Postsecondary schools in Hawaii will need a surety bond following the passage of House Bill 1079, which takes effect on July 1, 2017.
In Hawaii, postsecondary schools are degree-granting institutions that do not include internal employee education programs, labor union apprenticeship programs, or religious schools offering only religious degrees, among others. HB 1079 will apply only to postsecondary schools that are seeking accreditation.
HB 1079 adds a section to Hawaii Revised Statutes, Chapter 305J, which details regulations for postsecondary education authorization. The new section creates a procedure for postsecondary schools to apply for accreditation from an agency recognized by the U.S. Department of Education. Under the new rules, postsecondary schools applying for accreditation must provide a $50,000 surety bond to protect students’ tuition in the event that they violate Chapter 305J.
HB 1079 also allows the Hawaii Post-secondary Education Authorization Program (HPEAP) to grant accreditation-seeking postsecondary schools to receive provisional authorization to operate. Provisionally authorized schools will be allowed to continue operating while they seek accreditation, as long as they become accredited within five years. The provisional accreditation period may be extended for up to ten years by the Director of the Department of Commerce and Consumer Affairs.
Provisionally accredited postsecondary schools must notify enrolling students in writing that their ability to grant the student a degree is contingent upon their accreditation. If a provisionally authorized postsecondary school does not become accredited within the mandated time frame, their authorization is revoked and students can seek tuition reimbursement through the surety bond. If a school chooses to stop pursuing accreditation, it must refund students all tuition and fees paid. Provisionally accredited schools must pay a $5,000 annual fee to the state of Hawaii. Once authorized, postsecondary schools must reapply for accreditation every two years.