September 9, 2009, Introduced by Senator SANBORN and referred to the Committee on Economic Development and Regulatory Reform.
A bill to amend 1943 PA 148, entitled
"An act to provide for the regulation and licensing of proprietary
schools in the state; to require surety; to provide for collection
and disposition of fees; and to prescribe penalties for the
violation of this act,"
by amending sections 1, 1a, 2, 2a, and 2b (MCL 395.101, 395.101a,
395.102, 395.102a, and 395.102b), sections 1, 2, 2a, and 2b as
amended and section 1a as added by 1983 PA 60.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec.
1. (1) A proprietary school shall secure from the board a
license
issued in the form prescribed by the board and in
accordance
with this act. A person shall
not operate a proprietary
school in this state without a temporary permit or license from the
department under this act. The department shall prescribe the form
of license and temporary permit.
(2)
A license issued under this act shall be to a proprietary
school that is accredited by a national or regional accrediting
agency recognized by the United States secretary of education is
valid for 3 years. A license issued under this act to any other
proprietary
school is not valid for not more
than 1 year. If the
applicant
A proprietary school that is issued either a 1-year
license or a 3-year license shall pay an annual license fee set by
the department under section 2a(2). The department may renew the
license of a person that continues to comply with this act and the
rules
promulgated under this act. , the license may be renewed.
(3)
The license may be revoked department
may revoke a license
granted
under this act at any time if, in the
judgment of the board
department, the person to whom which the
license is issued is not
complying
with provisions of the any
applicable law or the rulings
of
the board department.
(4)
A person shall not be granted Except
as provided in
subsection (5), the department shall not grant a temporary permit
or a license to operate a proprietary school as part of, or in
conjunction
with, another business or commercial enterprise which
that utilizes or sells goods or services produced by students.
(5) A proprietary school may sell goods produced or services
provided by a student enrolled in an educational program operated
by a proprietary school, and the department may not refuse to grant
a temporary permit or license to a proprietary school solely
because the school operates that educational program, if all of the
following are met:
(a) The program includes classroom study and practical
training.
(b) Any practical training included in the program is
supervised by a member of the faculty.
(c) It is an integral part of the program that the student
engage in producing the goods or providing the services as part of
his or her practical training.
(d) Any customer purchasing goods produced or services
provided by a student in the program is notified that the
individual producing the goods or providing the services is a
student of the school.
(e) The price paid by the customer does not exceed the
proprietary school's actual and reasonable costs of producing the
goods or providing the services, plus an additional nominal amount.
Sec. 1a. (1) This act shall be known and may be cited as the
"proprietary schools act".
(2) As used in this act:
(a)
"Board" means the state board of education. "Department"
means the department of energy, labor, and economic growth.
(b) "Person" means an individual, partnership, corporation,
limited liability company, association, organization, or other
legal entity.
(c) "Proprietary school" means a school that uses a certain
plan or method to teach a trade, occupation, or vocation for a
consideration,
reward, or promise of whatever nature any kind.
Proprietary school includes, but is not limited to, a private
business, trade, or home study school. Proprietary school does not
include any of the following:
(i) A school or college possessing authority to grant degrees.
(ii) A school licensed by law through another board department
of this state.
(iii) A school maintained or a program conducted, without
profit, by a person for that person's employees.
Sec.
2. (1) A license shall not be issued until the The
department shall not issue a license under this act unless the
license applicant has operated under a temporary permit from the
department
in a manner satisfactory to the board
department and
until
the board department has approved the method and content of
the advertising, the standards and the methods of instruction, the
personnel, and the operating and instructional practices of the
school.
(2)
A The department may grant
a temporary permit to operate a
proprietary
school may be granted on the basis of based on a
written proposal submitted in the manner and form prescribed by the
board
department. The proposal shall include plans for facilities,
instructional procedures, personnel, business standards, and
operating
and instructional practices which that comply with this
act and with rules promulgated under this act. A temporary permit
issued
under this act shall be is
not valid for not more than 1
year.
If the applicant The
department may renew the temporary
permit of a person that continues to comply with this act and the
rules
promulgated under this act. , a temporary permit may be
renewed.
Sec.
2a. (1) The board department
shall provide for adequate
inspection
of all proprietary schools. The board department shall
promulgate
rules pursuant to under the administrative procedures
act
of 1969, Act No. 306 of the Public Acts of 1969, being sections
24.201
to 24.315 of the Michigan Compiled Laws 1969 PA 306, MCL
24.201
to 24.328, and employ the personnel
necessary to carry out
administer this act. A proprietary school shall submit reports
required
by the board department and shall make available to
authorized
representatives of the board department
all records
pertaining to the instructional program of the school or to any
individual student or enrollee.
(2)
The board department shall set and collect fees for
licenses, temporary permits, and renewals issued under this act.
The fees shall be used solely for administrative expenses incurred
under this act.
(3)
The board department shall exercise jurisdiction and
control over proprietary schools and solicitors for proprietary
schools
consistent with this act and Act No. 40 of the Public Acts
of
1963, being sections 395.121 to 395.125 of the Michigan Compiled
Laws
1963 PA 40, MCL 395.121 to
395.125.
Sec.
2b. A proprietary school shall provide the board
department with evidence of surety conditioned to provide
indemnification to a student suffering loss because of inability to
complete an approved course or program of study due to the closing
of
the proprietary school. A The
surety may consist of a bond, the
amount of which shall be determined according to rules promulgated
by
the board department. Surety shall expire on June 30 following
the date of issuance and the proprietary school must submit proof
of
renewal shall be submitted to the board prior to department
before
the date of expiration. Failure Any failure to submit
evidence
of surety shall invalidate invalidates
a license to
operate a proprietary school. This section does not apply to a
proprietary
school with a license issued by the board prior to
under this act before November 2, 1967.