[§305J-20] Candidates for accreditation; requirements; sanctions. (a) A candidate for accreditation shall:
(b) If a candidate for accreditation ceases operation, the director may make demand on the surety bond upon the claim for a refund by a student or the parent or legal guardian of a student, and the surety on the surety bond shall pay the claim in a timely manner. The student or a parent or legal guardian of the student who claims loss of tuition or fees as a result of the cessation of operations of a candidate for accreditation may file a claim with the department if the claim results from an act or practice that violates this chapter. If the amount of the surety bond is less than the total prepaid, unearned tuition and fees that have been paid by students at the time that the candidate for accreditation ceases operation, the department shall prorate the amount of the surety bond among the students. This subsection shall apply only to those students enrolled at a candidate for accreditation at the time it ceases operation.
(c) A candidate for accreditation that is no longer covered by a surety bond as required by this section or that fails to obtain accreditation within the required time frame with no extension of time for good cause shall have its provisional authorization automatically suspended pursuant to section 305J-12(a) and shall immediately cease enrolling new students.
(d) A candidate for accreditation's failure to reinstate a suspended provisional authorization within sixty days of suspension shall result in the revocation of the authorization, and the candidate shall forfeit all fees. The candidate shall provide written notice to all students within thirty days following the date of revocation.
(e) A candidate for accreditation that fails to obtain accreditation within the required time frame or that elects to stop pursuing accreditation shall refund students for any classes students are currently enrolled in or have not yet completed and shall comply with any applicable rules, policies, and procedures for closures of institutions or transition to a non-accredited status.
(f) Any candidate for accreditation that violates this chapter may be subject to one or more of the sanctions provided by section 305J-11(c). [L 2017, c 4, §1]