HB607

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HOUSE OF REPRESENTATIVES	H.B. NO.	607
TWENTY-FIRST LEGISLATURE, 2001
STATE OF HAWAII

A BILL FOR AN ACT

RELATING TO EDUCATION.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

§302A-425, License required for private trade, vocational, or technical school. No private trade, vocational, or technical school shall be operated by any person or persons, firm, or any other private organization or corporation for the purpose of teaching any trade, occupation, or vocation unless there is first secured from the department a license issued in accordance with sections 302A-424 to 302A-428 and in such form as the department may direct. The purpose of the licensing and regulation is to protect consumers against practices by private trade, vocational, or technical schools that are false, deceptive, misleading, or unfair, and to help ensure adequate educational quality at private trade, vocational, or technical schools.

SECTION 1. Chapter 302A-425 through 428, Hawaii Revised Statutes is amended by adding a new section to be appropriately designated and to read as follows:

§302A- Exceptions; (1) Schools maintained or classes conducted by employers for their own employees where no fee or tuition is charged;

(2) Schools maintained or classes conducted by a business that offers training to its customers in the use of equipment, skills, or concepts it sells as a means to promote its products.

(3) Courses of instruction given by a fraternal society, benevolent order, or professional organization to its members and that are not operated for profit.

(4) Flying schools qualified under the Federal Aviation Administration.

(5) Schools or training solely avocational or recreational in nature or to institutions offering such education exclusively;

(6) Courses of instruction on religious subjects given under the auspices of a religious organization;

(7) Schools that the superintendent determines are adequately regulated by other means, including but not limited to accreditation by an accrediting agency recognized by the US Department of Education;

(8) All schools regulated by a board or commission within the State department of commerce and consumer affairs (DCCA) whose curriculum and instruction leads to individual licensure within the regulated industry.

§302A- License fees; disposition of fees. Fees for licensure shall be imposed on private trade, vocational or technical schools subject to regulation, provided that the aggregate of the fees shall not be less than the full cost of administering that program. All fees collected shall be paid to the Department of Education. There is established with the department, a revolving fund into which all moneys collected in the form of fees, appropriations, or fines shall be deposited. The revolving fund shall be administered by the department and used for the administration of the licensing program.

§302A- Tuition Recovery Fund; payments by schools; effect of failure to pay; claims. (1) The Tuition Recovery Fund is established to protect students when a private trade, vocational or technical school ceases to provide educational services and for administrative expenses incurred in the administration of the licensing function. Interest earned by the account shall be credited to the account.

(2) The Superintendent of Education shall maintain and administer the fund, and the State Board of Education shall adopt by rule and procedures governing the administration and maintenance of the fund, including requirements relating to contributions to and claims against the fund.

(3) Each private trade, vocational or technical school shall pay to the Tuition Recovery Fund an initial capitalization deposit in amounts and within time limits established by rule of the board. Thereafter, each school shall make installment payments based on a matrix adopted by rule of the board. In establishing the amount and frequency of payments, the board may consider the enrollment and financial condition of each school and other factors that the board considers appropriate. The superintendent may deny, suspend or revoke the license of a school that fails to make payments or fails to conform to other requirements of this section or rules adopted by the board under this section.

(4) The superintendent shall deposit moneys received under this section in a special Tuition Recovery Fund with the Department of Education.

(5) The superintendent may disburse moneys from the fund in conformance with rules established by the board and only for tuition recovery purposes, including the superintendent’s cost in administering and maintaining the fund.

§302A-426, Suspension and revocation of license; procedure. (a) The department, after notice and opportunity for a hearing, may suspend or revoke a license at any time when, in the judgment of the department the licensee is not complying with sections 302A-424 to 302A-428 or the rules that may be adopted by the board. The notice of hearing shall be served personally or sent to the licensee by registered or certified mail with return receipt at the licensee’s last known address.

(b) Notice of suspension or revocation shall be served personally upon the licensee or sent to the licensee by registered or certified mail with return receipt, and the licensee shall forward the licensee’s license at once to the department, and cease at once to operate the private trade, vocational, or technical school.

§302A-427, Powers of department. No license shall be issued under sections 302A-424 to 302A-428 until the department has approved the method and content of the advertising, the standards and the methods of instruction, and the equipment provided. The department may consult with trade or vocational experts as to the equipment provided and the standards and methods of instruction offered. The department may adopt reasonable rules relating to the enforcement of sections 302A-424 to 302A-428.

§302A-428, Penalty. Any person, firm, or corporation that violates sections 302A-424 to 302A-428 shall be guilty of a misdemeanor, but shall be subject to a maximum fine of not more than [$100] or imprisonment of not more than ninety days, or both.

SECTION 6. Statutory material to be repealed is bracketed. New statutory material is underscored.

SECTION 7. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________