California Senate Bill SB1192 Amended / Bill

 BILL NUMBER: SB 1192AMENDED BILL TEXT AMENDED IN SENATE APRIL 6, 2016 INTRODUCED BY Senator Hill  (   Principal   coauthors:   Assembly Members   Medina   and Salas   )  FEBRUARY 18, 2016 An act to amend  Section 94885 of   Sections 94809, 94848, 94874.2, 94878, 94879, 94885, 94885.1, 94885.5, 94899, 94905, 94909, 94923, and 94944 of, to amend the heading of Article 14 (commencing with Section 94923) of Chapter 8 of Part 59 of Division 10 of Title 3 of, to add Sections 94922.5, 94923.5, and 94935.5 to, to add Chapter 8.1 (commencing with Section 94952) to Part 59 of Division 10 of Title 3 of, and   to add and repeal Article 20.5 (commencing with Section 94949.5) to Chapter 8 of Part 59 of Division 10 of Title 3 of,  the Education Code, relating to private postsecondary  education.   education, and making an appropriation therefor.  LEGISLATIVE COUNSEL'S DIGEST SB 1192, as amended, Hill. Private postsecondary education: California Private Postsecondary Education Act of 2009. Existing law, the California Private Postsecondary Education Act of 2009, provides, among other things, for student protections and regulatory oversight of private postsecondary institutions in the state. The act is enforced by the Bureau for Private Postsecondary Education within the Department of Consumer Affairs.  The act requires, except as provided, institutions covered by the act that offer a degree to receive accreditation by an accreditation agency recognized by the United States Department of Education or have an accreditation plan, approved by the bureau, for the institution to become fully accredited within 5 years of the bureau's issuance of a provisional approval to operate to the institution, as specified.   The act exempts an institution from its provisions if any of a list of specific criteria are met.   Existing law repeals the act on January 1, 2017.   This bill would recast and revise various provisions of the act. The bill would authorize bureau staff who, during an inspection of an institution, detect a violation of the act, or regulations adopted pursuant to the act, to issue the institution a citation before leaving the institution, as specified. The bill would require the Director of Consumer Affairs to appoint an enforcement monitor, no later than March 1, 2017, to, among other duties, monitor and evaluate the bureau's enforcement of the act and submit written reports to the department and the Legislature on his or her findings and conclusions, as specified. The bill would increase the amount of a fine that may be issued to a person for operating an institution without proper approval to operate from $50,000 to $100,000. The bill would, to the extent authorized by federal law, require a private postsecondary institution that does not maintain a physical presence in California and offers distance education to California students to register with the bureau and file a surety bond, as specified.   The act establishes the Student Tuition Recovery Fund and requires the bureau to adopt regulations governing the administration and maintenance of the fund, including requirements relating to assessments on students and student claims against the fund, and establishes that the moneys in this fund are continuously appropriated to the bureau for specified purposes.   This bill would make a California student of a Corinthian Colleges, Inc., institution, who meets all of the other eligibility requirements, eligible for recovery from the fund. To the extent that the bill expands the purposes of the fund, the bill would make an appropriation. The bill would establish the Office of Student Assistance and Relief, which would, among other duties, administer the fund, serve as a point of contact to address the needs of private postsecondary students, establish an Internet Web site that contains specified information for the benefit of these students, and work, in consultation with specified state and federal agencies, to determine the extent of resources available for these students and what actions state agencies need to take to ensure the protection of the public from the closure of private postsecondary educational institutions.   This bill would correct an inaccurate cross-reference in that provision relating to accreditation and would make other technical nonsubstantive changes.  Vote: majority. Appropriation:  no   yes  . Fiscal committee:  no   yes  . State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:  SECTION 1.   Section 94809 of the   Education Code   is amended to read:  94809. (a) An institution that had an application for an approval to operate pending with the former Bureau for Private Postsecondary and Vocational Education on June 30, 2007, may continue to operate until a decision is made in regard to the institution regarding the application for approval to operate, but shall comply with, and is subject to, this chapter. (b) An institution that did not have a valid approval to operate issued by, and did not have an application for approval to operate pending with, the former Bureau for Private Postsecondary and Vocational Education on June 30, 2007, that began operations between July 1, 2007, and January 1, 2010, may continue to operate unless a denial of approval to operate has been issued and has become final, but shall comply with, and is subject to, this chapter. (c) Students seeking to enroll in institutions operating under subdivisions (a) and (b) shall be notified by the institution, in writing and prior to executing an enrollment agreement, that the institution's application for approval to operate has not been reviewed by the bureau. (d) (1) An institution that is denied an approval to operate pursuant to subdivision (a) or (b) may file an appeal pursuant to the procedures established in Section 94888. (2) An institution that has filed an appeal  pursuant to paragraph (1)  may continue to operate during the appeal process but must disclose in a written statement approved by the bureau, to all current and prospective students, that the institution's application for approval to operate was denied by the bureau because the bureau determined the application did not satisfy the requirements to operate in California, that the institution is appealing the bureau's decision, and that the loss of the appeal may result in the institution's closure. (3) If the bureau determines that the continued operation of an institution poses a significant risk of harm to students, the bureau shall make an emergency decision pursuant to Section 94938.  