New Jersey Senate Bill S3731

New Jersey 2024-2025 Regular Session

• Introduced: 9/30/24
• Refer: 9/30/24
• Report Pass: 10/10/24
• Refer: 10/10/24

Caption

Establishes Student Tuition Recovery Fund in Office of the Secretary of Higher Education to compensate students impacted by failing or fraudulent proprietary institutions.

Impact

If enacted, S3731 will create a structured approach to managing the fallout from sudden closures of proprietary educational institutions. The legislation mandates these institutions to maintain a teach-out plan that outlines how they will assist students in the event of closure. Additionally, proprietary institutions will be required to contribute to the recovery fund at specified rates, ensuring that the fund is adequately financed to cover the claims of affected students. This measure would significantly alter existing legislative frameworks related to proprietary institutions and increase regulatory oversight over their operations.

Summary

Senate Bill S3731, introduced in the New Jersey Legislature, aims to establish a Student Tuition Recovery Fund within the Office of the Secretary of Higher Education. The purpose of this fund is to compensate students who have been economically affected by the closure or operational failures of proprietary institutions that offer academic degrees. The bill seeks to address issues of accountability for these institutions and provide a safety net for students who may lose their tuition and fees due to abrupt institutional closures. The fund would be designed to mitigate economic loss by providing financial reimbursement for students who meet specific eligibility criteria following such closures.

Sentiment

The general sentiment surrounding SB S3731 has been supportive among legislators and education advocates who recognize the need for consumer protections within the higher education landscape. Proponents argue that the bill is essential for safeguarding students' financial investments and ensuring that institutions uphold quality education standards. However, some stakeholders in the proprietary education sector have voiced concerns regarding the potential financial burden that the new mandates could impose on them, viewing the bill as an additional regulatory challenge.

Contention

Notably, contention may arise around the bill's provisions that require proprietary institutions to remit initial deposits to the Student Tuition Recovery Fund and subsequent contributions based on institutional fees. Critics worry this could lead to increased costs for students, potentially making education less accessible. Furthermore, the criteria established for students to receive compensation may also spark debate, particularly regarding the definitions of economic loss and the processes involved in claiming reimbursement from the fund.