Section 92-42-005 - Procedures for Application for Agent's PermitAn applicant for an agent's permit shall be an individual of good reputation and character, and shall represent only private postsecondary career schools which meet the minimum standards established pursuant to 92 NAC 41;
005.01 Application An individual shall fully complete an application form provided by the department.
005.01A An applicant shall be required to obtain a separate agent's permit for each school represented.005.01B Failure of an applicant to disclose all criminal convictions, including misdemeanors, shall be evidence of the lack of good reputation and character, and shall be cause for the Commissioner to deny any application or revoke any existing permit.005.02 Materials that Shall Accompany the Application for an Agent's Permit 005.02AApplication Fee. The application shall be accompanied by an application fee. All fees collected pursuant to this section shall be remitted by the Department to the State Treasurer for credit to the Private Postsecondary Career Schools Cash Fund. No fee shall be subject to refund. Application fees are provided for in Appendix A.005.02BSurety Bond. The application for an agent's permit shall be accompanied by a good and sufficient surety bond in a penal sum of five thousand dollars ($5,000.00) as detailed below: 005.02B1 The bond shall be executed by the applicant as principal and by a surety company qualified and authorized to do business in this state. The bond may be in blanket form to cover more than one agent for a private postsecondary career school, but it shall cover each agent for the school in a penal sum of five thousand dollars ($5,000.00). Bonds in blanket form shall be executed by the school as principal.005.02B2 The bond shall be conditioned to provide indemnification to any student or enrollee or his or her parent or guardian determined to have suffered loss or damage as a result of any act or practice which is a violation of the Act by the agent and that the surety shall pay any final judgement rendered by any court of this state having jurisdiction upon receipt of written notification of the judgement. Regardless of the number of years that such bond is in force, the aggregate liability of the surety thereon shall in no event exceed the penal sum thereof. The bond may be continuous.005.02B3 The surety bond shall cover the period of the agent's permit, as appropriate, except when a surety is released as provided in this section. A surety on any bond filed under section 005.02 may be released therefrom after such surety serves written notice thereof on the department thirty (30) days prior to the release. Such release shall not discharge or otherwise affect any claim theretofore or thereafter filed by a student or enrollee or his or her parent or guardian for loss or damage resulting from any act or practice which is a violation of the Act alleged to have occurred while the bond was in effect or for a school's ceasing operations during the term for which tuition has been paid while the bond or agreement was in force.005.02B4 A single agent's permit and surety bond for one school with one or more branch facilities shall extend to cover all branch facilities.005.02B5 Until the Tuition Recovery Cash Fund initially reaches the minimum fund level prescribed in section 85-1656 R.R.S., an agent's permit shall be suspended by operation of law when the school is no longer covered by a surety bond or agreement as required by Section 85-1639 R.R.S.. An agent's permit shall be suspended by operation of law when the agent is no longer covered by a surety bond or agreement as required by Section 85-1640 R.R.S.. The commissioner shall cause the school and agent to receive at least thirty (30) days written notice prior to the release of the surety to the effect that the permit shall be suspended by operation of law until another surety bond is filed in the same manner and like amount as the bond being terminated.005.02CSchool Safety. The application shall be accompanied by a statement of assurance signed by the Resident Director or a member of the school's administrative staff stating that the school complies with all applicable health, fire, safety, and sanitation laws and regulations.005.02DFinancial Stability. The school shall have adequate revenues and assets to meet the school's financial obligations; to provide adequate services to its students and prospective students; to provide refunds when students have justifiable claims against the school, and to refund all unearned tuition and other charges within a reasonable period of time if the school is dissolved. 005.02D1 At a minimum, a school shall submit financial statements prepared in accordance with the Generally Accepted Accounting Principles (GAAP) for the school's most recently completed fiscal year. Schools that prepare audited financial statements must submit the audited financial statements. If the school is affiliated with a corporation/parent organization, a copy of the parent organization's most recent financial statements prepared by an independent CPA shall be submitted.005.02D2 In evaluating the financial statements, a school must meet at least one of the following criteria: 005.02D2a The financial statements must demonstrate a minimum ratio of current assets to current liabilities of at least 1:1 for an institution's latest fiscal or calendar year. Asset Ratio is calculated by adding cash and cash equivalents to current accounts receivable and dividing the sum by total current liabilities.005.02D2b The school must have a positive net worth in which total assets exceed total liabilities for its latest fiscal or calendar year.005.02D2c The school shall show a profit for the most recent fiscal or calendar year or two previous fiscal years combined.005.02EContracts. The application shall be accompanied by copies of enrollment agreements and retail installment contracts to be used in Nebraska. 