§ 5001. Licensed private schools and registered business schools/computer training facilities. 1. Schools required to be licensed or registered. No private school or computer training facility which charges tuition or fees for instruction and which is not exempted hereunder shall be operated by any person or persons, firm, corporation, or private organization for the purpose of teaching or giving instruction in any subject or subjects, unless it is licensed or registered by the department. As used in this article, the following terms shall have the following meanings: a. "Licensed private school" shall mean any entity offering to instruct or teach any subject by any plan or method including written, visual or audio-visual methods. b. "Registered business school" shall mean a school in which a curriculum primarily provides a sequence of courses that may include accounting or bookkeeping, marketing, business arithmetic, business law, business English, shorthand, typing, computer business applications/programming, or substantially all said courses, for the purpose of preparing an individual to pursue a business occupation; provided, however, that a registered business school program may include instruction in English as a second language at a beginning or basic level, provided such instruction shall not constitute more than fifty percent of such program. Such authorization shall apply to all students who commence instruction in a registered business school program prior to July first, nineteen hundred ninety-one. A business school registered under this section shall employ only teachers licensed by the department, whose qualifications are substantially equivalent to those required of teachers of equivalent subjects in public secondary schools. c. "Computer training facility" shall mean any entity primarily engaged in providing training on the use, language, programs, application, networking and technical repair of computers. 2. Exempt schools. The following schools are exempted from the licensing requirement of this section: a. institutions authorized to confer degrees in this state; b. schools, other than correspondence schools, providing kindergarten, nursery, elementary or secondary education, except schools conducted for profit which provide instruction in English as a second language or preparation for high school equivalency examinations to out-of-school youth or adults; c. schools operated by governmental agencies or authorities; d. schools which engage exclusively in training of students with disabilities as defined in section forty-four hundred one of this chapter; e. schools conducted on a not-for-profit basis by firms or organizations for the training of their own employees only, provided that such instruction is offered at no charge to such employees, or by a fraternal society or benevolent order for its members or their immediate relatives only; f. schools which provide instruction in the following subjects only: religion, dancing, music, painting, drawing, sculpture, poetry, dramatic art, languages, reading comprehension, mathematics, recreation, yoga, martial arts and athletics, including the training of students to teach such subjects; g. schools in which the course of instruction is licensed, registered or approved under any other section of this chapter or by any other department or agency of the state; h. schools which provide instruction designed solely for giving flight training and/or related ground school instruction;i. schools in which instruction designed solely to prepare applicants for admission to professional licensing examinations administered by the department pursuant to title eight of this chapter, and applicants for examination for admission to the practice of law; j. schools which offer continuing education courses exclusively for individuals licensed by the department pursuant to title eight of this chapter and for individuals admitted to the practice of law; k. schools which provide instruction given exclusively to employees of a person or organization which has contracted with another person or organization to provide such instruction at no cost to the employees; l. conferences, trade shows, workshops, seminars, institutes or courses of study offered and sponsored either jointly or individually by recognized trade, business or professional organizations for the benefit of their membership; or those offered to the general public by individuals, firms or organizations which neither conduct such activities for a duration of more than five consecutive days nor more frequently than twice in any one calendar year; m. schools which provide instruction exclusively to persons employed full-time or part-time in the field in which instruction is being offered, where the instruction is provided to meet continuing education standards required for professional licensure as defined by law in this state; 2-a. Schools exempted pursuant to subdivision two of this section may waive such exemption and apply for a license or registration; provided, however, that the review of such applications shall be left to the discretion of the commissioner. 2-b. Programs offered by licensed private schools or registered business schools to private businesses where there is no tuition liability to the employees shall be exempt from the requirements of this article, provided that the following requirements are met: a. Only employees of the private business for which the program is being offered may enroll in classes that make up the program. b. Certificates or diplomas awarded to students in the program may not reference in any way the department. c. Prior to the commencement of the program, such schools shall submit to the department a disclosure form, prescribed by the commissioner, copies of which shall be provided to all students in such exempt program, which shall include but not be limited to the following information: (i) a description of the location and time period in which the program will be offered; (ii) a statement that the students enrolled in the program shall not be subject to any tuition liability for the program, even if such students do not complete the program; (iii) a statement that the program being provided to the private business has not been approved by the department and is not under the department's jurisdiction and that the students in the program have been advised of the fact; and (iv) the signatures of the school director or owner of the school and the representative of the private business for which the program is being offered certifying the accuracy of the statements on the form. d. Any additional student openings in a program deemed exempt by the department may be made available to students not affiliated with the private business on the condition that such students execute a disclosure form as prescribed in paragraph c of this subdivision. Such admitted students shall only constitute up to ten percent of the exempt program's total capacity.4. Application, renewal application and application fees. a. Application and renewal application for a license as a private school or registration as a business school required by the commissioner shall be filed on forms prescribed and provided by the department. Except as provided in subparagraph (iii) of paragraph e of this subdivision, each renewal application for a private business school registered pursuant to this section or for a private school licensed pursuant to this section shall include an audited financial statement audited according to generally accepted auditing standards by an independent certified public accountant or an independent public accountant and statistical reports certified by the owner or operator of the school, as required by the commissioner; provided, however, that the commissioner shall accept a copy of a current financial statement previously filed by a school with any other governmental agency in compliance with the provisions of any federal or state laws, or rules or regulations if such statement contains all of the information required under this subdivision and conforms to this subdivision's requirements of auditing, review and certification. Any required audit of the financial statement shall be a condition of licensure or registration and shall be paid for by the school, and the results of the audit shall be forwarded to the commissioner. Applications not accompanied by the audits and reports required pursuant to this subdivision shall not be considered for approval by the