17:3141.5      License;  minimum standards;  temporary licenses;  duration of license;  bond

A. No applicant shall be issued a license in this state until the Board of Regents has first determined that the school maintains substantially the following minimum standards:

(1) The school has qualified instructors, and that each instructor has, at a minimum, a baccalaureate degree.  In those subject areas which do not require traditional academic credentials, each instructor holds alternate credentials appropriate to the subject area in which he teaches including a certificate, diploma, license, or other degree from a recognized institution or organization as determined by the board.

(2) All advertising and representations made on behalf of the school to prospective students are truthful and free from misrepresentation and fraud.

(3) Any dormitory or eating facility offered by the school or with which the school has any contractual connection is clean, healthful, safe, and adequate for the number of students proposed to be served, and supervision of the same is adequately maintained at all times.

(4) The premises and conditions under which the students work or study are sanitary, healthful, and safe according to the standards set forth by the Department of Health and Hospitals.

(5) Prior to enrollment the student has been presented with a published statement of total tuition charges and/or part payments thereof, fees required, and all charges to be made for books, equipment, and supplies needed by the student and, if housing is provided for students, all charges therefor, or if housing is not furnished, a statement to that effect.

(6)(a) The school adheres to a tuition refund schedule as presented to the student in published form in the enrollment contract prior to enrollment in the event the student discontinues the training or is excluded therefrom.

(b) For any course consisting of any combination of home study lessons or local classroom lessons and resident training which must be completed before the student will achieve the stated objectives of the training, a pro rata refund policy shall apply as follows:

(i) In the case of classroom lessons, if the number of classroom lessons completed is equal to, or greater than, fifty percent of the total number of lessons in the classroom portion of the course of instruction, the student is not entitled to any refund of tuition associated with the classroom portion of the course of instruction.  If the number of classroom lessons completed is less than fifty percent of the lessons in the classroom portion of the course of instruction, the percentage of classroom tuition to be refunded shall be determined by subtracting the amount of tuition for the classroom portion of the course that the school has earned from the total amount the student has paid the school for the classroom portion of the course.  The percentage of the classroom tuition earned by the school shall be determined by dividing the total number of classroom lessons in the course of instruction, into the total number of classroom lessons completed as of the last recorded date of attendance, rounded upward to the nearest ten percent.

(ii) In the case of home study lessons, the pro rata refund shall be that portion of the period of enrollment for home study for which the student has been charged that remains and shall be determined by dividing the total number of lessons for which the student has been charged into the total number of lessons not submitted by the student.

(iii) An administration or registration fee not to exceed one hundred and fifty dollars also shall be retained by the school.

(7) The school is equipped and able at all times to comply with its contractual relationships with the enrolled students.

(8) The facilities, class instruction rooms, housing quarters, and eating facilities are at all reasonable times open to inspection by the state superintendent of education, the commission, its members and staff, or designated agents and the representatives of the Department of Health and Hospitals.

(9) All equipment furnished is suitable and similar to that which is customarily used in the work that would be preferred by a student taking that course of instruction upon completion of the course.

(10) The school provides evidence that it meets local and state guidelines and standards, relative to zoning, occupational licensure, health, and safety.

B. A license shall be issued or denied within sixty days after receipt of the application by the board.  A license shall be valid only for the school and courses for which it is issued and shall not include other schools or branches operated by the owner.  No new course shall be offered by any school holding a license until it is approved by the Board of Regents upon the recommendation of the commission, in accordance with procedure which shall be established by the board.

C. (1) Each license shall be valid for not more than two years from the date of issuance, and thereafter for a period to be determined by the Board of Regents or until revoked for cause by the board.  The effective date of the first license renewal shall be established by the board.

(2) Each application for license renewal must be received by the board within the time period provided in R.S. 17:3141.4(B)(2) and shall contain such information as may be required by the board.

(3) Each license shall be assigned a number and shall be displayed on the premises of an institution.

