violation of section five thou-
    39  sand two of this article with the intent to defraud ten or more persons,
    40  and so withholds tuition refunds in  excess  of  one  thousand  dollars,
    41  shall  be  guilty  of a class E felony punishable in accordance with the
    42  penal law.
    43    d. Upon a determination that there exist reasonable grounds to believe
    44  that a violation of this article has been committed, or that  any  other

    45  crime  has  been  committed in connection with the operation of a school
    46  required to be licensed pursuant to this article, the commissioner shall
    47  refer such determination, and the information upon which it is based, to
    48  the attorney general or to the appropriate district attorney. The attor-
    49  ney general or a district attorney may bring an action on his or her own
    50  initiative.
    51    8. Private right of action. A student injured by a violation  of  this
    52  article  may bring an action against the owner or operator of a licensed
    53  private career school [or registered business school] for actual damages
    54  or one hundred dollars, whichever  is  greater.  A  court  may,  in  its
    55  discretion, award reasonable attorney's fees to a prevailing plaintiff.
        A. 7859--A                         24
 

     1    §  6.  Subdivisions  3  and 4 of section 5004 of the education law, as
     2  amended by chapter 604 of the laws of 1993, are amended and a new subdi-
     3  vision 4-a is added to read as follows:
     4    3.  Exempted  from the requirements of this section are persons acting
     5  solely for schools which are not required to be licensed or are  specif-
     6  ically  exempted  from  the  licensing [or registration] requirements of
     7  this article. Persons  who  are  paid  to  procure,  solicit  or  enroll
     8  students  on  the premises of schools required to be licensed [or regis-
     9  tered] shall not be exempt from the provisions of  this  section.    The
    10  certification  requirements  of  this section shall not apply to persons
    11  receiving gifts or other non-monetary considerations valued at not  more

    12  than  [twenty-five]  seventy-five  dollars from a school from which they
    13  have graduated or are currently enrolled for each student  referred  for
    14  enrollment at the school.
    15    4.  Application  and  renewal application for a private school agent's
    16  certificate shall be filed on forms to be prescribed and provided by the
    17  commissioner. Said certificate shall be valid for [two] three years from
    18  the date of issuance. Certificates which  have  been  renewed  shall  be
    19  valid  for a period of [two] three years from the expiration date of the
    20  certificate which has been renewed. Every applicant and  renewal  appli-
    21  cant shall pay to the department a fee of [one] two hundred dollars.
    22    4-a.  Notwithstanding  the  provisions  of  subdivision  four  of this

    23  section, the school director may apply  for  a  private  school  agent's
    24  certificate  on  forms to be prescribed and provided by the commissioner
    25  without incurring the agent application fee.
    26    § 7. Section 5006 of the education law, as added by chapter 887 of the
    27  laws of 1990, is amended to read as follows:
    28    § 5006. Teachout plans.  1. A school may submit a teachout plan to the
    29  commissioner for approval pursuant to  regulations  established  by  the
    30  commissioner.  A  teachout  plan  shall  consist of a contract between a
    31  [registered business or] licensed private career  school,  with  another
    32  school,  hereinafter  called  the  teachout school, so that in the event
    33  that the [registered business or] licensed private career school  ceases

    34  instruction,  the teachout school will provide the necessary instruction
    35  specified in a student's original enrollment agreement with  the  school
    36  ceasing  instruction.  A teachout plan may employ more than one teachout
    37  school to provide instruction to students in the school ceasing instruc-
    38  tion. Schools under common ownership but having  separate  licenses  [or
    39  registrations]  may,  subject to the approval of the commissioner, enter
    40  into teachout agreements. A teachout plan may be contracted between  the
    41  commissioner  and  one  or  more  teachout schools in the event that the
    42  closing school is unable or unwilling to do so.
    43    2. A teachout plan shall include the following provisions:    (a)  the
    44  teachout school must offer courses of study that are substantially simi-
    45  lar to those offered in the school ceasing instruction;

