Substitute Senate Bill No. 998
Public Act No. 21-45
AN ACT CONCERNING THE RECOMMENDATIONS OF THE OFFICE
OF HIGHER EDUCATION REGARDING PRIVATE OCCUPATIONAL
SCHOOLS AND CLOSURE PLANS OF INSTITUTIONS OF HIGHER
EDUCATION.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Subsection (c) of section 10a-22b of the general statutes is
repealed and the following is substituted in lieu thereof (Effective July 1,
2021):
(c) Each person, board, association, partnership, corporation, limited
liability company or other entity which seeks to offer occupational
instruction shall submit to the executive director, or the executive
director's designee, in such manner as the executive director, or the
executive director's designee, prescribes, an application for a certificate
of authorization which includes, but need not be limited to, (1) the
proposed name of the school; (2) ownership and organization of the
school including the names and addresses of all principals, officers,
members and directors; (3) names and addresses of all stockholders of
the school, except for applicants which are listed on a national securities
exchange; (4) addresses of any building or premises on which the school
will be located; (5) description of the occupational instruction to be
offered; (6) the proposed student enrollment agreement, which includes Substitute Senate Bill No. 998
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for each program of occupational instruction offered a description, in
plain language, of any requirements for employment in such occupation
or barriers to such employment pursuant to state law or regulations; (7)
the proposed school catalog, which includes for each program of
occupational instruction offered a description of any requirements for
employment in such occupation or barriers to such employment
pursuant to state law or regulations; (8) financial statements detailing
the financial condition of the school pursuant to subsection (d) of this
section and subsection (g) of section 10a-22d, as amended by this act,
prepared by management and reviewed or audited, or, for a
nonaccredited school annually [enrolling fewer than ten students]
receiving less than fifty thousand dollars in tuition revenue, compiled,
by an independent licensed certified public accountant or independent
licensed public accountant; and (9) an agent for service of process. Each
application for initial authorization shall be accompanied by a
nonrefundable application fee made payable to the private occupational
school student protection account in the amount of two thousand
dollars for the private occupational school and two hundred dollars for
each branch of a private occupational school in this state. Any
application for initial authorization that remains incomplete six months
after the date such application was first submitted to the Office of
Higher Education shall expire and the office shall not approve such
expired application for authorization.
Sec. 2. Subsection (g) of section 10a-22d of the general statutes is
repealed and the following is substituted in lieu thereof (Effective July 1,
2021):
(g) Each private occupational school shall keep financial records in
conformity with generally accepted accounting principles. An annual
financial statement detailing the financial status of the school shall be
prepared by school management and reviewed or audited, or, for a
nonaccredited school annually [enrolling fewer than ten students] Substitute Senate Bill No. 998
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receiving less than fifty thousand dollars in tuition revenue, compiled,
by a licensed certified public accountant or licensed public accountant
in accordance with standards established by the American Institute of
Certified Public Accountants. A copy of such financial statement shall
be filed with the executive director on or before the last day of the fourth
month following the end of the school's fiscal year, except in the case of
a nationally accredited school recognized by the United States
Department of Education, in which case such financial statement shall
be due on or before the last day of the sixth month following the end of
the school's fiscal year. Only audited financial statements shall be
accepted from a nationally accredited school. Upon a nonaccredited
school's written request, the executive director may authorize, for good
cause shown, a filing extension for a period not to exceed sixty days. No
filing extensions shall be granted to a nationally accredited school.
Sec. 3. Section 10a-22d of the general statutes is amended by adding
subsection (h) as follows (Effective July 1, 2021):
(NEW) (h) The failure of any private occupational school to submit
an application to the Office of Higher Education for the renewal of a
certificate of authorization on or before the date on which it is due may
result in the loss of authorization under section 10a-22f, as amended by
this act. The executive director of said office may deny the renewal of
such certificate of authorization if there exists a failure to file such
renewal application by the date on which it is due, or the end of any
period of extension authorized pursuant to subsection (e) of this section.