commissioner. Initial applications shall be accompanied by financial reports as required by the commissioner. The commissioner shall act on an initial application for a license or registration within one hundred twenty days of receipt of a complete application. The applicant shall receive a written approval or denial together with the reasons for a denial of such application. b. (i) An initial license or registration issued pursuant to the provisions of this article shall be valid for a period of two years. A renewal of license or registration issued pursuant to the provisions of this article shall be valid for a period of four years. All license and registration fees for a renewal shall be double the amounts listed in paragraph g of this subdivision. (ii) Each school shall display, near the entrance to the school and under glass, the license or registration which has been issued to it. Such authorization shall be displayed only during the period of its validity. c. An application for renewal of any license or registration shall be submitted at least one hundred twenty days prior to the expiration date of the current authorization to operate accompanied by the nonrefundable application fee and such certified statistical reports and annual financial statements required pursuant to this subdivision. d. When complete and timely application has been made for renewal of any license or registration, the school shall receive a written approval or denial, together with the reasons for denial of renewal, from the commissioner no less than thirty days prior to the date such license or registration expires. e. Financial statements and statistical reports. (i) Licensed private schools and registered business schools shall submit such certified statistical reports and annual financial statements as required by the commissioner. The commissioner may require audited statistical reports upon a determination that a school has provided false or inaccurate certified statistical reports. The financial statements shall be based on the fiscal year of the school and shall also include an itemized account of tuition refunds due and owing to past or presently enrolled students. Statistical reports shall include, but not be limited to, enrollment, completion and placement data. The commissioner shall usesuch financial statements and statistical reports submitted for the purposes of licensure and registration of schools, establishing fees or assessments pursuant to this article and determining standards pursuant to paragraph b of subdivision five of section five thousand two of this article. The attorney general, the comptroller and the president of the higher education services corporation shall have access to this information when it is necessary to perform their duties as required by state law. (ii) Any school which received in excess of two hundred fifty thousand dollars in gross tuition in a school fiscal year shall be required to submit an annual audited financial statement to the commissioner for that fiscal year. In addition, any school which has a gross tuition of two hundred fifty thousand dollars or less in a school fiscal year but whose combined state and federal student financial aid in such year exceeds one hundred thousand dollars shall also submit an annual audited financial statement to the commissioner for that fiscal year. (iii) Schools whose gross tuition is two hundred fifty thousand dollars or less in a school fiscal year and which receive less than one hundred thousand dollars in state and federal student financial aid in a school fiscal year shall file with the commissioner an unaudited financial statement in a format prescribed by the commissioner, provided, however, that any such school with gross tuition in excess of fifty thousand dollars shall have filed at least one audited financial statement after the first year of its operation. The statement shall be signed by the president or chief executive officer and the chief fiscal officer of the school who shall certify that the statements are true and accurate. Upon a determination by the commissioner that a school has submitted false or inaccurate statements or that a significant, unsubstantiated decline in gross tuition has occurred, the commissioner may require any such school to file an audited financial statement pursuant to this paragraph. f. Alternate licensing provision. The commissioner shall issue regulations which define alternate licensing requirements for the following: (1) correspondence schools in which all approved programs and courses are under three hundred hours; (2) schools which are eligible for exemption under this section but which elect to be licensed; (3) non-profit schools exempt from taxation under section 501(c)(3) of the internal revenue code whose programs are funded entirely through donations from individuals or philanthropic organizations, or endowments, and interest accrued thereon; and (4) language schools conducted for-profit which provide instruction in English as a second language and which accept no public funds. g. Application fee. Every applicant and renewal applicant shall pay to the department a nonrefundable, nontransferable fee based on gross annual tuition income as determined by the annual financial statements required in paragraph a of this subdivision for the most recent school fiscal year, according to the following schedule: GROSS ANNUAL TUITION INCOME FEE 0-$199,999 $ 250.00 $200,000-$499,999 $ 500.00 $500,000-$999,999 $ 750.00 $1,000,000-$4,999,999 $1,500.00 $5,000,000-$9,999,999 $3,000.00 $10,000,000 or above $6,000.00Such fees shall accrue to the credit of the proprietary vocational school supervision account. If the evaluation of a particular course or facility requires the services of an expert not employed by the department, the department shall retain such expert and the school shall reimburse the department for the reasonable cost of such services. 5. Required disclosure for licensure. a. The commissioner shall require that each applicant for a license for the operation of a private vocational or business school disclose the following information: (1) Whether the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds, has been convicted of a crime defined in this article, or any other crime involving the operation of any educational or training program, or, in connection with the operation of any such program, a crime involving the unlawful acquisition, use, payment or expenditure of educational or training program funds; and (2) Whether the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds has been convicted: (A) in this state of any of the following felonies defined in the penal law: bribery involving public servants; commercial bribery; perjury in the second degree; rewarding official misconduct; larceny, in connection with the provision of services or involving the theft of governmental funds; offering a false instrument for filing, falsifying business records; tampering with public records; criminal usury; scheme to defraud; or defrauding the government; or (B) in any other jurisdiction of an offense which is substantially similar to any of the felonies defined in clause (A) of this subparagraph and for which a sentence to a term of imprisonment in excess of one year was authorized and is authorized in this state regardless of whether such sentence was imposed; and (3) Whether the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds, has been finally determined in any administrative or civil proceeding to have committed a violation of any provision of this article or any rules and regulations promulgated pursuant thereto, or any related order or determination of the commissioner, or of any similar statute, rule, regulation, order or determination of another jurisdiction pertaining to the licensure and operation of any educational or training program; and (4) Whether any school owned or operated by the applicant closed or ceased operation and, if so, whether at the time of the closing the applicant was subject to a pending disciplinary action, disallowance, fine or other penalty and whether it owed refunds to any government agency or students. b. No application for any license pursuant to this article shall be denied by reason of disclosure pursuant to this subdivision of the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds unless the commissioner makes a written determination that there is a direct relationship between one or more of such previous offenses and the license sought, or that issuance of the license would create anunreasonable risk to property or to the safety, education or welfare of specific individuals or the general public. In making such determination, the commissioner shall be guided by the factors set forth in section seven hundred fifty-three of the correction law. For purposes of this subdivision, "ownership or control interest" means: with respect to a school that is organized as or owned by a corporation, a position as an officer or director of such corporation; or, with respect to a school that is organized as or owned by a partnership, a position as a partner; or any other interest totaling ten percent or more, whether direct or indirect, in the total equity or assets of such school. c. The commissioner may deny, suspend, revoke or decline to renew any license (1) if the significance of the convictions or administrative violations warrant such action or (2) if the commissioner determines that a school did not make any disclosure required by this subdivision. 