    46    (b)  teachout  schools must be located in the geographic area in which
    47  the school ceasing instruction was located  unless  the  school  ceasing
    48  instruction provided distance learning or online training;
    49    (c) all provisions for a teachout plan must be included in the enroll-
    50  ment agreement signed by the student; and
    51    (d)  the  teachout school shall agree to fulfill the enrollment agree-
    52  ment signed by the student at the school ceasing instruction.
    53    3. The [registered business or] licensed school shall provide  to  the
    54  teachout  school  and  to  the department [immediately upon closure] the
    55  following information prior to closure:
        A. 7859--A                         25
 
     1    (a) Copies of the academic and financial records for all  students  in

     2  attendance at the school at the projected time of closure;
     3    (b)  A  listing of all such students presently in attendance including
     4  their names, addresses, social security numbers,  curriculum  that  each
     5  student  is  enrolled  in and the number of hours the students will have
     6  completed at the time of the school closure.
     7    4. The department will provide to  the  teachout  school,  immediately
     8  upon  notification  of a school closing, a copy of each approved curric-
     9  ulum that the closing school is presently offering.
    10    5. The commissioner shall require all teachout schools to address  the
    11  following issues:
    12    (a)  Integration  of students into a curriculum which may be different
    13  from the curriculum in which they are currently receiving instruction;
    14    (b) Assessments of students' progress so that they may be placed  into
    15  an appropriate course;

    16    (c)  Provision of remedial instruction to students who are found to be
    17  deficient in one or more course areas upon their initial assessment;
    18    (d) Provision by  the  teachout  school  to  adhere  to  the  required
    19  student/teacher ratios and room capacities; and
    20    (e)  Compliance  with statutory and regulatory requirements during the
    21  teachout.
    22    6. The student shall not be subject to  any  costs  beyond  the  total
    23  costs identified in the original enrollment agreement.
    24    7.  A student may decline to pursue instruction at the teachout school
    25  and may instead seek a refund pursuant to section five thousand seven of
    26  this article.
    27    § 8. Section 5007 of the education law, as added by chapter 887 of the
    28  laws of 1990, the section heading, subdivision 1 and subdivision  10  as
    29  amended  by  chapter 434 of the laws of 1999, paragraph a of subdivision

    30  3, paragraphs c and d of subdivision 4, subparagraphs 1 and 3  of  para-
    31  graph  a  and paragraph b of subdivision 5, paragraph b of subdivision 9
    32  as amended and paragraphs e and f of subdivision 4 as added  by  chapter
    33  604 of the laws of 1993, is amended to read as follows:
    34    § 5007. Tuition reimbursement account. 1. Except as otherwise provided
    35  in subdivision six of this section, the portion of the annual assessment
    36  of  schools  [registered and] licensed pursuant to section five thousand
    37  one of this article as prescribed in subdivision [eight]  nine  of  such
    38  section  and  all  fines, penalties and settlements received pursuant to
    39  this  article  shall  be  transferred  upon  receipt  into  the  tuition
    40  reimbursement account.
    41    3. a. The commissioner shall develop a complaint form and provide such

    42  form  to  students. In order to claim a refund, a student shall apply to
    43  the fund with a complaint form pursuant to the requirements  of  section
    44  five  thousand  three  of  this article. Except as otherwise provided in
    45  this article, the commissioner shall compute the refund, if  any,  using
    46  the  refund  formula  established  by  subdivision three of section five
    47  thousand two of this article.
    48    b. Claimants who had been enrolled in schools which have not closed or
    49  ceased operation shall be required to show in a manner determined by the
    50  commissioner that:
    51    (1) the student is eligible for a refund;
    52    (2) the student has made a request to the school for a refund; and
    53    (3) the school has failed to make the refund within  the  time  period
    54  required by this article.
    55    c.  The  commissioner  shall  act on each refund request within thirty
    56  business days of such request.