SEC. 2.   Section 94848 of the   Education Code   is amended to read:  94848. "Licensure" includes any license, certificate, permit, or similar credential that a person must hold to lawfully engage in a profession, occupation, trade, or career field.  "Licensure" shall also include required certification or registration that a person must hold to lawfully engage in a profession, occupation, trade, or career field.   SEC. 3.   Section 94874.2 of the   Education Code   is amended to read:  94874.2. Beginning January 1, 2016, an institution that is approved to participate in veterans' financial aid programs pursuant to Section 21.4253 of Title 38 of the Code of Federal Regulations that is not an independent institution of higher education, as defined in subdivision (b) of Section 66010,  may not claim an exemption from this chapter.   shall not be exempt from this chapter.   SEC. 4.   Section 94878 of the   Education Code   is amended to read:  94878. (a) The bureau shall establish an Internet Web site that includes at least all of the following information: (1) An explanation of the bureau's scope of authority. (2) (A) A directory of approved institutions, and a link, if feasible, to the Internet Web site of each institution. (B) For each institution, the directory shall be developed in a manner that allows the user to search by institution and shall include all of the following information: (i) The status of the institution's approval to operate. (ii) The information provided by the institutions, including, but not limited to, the annual report, as required by Section 94934, including the school catalog and the School Performance Fact Sheet. The School Performance Fact Sheet shall be maintained on the directory for at least five years after the date of its submission to the bureau. (iii) If a law school satisfies the requirements of this chapter regarding a School Performance Fact Sheet by complying with the requirements of Section 94910.5, the bureau shall include the information provided by the institution pursuant to Section 94910.5 on its Internet Web site and shall maintain the information in the same manner as required by clause (ii). (iv) The disciplinary history of the institution, which shall include, but shall not be limited to, all of the following: (I) Pending formal accusations filed by the bureau. (II) Suspensions, revocations, citations, fines, infractions, probations, pending litigation filed by the bureau, and final judgments resulting from litigation filed by the bureau. (III) Pending or final civil or criminal cases filed by the Attorney General, a city attorney, or a district attorney in this state, or filed in any state by an attorney general or a federal regulatory or prosecutorial agency  if the case would be actionable under California or federal law,  of which the bureau has received notice. (IV) Final administrative actions by the United States Department of Education, including orders requiring restitution to students. (V) All disciplinary actions ordered by an accreditation agency, including any order to show cause, of which the bureau has received notice pursuant to Section 94934 or other information otherwise publicly available of which the bureau has received notice. (b) The bureau shall maintain the Internet Web site described in subdivision (a). The bureau shall ensure that the information specified in subdivision (a) is kept current. The bureau shall update the Internet Web site at least annually, to coincide with the submission of annual reports by the institutions pursuant to Section 94934. (c) (1) The bureau shall post on its Internet Web site a list of all institutions that were denied approval to operate, after the denial is final, and describe in clear and conspicuous language the reason the institution was denied approval. The bureau shall include with this list the statement provided in paragraph (2) on its Internet Web site. (2) "The following institutions were denied approval to operate by the Bureau for Private Postsecondary Education for failing to satisfy the standards relating to educational quality, or consumer protection, or both. These unlicensed institutions are not operating in compliance with the law, and students are strongly discouraged from attending these institutions."  SEC. 5.   Section 94879 of the   Education Code   is amended to read:  94879. The bureau shall conduct an outreach program to secondary school  pupils   students  as well as prospective and current private postsecondary students, to provide them with information on how to best select a private postsecondary institution, how to enter into enrollment agreements, how to make informed decisions in the private postsecondary education marketplace, and how to contact the bureau for assistance. The bureau may accomplish the purposes of this section in cooperation with other federal, state, or local entities, or any combination of these entities.  SEC. 6.   Section 94885 of the   Education Code   is amended to read:  94885. (a) The bureau shall adopt by regulation minimum operating standards for an institution that shall reasonably ensure that all of the following occur: (1) The content of each educational program can achieve its stated objective. (2) The institution maintains specific written standards for student admissions for each educational program and those standards are related to the particular educational program. (3) The facilities, instructional equipment, and materials are sufficient to enable students to achieve the educational program's goals. (4) The institution maintains a withdrawal policy and provides refunds. (5) The directors, administrators, and faculty are properly qualified. (6) The institution is financially sound and capable of fulfilling its commitments to students. (7) That, upon satisfactory completion of an educational program, the institution gives students a document signifying the degree or diploma awarded. (8) Adequate records and standard transcripts are maintained and are available to students. (9) The institution is maintained and operated in compliance with this chapter and all other applicable ordinances and laws. (b) Except as provided in Section  94855.1,   94885.1,  an institution offering a degree must satisfy one of the following requirements:  (i)   (1)  Accreditation by an accrediting agency recognized by the United States Department of Education, with the scope of that accreditation covering the offering of at least one degree program by the institution.  (ii)   (2)  An accreditation plan, approved by the bureau, for the institution to become fully accredited within five years of the bureau's issuance of a provisional approval to operate to the institution. The provisional approval to operate to an unaccredited degree-offering institution shall be in compliance with Section 94885.5.  SEC. 7.   Section 94885.1 of the   Education Code   is amended to read:  94885.1. (a) An institution that is not accredited by an accrediting agency recognized by the United States Department of Education and offering at least one degree program, and that has obtained an approval to operate from the bureau on or before January 1, 2015, shall be required to satisfy at least one of the following no later than July 1, 2015: (1) Accreditation by an accrediting agency recognized by the United States Department of Education, with the scope of that accreditation covering the offering of at least one degree program by the institution. (2) Compliance with subdivision (b). (b) The bureau shall identify institutions that are subject to subdivision (a) and notify those institutions by February 1, 2015, of the accreditation requirements pursuant to this section and that the institution is required provide the following information to the bureau if the institution plans to continue to offer a degree program after July 1, 2015: (1) An accreditation plan that, at a minimum, identifies an accrediting agency recognized by the United States Department of Education from which the institution will seek accreditation, with the scope of that accreditation covering the offering of at least one degree program, and outlines the process by which the institution will achieve accreditation candidacy or pre-accreditation by July 1, 2017, and full accreditation by July 1, 2020. (2) Evidence of having achieved accreditation candidacy or pre-accreditation by July 1, 2017. (3) Evidence of having obtained full accreditation by July 1, 2020. (4) Any additional documentation the bureau deems necessary. (c) An institution that satisfies the requirements of subdivision (b) shall comply with all of the following: (1) Notify students seeking to enroll in the institution, in writing, prior to the execution of the student's enrollment agreement, that the institution's approval to offer a degree program is contingent upon the institution being subsequently accredited. (2) A visiting committee, empaneled by the bureau pursuant to Section 94882, shall review the institution by January 1, 2017, and determine if the institution is likely to achieve full accreditation by July 1, 2020. If the visiting committee finds the institution deficient in its accreditation plan, the bureau may prohibit the institution from enrolling new students in its degree program or programs, and require the execution of a teach-out plan for its enrolled students.  (d) (1) The bureau may, upon the submission of sufficient evidence that an unaccredited institution is making strong progress toward obtaining accreditation, grant an institution's request for an extension of time, not to exceed two years, to obtain pre-accreditation, accreditation candidacy, or accreditation.   (2) Evidence submitted to the bureau pursuant to paragraph (1) shall include, but is not limited to, an amended accreditation plan identifying why pre-accreditation, accreditation candidacy, or accreditation outlined in the original plan submitted to the bureau was not achieved, steps the institution is taking to comply with this section, and documentation from an accrediting agency demonstrating the institution's ability to achieve pre-accreditation, accreditation candidacy, or accreditation.   (d)   (   e)  Any institution that fails to comply with the requirements of this section by the dates provided, as required, shall have its approval to operate automatically suspended on the applicable date. The bureau shall issue an order suspending the institution and that suspension shall not be lifted until the institution complies with the requirements of this section. A suspended institution shall not enroll new students in any of its degree programs, and shall execute a teach-out plan for its enrolled students.  (e)   (   f)  The bureau shall adopt emergency regulations for purposes of implementing this section. The adoption of these regulations shall be deemed to be an emergency and necessary for the immediate preservation of the public peace, health and safety, or general welfare for purposes of Sections 11346.1 and 11349.6 of the Government Code. These emergency regulations shall become law through the regular rulemaking process within one year of the enactment of this section.  (f)  (   g)  This section shall remain in effect until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.  SEC. 8.   