Sec. 4. Subsection (a) of section 10a-22f of the general statutes is
repealed and the following is substituted in lieu thereof (Effective July 1,
2021):
(a) A certificate of authorization issued to a private occupational
school pursuant to sections 10a-22a to 10a-22o, inclusive, as amended
by this act, and sections 10a-22u to 10a-22w, inclusive, as amended by Substitute Senate Bill No. 998
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this act, may be revoked by the executive director if such school (1)
ceases to meet the conditions of its authorization; (2) commits a material
or substantial violation of sections 10a-22a to 10a-22o, inclusive, as
amended by this act, or sections 10a-22u to 10a-22w, inclusive, as
amended by this act, or the regulations prescribed thereunder; (3) makes
a false statement about a material fact in application for authorization
or renewal; [or] (4) fails to make a required payment to the private
occupational school student protection account pursuant to section 10a-
22u, as amended by this act; or (5) fails to submit a complete application
for a renewed certificate of authorization pursuant to section 10a-22d,
as amended by this act.
Sec. 5. Section 10a-22h of the general statutes is repealed and the
following is substituted in lieu thereof (Effective July 1, 2021):
[(a) No representative of a private occupational school not authorized
pursuant to sections 10a-22a to 10a-22o, inclusive, and sections 10a-22u
to 10a-22w, inclusive, shall visit the residence of any prospective
student, solicit enrollments, sell occupational instruction in any form or
manner, make representations or give counsel to prospective students
without first obtaining a permit from the executive director. Such permit
shall not be represented to constitute approval of the school itself. Any
contract entered into in violation of this section shall not be enforceable
by such school.
(b) Any person seeking to represent an out-of-state private
occupational school not authorized pursuant to sections 10a-22a to 10a-
22o, inclusive, and sections 10a-22u to 10a-22w, inclusive, shall file an
application with the Office of Higher Education on forms prescribed by
the executive director. Upon issuance of a permit, such representative
shall pay a nonrefundable fee of five hundred dollars into the private
occupational student protection account. The permit shall be valid for a
period of one year from date of issuance.] Substitute Senate Bill No. 998
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Any out-of-state private occupational school that seeks to operate a
distance learning program in the state shall submit an application to the
Office of Higher Education in the form and manner prescribed by the
office. Each such private occupational school shall agree to abide by
standards established by the office. The office shall approve or reject
such private occupational school's application in accordance with the
standards established by the office. Authorization by the office to
operate a distance learning program in the state shall be valid for a
period of one year and may be renewed by the office for additional one-
year periods. The office shall establish a schedule of application and
renewal fees for all out-of-state private occupational schools that are
approved by the office. As used in this subsection, "distance learning
program" means a program of study in which lectures are broadcast or
classes are conducted by correspondence or over the Internet, without
requiring a student to attend in person.
Sec. 6. Subsection (a) of section 10a-22u of the general statutes is
repealed and the following is substituted in lieu thereof (Effective July 1,
2021):
(a) There shall be an account to be known as the private occupational
school student protection account within the General Fund. Each
private occupational school authorized in accordance with the
provisions of sections 10a-22a to 10a-22o, inclusive, as amended by this
act, shall pay to the State Treasurer an amount equal to four-tenths of
one per cent of the tuition received by such school per calendar quarter
exclusive of any refunds paid, except that distance learning and
correspondence schools authorized in accordance with the provisions of
[sections 10a-22a to 10a-22o, inclusive,] section 10a-22h, as amended by
this act, shall contribute to said account only for Connecticut residents
enrolled in such schools. Payments shall be made by January thirtieth,
April thirtieth, July thirtieth and October thirtieth in each year for
tuition received during the three months next preceding the month of Substitute Senate Bill No. 998
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payment. In addition to amounts received based on tuition, the account
shall also contain any amount required to be deposited into the account
pursuant to sections 10a-22a to 10a-22o, inclusive, as amended by this
act. Said account shall be used for the purposes of section 10a-22v, as
amended by this act. Any interest, income and dividends derived from
the investment of the account shall be credited to the account. All direct
expenses for the maintenance of the account may be charged to the
account upon the order of the State Comptroller. The executive director
may assess the account for all direct expenses incurred in the
implementation of the purposes of this section which are in excess of the
normal expenditures of the Office of Higher Education.