        A. 7859--A                         26
 
     1    4. Students may be eligible for refunds under this section as follows:
     2    a.  A  student  who  is  offered a teachout plan for the curriculum in
     3  which the student was enrolled at the time the school closed  or  ceased
     4  operation,  which  has  been  approved  by  the department, may elect to
     5  continue instruction pursuant to the teachout plan  or  may  decline  to
     6  continue  instruction and may instead apply for a full refund under this
     7  section. The option to apply for a refund shall extend to the end of the
     8  first week of instruction at the teachout school.
     9    b. A student who was enrolled in a school  which  has  not  closed  or
    10  ceased operation is entitled to a refund computed in accordance with the
    11  refund  policy established by subdivision three of section five thousand
    12  two of this article.

    13    c. A student who was enrolled in a school at the time the school clos-
    14  es or ceases operation is entitled to a refund of  the  full  amount  of
    15  prepaid  tuition.  In  addition,  commencing  September  first, nineteen
    16  hundred ninety-three, a student who drops out of a  school,  where  such
    17  school closes within [fourteen] thirty days of the student's termination
    18  and  prior  to  completion of such student's program as specified in the
    19  enrollment agreement, shall be entitled to a full refund  of  [the  full
    20  amount  of  prepaid tuition] all tuition, fees and book charges paid for
    21  by or on behalf of the student in cash or in  loans,  excluding  funding
    22  provided by any government agencies.
    23    d.  A  student  who  was  enrolled in a school which has not closed or

    24  ceased operation, and who has dropped out, is entitled to a full  refund
    25  of all tuition, fees and other required costs paid by the student if the
    26  student  has  submitted  a  complaint  form  to the commissioner and the
    27  commissioner has  determined  that  a  violation  of  this  article  has
    28  occurred  which  warrants  a  refund.  The commissioner shall promulgate
    29  regulations identifying those violations that warrant a refund.
    30    e.  Commencing  September  first,  nineteen  hundred  ninety-three,  a
    31  student who drops out of a school, which subsequently closes, and who is
    32  owed  a  refund  for the failure of such school to follow the provisions
    33  enumerated in subdivision three of section five  thousand  two  of  this
    34  article  shall  be  eligible for a refund from the tuition reimbursement
    35  fund according to the provisions of subdivision three  of  section  five

    36  thousand two of this article.
    37    f.  Commencing  September  first,  nineteen  hundred ninety-three, any
    38  student enrolled in a school based upon an ability to  benefit  examina-
    39  tion  shall  be  eligible  for  a full refund, regardless of whether the
    40  student is currently enrolled, graduated or dropped out, if  the  school
    41  enrolled the student contrary to the provisions of the approved entrance
    42  requirements  and the student complies with the requirements of subdivi-
    43  sion one of section five thousand three of this article.
    44    5. a. For a student who had been enrolled in a  school  that  has  not
    45  closed or ceased operation, the refund shall be paid as follows:
    46    (1)  guaranteed  student loans, if any, in which case the commissioner
    47  shall notify the student of such payment and shall be paid  directly  to
    48  the lender or guarantee agency where appropriate;

    49    (2) actual personal tuition expenditures, if any; and
    50    (3) tuition assistance program awards and other governmental aid.
    51    b.  For schools that have closed or ceased operation, the commissioner
    52  shall refund actual personal tuition, fees and book expenditures to  the
    53  student.  The  repayment of any loans incurred by the student as part of
    54  the actual personal tuition, fees and book expenditures  shall  be  paid
    55  directly to the lender or the guarantee agency where appropriate.
        A. 7859--A                         27
 
     1    6.  a.  Where a claim is paid to a student of an operating school, the
     2  commissioner shall immediately notify the school.
     3    b.  Within  ten  days  of  the receipt of the notice, the school shall
     4  either request a hearing to challenge the  commissioner's  determination