Section 94885.5 of the   Education Code   is amended to read:  94885.5. (a) If an institution that has not been accredited by an accrediting agency recognized by the United States Department of Education seeks to offer one or more degree programs, the institution shall satisfy the following requirements in order to be issued a provisional approval to operate from the bureau: (1) The institution may not offer more than two degree programs during the term of its provisional approval to operate. (2) The institution shall submit an accreditation plan, approved by the bureau, for the institution to become fully accredited within five years of issuance of its provisional approval to operate. The plan shall include, at a minimum, identification of an accreditation agency recognized by the United States Department of Education, from which the institution plans to seek accreditation, and outline the process by which the institution will achieve accreditation candidacy or pre-accreditation within two years, and full accreditation within five years, of issuance of its provisional approval. (3) The institution shall submit to the bureau all additional documentation the bureau deems necessary to determine if the institution will become fully accredited within five years of issuance of its provisional approval to operate. (b) If an institution is granted a provisional approval to operate pursuant to subdivision (a), the following is required: (1) Students seeking to enroll in that institution shall be notified in writing by the institution, prior to the execution of the student's enrollment agreement, that the institution's approval to operate is contingent upon it being subsequently accredited. (2) Within the first two years of issuance of the provisional approval, a visiting committee, empaneled by the bureau pursuant to Section 94882, shall review the institution's application for approval and its accreditation plan, and make a recommendation to the bureau regarding the institution's progress to achieving full accreditation. (3) The institution shall provide evidence of accreditation candidacy or pre-accreditation within two years of issuance of its provisional approval, and evidence of accreditation within five years of issuance of its provisional approval, with the scope of that accreditation covering the offering of at least one degree program. (c) An institution required to comply with this section that fails to do so by the dates provided, as required, shall have its provisional approval to operate automatically suspended on the applicable date. The bureau shall issue an order suspending the institution and that suspension shall not be lifted until the institution complies with the requirements of this section. A suspended institution shall not enroll new students in any of its degree programs and shall execute a teach-out plan for its enrolled students.  (d) The bureau may grant an institution's request for an extension of time, not to exceed two years, to obtain pre-accreditation, accreditation candidacy, or accreditation pursuant to the requirements outlined in subdivision (d) of Section 94885.1.   (d)   (   e)  An institution issued a provisional approval under this section is required to comply with all other laws and regulations.  (e)   (   f)  The bureau shall adopt emergency regulations for purposes of implementing this section. The adoption of these regulations shall be deemed to be an emergency and necessary for the immediate preservation of the public peace, health and safety, or general welfare for purposes of Sections 11346.1 and 11349.6 of the Government Code. These emergency regulations shall become law through the regular rulemaking process within one year of the enactment of this section.  SEC. 9.   Section 94899 of the   Education Code   is amended to read:  94899. If an institution offers an educational program in a profession, occupation, trade, or career field that requires  licensure in this state,   licensure, including required certification or registration, in this state,  the institution shall have an educational program approval from the appropriate  state licensing   licensing, certifying, or registration  agency to conduct that educational program in order that a student who completes the educational program, except as provided in Section 94905, is eligible to sit for any required licensure  examination.   examination or meet the requirements for certification or registration.   SEC. 10.   Section 94905 of the   Education Code   is amended to read:  94905. (a) During the enrollment process, an institution offering educational programs designed to lead to positions in a profession, occupation, trade, or career field requiring  licensure   licensure, including required certification or registration,  in this state shall exercise reasonable care to determine if the student will not be eligible to obtain  licensure   licensure, including required certification or registration,  in the profession, occupation, trade, or career field at the time of the student's graduation and shall provide all students enrolled in those programs with a written copy of the requirements for  licensure  licensure, including required certification or registration,  established by the state, including any applicable course requirements established by the state.  An institution shall provide all students enrolled in these educational programs with information about voluntary certification or registration being the preferred industry practice.  If the minimum course requirements of the institution exceed the minimum requirements for state  licensure,   licensure, as defined in Section 94848,  the institution shall disclose this information, including a list of those courses that are not required for state  licensure.   licensure, as defined in Section 94848.  The institution shall not execute an enrollment agreement with a student that is known to be ineligible for licensure,  as defined in Section 94848,  unless the student's stated objective is other than  licensure.   licensure, as defined in Section 94848.  (b) During the enrollment process, an institution may discuss internships and student jobs available to the student during the student's attendance at the institution. If the institution discusses internships and student jobs, the institution shall disclose the number of requests for internship and student job placement assistance received by the institution during the immediately preceding calendar year and the number of actual placements during that year.  SEC. 11.   