6. If, during the two year period for which a license or registration is granted, the commissioner determines that a school's financial condition may result in the interruption or cessation of instruction or jeopardize student tuition funds, the commissioner may, upon notice to the school, place the school on probation for a period of no more than thirty days, during which time the school and the department must make efforts to resolve the problems at the school. If no resolution can be attained, a hearing, pursuant to subdivisions two and three of section five thousand three of this article will be scheduled. Such probation may include additional monitoring, inspections, limitations on enrollment, teaching out some or all of a school's present students or temporary cessation of instruction. 7. No license or registration granted under this section shall be transferable or assignable without the approval of the commissioner. Any transfer or assignment of any interest totaling ten percent or more, whether direct or indirect, in the total equity or assets of a school shall be deemed a transfer of such school's license or registration. The commissioner shall approve or deny a transfer or assignment based on the requirements set forth in subdivisions three and four of this section. Such approval or denial, together with the reasons for denial, shall be transmitted in writing within ninety days of the receipt of the complete application by the commissioner. Upon a showing of good cause as to why the applicant could not obtain the commissioner's approval prior to a transfer or assignment, the commissioner shall temporarily approve the transfer or assignment for a period not to exceed forty-five days and for such additional periods as the commissioner may deem appropriate. 8. No licensed or registered school shall discontinue operation or surrender its license or registration unless thirty days written notice of its intention to do so and a plan for maintenance of safe keeping of the records of the school is provided to the commissioner. However, upon good cause shown, the commissioner may waive the thirty days notice requirement. 9. Annual supervision fund and tuition reimbursement fund assessment. a. The commissioner shall annually assess each school a total percentage of that school's gross tuition pursuant to subdivision three of section five thousand two of this article, as determined by the annual financial statement or annual audited financial statement required by this article. This assessment shall be based upon each school's gross tuition from the previous year, and shall be payable to the commissioner in equal quarterly installments which shall be due on June first, September first, December first and March first. b. (i) Beginning April first, nineteen hundred ninety-one, such annualized assessment shall be one percent.(ii) Beginning July first, nineteen hundred ninety-four, such annualized assessment shall be nine-tenths of one percent. (iii) Beginning April first, nineteen hundred ninety-five, and in each succeeding year, such annualized assessment shall be eight-tenths of one percent. c. (i) Of the total assessment provided for herein, three-tenths of one percent shall accrue to the credit of the tuition reimbursement fund pursuant to section five thousand seven of this article. (ii) The balance of the total assessment provided for herein shall be dedicated to fund the department's supervision and regulation of licensed private schools and registered business schools pursuant to an annual appropriation and an annual plan of expenditure prepared by the commissioner and approved by the director of the budget. Following the close of each fiscal year, the commissioner, in consultation with the director of the budget, shall determine if the balance in the proprietary vocational school supervision fund for such fiscal year exceeded the amount required for the support of the department's supervisory activities taking into account projected revenues and expenditures for the subsequent fiscal year. To the extent that a surplus is identified, the commissioner, with the approval of the director of the budget, shall direct the transfer of such surplus to the tuition reimbursement fund. d. Payments made within thirty days following the due date shall be subject to interest at one percent above the prevailing prime rate. Thereafter, late payments may result in suspension of licensure by the commissioner. Payments required by this subdivision shall be considered a condition of licensure or registration.
§ 5001. Licensed private schools and registered business schools/computer training facilities. 1. Schools required to be licensed or registered. No private school or computer training facility which charges tuition or fees for instruction and which is not exempted hereunder shall be operated by any person or persons, firm, corporation, or private organization for the purpose of teaching or giving instruction in any subject or subjects, unless it is licensed or registered by the department. As used in this article, the following terms shall have the following meanings: a. "Licensed private school" shall mean any entity offering to instruct or teach any subject by any plan or method including written, visual or audio-visual methods. b. "Registered business school" shall mean a school in which a curriculum primarily provides a sequence of courses that may include accounting or bookkeeping, marketing, business arithmetic, business law, business English, shorthand, typing, computer business applications/programming, or substantially all said courses, for the purpose of preparing an individual to pursue a business occupation; provided, however, that a registered business school program may include instruction in English as a second language at a beginning or basic level, provided such instruction shall not constitute more than fifty percent of such program. Such authorization shall apply to all students who commence instruction in a registered business school program prior to July first, nineteen hundred ninety-one. A business school registered under this section shall employ only teachers licensed by the department, whose qualifications are substantially equivalent to those required of teachers of equivalent subjects in public secondary schools. c. "Computer training facility" shall mean any entity primarily engaged in providing training on the use, language, programs, application, networking and technical repair of computers. 