Post-secondary educational institutions in Hawaii seeking accreditation now have to post a surety bond. The purpose of the bonding is to serve as protection for students in the state. If their post-secondary school fails to meet its legal obligations, they can get reimbursed for paid tuition.
House Bill 1079 introduced the new requirements in the accreditation process. The new rules came into force on July 1. Post-secondary schools seeking accreditation have to obtain a $50,000 bond, which can be used for compensation, if the need arises.
Here are the most important details about the bonding that Hawaii post-secondary schools and their students need to know:
The new bill amends the regulations for post-secondary schools accreditation by adding a requirement for institutions to get bonded. They have to use the official bond form and present it to the Hawaii Post-secondary Education Authorization Program (HPEAP).
What does the bonding provide for students? It provides an extra layer of guarantee they will receive a diploma from an accredited post-secondary school. The bond ensures that education institutions will comply with the Hawaii Revised Statutes, Chapter 305J.
The bond can provide compensation for students in case their post-secondary school does not abide by state rules, ceases operation or similar situations. Students and their parents or legal guardians can seek reimbursement for the tuition fees they have paid by launching a claim process on the private school bond. This means their interests can be safeguarded even if problems with the educational institution arise.
In cases of proven claims, the surety that has bonded the school handles the costs initially. The bonded school, however, needs to repay it afterward, which means the indemnity remains with the educational institution.
House Bill 1079 brings additional changes to the accreditation process for post-secondary schools. Institutions are now allowed to continue operating while awaiting their authorization from an accreditation agency approved by the U.S. Department of Education.
Post-secondary schools can get a provisional authorization from the HPEAP. They have to receive their full accreditation within five years. This period may, in certain circumstances, be prolonged to 10 years. The yearly fee for the authorization is $5,000. Once having received an accreditation, schools have to renew it every two years.
While operating provisionally, an institution is required to warn its students that their diplomas will depend on the successful accreditation process. In case the school does not manage to get accreditation, or stops the process, the surety bond ensures that students can receive a reimbursement for the tuition they have paid.
That’s why the institution should ensure it is covered by a bond at all times, as otherwise its provisional authorization will be immediately suspended. It cannot enroll students afterward. If the school does not take action to activate its suspended authorization within 60 days, the HPEAP will revoke the provisional accreditation.
While the new bill provide various options for post-secondary schools in Hawaii, its main goal is to safeguard the interests of students in the state and to ensure they receive high quality and duly accredited education.
Todd Bryant is the president and founder of Bryant Surety Bonds.