(4) No license shall be transferable and in the event of a change of ownership of the school, the license shall be revoked unless the new owner notifies the commission within ten days of the sale and files a license application within the time period prescribed by the commission.  If the school is owned by a corporation, a change of ownership is deemed to occur when fifty percent or more of all types in the aggregate of the corporation's stock has been transferred to a person or persons other than the person or persons who were stockholders at the time the school license was issued.

D. (1)(a) Each application for a license shall be accompanied by a surety bond in the amount of ten thousand dollars or such equivalent security as the board may accept.  A bond shall be issued by a surety authorized to do business in this state and shall be filed with the commissioner of higher education.  The term of the bond shall be continuous, but shall be subject to cancellation by the surety in the manner described in this Section.  The bond shall provide blanket coverage for the acts of all persons engaged as agents of the school without naming them and without regard to the time they are engaged during the term of the bond.

(b) Such bond shall provide for the indemnification of any person suffering loss or damage as a result of any of the following:

(i) Any fraud or misrepresentation used in procuring his enrollment.

(ii) The failure on the part of the school to carry out and comply with each and every contract and agreement made and entered into by the school, acting by and through its officers, agents, or representatives with any student or enrollee.

(iii) The inability of the student to complete the course or courses because the school ceased operation or failed to furnish the facilities advertised or included in the contracted agreement.

(iv) The failure on the part of the school to adequately maintain all student records, which shall include the failure to transfer such records in accordance with the provisions of R.S. 17:3141.16(D)(3) and (4).

(2) The surety bond shall cover the period of the license except when the surety is released in the manner provided herein.  A surety on the bond may be released therefrom after the surety has made a written notice thereof directed to the commission and to the Board of Regents at least thirty days prior to the release.  The release shall not affect the liability of the surety for acts arising prior to the release of the surety.

E. The surety may terminate the bond upon giving a sixty-day written notice to the principal, the commission, and the Board of Regents;  however, the liability of the surety for the acts of the principal and its agents shall continue during the sixty‑day period.  The notice shall not release the surety from liability which accrues before the cancellation becomes final but which is discovered after that date and which arose at any time during the term of the bond.  Unless the bond is replaced by that of another surety before the expiration of the sixty-day period, the license shall be suspended by the board.  Any person required to file a bond may file in lieu thereof cash, a certificate of deposit or government bonds in the amount of ten thousand dollars.  The deposit shall be subject to the same terms and conditions as required herein for surety bonds.  Any interest or earnings on such deposits are payable to the depositor.

F. (1) The license shall be suspended by the Board of Regents for failure to pay fees or to submit updated information on changes in staff and school programs once each year, not less than thirty days prior to the expiration date of such license.

(2) In addition the license shall be suspended by the Board of Regents if the proprietary school is no longer covered by a surety bond as required by this Section;  however, the commissioner of higher education shall cause said proprietary school to receive written notice of the suspension at least thirty days prior to the release of said surety to the effect that said license shall be suspended until a reinstatement licensure fee and another surety bond is filed.  The surety bond shall be filed in the same manner and amount as required for the initial surety bond.

(3) Notwithstanding the provisions of this Subsection, no school exempted from filing information under the provisions of R.S. 17:3141.4(D) shall be affected by the provisions of this Subsection.

G. Notwithstanding the provisions of this Section, a proprietary school shall not be required to post the surety bond if the school does not require students to pay tuition for course study more than one month in advance, the school has been in continuous operation for at least five years, and the school has met all of the regulations of the commission and rules established by the Board of Regents.

Added by Acts 1972, No. 311, § 1.  Amended by Acts 1974, No. 397, § 1;  Acts 1978, No. 340, § 1;  Acts 1980, No. 476, § 1;  Acts 1988, No. 881, § 1;  Acts 1989, No. 798, § 1;  Acts 1990, No. 1049, § 1;  Acts 1995, No. 1270, § 1, eff. July 1, 1995;  Acts 1998, 1st Ex.Sess., No. 151, § 1, eff. July 1, 1999;  Acts 2000, 1st Ex.Sess., No. 63, § 1, eff. April 17, 2000;  Acts 2006, No. 223, § 1, eff. June 2, 2006.