Section 94909 of the   Education Code   is amended to read:  94909. (a) Except as provided in subdivision (d), prior to enrollment, an institution shall provide a prospective student, either in writing or electronically, with a school catalog containing, at a minimum, all of the following: (1) The name, address, telephone number, and, if applicable, Internet Web site address of the institution. (2) Except as specified in Article 2 (commencing with Section 94802), a statement that the institution is a private institution and that it is approved to operate by the bureau. (3) The following statements: (A) "Any questions a student may have regarding this catalog that have not been satisfactorily answered by the institution may be directed to the Bureau for Private Postsecondary Education at (address), Sacramento, CA (ZIP Code), (Internet Web site address), (telephone and fax numbers)." (B) "As a prospective student, you are encouraged to review this catalog prior to signing an enrollment agreement. You are also encouraged to review the School Performance Fact Sheet, which must be provided to you prior to signing an enrollment agreement." (C) "A student or any member of the public may file a complaint about this institution with the Bureau for Private Postsecondary Education by calling (toll-free telephone number) or by completing a complaint form, which can be obtained on the bureau's Internet Web site (Internet Web site address)." (4) The address or addresses where class sessions will be held. (5) A description of the programs offered and a description of the instruction provided in each of the courses offered by the institution, the requirements for completion of each program, including required courses, any final tests or examinations, any required internships or externships, and the total number of credit hours, clock hours, or other increments required for completion. (6) If the educational program is designed to lead to positions in a profession, occupation, trade, or career field requiring licensure in this state, a notice to that effect and a list of the requirements for eligibility for licensure. (7) Information regarding the faculty and their qualifications. (8) A detailed description of institutional policies in the following areas: (A) Admissions policies, including the institution's policies regarding the acceptance of credits earned at other institutions or through challenge examinations and achievement tests, admissions requirements for ability-to-benefit students, and a list describing any transfer or articulation agreements between the institution and any other college or university that provides for the transfer of credits earned in the program of instruction. If the institution has not entered into an articulation or transfer agreement with any other college or university, the institution shall disclose that fact. (B) Cancellation, withdrawal, and refund policies, including an explanation that the student has the right to cancel the enrollment agreement and obtain a refund of charges paid through attendance at the first class session, or the seventh day after enrollment, whichever is later. The text shall also include a description of the procedures that a student is required to follow to cancel the enrollment agreement or withdraw from the institution and obtain a refund consistent with the requirements of Article 13 (commencing with Section 94919). (C) Probation and dismissal policies. (D) Attendance policies. (E) Leave-of-absence policies. (9) The schedule of total charges for a period of attendance and an estimated schedule of total charges for the entire educational program. (10) A statement reporting whether the institution participates in federal and state financial aid programs, and if so, all consumer information that is required to be disclosed to the student pursuant to the applicable federal and state financial aid programs. (11) A statement specifying that, if a student obtains a loan to pay for an educational program, the student will have the responsibility to repay the full amount of the loan plus interest, less the amount of any refund, and that, if the student has received federal student financial aid funds, the student is entitled to a refund of the moneys not paid from federal student financial aid program funds. (12) A statement specifying whether the institution has a pending petition in bankruptcy, is operating as a debtor in possession, has filed a petition within the preceding five years, or has had a petition in bankruptcy filed against it within the preceding five years that resulted in reorganization under Chapter 11 of the United States Bankruptcy Code (11 U.S.C. Sec. 1101 et seq.). (13) If the institution provides placement services, a description of the nature and extent of the placement services. (14) A description of the student's rights and responsibilities with respect to the Student Tuition Recovery Fund. This statement shall specify that it is a state requirement that a student who pays his or her tuition is required to pay a state-imposed assessment for the Student Tuition Recovery Fund. This statement shall also describe the purpose and operation of the Student Tuition Recovery Fund and the requirements for filing a claim against the Student Tuition Recovery Fund. (15) The following statement: "NOTICE CONCERNING TRANSFERABILITY OF CREDITS AND CREDENTIALS EARNED AT OUR INSTITUTION The transferability of credits you earn at (name of institution) is at the complete discretion of an institution to which you may seek to transfer. Acceptance of the (degree, diploma, or certificate) you earn in (name of educational program) is also at the complete discretion of the institution to which you may seek to transfer. If the (credits or degree, diploma, or certificate) that you earn at this institution are not accepted at the institution to which you seek to transfer, you may be required to repeat some or all of your coursework at that institution. For this reason you should make certain that your attendance at this institution will meet your educational goals. This may include contacting an institution to which you may seek to transfer after attending (name of institution) to determine if your (credits or degree, diploma, or certificate) will transfer." (16) A statement specifying whether the institution, or any of its degree programs, are accredited by an accrediting agency recognized by the United States Department of Education. If the institution is unaccredited and offers an associate, baccalaureate, master's, or doctoral degree, or is accredited and offers an unaccredited program for an associate, baccalaureate, master's, or doctoral degree, the statement shall disclose the known limitations of the degree program, including, but not limited to, all of the following: (A) Whether a graduate of the degree program will be eligible to sit for the applicable licensure exam in California and other  states.   