2. Exempt schools. The following schools are exempted from the licensing requirement of this section: a. institutions authorized to confer degrees in this state; b. schools, other than correspondence schools, providing kindergarten, nursery, elementary or secondary education, except schools conducted for profit which provide instruction in English as a second language or preparation for high school equivalency examinations to out-of-school youth or adults; c. schools operated by governmental agencies or authorities; d. schools which engage exclusively in training of students with disabilities as defined in section forty-four hundred one of this chapter; e. schools conducted on a not-for-profit basis by firms or organizations for the training of their own employees only, provided that such instruction is offered at no charge to such employees, or by a fraternal society or benevolent order for its members or their immediate relatives only; f. schools which provide instruction in the following subjects only: religion, dancing, music, painting, drawing, sculpture, poetry, dramatic art, languages, reading comprehension, mathematics, recreation, yoga, martial arts and athletics, including the training of students to teach such subjects; g. schools in which the course of instruction is licensed, registered or approved under any other section of this chapter or by any other department or agency of the state; h. schools which provide instruction designed solely for giving flight training and/or related ground school instruction;i. schools in which instruction designed solely to prepare applicants for admission to professional licensing examinations administered by the department pursuant to title eight of this chapter, and applicants for examination for admission to the practice of law; j. schools which offer continuing education courses exclusively for individuals licensed by the department pursuant to title eight of this chapter and for individuals admitted to the practice of law; k. schools which provide instruction given exclusively to employees of a person or organization which has contracted with another person or organization to provide such instruction at no cost to the employees; l. conferences, trade shows, workshops, seminars, institutes or courses of study offered and sponsored either jointly or individually by recognized trade, business or professional organizations for the benefit of their membership; or those offered to the general public by individuals, firms or organizations which neither conduct such activities for a duration of more than five consecutive days nor more frequently than twice in any one calendar year; m. schools which provide instruction exclusively to persons employed full-time or part-time in the field in which instruction is being offered, where the instruction is provided to meet continuing education standards required for professional licensure as defined by law in this state; 2-a. Schools exempted pursuant to subdivision two of this section may waive such exemption and apply for a license or registration; provided, however, that the review of such applications shall be left to the discretion of the commissioner. 2-b. Programs offered by licensed private schools or registered business schools to private businesses where there is no tuition liability to the employees shall be exempt from the requirements of this article, provided that the following requirements are met: a. Only employees of the private business for which the program is being offered may enroll in classes that make up the program. b. Certificates or diplomas awarded to students in the program may not reference in any way the department. c. Prior to the commencement of the program, such schools shall submit to the department a disclosure form, prescribed by the commissioner, copies of which shall be provided to all students in such exempt program, which shall include but not be limited to the following information: (i) a description of the location and time period in which the program will be offered; (ii) a statement that the students enrolled in the program shall not be subject to any tuition liability for the program, even if such students do not complete the program; (iii) a statement that the program being provided to the private business has not been approved by the department and is not under the department's jurisdiction and that the students in the program have been advised of the fact; and (iv) the signatures of the school director or owner of the school and the representative of the private business for which the program is being offered certifying the accuracy of the statements on the form. d. Any additional student openings in a program deemed exempt by the department may be made available to students not affiliated with the private business on the condition that such students execute a disclosure form as prescribed in paragraph c of this subdivision. Such admitted students shall only constitute up to ten percent of the exempt program's total capacity.4. Application, renewal application and application fees. a. Application and renewal application for a license as a private school or registration as a business school required by the commissioner shall be filed on forms prescribed and provided by the department. Except as provided in subparagraph (iii) of paragraph e of this subdivision, each renewal application for a private business school registered pursuant to this section or for a private school licensed pursuant to this section shall include an audited financial statement audited according to generally accepted auditing standards by an independent certified public accountant or an independent public accountant and statistical reports certified by the owner or operator of the school, as required by the commissioner; provided, however, that the commissioner shall accept a copy of a current financial statement previously filed by a school with any other governmental agency in compliance with the provisions of any federal or state laws, or rules or regulations if such statement contains all of the information required under this subdivision and conforms to this subdivision's requirements of auditing, review and certification. Any required audit of the financial statement shall be a condition of licensure or registration and shall be paid for by the school, and the results of the audit shall be forwarded to the commissioner. Applications not accompanied by the audits and reports required pursuant to this subdivision shall not be considered for approval by the commissioner. Initial applications shall be accompanied by financial reports as required by the commissioner. The commissioner shall act on an initial application for a license or registration within one hundred twenty days of receipt of a complete application. The applicant shall receive a written approval or denial together with the reasons for a denial of such application. b. (i) An initial license or registration issued pursuant to the provisions of this article shall be valid for a period of two years. A renewal of license or registration issued pursuant to the provisions of this article shall be valid for a period of four years. All license and registration fees for a renewal shall be double the amounts listed in paragraph g of this subdivision. (ii) Each school shall display, near the entrance to the school and under glass, the license or registration which has been issued to it. Such authorization shall be displayed only during the period of its validity. c. An application for renewal of any license or registration shall be submitted at least one hundred twenty days prior to the expiration date of the current authorization to operate accompanied by the nonrefundable application fee and such certified statistical reports and annual financial statements required pursuant to this subdivision. d. When complete and timely application has been made for renewal of any license or registration, the school shall receive a written approval or denial, together with the reasons for denial of renewal, from the commissioner no less than thirty days prior to the date such license or registration expires. e. Financial statements and statistical reports. (i) Licensed private schools and registered business schools shall submit such certified statistical reports and annual financial statements as required by the commissioner. The commissioner may require audited statistical reports upon a determination that a school has provided false or inaccurate certified statistical reports. The financial statements shall be based on the fiscal year of the school and shall also include an itemized account of tuition refunds due and owing to past or presently enrolled students. Statistical reports shall include, but not be limited to, enrollment, completion and placement data. The commissioner shall usesuch financial statements and statistical reports submitted for the purposes of licensure and registration of schools, establishing fees or assessments pursuant to this article and determining standards pursuant to paragraph b of subdivision five of section five thousand two of this article. The attorney general, the comptroller and the president of the higher education services corporation shall have access to this information when it is necessary to perform their duties as required by state law. (ii) Any school which received in excess of two hundred fifty thousand dollars in gross