Sec. 7. Section 10a-22v of the general statutes is repealed and the
following is substituted in lieu thereof (Effective July 1, 2021):
Any student enrolled in a private occupational school authorized in
accordance with the provisions of sections 10a-22a to 10a-22o, inclusive,
as amended by this act, who is unable to complete an approved course
or unit of instruction at such school because of the insolvency or
cessation of operation of the school and who has paid tuition for such
course or unit of instruction, may, not later than two years after the date
on which such school became insolvent or ceased operations, make
application to the executive director for a refund of tuition from the
account established pursuant to section 10a-22u, as amended by this act,
to the extent that such account exists or has reached the level necessary
to pay outstanding approved claims, except that in the case of distance
learning and correspondence schools authorized in accordance with the
provisions of [sections 10a-22a to 10a-22o, inclusive,] section 10a-22h, as
amended by this act, only Connecticut residents enrolled in such schools
may be eligible for such refund. Upon such application, the executive
director shall determine whether the applicant is unable to complete a
course or unit of instruction because of the insolvency or cessation of
operation of the school to which tuition has been paid. The executive Substitute Senate Bill No. 998
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director may summon by subpoena any person, records or documents
pertinent to the making of a determination regarding insolvency or
cessation of operation. For the purpose of making any tuition refund
pursuant to this section, a school shall be deemed to have ceased
operation whenever it has failed to complete a course or unit of
instruction for which the student has paid a tuition fee and, as a result,
the school's authorization has been revoked pursuant to section 10a-22f,
as amended by this act. If the executive director finds that the applicant
is entitled to a refund of tuition because of the insolvency or cessation
of operation of the school, the executive director shall determine the
amount of an appropriate refund which shall be equal to the tuition paid
for the uncompleted course or unit of instruction. Thereafter the
executive director shall direct the State Treasurer to pay, per order of the
Comptroller, the refund to the applicant or persons, agencies or
organizations indicated by the applicant who have paid tuition on the
student's behalf. If the student is a minor, payment shall be made to the
student's parent, parents or legal guardian. In no event shall a refund be
made from the student protection account for any financial aid provided
to or on behalf of any student in accordance with the provisions of Title
IV, Part B of the Higher Education Act of 1965, as amended from time
to time. Each recipient of a tuition refund made in accordance with the
provisions of this section shall assign all rights to the state of any action
against the school or its owner or owners for tuition amounts
reimbursed pursuant to this section. Upon such assignment, the state
may take appropriate action against the school or its owner or owners
in order to reimburse the student protection account for any expenses
or claims that are paid from the account and to reimburse the state for
the reasonable and necessary expenses in undertaking such action. Any
student who falsifies information on an application for tuition
reimbursement shall lose his or her right to any refund from the account.
Sec. 8. Section 10a-34e of the general statutes is amended by adding
subsections (c) and (d) as follows (Effective July 1, 2021): Substitute Senate Bill No. 998
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(NEW) (c) Not later than January 1, 2022, each independent
institution of higher education shall submit to the Office of Higher
Education a closure plan, which shall include, but need not be limited
to, (1) how such institution will respond to a natural disaster, pandemic,
data security threat or other catastrophic event that impacts the
operations of such institution, and (2) how such institution will manage
student records, provide a continuity of education for enrolled students
and administer student financial aid and refunds. An independent
institution of higher education that is regionally accredited may comply
with the requirements of this subsection by submitting to said office the
same closure plan that the institution submitted to the regional
accreditation agency. If an independent institution of higher education
updates its closure plan, then such institution shall submit such updated
closure plan not later than thirty days after the governing board of such
institution approves such updated closure plan.
(NEW) (d) Any independent institution of higher education that
plans to close permanently shall submit a written notice to the Office of
Higher Education not later than thirty days after the governing board of
such institution authorizes such closure. Such written notice shall
include, but need not be limited to, (1) the planned date of termination
of operations; (2) the planned date and location for the transfer of
student records; (3) the name and address of the organization that will
receive and maintain student records; (4) the name and contact
information of the designated office or official who will manage
transcript requests; (5) the arrangement for the continued education of
enrolled students through the facilitation of a teach-out, as defined in
section 10a-22m, or other means; (6) evidence of communication with
the United States Department of Education regarding the management
of student refunds, state or federal grants and scholarships and state
loans; and (7) if such institution is regionally accredited, evidence of
communication with the regional accreditation agency regarding such
closure. Substitute Senate Bill No. 998
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