states or become certified or registered as required for the applicable profession, occupation, trade, or career field in California.  (B) A degree program that is unaccredited or a degree from an unaccredited institution is not recognized for some employment positions, including, but not limited to, positions with the State of California. (C) That a student enrolled in an unaccredited institution is not eligible for federal financial aid programs. (b) If the institution has a general student brochure, the institution shall provide that brochure to the prospective student prior to enrollment. In addition, if the institution has a program-specific student brochure for the program in which the prospective student seeks to enroll, the institution shall provide the program-specific student brochure to the prospective student prior to enrollment. (c) An institution shall provide the school catalog to any person upon request. In addition, if the institution has student brochures, the institution shall disclose the requested brochures to any interested person upon request. (d) An accredited institution is not required to provide a School Performance Fact Sheet to a prospective student who is not a California resident, not residing in California at the time of his or her enrollment, and enrolling in an accredited distance learning degree program offered by the institution, if the institution complies with all federal laws, the applicable laws of the state where the student is located, and other appropriate laws, including, but not limited to, consumer protection and student disclosure requirements.  SEC. 12.   The heading of Article 14 (commencing with Section 94923) of Chapter 8 of Part 59 of Division 10 of Title 3 of the   Education Code   is amended to read:  Article 14.  Student Tuition Recovery Fund   Office of Student Assistance and Relief   SEC. 13.   Section 94922.5 is added, immediately preceding Section 94923, to the   Education Code   , to read:   94922.5. (a) The Office of Student Assistance and Relief is hereby established in order to promote the success of students attending private postsecondary educational institutions. (b) Duties of the office include, but are not limited to, providing assistance to private postsecondary students, conducting proactive outreach to these students, administering the Student Tuition Recovery Fund, and overseeing the registration of institutions pursuant to Section 94952. The office shall serve as a primary point of contact to address the needs of private postsecondary education students. (c) The office shall establish and maintain an Internet Web site to provide information to private postsecondary students about their rights and protections available to them. The office shall provide information on its Internet Web site about free services available to private postsecondary students offered by local nonprofit community service organizations with demonstrated experience in assisting students in areas including, but not limited to, legal services and student loan matters. Each local nonprofit community service organization shall be a 501(c)(3) tax-exempt organization in good standing with the Internal Revenue Service and in compliance with all applicable laws and requirements. (d) The office shall work, in consultation with state and federal agencies, including, but not limited to, the Student Aid Commission, the Office of the Chancellor of the California Community Colleges, the Department of Veterans Affairs, the federal Consumer Financial Protection Bureau, and the United States Department of Education, to determine the extent of options and resources available to private postsecondary students and criteria that indicates what additional steps state agencies need to take to ensure the protection of the public from the closure of a private postsecondary educational institution.   SEC. 14.   Section 94923 of the   Education Code   is amended to read:  94923. (a) The Student Tuition Recovery Fund relieves or mitigates economic loss suffered by a student while enrolled in  an educational program, as defined in Section 94837, at  an institution not exempt from this article pursuant to Article 4 (commencing with Section 94874), who, at the time of his or her enrollment, was a California resident or was enrolled in a California residency program, prepaid tuition, and suffered economic loss. (b) The  bureau shall adopt by regulation procedures governing the administration and maintenance of the  Student Tuition Recovery  Fund, including requirements relating to assessments on students and student claims against the Student Tuition Recovery Fund. The regulations   Fund  shall provide  for  awards to students who suffer economic loss. The  regulations shall ensure that the  following students, and any other students deemed appropriate, are eligible for payment from the Student Tuition Recovery Fund: (1) Any student who was enrolled at an institution, at a location of the institution, or in an educational program offered by the institution, at the time that institution, location, or program was closed or discontinued, as applicable, who did not choose to participate in a teach-out plan approved by the bureau or did not complete a chosen teach-out plan approved by the bureau. (2) Any student who was enrolled at an institution or a location of the institution within the 120-day period before the closure of the institution or location of the institution, or who was enrolled in an educational program within the 120-day period before the program was discontinued, if the bureau determines there was a significant decline in the quality or value of that educational program during that time period. (3) Any student who was enrolled at an institution or a location of the institution more than 120 days before the closure of the institution or location of the institution, in an educational program offered by the institution as to which the bureau determines there was a significant decline in the quality or value of the program more than 120 days before closure.  (4) A student who was enrolled at a California campus of a Corinthian Colleges, Inc., institution or was a California student enrolled in an online program offered by an out-of-state campus of a Corinthian Colleges, Inc., institution, who also meets all of the other eligibility requirements, if the student was enrolled as of June 20, 2014, or withdrew within 120 days of that date or any greater period determined by the bureau pursuant to this section.   (4)   (5   )  A student to whom an institution has been ordered to pay a refund by the bureau but has failed to do so.  (5)   (   6)  A student to whom an institution has failed to pay or reimburse loan proceeds under a federal student loan program as required by law, or has failed to pay or reimburse proceeds received by the institution in excess of tuition and other costs.  (6)   (   7)  A student who has been awarded restitution, a refund, or other monetary award by an arbitrator or court, based on a violation of this chapter by an institution or representative of an institution, but who has been unable to collect the award from the institution. The bureau shall review the award or judgment and shall ensure the amount to be paid from the fund does not exceed the student's economic loss. (c) Any student who is required to pay a Student Tuition Recovery Fund assessment who pays tuition equal to or greater than the required assessment shall be deemed to have paid the required assessment, whether or not his or her enrollment agreement specifies collection of the required assessment, and whether or not the institution identifies any money collected from the student as a Student Tuition Recovery Fund assessment. (d)  The bureau shall establish regulations ensuring, as permissible under California law, that a   A    student who suffers educational opportunity losses, whose charges are paid by a third-party payer, is eligible for educational credits under the fund. (e) The bureau may seek repayment to the Student Tuition Recovery Fund from an institution found in violation of the law for which a student claim was paid. An institution shall not be eligible to renew its approval to operate with the bureau if the repayment is not made to the bureau as requested. (f)  The bureau shall, by regulation, define "economic loss." The regulation shall ensure that the definition of   For purposes of this section,  "economic loss" includes, but is not necessarily limited to, pecuniary loss, which is the sum of the student's tuition, all other institutional charges as defined in Section 94844, the cost of equipment and materials required for the educational program as defined in Section 94837, interest on any student loan used to pay for such charges, collection costs, penalties, and any license or examination fees the student paid to the institution but is unable to recover. Economic loss shall also include the amount the institution collected and failed to pay to third parties on behalf of the student for license fees or any other purpose. Economic loss does not include Student Tuition Recovery Fund assessments, unless the student is entitled to a full refund under Section 94919 or 94920, room and board, supplies, transportation, application fees, or nonpecuniary damages such as inconvenience, aggravation, emotional distress, or punitive damages. Economic loss does not include legal fees, attorney fees, court costs, or arbitration fees. Nothing in this subdivision shall prevent the bureau from further defining economic loss to include loss of educational opportunity.  SEC. 15.   Section 94923.5 is added to the   Education Code   , to read:   94923.5. It is the intent of the Legislature to require, to the extent authorized by federal law, a private postsecondary educational institution that does not maintain a physical presence in California and offers distance education to California students to file a surety bond for the benefit of its California students who suffer economic loss.   SEC. 16.   Section 94935.5 is added to the   Education Code   , to read:   94935.5. (a) Bureau staff who, during an inspection of an institution, detect a violation of this chapter, or regulations adopted pursuant to this chapter, that is not a minor violation, may issue the institution a citation before leaving the institution. (b) The citation may contain either or both of the following: (1) An order of abatement that may require an institution to demonstrate how future compliance with this chapter, or regulations adopted pursuant to this chapter, will be accomplished. (2) Notwithstanding Section 125.9 of the Business and Professions Code, an administrative fine not to exceed five thousand dollars ($5,000) for each violation. Assessment of the administrative fine shall be based on all of the following considerations: (A) The nature and seriousness of the violation. (B) The persistence of the violation. (C) The good faith of the institution. (D) The history of previous violations. (E) The purposes of this chapter. (F) The potential harm to students. (c) (1) The citation shall be in writing and describe the nature of the violation and the specific provision of this chapter, or regulation adopted pursuant to this chapter, that is alleged to have been violated. (2) The citation shall inform the institution of its right to request, in writing, a hearing within 30 days of the issuance of the citation. (3) If a hearing is requested, the bureau shall select an informal hearing pursuant to Article 10 (commencing with Section 11445.10) of Chapter 4.5 of Part 1 of Division 3 of Title 2 of the Government Code or a formal hearing pursuant to Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code. (4) If a hearing is not requested, payment of the administrative fine is due 30 days from the date of service and shall not constitute an admission of the violation charged. (5) If a hearing is conducted and payment of an administrative fine is ordered, the administrative fine is due 30 days from when the final order is entered. (6) The bureau may enforce the administrative fine as if it were a money judgment pursuant to Title 9 (commencing with Section 680.010) of Part 2 of the Code of Civil Procedure. (d) All administrative fines shall be deposited in the Private Postsecondary Education Administration Fund.   