tuition in a school fiscal year shall be required to submit an annual audited financial statement to the commissioner for that fiscal year. In addition, any school which has a gross tuition of two hundred fifty thousand dollars or less in a school fiscal year but whose combined state and federal student financial aid in such year exceeds one hundred thousand dollars shall also submit an annual audited financial statement to the commissioner for that fiscal year. (iii) Schools whose gross tuition is two hundred fifty thousand dollars or less in a school fiscal year and which receive less than one hundred thousand dollars in state and federal student financial aid in a school fiscal year shall file with the commissioner an unaudited financial statement in a format prescribed by the commissioner, provided, however, that any such school with gross tuition in excess of fifty thousand dollars shall have filed at least one audited financial statement after the first year of its operation. The statement shall be signed by the president or chief executive officer and the chief fiscal officer of the school who shall certify that the statements are true and accurate. Upon a determination by the commissioner that a school has submitted false or inaccurate statements or that a significant, unsubstantiated decline in gross tuition has occurred, the commissioner may require any such school to file an audited financial statement pursuant to this paragraph. f. Alternate licensing provision. The commissioner shall issue regulations which define alternate licensing requirements for the following: (1) correspondence schools in which all approved programs and courses are under three hundred hours; (2) schools which are eligible for exemption under this section but which elect to be licensed; (3) non-profit schools exempt from taxation under section 501(c)(3) of the internal revenue code whose programs are funded entirely through donations from individuals or philanthropic organizations, or endowments, and interest accrued thereon; and (4) language schools conducted for-profit which provide instruction in English as a second language and which accept no public funds. g. Application fee. Every applicant and renewal applicant shall pay to the department a nonrefundable, nontransferable fee based on gross annual tuition income as determined by the annual financial statements required in paragraph a of this subdivision for the most recent school fiscal year, according to the following schedule: GROSS ANNUAL TUITION INCOME FEE 0-$199,999 $ 250.00 $200,000-$499,999 $ 500.00 $500,000-$999,999 $ 750.00 $1,000,000-$4,999,999 $1,500.00 $5,000,000-$9,999,999 $3,000.00 $10,000,000 or above $6,000.00Such fees shall accrue to the credit of the proprietary vocational school supervision account. If the evaluation of a particular course or facility requires the services of an expert not employed by the department, the department shall retain such expert and the school shall reimburse the department for the reasonable cost of such services. 5. Required disclosure for licensure. a. The commissioner shall require that each applicant for a license for the operation of a private vocational or business school disclose the following information: (1) Whether the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds, has been convicted of a crime defined in this article, or any other crime involving the operation of any educational or training program, or, in connection with the operation of any such program, a crime involving the unlawful acquisition, use, payment or expenditure of educational or training program funds; and (2) Whether the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds has been convicted: (A) in this state of any of the following felonies defined in the penal law: bribery involving public servants; commercial bribery; perjury in the second degree; rewarding official misconduct; larceny, in connection with the provision of services or involving the theft of governmental funds; offering a false instrument for filing, falsifying business records; tampering with public records; criminal usury; scheme to defraud; or defrauding the government; or (B) in any other jurisdiction of an offense which is substantially similar to any of the felonies defined in clause (A) of this subparagraph and for which a sentence to a term of imprisonment in excess of one year was authorized and is authorized in this state regardless of whether such sentence was imposed; and (3) Whether the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds, has been finally determined in any administrative or civil proceeding to have committed a violation of any provision of this article or any rules and regulations promulgated pursuant thereto, or any related order or determination of the commissioner, or of any similar statute, rule, regulation, order or determination of another jurisdiction pertaining to the licensure and operation of any educational or training program; and (4) Whether any school owned or operated by the applicant closed or ceased operation and, if so, whether at the time of the closing the applicant was subject to a pending disciplinary action, disallowance, fine or other penalty and whether it owed refunds to any government agency or students. b. No application for any license pursuant to this article shall be denied by reason of disclosure pursuant to this subdivision of the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds unless the commissioner makes a written determination that there is a direct relationship between one or more of such previous offenses and the license sought, or that issuance of the license would create anunreasonable risk to property or to the safety, education or welfare of specific individuals or the general public. In making such determination, the commissioner shall be guided by the factors set forth in section seven hundred fifty-three of the correction law. For purposes of this subdivision, "ownership or control interest" means: with respect to a school that is organized as or owned by a corporation, a position as an officer or director of such corporation; or, with respect to a school that is organized as or owned by a partnership, a position as a partner; or any other interest totaling ten percent or more, whether direct or indirect, in the total equity or assets of such school. c. The commissioner may deny, suspend, revoke or decline to renew any license (1) if the significance of the convictions or administrative violations warrant such action or (2) if the commissioner determines that a school did not make any disclosure required by this subdivision. 6. If, during the two year period for which a license or registration is granted, the commissioner determines that a school's financial condition may result in the interruption or cessation of instruction or jeopardize student tuition funds, the commissioner may, upon notice to the school, place the school on probation for a period of no more than thirty days, during which time the school and the department must make efforts to resolve the problems at the school. If no resolution can be attained, a hearing, pursuant to subdivisions two and three of section five thousand three of this article will be scheduled. Such probation may include additional monitoring, inspections, limitations on enrollment, teaching out some or all of a school's present students or temporary cessation of instruction. 7. No license or registration granted under this section shall be transferable or assignable without the approval of the commissioner. Any transfer or assignment of any interest totaling ten percent or more, whether direct or indirect, in the total equity or assets of a school shall be deemed a transfer of such school's license or registration. The commissioner shall approve or deny a transfer or assignment based on the requirements set forth in subdivisions three and four of this section. Such approval or denial, together with the reasons for denial, shall be transmitted in writing within ninety days of the receipt of the complete application by the commissioner. Upon a showing of good cause as to why the applicant could not obtain the commissioner's approval prior to a transfer or assignment, the commissioner shall temporarily approve the transfer or assignment for a period not to exceed forty-five days and for such additional periods as the commissioner may deem appropriate. 