Historical Rule for the Texas Administrative Code

RULE §535.64Accreditation of Schools and Approval of Courses and Instructors
Repealed Date:01/01/2011

(a) Application. A person desiring to offer educational programs or courses of study under approval of the commission pursuant to Texas Occupations Code, Chapter 1101 (the Act), §1101.301, shall file an application on forms adopted by the commission accompanied by the fee prescribed pursuant to §1101.152(a)(10) of the Act. The commission may request additional information from an applicant which the commission deems to be relevant and material to the consideration of an application.

(b) Standards for approval of application for accreditation. To be accredited as a school, the applicant must satisfy the commission as to the applicant's ability to administer courses with competency, honesty, trustworthiness and integrity. If the applicant proposes to employ another person, such as an independent contractor, to conduct or administer the courses, the other person must meet this standard as if the other person were the applicant. The applicant also must demonstrate that the applicant has sufficient financial resources to conduct its proposed operations on a continuing basis without risk of loss to students attending the school and that the proposed facilities will be adequate and safe for conducting classes. If the applicant is currently accredited, the applicant will be deemed to meet financial requirements imposed by this subsection once the applicant has provided the statutory bond or other security acceptable to the commission under §1101.301 of the Act and there are no unsatisfied final money judgments against the applicant; otherwise, the application will be subject to the financial review provisions of this section.

(c) Financial review. The commission shall review the financial condition of each proposed school to determine whether the school has sufficient financial resources to conduct its proposed operations on a continuing basis. In making this determination, the commission shall be conservative in the financial assumptions it makes concerning the school's proposed operations and its future cash flows. The applicant shall provide the following information:

  (1) business financial statements prepared in accordance with generally accepted accounting principles, which shall include a current statement of financial condition and a current statement of net worth;

  (2) on an initial application, a proposed budget for the first year of operation; and

  (3) on an initial application, a market survey indicating the anticipated enrollment for the first year of operation.

(d) Approval of application for accreditation. If it determines that the applicant meets the standards for accreditation and has furnished the bond or other acceptable security required by the Act, §1101.302, the commission shall approve the application and provide a written notice of the accreditation to the applicant. Unless surrendered or revoked for cause, the accreditation will be valid for a period of five years.

(e) Subsequent application for accreditation. No more than six months prior to the expiration of its current accreditation, a school may apply for accreditation for another five year period.

  (1) To renew its accreditation, at least 55 percent of the school's graduates must have passed a commission licensing exam the first time the exam is taken by the graduates.

  (2) The school a graduate is affiliated with for purposes of this subsection is the school where the graduate took his or her last core course, unless the course was taken more than two years before the date the graduate submitted an education evaluation to the commission. If the graduate's last core course was taken more than two years before that date, the commission will not count the course or the graduate in calculating the school's exam pass rate.

  (3) For purposes of calculating the exam passage rate of a commission-accredited school, each type of licensing examination that a graduate takes for the first time will have a school affiliation, unless the last core course taken for the purpose of meeting the education requirements for the type of license was taken at a school that is not accredited by the commission or the course was taken more than two years before the date the graduate submitted an education evaluation to the commission.

  (4) A school's passage rate will be calculated and published quarterly by dividing the number of that school's graduates, as defined in subsection (e)(2) of this section, who passed the examination on their first attempt in the five-year period ending on the last day of the previous quarter by the total number of the school's graduates who took the exam for the first time in the same period. If a school offers courses toward multiple license types, the exam results for that school will be calculated and posted by license type and aggregated into the school's overall passage rate for that period. The passage rate that will be used to determine whether the accreditation standard has been met is the most current aggregate rate published by the commission as of the date the commission receives the timely application for reaccreditation or, if the accreditation expired before being renewed, the most recent rate published by the commission as of the expiration date of the school's accreditation.

  (5) In determining whether a school qualifies for reaccreditation based on its examination passage rate, the commission may consider a variety of factors, including the separate passage rates for sales, broker, and inspector applicants and trends within the school's passage rate over the five-year accreditation period.

(f) Disapproval of application. If it determines that an applicant does not meet the standards for accreditation, the commission shall disapprove the application in writing. An applicant may request a hearing before the commission on the disapproval by filing a written request for hearing within 10 days following the applicant's receipt of the notice of disapproval. Following the hearing, the commission shall issue an order which, in the opinion of the commission, is appropriate in the matter concerned. Venue for any hearing conducted under this section shall be in Travis County. The disapproval and hearing are subject to the Administrative Procedure Act, Texas Government Code, Chapter 2001, and to Chapter 533 of this title (relating to Practice and Procedure).

(g) Forms. The Texas Real Estate Commission adopts by reference the following forms approved by the commission. These documents are published by and available from the Texas Real Estate Commission, P.O. Box 12188, Austin, Texas 78711-2188, www.trec.state.tx.us.

  (1) Form ED 1-0, Education Provider Application;

  (2) Form ED 2-0, Principal Information Form;

  (3) Form ED 3-1, Course Application;

  (4) Form ED 4-2, Instructor Application - Core, Legal Update and Ethics;

  (5) Form ED 5-2, Real Estate Provider Bond;

  (6) Form ED 6-0; Evaluation Form; and

  (7) Form ED 7-1, Instructor Manual Guidelines.

(h) Obtaining approval to offer course. An applicant shall submit Form ED 3-1 the first time approval is sought to offer a course. Once a course has been approved, no further approval is required for another accredited school to offer the same course. Prior to advertising or offering the course, however, the subsequent provider shall complete Form ED 3-1, file the form with the commission and receive written or oral acknowledgment from the commission that all necessary documentation has been filed. A school shall submit an instructor's manual for each proposed course. The commission may require a copy of the course materials and instructor's manual to be submitted for each previously approved course the school intends to offer. Subsequent providers shall offer the course as originally approved or as revised with the approval of the commission and shall use all materials required in the original or revised course. Each manual must comply with Form ED 7-1, Instructor Manual Guidelines. Schools may offer a course using an alternative delivery method such as computers if the course satisfies the requirements for such a course contained in §535.62(d)(7) of this title (relating to Acceptable Courses of Study). For the purpose of approval of courses, a correspondence course offered in association with an accredited college or university in accordance with §535.62(d)(6) of this title, is equivalent to a correspondence course offered by an accredited college or university.

(i) Standards for instructor approval. The application for commission approval of an instructor must be filed on forms adopted by the commission. To be approved as an instructor, a person must satisfy the commission as to the person's competency in the subject matter to be taught and ability to teach effectively. Each instructor must also possess the following qualifications:

  (1) a college degree in the subject area or five years professional experience in the subject area and three years experience in teaching or training; or


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