     5  that  a  refund was owed to the student or reimburse the fund the amount
     6  paid to the claimant plus a penalty up to two times  such  amount.  This
     7  payment  shall  also incur interest for each day it remains unpaid at an
     8  annual interest rate of one percent above the prime  rate.  The  commis-
     9  sioner  may  promulgate  streamlined  procedures for conducting hearings
    10  pursuant to this paragraph. Any penalty assessed  under  this  paragraph
    11  shall  be  in  addition to any other penalties assessed pursuant to this
    12  article.   Notwithstanding any other provision  of  law,  penalties  and
    13  interest  paid  pursuant to this paragraph shall accrue to the credit of
    14  the proprietary vocational school supervision  account  to  support  the
    15  costs associated with the hearings authorized in this subdivision.
    16    7.  Notwithstanding  the  notice  procedures  described in subdivision

    17  three of this section, in the event of a school closing, the commission-
    18  er on his or her own initiative may take appropriate action  in  accord-
    19  ance  with this section to process refund claims on behalf of all of the
    20  students of the closed school.
    21    8. Assignment of rights. Persons and entities receiving refunds  under
    22  this  section  shall  be  deemed  to  have  assigned or subrogated their
    23  tuition reimbursement rights  to  the  commissioner  on  behalf  of  the
    24  tuition  reimbursement  fund only for the amount refunded by the tuition
    25  reimbursement fund. Within [thirty]  ninety  days  of  any  refund  made
    26  pursuant to this section, the commissioner or the attorney general shall
    27  take appropriate action to recover the total amount of the refunds made,
    28  plus administrative costs, from the school.

    29    9.  a.  A  student whose loan liability is exempted pursuant to former
    30  section six hundred eighty-three of this chapter and is entitled  to  or
    31  owed  a  refund  shall  transfer to the higher education services corpo-
    32  ration the right to claim the refund  owed  and  due  from  the  tuition
    33  reimbursement  fund. In such event, the corporation shall be entitled to
    34  receive a refund for that portion of the claim not paid  to  the  corpo-
    35  ration  by  the  United  States  Secretary  of Education pursuant to the
    36  federal guaranteed loan program.
    37    b. Any amounts remaining in the tuition reimbursement fund as of  June
    38  first,  nineteen  hundred  ninety-three  and on every March thirty-first
    39  thereafter, shall be made available to  the  higher  education  services
    40  corporation  for  payment  of student loans on which collection activity

    41  has ceased pursuant to the  provisions  of  subdivision  six  of  former
    42  section  six  hundred  eighty-three of this chapter. No amounts shall be
    43  paid to the higher education services corporation  for  loans  on  which
    44  collection  activity  has ceased because of the operation of section 437
    45  of the Higher Education Act of 1965, as amended.
    46    10. Management of the tuition reimbursement account.  a.  As  used  in
    47  this  subdivision,  net balance is defined as the actual cash balance of
    48  the account as determined by the commissioner on June  thirtieth,  nine-
    49  teen  hundred  ninety-three  and  every three months thereafter. For the
    50  purpose of calculating the net balance, the commissioner shall not  take
    51  into  consideration  any refunds made from the account pursuant to para-
    52  graphs d and f of subdivision four of this section for  the  year  imme-

    53  diately preceding the date on which the calculation is made.
    54    b.  In  the  event  that  the account has accumulated a net balance in
    55  excess of one million eight hundred thousand dollars,  the  commissioner
    56  shall,  with the approval of the director of the budget, waive an amount
        A. 7859--A                         28
 
     1  not to exceed the amount due for the next quarterly assessment  pursuant
     2  to  this  section  and  subdivision nine of section five thousand one of
     3  this article for schools which have paid sixteen  quarters  or  more  of
     4  assessments only. In such event, payment of future quarterly assessments
     5  shall  be suspended for schools which have paid sixteen quarters or more
     6  of assessments until the net balance of  the  account  falls  below  one
     7  million three hundred thousand dollars.

