§ 17:3140.11 — Proprietary School Student Protection Dedicated Fund Account

Louisiana § 17:3140.11

• Jurisdiction: Louisiana
• Title 17: Credit Union Law

Text

§3140.11. Proprietary School Student Protection Dedicated Fund Account
A. There shall be established in the state treasury as a special permanent account the
Proprietary School Student Protection Dedicated Fund Account. Following compliance with
the requirements of Article VII, Section 9(B) of the Constitution of Louisiana relative to the
Bond Security and Redemption Fund, all monies generated pursuant to the provisions of this
Section shall be deposited into the Proprietary School Student Protection Dedicated Fund
Account, and monies in this fund shall be used solely to make refunds of unearned tuition
as provided in this Chapter. The monies in the account shall be invested by the state
treasurer in the same manner as for the state general fund and interest earned on the
investment of these monies shall be credited to the account. All unexpended and
unencumbered monies in the account at the end of a fiscal year shall remain in the account
and be available for expenditure in the next fiscal year. The legislature shall make yearly
appropriations from the fund to the board for the purposes of the proprietary school student
protection program.
B.(1) Each licensed proprietary school shall make payments to the Proprietary
School Student Protection Dedicated Fund Account. The first payment to the fund by a
school shall be one thousand dollars and shall accompany application for licensure.
Beginning one year after licensure by the board and annually thereafter, the annual payment
shall be determined based on the graduated schedule as provided in this Paragraph. If the
gross tuition collected by a school during the first assessment period after licensure requires
an adjustment, the adjustment shall be made in accordance with the applicable provisions of
this Section.
Gross Tuition Collected During Annual Payment
Assessment Period
$ 1 - 24,999 $ 200.00
$ 25,000 - 49,999 $ 250.00
$ 50,000 - 99,999 $ 300.00
$ 100,000 - 199,999 $ 400.00
$ 200,000 - 299,999 $ 500.00
$ 300,000 - 399,999 $ 600.00
$ 400,000 - 499,999 $ 700.00
$ 500,000 - 749,999 $ 1,000.00
$ 750,000 - 999,999 $ 1,250.00
$ 1,000,000 - 1,499,999 $ 1,500.00
$ 1,500,000 - and above $ 2,000.00
(2) All payments to the Proprietary School Student Protection Dedicated Fund
Account shall be made payable to the "Student Protection Fund". Except in cases of
overpayment, all payments to the Proprietary School Student Protection Dedicated Fund
Account shall be nonrefundable.
(3) Nontuition revenues and all income generated from contract training services
shall be exempt from the calculation of a school's gross tuition revenues.
(4) Payments required pursuant to this Section shall be a condition of doing business
in the state and failure to make a payment within thirty days following the date on which it
is due shall result in the loss of licensure as granted under the provisions of this Chapter.
The commission shall provide written notice of the required payment to each school not less
than thirty days prior to the due date of the payment.
(5) If an audit of tuition revenues conducted by the board determines that a school
has paid into the Proprietary School Student Protection Dedicated Fund Account an amount
less than was required, the school shall pay the amount required to the commission within
thirty days of receipt of written notice from the board of the amount of the underpayment.
(6) If an audit of tuition revenues conducted by the board determines that a school
has paid into the Proprietary School Student Protection Dedicated Fund Account an amount
more than was required, subsequent payment or payments by the school shall be
appropriately credited by the commissioner of higher education or his designee until the
credited payment or payments equal the amount of the overpayment.
C. Forms developed and provided annually to calculate payments due the Proprietary
School Student Protection Dedicated Fund Account shall be completed by the school and
submitted annually to the commission. The school director or persons designated to sign on
his behalf shall attest that the information provided is correct and complete.
D. Claims against the account shall be considered from currently enrolled students
only when there is a lack of availability for that student to transfer for the time remaining in
his course of study at no additional cost to a similar program within the student's local area
as determined by the commission or other teach-out options.
E. A school shall inform its students in writing of their rights under the provisions
governing the Proprietary School Student Protection Dedicated Fund Account.
F. Any student enrolled in a proprietary school licensed under the provisions of this
Chapter who is unable to complete a course or unit of instruction at a school because of
cessation of operation of the school and who has paid tuition for the course or unit of
instruction may make application to the board for a refund of tuition from the Proprietary
School Student Protection Dedicated Fund Account to the extent that the fund exists or has
reached the level necessary to pay outstanding approved claims.
G.(1) Application for refund shall be made on forms provided by the board after
determination of cessation of operation of the school.
(2) In applying for a refund pursuant to the provisions of this Section, a student shall
specify all sources and amounts of tuition which were paid on the student's behalf.
H.(1) Upon application, the board shall determine whether the applicant is unable
to complete a course or unit of instruction because of the cessation of operation of the school
to which tuition has been paid. The board may summon by subpoena any person, records, or
documents pertinent to the making of a determination regarding cessation of operation.
(2) If the board finds that the applicant is entitled to a tuition refund because of the
cessation of operation of the school, the board shall determine the amount of an appropriate
refund which shall be equal to or a portion of the tuition paid for the uncompleted course or
unit of instruction. The board shall direct the commission to pay the refund to the applicant
or persons, agencies, or organizations indicated by the applicant who has paid tuition on the
student's behalf. If the student is a minor, payment shall be made to the student's parent or
legal guardian.
(3) 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 assignment, the board
may take appropriate action against the school or its owner or owners in order to reimburse
the Proprietary School Student Protection Dedicated Fund 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 the action.
I. A claim shall be made against the account only if it arises out of the cessation of
operation and after claims are made against the surety bond or other school financial
resources.
J. The board shall adopt necessary rules and regulations based on recommendations
from the commission providing for the cessation of payments into the Proprietary School
Student Protection Dedicated Fund Account by schools licensed under the provisions of this
Chapter upon the account balance reaching a minimum of eight hundred thousand dollars and
for the resumption of payments into the account whenever the account balance is less than
seven hundred fifty thousand dollars.
K.(1) Notwithstanding the provisions of Subsection A of this Section, there is hereby
established a special account within the Proprietary School Student Protection Dedicated
Fund Account to be known as the Proprietary School Student Records and Administration
Account, hereafter in this Subsection referred to as the "administration account". Any
balance in the Proprietary School Student Protection Dedicated Fund Account on July 1,
2000, that exceeds eight hundred thousand dollars, as provided in Subsection J of this
Section, shall be deposited into the administration account. All interest earned on the
account after July 1, 2000, shall be deposited in the administration account. All deposits
made to the Proprietary School Student Protection Dedicated Fund Account after July 1,
2000, shall be made in accordance with the provisions of this Section.
(2) Amounts from the administration account shall be pledged and dedicated solely
and exclusively for costs associated with board functions as they relate to the administration
of proprietary schools and for the creation of a digital student records management system.
NOTE: See Acts 2019, No. 404 providing for the effects of the conversion of certain
dedicated funds to special statutorily dedicated fund accounts.
NOTE: Section 19(A) of Acts 2019, No. 404 states that the funds enumerated in
Section 19(A) of the Act were converted to accounts in Acts 2018, No. 612 and shall be
considered as statutorily dedicated fund accounts containing fees and self-generated
revenues. Although enumerated in Section 19(A)(8) of Acts 2019, No. 404, the "Proprietary
School Student Protection Dedicated Fund Account created in R.S. 17:3141.16" was not
provided for in Acts 2018, No. 612.

Legislative History

Acts 2019, No. 404, §§ 2, 19, eff. July 1, 2020; Acts 2019, No. 437, §1.