005.02E1Enforcement of Contract. At the option of the student or his/her parent or guardian, all contracts entered into by any student, or his/her parent or guardian, or given them by an individual who does not possess a current and valid permit, and any non-negotiable promissory note or other non-negotiable indebtedness taken in lieu of cash by such an individual, may be declared invalid by the department and all monies paid recovered from the school he/she represents.005.02FEvidence of a Refund Policy. The application shall be accompanied by evidence that the school has and adheres to a reasonable refund policy of unearned tuition and fees paid in advance by an enrollee who fails to enter, or withdraws, or is discontinued therefrom prior to completion of the study. Refunds of unearned tuition, fees, and other charges shall be made in the following manner within sixty (60) days of termination: 005.02F1 If cancellation occurs within seventy-two (72) hours of enrollment, all monies paid shall be refunded.005.02F2 If cancellation occurs after seventy-two (72) hours of enrollment, but before classes at the resident school begin or home study materials are delivered, a refund shall be made of all tuition paid except a registration fee not to exceed one hundred fifty ($ 150.00).005.02F3 If cancellation occurs after classes at the resident school have begun or after home study materials have been delivered, the school shall adhere strictly to the refund policy published in the school's catalog or in the enrollment agreement. Once books and supplies have been issued, they become the property of students and any refunds on them shall be at the discretion of the school.005.02F4 A full refund is due students whose contracted educational services are denied as a result of intentional deception, or misrepresentation of facts, or the use of advertising which is known to be false, inaccurate, or misleading.005.02F5 A full refund is due an individual whose admission is denied by the school.005.02F6 The school shall make all refunds due within sixty (60) days following a student's official drop date, or in the case of a student who does not return to school at the expiration of an approved leave of absence, within sixty (60) days following the last day of that leave of absence. 005.02F6a The school shall maintain accurate records of attendance to assist in establishing the last day of attendance of any student enrolled at the school.005.02GDescriptive Literature. The application shall be accompanied by descriptive literature published or proposed to be published by the school. This shall include copies of all brochures, catalogs, promotional materials, written scripts, media advertising, and promotional literature that may be used to induce students to enroll in courses of instruction.005.02HAdvertising. All advertising and promotional materials shall include the full and correct name and location of the school. 005.02H1 All materials used in this state shall be completely truthful and shall refrain from giving any false, misleading, or exaggerated impression with respect to the school, its personnel, its courses and services, or the occupational opportunities for its graduates.005.02H2 When using the classified column of a newspaper or other publications to recruit students, the school shall use only headings such as "Education," "Schools," or "Instruction," rather than "Help Wanted," "Employment," or "Business Opportunities."005.02H3 During recruitment, no statement or representation shall be made that students will be guaranteed employment nor shall any school or a representative thereof falsely represent opportunities concerning income.005.02H4 No dollar amounts shall be quoted in any advertising as representative or indicative of the earning potential of graduates, unless the facts are substantiated and the supporting data made available for inspection.005.02H5 The school's representatives shall refrain from using unethical, deceptive, or derogatory practices in recruiting students or in any reference to competitors.005.02H6 All advertising or promotional materials shall clearly identify any branch facility as such and shall not portray it as a separate stand alone campus facility.005.02IOut of State Schools; Certificate of Approval to Recruit. If any school which the applicant intends to represent is an out-of-state school, the application for an agent's permit shall be accompanied by: 005.02I1 the information required of schools making application for authorization to operate and evidence to show that its place of business outside this state has been licensed or approved for operation by the appropriate state agency in the state in which it is domiciled, 005.02I1a The information required above shall consist of the information required of schools applying for authorization to operate in this State as provided in 92 NAC 41, Sections 005.01 through 005.09A and Section 005.09C.005.02I2 an application for a Certificate of Approval to Recruit; and,005.02I3 and a fee as provided for in Appendix A.005.02I4 If the state of domicile of the school has no authorization law for private postsecondary career schools, or no such law applies to a particular school or course of study or instruction concerning which the applicant intends to act as an agent, the school shall: 005.02I4a submit all information required in Section 005.02I1a above and show evidence that it has been accredited by an accrediting agency recognized by the United States Department of Education as specified in Section 85-1609 R.R.S. and,005.02I4b file with the department a school bond in at least the amount required by Section 85-1639 R.R.S. 005.02I4b1 The school bond shall be a surety bond in the penal sum of $20,000, executed by the out-of-state school as principal and by a surety company qualified and authorized to do business in this state. The bond shall be conditioned to provide indemnification to any student or enrollee who is a resident of this state at the time of enrollment, or to his or her parent or guardian, who is determined to have suffered loss of damage due to the school not performing all agreements and contracts entered into with such students or parents/guardians.005.02I5Term of Certificate of Approval To Recruit. The term of the Certificate of Approval To Recruit is based upon a term beginning on the date of issuance and ending December 31 of the same year.92 Neb. Admin. Code, ch. 42, § 005
Amended effective 11/8/2016.