     8    c. In the event the net balance of the account falls below one million
     9  three  hundred  thousand  dollars,  if the quarterly assessment has been
    10  suspended for schools which  have  paid  sixteen  quarters  or  more  of
    11  assessments  pursuant  to  paragraph  b of this subdivision, it shall be
    12  reinstated for the next quarterly assessment and all subsequent quarter-
    13  ly assessments until the account has accumulated a net balance in excess
    14  of one million eight hundred thousand dollars.
    15    d. Notwithstanding the provisions of paragraph b of this  subdivision,
    16  in the event that the balance of the account is in excess of one million
    17  three  hundred thousand dollars, all schools licensed after June thirti-
    18  eth, nineteen hundred ninety-nine shall be  required  to  pay  into  the
    19  account the equivalence of three years of annual assessments over a five
    20  year period.

    21    e.  Notwithstanding  the provisions of paragraph b of this subdivision
    22  all schools licensed after June thirtieth, nineteen hundred ninety-three
    23  and before July first, nineteen hundred ninety-nine will be required  to
    24  pay  into  the  account the equivalence of three years of annual assess-
    25  ments within four years of the effective date of  this  paragraph.  This
    26  amount  to be assessed shall be determined based upon the school's gross
    27  tuition in its first three years of licensure.
    28    g. In the event that the balance of the tuition reimbursement  account
    29  is  equal  to  or in excess of [one] two million [five hundred thousand]
    30  dollars, the  amounts  assessed  the  schools  in  accordance  with  the
    31  provisions  of paragraphs d and e of this subdivision shall be deposited
    32  directly to the proprietary vocational school supervision account.

    33    h. The commissioner may annually apportion from the account an  amount
    34  up to two hundred thousand dollars for the purpose of securing, scanning
    35  and  otherwise  making  student records from closed schools available to
    36  students who attended such schools.  Provided, however, that in no  case
    37  shall such apportionment cause the account to fall below the balance set
    38  forth  in  paragraph c of this subdivision, nor shall such apportionment
    39  cause schools whose quarterly assessments have  been  suspended  to  pay
    40  additional quarterly assessments.
    41    11.  Fund audit. The state comptroller shall [annually] audit or cause
    42  to be audited the tuition reimbursement fund once every  two  years  and

    43  produce  an  [annual] audited financial statement according to generally
    44  accepted accounting principles.
    45    12. New schools. Within the first [six  months]  year  that  a  school
    46  begins  licensed operation, the commissioner shall assess such school an
    47  amount to be deposited into the fund in an amount to  be  determined  by
    48  the commissioner.
    49    §  9.    Section 5008 of the education law, as added by chapter 887 of
    50  the laws of 1990, is amended to read as follows:
    51    § 5008. Trust accounts.   1. If the  commissioner  determines  that  a
    52  school has demonstrated a pattern or practice of failing to make tuition
    53  refunds  in  a  timely  manner  consistent  with this article and/or the
    54  school's financial condition may result in the interruption or cessation

    55  of instruction or jeopardize student  tuition  funds,  the  commissioner
    56  shall  require a school to establish a trust account in a form or manner
        A. 7859--A                         29
 
     1  which the commissioner[, after consultation with the advisory  council,]
     2  shall [prescribe in regulations] determine to be appropriate. The assets
     3  or funds contained in the trust account shall be maintained for the sole
     4  and exclusive benefit of the students.
     5    2.  In  making this determination, the commissioner shall consider the
     6  following factors: the number of refunds not paid by  the  school  in  a
     7  timely  manner;  the  number  of claims made to, or paid by, the tuition
     8  reimbursement [fund]  account;  [and]  a  pattern  of  misconduct  which