8. No licensed or registered school shall discontinue operation or surrender its license or registration unless thirty days written notice of its intention to do so and a plan for maintenance of safe keeping of the records of the school is provided to the commissioner. However, upon good cause shown, the commissioner may waive the thirty days notice requirement. 9. Annual supervision fund and tuition reimbursement fund assessment. a. The commissioner shall annually assess each school a total percentage of that school's gross tuition pursuant to subdivision three of section five thousand two of this article, as determined by the annual financial statement or annual audited financial statement required by this article. This assessment shall be based upon each school's gross tuition from the previous year, and shall be payable to the commissioner in equal quarterly installments which shall be due on June first, September first, December first and March first. b. (i) Beginning April first, nineteen hundred ninety-one, such annualized assessment shall be one percent.(ii) Beginning July first, nineteen hundred ninety-four, such annualized assessment shall be nine-tenths of one percent. (iii) Beginning April first, nineteen hundred ninety-five, and in each succeeding year, such annualized assessment shall be eight-tenths of one percent. c. (i) Of the total assessment provided for herein, three-tenths of one percent shall accrue to the credit of the tuition reimbursement fund pursuant to section five thousand seven of this article. (ii) The balance of the total assessment provided for herein shall be dedicated to fund the department's supervision and regulation of licensed private schools and registered business schools pursuant to an annual appropriation and an annual plan of expenditure prepared by the commissioner and approved by the director of the budget. Following the close of each fiscal year, the commissioner, in consultation with the director of the budget, shall determine if the balance in the proprietary vocational school supervision fund for such fiscal year exceeded the amount required for the support of the department's supervisory activities taking into account projected revenues and expenditures for the subsequent fiscal year. To the extent that a surplus is identified, the commissioner, with the approval of the director of the budget, shall direct the transfer of such surplus to the tuition reimbursement fund. d. Payments made within thirty days following the due date shall be subject to interest at one percent above the prevailing prime rate. Thereafter, late payments may result in suspension of licensure by the commissioner. Payments required by this subdivision shall be considered a condition of licensure or registration.
§ 5001. Licensed private schools and registered business schools/computer training facilities. 1. Schools required to be licensed or registered. No private school or computer training facility which charges tuition or fees for instruction and which is not exempted hereunder shall be operated by any person or persons, firm, corporation, or private organization for the purpose of teaching or giving instruction in any subject or subjects, unless it is licensed or registered by the department. As used in this article, the following terms shall have the following meanings: a. "Licensed private school" shall mean any entity offering to instruct or teach any subject by any plan or method including written, visual or audio-visual methods. b. "Registered business school" shall mean a school in which a curriculum primarily provides a sequence of courses that may include accounting or bookkeeping, marketing, business arithmetic, business law, business English, shorthand, typing, computer business applications/programming, or substantially all said courses, for the purpose of preparing an individual to pursue a business occupation; provided, however, that a registered business school program may include instruction in English as a second language at a beginning or basic level, provided such instruction shall not constitute more than fifty percent of such program. Such authorization shall apply to all students who commence instruction in a registered business school program prior to July first, nineteen hundred ninety-one. A business school registered under this section shall employ only teachers licensed by the department, whose qualifications are substantially equivalent to those required of teachers of equivalent subjects in public secondary schools. c. "Computer training facility" shall mean any entity primarily engaged in providing training on the use, language, programs, application, networking and technical repair of computers. 2. Exempt schools. The following schools are exempted from the licensing requirement of this section: a. institutions authorized to confer degrees in this state; b. schools, other than correspondence schools, providing kindergarten, nursery, elementary or secondary education, except schools conducted for profit which provide instruction in English as a second language or preparation for high school equivalency examinations to out-of-school youth or adults; c. schools operated by governmental agencies or authorities; d. schools which engage exclusively in training of students with disabilities as defined in section forty-four hundred one of this chapter; e. schools conducted on a not-for-profit basis by firms or organizations for the training of their own employees only, provided that such instruction is offered at no charge to such employees, or by a fraternal society or benevolent order for its members or their immediate relatives only; f. schools which provide instruction in the following subjects only: religion, dancing, music, painting, drawing, sculpture, poetry, dramatic art, languages, reading comprehension, mathematics, recreation, yoga, martial arts and athletics, including the training of students to teach such subjects; g. schools in which the course of instruction is licensed, registered or approved under any other section of this chapter or by any other department or agency of the state; h. schools which provide instruction designed solely for giving flight training and/or related ground school instruction;i. schools in which instruction designed solely to prepare applicants for admission to professional licensing examinations administered by the department pursuant to title eight of this chapter, and applicants for examination for admission to the practice of law; j. schools which offer continuing education courses exclusively for individuals licensed by the department pursuant to title eight of this chapter and for individuals admitted to the practice of law; k. schools which provide instruction given exclusively to employees of a person or organization which has contracted with another person or organization to provide such instruction at no cost to the employees; l. conferences, trade shows, workshops, seminars, institutes or courses of study offered and sponsored either jointly or individually by recognized trade, business or professional organizations for the benefit of their membership; or those offered to the general public by individuals, firms or organizations which neither conduct such activities for a duration of more than five consecutive days nor more frequently than twice in any one calendar year; m. schools which provide instruction exclusively to persons employed full-time or part-time in the field in which instruction is being offered, where the instruction is provided to meet continuing education standards required for professional licensure as defined by law in this state; 2-a. Schools exempted pursuant to subdivision two of this section may waive such exemption and apply for a license or registration; provided, however, that the review of such applications shall be left to the discretion of the commissioner. 