SEC. 17.   Section 94944 of the   Education Code   is amended to read:  94944. Notwithstanding any other provision of law, the bureau shall cite any person, and that person shall be subject to a fine not to exceed  fifty thousand dollars ($50,000),   one hundred thousand dollars ($100,000),  for operating an institution without proper approval to operate issued by the bureau pursuant to this chapter.  SEC. 18.   Article 20.5 (commencing with Section 94949.5) is added to Chapter 8 of Part 59 of Division 10 of Title 3 of the   Education Code   , to read:   Article 20.5. Enforcement Monitor 94949.5. (a) (1) The director shall appoint an enforcement monitor no later than March 1, 2017. The director may retain a person for this position by a personal services contract. In this connection, the Legislature finds, pursuant to Section 19130 of the Government Code, that this is a new state function. (2) The director shall supervise the enforcement monitor and may terminate or dismiss him or her from this position. If the monitor is terminated or dismissed, the director shall appoint a replacement monitor within two months. (3) The monitoring duty of the enforcement monitor shall be on a continuing basis for a period of no more than two years from the date of the initial enforcement monitor's appointment. (b) The enforcement monitor shall monitor and evaluate the bureau' s enforcement efforts, with specific concentration on the adequacy of bureau compliance inspections, handling and processing of student complaints, and timely application of sanctions or discipline imposed on institutions and persons in order to protect the public. (c) The enforcement monitor shall exercise no authority over the bureau's management or staff; however, the bureau and its staff shall cooperate with the monitor and shall provide data, information, and files as requested by the monitor to perform all of his or her duties. (d) The director shall assist the enforcement monitor in the performance of his or her duties, and the monitor shall have the same investigative authority as the director. (e) The director shall specify additional duties of the enforcement monitor. (f) (1) The enforcement monitor shall submit to the department and the Legislature, in compliance with Section 9795 of the Government Code, an initial written report of his or her findings and conclusions no later than July 1, 2018, and a subsequent written report no later than November 1, 2018. The enforcement monitor shall be available to make oral reports to the department or the Legislature if requested to do so. The monitor may also provide additional information to either the department or the Legislature at his or her discretion or at the request of either the department or the Legislature. The monitor shall make his or her reports available to the public or the media. The monitor shall make every effort to provide the bureau with an opportunity to reply to any facts, findings, issues, or conclusions made in his or her reports to the department or the Legislature with which the bureau may disagree. (2) The enforcement monitor shall issue a final written report before January 1, 2019. The final report shall include final findings and conclusions on the topics addressed in the initial report submitted by the monitor pursuant to paragraph (1). (g) The bureau shall pay for all of the costs associated with the employment of the enforcement monitor. 94949.6. This article shall remain in effect only until March 1, 2019, and as of that date is repealed, unless a later enacted statute, that is enacted before March 1, 2019, deletes or extends that date.   SEC. 19.   Chapter 8.1 (commencing with Section 94952) is added to Part 59 of Division 10 of Title 3 of the   Education Code   , to read:   CHAPTER 8.1. PRIVATE POSTSECONDARY EDUCATION OFFERED THROUGH DISTANCE LEARNING 94952. To the extent authorized by federal law, a private postsecondary educational institution that does not maintain a physical presence in California and offers distance education to California students shall register with the bureau and file a surety bond in compliance with Section 94923.5.   SECTION 1.   Section 94885 of the Education Code is amended to read: 94885. (a) The bureau shall adopt by regulation minimum operating standards for an institution that shall reasonably ensure that all of the following occur: (1) The content of each educational program can achieve its stated objective. (2) The institution maintains specific written standards for student admissions for each educational program and those standards are related to the particular educational program. (3) The facilities, instructional equipment, and materials are sufficient to enable students to achieve the educational program's goals. (4) The institution maintains a withdrawal policy and provides refunds. (5) The directors, administrators, and faculty are properly qualified. (6) The institution is financially sound and capable of fulfilling its commitments to students. (7) That, upon satisfactory completion of an educational program, the institution gives students a document signifying the degree or diploma awarded. (8) Adequate records and standard transcripts are maintained and are available to students. (9) The institution is maintained and operated in compliance with this chapter and all other applicable ordinances and laws. (b) Except as provided in Section 94885.1, an institution offering a degree must satisfy one of the following requirements: (1) Accreditation by an accrediting agency recognized by the United States Department of Education, with the scope of that accreditation covering the offering of at least one degree program by the institution. (2) An accreditation plan, approved by the bureau, for the institution to become fully accredited within five years of the bureau's issuance of a provisional approval to operate to the institution. The provisional approval to operate to an unaccredited degree-offering institution shall be in compliance with Section 94885.5.