     9  substantially  affects the financial interests of students or the state,
    10  potential liability to the tuition reimbursement account, current assets
    11  as opposed to current liabilities, and such other  measures  as  may  be
    12  appropriate.
    13    §  10. Section 5009 of the education law, as amended by chapter 434 of
    14  the laws of 1999, is amended to read as follows:
    15    § 5009. Duties of the commissioner.  In addition to all  other  duties
    16  assigned  in this article, the duties of the commissioner shall include,
    17  but not be limited to:
    18    [(a) submitting a report to the governor, the temporary  president  of
    19  the  senate,  the  speaker  of  the assembly, the minority leader of the
    20  senate and the minority leader of the assembly beginning  the  fifteenth

    21  day of January after this section shall have become effective, and annu-
    22  ally  thereafter  on that date, on the implementation and enforcement of
    23  this article, which shall include but not be limited to  (i)  curriculum
    24  approval  and  reapproval  standards, (ii) student complaints, (iii) the
    25  resolution of disciplinary actions brought by the  department  or  other
    26  appropriate  state agency, (iv) the audited financial statements submit-
    27  ted by the schools, (v) tuition  reimbursement  account  activity,  (vi)
    28  data  regarding  retention and completion rates for students enrolled in
    29  nondegree, appropriate degree or certificate programs of  two  years  or
    30  less  at registered business schools, licensed private schools, proprie-

    31  tary degree-granting schools and independent and public colleges,  (vii)
    32  the  extent  to  which  the department has met the timelines mandated by
    33  this article, (viii) entrance standards,  (ix)  the  number  of  schools
    34  inspected annually, and (x) the number of trust accounts imposed.
    35    (b)] 1. ensuring that up-to-date, accurate information is available to
    36  the  public,  via  the  internet  and other appropriate media, regarding
    37  every duly licensed proprietary school in this state, as well as  disci-
    38  plinary actions decided by the state.
    39    [(c)]  2.  developing  and  issuing  to duly licensed [and registered]
    40  proprietary schools a symbol to indicate such status; provided that such
    41  symbol shall be developed and made available to such  schools  no  later

    42  than September thirtieth, nineteen hundred ninety-nine.
    43    [(d)] 3. administering a public information campaign aimed at increas-
    44  ing awareness about the importance of attending licensed [or registered]
    45  proprietary vocational schools. Such campaign shall be targeted to popu-
    46  lations  at  risk  of enrolling in unlicensed [or unregistered] schools,
    47  and shall be conducted using means including, but not limited to, public
    48  service announcements  on  commercial  radio  and  television  stations,
    49  public access television, and print media.
    50    [(e)]  4. providing for the orderly maintenance of any student records
    51  which may be transferred to the department pursuant to any school's plan
    52  developed pursuant to subdivision eight of section five thousand one  of

    53  this  article;  including responding to student requests for transcripts
    54  and records within twenty days of receiving a request. The  commissioner
    55  is  hereby  authorized to impose an appropriate fee for such transcripts
    56  pursuant to a schedule approved by the director of the budget.
        A. 7859--A                         30
 
     1    § 11. Section 5010 of the education law, as added by  chapter  887  of
     2  the  laws  of  1990, subdivision 1 as amended by section 23 of part A of
     3  chapter 62 of the laws of 2011, subdivision 4 as added by chapter 604 of
     4  the laws of 1993, and subdivision 5 as added by chapter 434 of the  laws
     5  of 1999, is amended to read as follows:
     6    § 5010. Advisory council. 1. An advisory council for [registered busi-

     7  ness  and] licensed [trade] private career schools is hereby created for
     8  the purpose of advising the board of regents  and  the  commissioner  as
     9  provided  herein.  The  council  shall  be  composed  of  eleven members
    10  appointed by the governor, two of whom shall be upon the  recommendation
    11  of  the temporary president of the senate, two of whom shall be upon the
    12  recommendation of the speaker of the assembly, one of whom shall be upon
    13  the recommendation of the minority leader of the senate and one of  whom
    14  shall be upon the recommendation of the minority leader of the assembly.
    15  Of  the  five  remaining members, one shall be an owner or director of a
    16  school regulated pursuant to this article, [one  shall  be  a  currently
    17  enrolled  student  at  the  time  of appointment or a graduate of such a

