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Josh-D. S. Davis

Xaminmo / Omnimax / Max Omni / Mad Scientist / Midnight Shadow / Radiation Master

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California wants more money.
Baby poop
The California Private Postsecondary Act of 2009 will require flight schools to pay a yearly fee and open their books to regulators.

The intent of the law is to protect the financial wellbeing of students who seek an education at a postsecondary school.

If the school goes out of business, or is unable to fulfill its obligation to the student, the student is reimbursed a certain amount of money.

To fund the program, Part 141 FAA flight schools will now be required to pay an initial $5,000 fee, followed by a $1,000 annual fee, and 0.75 percent of yearly revenue to the program.

Am I the only person who thinks that this is a bad idea? That's a large amount of money. It's legally mandated solvency insurance that's managed by a government entity that has a questionable financial track record. It's higher taxes and higher burden on small business.

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I'm not privy to how many CA flight schools go under each year, and how many students it effects, but this does seem a little heavy handed. I'm glad the funding is coming from the schools as a cost-of-business thing instead of going to the taxpayers. But is there a precedent for this with other trade schools, I wonder? Do Devry, ITT, or art institutes for example have something like this in place?

Ceremonial deceased equine abuse: If only there were a giant, untapped pile of state revenue that California could somehow tap into...

Well, there were 2 or 3 schools nationwide that went under and took large, up-front deposits with them.

My view is that you don't put a huge deposit up front. I mean, some want a $2k block up front, and even that is asking a lot.

I dunno how far reaching this is, but I think regulating the amount of unsecured deposit hold is much better than taxing small schools.

I don't know how I didn't think of this earlier, but this reminded me of the great Texas Massage School Crash of '09. Texas law states that students are entitled to a refund only if they do not receive a copy of their transcript within 30 days. I can't imagine not being able to transfer already completed classes to another school due to lack of paperwork. Here's a more complete article about it:


But back to your point, you're absolutely right. This seems to add a for-profit solvency insurance wing to the FAA. Professional pilots already have one of the most disproportionate cost of education to the income they earn, this only drives up the cost of education.

Don't get me wrong, I'm all about schools being forced to open their books as part of accreditation. I'd go so far as to say that the accrediting entity should be responsible for the students' transcripts in the event of a closing, too. In a perfect world, these entities should exist primarily to protect the students' best interest, or they should become obsolete.

yaya. Open finances isn't a big deal. Transcript registries, also OK. Keep it out of the government though.

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