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House approves bond and surety requirements for private proprietary schools (SB 80)
Summary
Lawmakers passed SB 80 to give the Board of Regents authority to require surety bonds or similar instruments from proprietary (for‑profit) schools to protect students’ prepaid tuition; a clarifying amendment capped bond amounts at anticipated annual tuition.
The Utah House passed Senate Bill 80, a measure that expands Board of Regents authority to require financial surety from proprietary (private, for‑profit) postsecondary schools so students’ prepaid tuition can be refunded if a school closes unexpectedly.
Representative Allen, who presented the bill, said the measure is aimed at preventing students from losing tuition after sudden school closures and noted the legislation allows the Board of Regents to require surety bonds, certificates of deposit or irrevocable letters of credit sized to the amount of tuition and fees. Allen cited a case of a technical school that closed suddenly and left students out substantial sums of tuition.
Representative Hickman offered amendment number 1 to limit the required bond or guarantee "not to exceed in amount the anticipated tuition and fees to be received by the proprietary school during a school year." The House adopted that clarifying amendment and later passed the bill by voice recorded as 66‑0. The sponsor and supporters said the bill would not apply to accredited institutions such as Westminster, BYU or University of Phoenix and that bond amounts would vary with tuition levels.
Supporters said the change protects students from financial loss while still allowing legitimate proprietary schools to operate. The bill will be transmitted to the Senate for further action.