2-b. Programs offered by licensed private schools or registered business schools to private businesses where there is no tuition liability to the employees shall be exempt from the requirements of this article, provided that the following requirements are met: a. Only employees of the private business for which the program is being offered may enroll in classes that make up the program. b. Certificates or diplomas awarded to students in the program may not reference in any way the department. c. Prior to the commencement of the program, such schools shall submit to the department a disclosure form, prescribed by the commissioner, copies of which shall be provided to all students in such exempt program, which shall include but not be limited to the following information: (i) a description of the location and time period in which the program will be offered; (ii) a statement that the students enrolled in the program shall not be subject to any tuition liability for the program, even if such students do not complete the program; (iii) a statement that the program being provided to the private business has not been approved by the department and is not under the department's jurisdiction and that the students in the program have been advised of the fact; and (iv) the signatures of the school director or owner of the school and the representative of the private business for which the program is being offered certifying the accuracy of the statements on the form. d. Any additional student openings in a program deemed exempt by the department may be made available to students not affiliated with the private business on the condition that such students execute a disclosure form as prescribed in paragraph c of this subdivision. Such admitted students shall only constitute up to ten percent of the exempt program's total capacity.4. Application, renewal application and application fees. a. Application and renewal application for a license as a private school or registration as a business school required by the commissioner shall be filed on forms prescribed and provided by the department. Except as provided in subparagraph (iii) of paragraph e of this subdivision, each renewal application for a private business school registered pursuant to this section or for a private school licensed pursuant to this section shall include an audited financial statement audited according to generally accepted auditing standards by an independent certified public accountant or an independent public accountant and statistical reports certified by the owner or operator of the school, as required by the commissioner; provided, however, that the commissioner shall accept a copy of a current financial statement previously filed by a school with any other governmental agency in compliance with the provisions of any federal or state laws, or rules or regulations if such statement contains all of the information required under this subdivision and conforms to this subdivision's requirements of auditing, review and certification. Any required audit of the financial statement shall be a condition of licensure or registration and shall be paid for by the school, and the results of the audit shall be forwarded to the commissioner. Applications not accompanied by the audits and reports required pursuant to this subdivision shall not be considered for approval by the commissioner. Initial applications shall be accompanied by financial reports as required by the commissioner. The commissioner shall act on an initial application for a license or registration within one hundred twenty days of receipt of a complete application. The applicant shall receive a written approval or denial together with the reasons for a denial of such application. b. (i) An initial license or registration issued pursuant to the provisions of this article shall be valid for a period of two years. A renewal of license or registration issued pursuant to the provisions of this article shall be valid for a period of four years. All license and registration fees for a renewal shall be double the amounts listed in paragraph g of this subdivision. (ii) Each school shall display, near the entrance to the school and under glass, the license or registration which has been issued to it. Such authorization shall be displayed only during the period of its validity. c. An application for renewal of any license or registration shall be submitted at least one hundred twenty days prior to the expiration date of the current authorization to operate accompanied by the nonrefundable application fee and such certified statistical reports and annual financial statements required pursuant to this subdivision. d. When complete and timely application has been made for renewal of any license or registration, the school shall receive a written approval or denial, together with the reasons for denial of renewal, from the commissioner no less than thirty days prior to the date such license or registration expires. e. Financial statements and statistical reports. (i) Licensed private schools and registered business schools shall submit such certified statistical reports and annual financial statements as required by the commissioner. The commissioner may require audited statistical reports upon a determination that a school has provided false or inaccurate certified statistical reports. The financial statements shall be based on the fiscal year of the school and shall also include an itemized account of tuition refunds due and owing to past or presently enrolled students. Statistical reports shall include, but not be limited to, enrollment, completion and placement data. The commissioner shall usesuch financial statements and statistical reports submitted for the purposes of licensure and registration of schools, establishing fees or assessments pursuant to this article and determining standards pursuant to paragraph b of subdivision five of section five thousand two of this article. The attorney general, the comptroller and the president of the higher education services corporation shall have access to this information when it is necessary to perform their duties as required by state law. (ii) Any school which received in excess of two hundred fifty thousand dollars in gross tuition in a school fiscal year shall be required to submit an annual audited financial statement to the commissioner for that fiscal year. In addition, any school which has a gross tuition of two hundred fifty thousand dollars or less in a school fiscal year but whose combined state and federal student financial aid in such year exceeds one hundred thousand dollars shall also submit an annual audited financial statement to the commissioner for that fiscal year. (iii) Schools whose gross tuition is two hundred fifty thousand dollars or less in a school fiscal year and which receive less than one hundred thousand dollars in state and federal student financial aid in a school fiscal year shall file with the commissioner an unaudited financial statement in a format prescribed by the commissioner, provided, however, that any such school with gross tuition in excess of fifty thousand dollars shall have filed at least one audited financial statement after the first year of its operation. The statement shall be signed by the president or chief executive officer and the chief fiscal officer of the school who shall certify that the statements are true and accurate. Upon a determination by the commissioner that a school has submitted false or inaccurate statements or that a significant, unsubstantiated decline in gross tuition has occurred, the commissioner may require any such school to file an audited financial statement pursuant to this paragraph. f. Alternate licensing provision. The commissioner shall issue regulations which define alternate licensing requirements for the following: (1) correspondence schools in which all approved programs and courses are under three hundred hours; (2) schools which are eligible for exemption under this section but which elect to be licensed; (3) non-profit schools exempt from taxation under section 501(c)(3) of the internal revenue code whose programs are funded entirely through donations from individuals or philanthropic organizations, or endowments, and interest accrued thereon; and (4) language schools conducted for-profit which provide instruction in English as a second language and which accept no public funds. g. Application fee. Every applicant and renewal applicant shall pay to the department a nonrefundable, nontransferable fee based on gross annual tuition income as determined by the annual financial statements required in paragraph a of this subdivision for the most recent school fiscal year, according to the following schedule: GROSS ANNUAL TUITION INCOME FEE 0-$199,999 $ 250.00 $200,000-$499,999 $ 500.00 $500,000-$999,999 $ 750.00 $1,000,000-$4,999,999 $1,500.00 $5,000,000-$9,999,999 $3,000.00 $10,000,000 or above $6,000.00Such fees shall accrue to the credit of the proprietary vocational school supervision account. If the evaluation of a particular course or facility requires the services of an expert not employed by the department, the department shall retain such expert and the school shall reimburse the department for the reasonable cost of such services. 