What's happening
This bill requires for-profit colleges in New York to publicly disclose data, financials, and complaints, and mandates state oversight of enrollment changes.
Why it matters
Gives prospective students and the public easier access to key information. about for-profit colleges, including their degree programs, accreditations, participation in state and federal financial aid, complaint history, and any disciplinary actions, helping people make more informed decisions about enrollment.
Requires annual publication of financial data and a visual summary of each institution’s financial health. , including data on spending for student services, staff, advertising, and a federal composite score—potentially exposing institutions that prioritize profits over educational quality.
Mandates state review of for-profit college programs with significant enrollment changes. (±15% in a year), triggering checks on educational quality and compliance, and empowering the state to impose restrictions or corrective actions if problems are found—this could help prevent unchecked growth or decline that might harm students.
Improves transparency around complaints and closures. , including providing former students of closed schools with easier access to their transcripts and records, and making complaint processes more visible—offering protection and recourse for students who experience issues.
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Who cares
Headline styles
Disclose For-Profit College Finances
Plain English, a few words. Used as the page title.
Sponsors
History
- Referred to higher education
- Amend by restoring to original print 5799
- Print number 5799b
- Amend and recommit to higher education
- Print number 5799a
- Amend and recommit to higher education
- Referred to higher education
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
5799
2019-2020 Regular Sessions
IN SENATE
May 15, 2019
Introduced by Sen. THOMAS -- read twice and ordered printed, and when printed to be committed to the Committee on Higher Education
AN ACT to amend the education law, in relation to reporting and publishing of certain financial statements and statistical reports received by the commissioner of education
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The education law is amended by adding a new section 239-c to read as follows:
§ 239-c. For-profit higher education institutions; enhanced disclosure. 1. As used in this section the term "for-profit institution of higher education" means a school that:
(a) provides a program leading to an associates or baccalaureate degree;
(b) is legally authorized in New York state to provide a program of education beyond secondary education; and
(c) is neither a public or nonprofit institution.
2. For school fiscal years beginning on and after July first, two thousand twenty, each for-profit institution of higher education shall file annually 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 institution, as required by the commissioner; provided, however, that the commissioner shall accept a copy of a current financial statement previously filed by an institution 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 section and conforms to this section's requirements of auditing, review and certification. Any required audit of the financial statement shall be
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11661-01-9
S. 5799 2
paid for by the institution, and the results of such audit shall be forwarded to the commissioner.
3. The commissioner may require audited statistical reports upon a determination that a for-profit institution of higher education has provided false or inaccurate certified statistical reports. The financial statements shall be based on the fiscal year of the institution 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.
4. For school fiscal years beginning on and after July first, two thousand twenty, the commissioner shall make publicly available and publish on the website of the department all annual financial statements and statistical reports received pursuant to this section within thirty days of receipt by the commissioner of such statements and reports. The department shall maintain and make publicly available such records on its website for a period of no less than ten years.
§ 2. Paragraph e of subdivision 4 of section 5001 of the education law is amended by adding a new subparagraph (iv) to read as follows:
(iv) For school fiscal years beginning on and after July first, two thousand twenty, the commissioner shall make publicly available and publish on the website of the department all annual financial statements and statistical reports received pursuant to this paragraph within thirty days of receipt by the commissioner of such statements and reports. The department shall maintain and make publicly available such records on its website for a period of no less than ten years.
§ 3. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the education law, in relation to reporting and publishing of certain financial statements and statistical reports received by the commissioner of education
Purpose or general idea of bill
To protect New Yorkers by increasing transparency and accountability in the for-profit education industry through the publication of audited financial statements of for-profit institutions of higher education.
Summary of provisions
Section 1 amends the education law by adding a new section 239-c to:
- Define the term "for-profit institution of higher education"
- Require a for-profit to file annually with the state department of education an audited financial statement certified by the owner or oper- ator of the institution
- Authorize the commissioner to require audited statistical reports upon a determination that a for-profit institution of higher education has provided false or inaccurate certified statistical reports
- Require the commissioner to make all annual financial statements and statistical reports received publicly available on the department's website
Section 2 amends paragraph e of subdivision 4 of section 5001 of the education law by adding a new subparagraph (iv) to require the commis- sioner to make all annual financial statements and statistical reports received publicly available on the department's website
Section 3 provides the effective date
Justification
Taxpayers invest in the success of New York's students through state- funded scholarships, some 20 percent of which were accepted at for-pro- fit institutions in 2015-16. Prospective students, advocacy organiza- tions, and any interested parties deserve the right to access these statements as a matter of transparency and to ensure consumers are empowered in the choices they make.
The rate at which for-profit institutions have been closing their doors due to financial troubles is cause for concern and a further reason why the audited financial statements of these schools should be publicly available for review by consumer protection advocates. The Chronicle of Higher Education released a report in April 2019 that showed 451,270 students nationwide have been affected by for-profit closures between 2014 and 2018. In New York, 33 for-profit institutions with a total enrollment of 13,312, closed their doors in the same period of time. The vast majority of the students at these schools were people of color and women. Across the country, older and low-income students are dispropor- tionately affected by this crisis. School closures are devastating for students and staff--too often closures happen quickly and without warn- ing to students who are left without a means to finish their degrees. Nonprofit colleges in our state are already required to report their financial information on 990 forms. Financial information for public institutions is also available. This bill would simply subject for-pro- fit institutions to a similar standard so New Yorkers know how these schools spend their tax dollars and have an understanding of the finan- cial health of these schools.
Prior legislative history
New bill.
Fiscal implications for state and local governments
To be determined.
Effective date
Immediately after becoming law.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.