    18  school who graduated within three years of appointment] and one shall be
    19  a student advocate. The governor shall designate a chairperson from such
    20  members.  The commissioner [of education], the president of  the  higher
    21  education services corporation, the secretary of state, the comptroller,
    22  the  director  of the division of the budget, and the executive director
    23  of the job training partnership council, or their designees, shall serve
    24  as ex-officio, non-voting members of the council.
    25    2. The council shall meet no less than four times a year.  Members  of
    26  the  council  shall receive no compensation for their services but shall
    27  be reimbursed for reasonable expenses actually and necessarily  incurred
    28  by  them  in  the  performance  of their duties. Council member terms of

    29  office shall be limited to three years, provided  that  members  may  be
    30  reappointed. All appointments to the council to fill vacancies in exist-
    31  ence  on  the  effective date of the chapter of the laws of two thousand
    32  twelve which amended this subdivision shall be made within  ninety  days
    33  of such effective date.
    34    3.  The  council shall advise the commissioner on [the following] such
    35  matters[:
    36    (a) trust accounts;
    37    (b) performance standards;
    38    (c) the effectiveness and utilization  of  the  tuition  reimbursement
    39  fund;
    40    (d) the efficacy of instituting a fee-for-service system;
    41    (e) the effectivesness of the timelines mandated by this article;

    42    (f) the impact of assessments on schools;
    43    (g) recruitment bonuses; and
    44    (h) such other matters] as the council determines are appropriate.
    45    [4.  The  proprietary  school  advisory  council shall conduct a study
    46  concerning the methodologies used to  determine  student  refunds.  Such
    47  study  shall include, but not be limited to, refund policies promulgated
    48  pursuant to federal statute or regulation, state statute  or  regulation
    49  and the policies of national accrediting organizations as they relate to
    50  term-based  and  clock  hour-based  programs. Not later than July first,
    51  nineteen hundred ninety-four, the advisory council shall make  recommen-
    52  dations  to the commissioner and the board of regents for any changes in

    53  legislation, regulations, policy  or  practice  needed  to  improve  and
    54  simplify  the  student  refund  process. The commissioner shall submit a
    55  report of the findings of the advisory council together with the  recom-
        A. 7859--A                         31

     1  mendations  of  the  department  to the legislature and the governor not
     2  later than the first day of October, nineteen hundred ninety-four.
     3    5.  The  advisory  council shall report to the governor, the temporary
     4  president of the senate, the speaker of the assembly,  and  the  commis-
     5  sioner  on  the  status of unlicensed proprietary schools in this state.
     6  The report shall also contain a statement on the  effectiveness  of  the

     7  change  in the tuition reimbursement fund and any recommendations for an
     8  extension of the changes or the consideration of different changes  when
     9  such  changes  are  repealed.  Such  report  is to be delivered on April
    10  first, two thousand two.]
    11    § 12. This act shall take effect on  the  one  hundred  twentieth  day
    12  after  it  shall have become a law; provided, however, that subparagraph
    13  (iv) of paragraph b of subdivision 4 of section 5001  of  the  education
    14  law,  as  added by section three of this act, shall expire and be deemed
    15  repealed three years after such effective date; and  provided,  further,
    16  that paragraph g of subdivision 10 of section 5007 of the education law,
    17  as  amended  by section eight of this act shall not affect the repeal of
    18  such paragraph and shall be deemed  repealed  therewith;  and  provided,

    19  further,  that  effective  immediately, the commissioner of education is
    20  authorized and directed to promulgate any regulations needed  to  imple-
    21  ment the provisions of this act on such effective date.