5. Required disclosure for licensure. a. The commissioner shall require that each applicant for a license for the operation of a private vocational or business school disclose the following information: (1) Whether the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds, has been convicted of a crime defined in this article, or any other crime involving the operation of any educational or training program, or, in connection with the operation of any such program, a crime involving the unlawful acquisition, use, payment or expenditure of educational or training program funds; and (2) Whether the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds has been convicted: (A) in this state of any of the following felonies defined in the penal law: bribery involving public servants; commercial bribery; perjury in the second degree; rewarding official misconduct; larceny, in connection with the provision of services or involving the theft of governmental funds; offering a false instrument for filing, falsifying business records; tampering with public records; criminal usury; scheme to defraud; or defrauding the government; or (B) in any other jurisdiction of an offense which is substantially similar to any of the felonies defined in clause (A) of this subparagraph and for which a sentence to a term of imprisonment in excess of one year was authorized and is authorized in this state regardless of whether such sentence was imposed; and (3) Whether the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds, has been finally determined in any administrative or civil proceeding to have committed a violation of any provision of this article or any rules and regulations promulgated pursuant thereto, or any related order or determination of the commissioner, or of any similar statute, rule, regulation, order or determination of another jurisdiction pertaining to the licensure and operation of any educational or training program; and (4) Whether any school owned or operated by the applicant closed or ceased operation and, if so, whether at the time of the closing the applicant was subject to a pending disciplinary action, disallowance, fine or other penalty and whether it owed refunds to any government agency or students. b. No application for any license pursuant to this article shall be denied by reason of disclosure pursuant to this subdivision of the applicant, or any corporation, partnership, association or organization or person holding an ownership or control interest in such school, or any employee responsible in a supervisory capacity for the administration of student funds or governmental funds unless the commissioner makes a written determination that there is a direct relationship between one or more of such previous offenses and the license sought, or that issuance of the license would create anunreasonable risk to property or to the safety, education or welfare of specific individuals or the general public. In making such determination, the commissioner shall be guided by the factors set forth in section seven hundred fifty-three of the correction law. For purposes of this subdivision, "ownership or control interest" means: with respect to a school that is organized as or owned by a corporation, a position as an officer or director of such corporation; or, with respect to a school that is organized as or owned by a partnership, a position as a partner; or any other interest totaling ten percent or more, whether direct or indirect, in the total equity or assets of such school. c. The commissioner may deny, suspend, revoke or decline to renew any license (1) if the significance of the convictions or administrative violations warrant such action or (2) if the commissioner determines that a school did not make any disclosure required by this subdivision. 6. If, during the two year period for which a license or registration is granted, the commissioner determines that a school's financial condition may result in the interruption or cessation of instruction or jeopardize student tuition funds, the commissioner may, upon notice to the school, place the school on probation for a period of no more than thirty days, during which time the school and the department must make efforts to resolve the problems at the school. If no resolution can be attained, a hearing, pursuant to subdivisions two and three of section five thousand three of this article will be scheduled. Such probation may include additional monitoring, inspections, limitations on enrollment, teaching out some or all of a school's present students or temporary cessation of instruction. 7. No license or registration granted under this section shall be transferable or assignable without the approval of the commissioner. Any transfer or assignment of any interest totaling ten percent or more, whether direct or indirect, in the total equity or assets of a school shall be deemed a transfer of such school's license or registration. The commissioner shall approve or deny a transfer or assignment based on the requirements set forth in subdivisions three and four of this section. Such approval or denial, together with the reasons for denial, shall be transmitted in writing within ninety days of the receipt of the complete application by the commissioner. Upon a showing of good cause as to why the applicant could not obtain the commissioner's approval prior to a transfer or assignment, the commissioner shall temporarily approve the transfer or assignment for a period not to exceed forty-five days and for such additional periods as the commissioner may deem appropriate. 8. No licensed or registered school shall discontinue operation or surrender its license or registration unless thirty days written notice of its intention to do so and a plan for maintenance of safe keeping of the records of the school is provided to the commissioner. However, upon good cause shown, the commissioner may waive the thirty days notice requirement. 9. Annual supervision fund and tuition reimbursement fund assessment. a. The commissioner shall annually assess each school a total percentage of that school's gross tuition pursuant to subdivision three of section five thousand two of this article, as determined by the annual financial statement or annual audited financial statement required by this article. This assessment shall be based upon each school's gross tuition from the previous year, and shall be payable to the commissioner in equal quarterly installments which shall be due on June first, September first, December first and March first. b. (i) Beginning April first, nineteen hundred ninety-one, such annualized assessment shall be one percent.(ii) Beginning July first, nineteen hundred ninety-four, such annualized assessment shall be nine-tenths of one percent. (iii) Beginning April first, nineteen hundred ninety-five, and in each succeeding year, such annualized assessment shall be eight-tenths of one percent. c. (i) Of the total assessment provided for herein, three-tenths of one percent shall accrue to the credit of the tuition reimbursement fund pursuant to section five thousand seven of this article. (ii) The balance of the total assessment provided for herein shall be dedicated to fund the department's supervision and regulation of licensed private schools and registered business schools pursuant to an annual appropriation and an annual plan of expenditure prepared by the commissioner and approved by the director of the budget. Following the close of each fiscal year, the commissioner, in consultation with the director of the budget, shall determine if the balance in the proprietary vocational school supervision fund for such fiscal year exceeded the amount required for the support of the department's supervisory activities taking into account projected revenues and expenditures for the subsequent fiscal year. To the extent that a surplus is identified, the commissioner, with the approval of the director of the budget, shall direct the transfer of such surplus to the tuition reimbursement fund. d. Payments made within thirty days following the due date shall be subject to interest at one percent above the prevailing prime rate. Thereafter, late payments may result in suspension of licensure by the commissioner. Payments required by this subdivision shall be considered a condition of licensure or registration.
