| (a) Application. An application for a school license
for a primary or branch driver education school shall be made on forms
prescribed by the department. A license application is valid for one
year from the date it is filed with the department.
(b) Bond requirements. In the case of an original or
a change of owner application, an original bond or approved alternate
form of security shall be provided. In the case of a renewal application,
an original bond or approved alternate form of security or a continuation
agreement for the approved bond currently on file or continuation
of an approved alternate form of security shall be submitted. The
bond or the continuation agreement shall be executed on the form provided
by the department. Approved alternate forms of security shall adhere
to the following guidelines.
(1) An irrevocable letter of credit. The letter shall
be in the name of the owner of the school. The letter shall specify
the amount of credit extended, which shall be equivalent to the coverage
required for a corporate surety bond, and the purpose of the credit.
The letter shall contain the signature of an appropriate bank representative.
The bank and the letter shall be approved by the department.
(2) A cash deposit. An irrevocable account shall be
established by the school owner in the name of the department to be
drawn upon as needed to pay student refunds as needed if the school
closes owing refunds. The account shall be equivalent to the coverage
required for a corporate surety bond. The bank and the terms of the
account shall be approved by the department. The department shall
keep records of deposits and/or withdrawals on the account.
(c) Verification of ownership.
(1) In the case of an original or change of owner application
for a primary school, the owner of the school must provide verification
of ownership.
(2) In the case of an original or change of owner application
for a branch school, the owner shall submit an application on forms
prescribed by the department.
(d) Purchase of a driver education school.
(1) A person, partnership, or corporation purchasing
a licensed driver education school shall obtain an original license
or branch school license as applicable.
(2) The purchaser shall assume all refund liabilities
incurred by the seller or any former owner as well as the liabilities,
duties, and obligations under the enrollment contracts between the
students and the seller, or any former owner before the transfer of
ownership.
(e) New location or change of address.
(1) The department must be notified in writing of any
change of address at least fifteen (15) working days before the move.
(2) The school must submit the appropriate change of
address fee prior to the actual move.
(3) If a student is not willing to change locations
or is prevented from completing the training at the new location,
a pro-rata refund (without deducting any administrative expense) must
be made to the student.
(f) Renewal of driver education school license. A complete
application for the renewal of a license for a primary or branch driver
education school shall be submitted before the expiration of the license
and shall include the following:
(1) a completed application for renewal;
(2) renewal fee;
(3) a current list of instructors employed at the school;
(4) an executed bond or executed continuation agreement
for the bond currently approved by, and on file with, the department
or an approved alternate form of security;
(5) if applicable, a current list of all motor vehicles
used for instruction; and
(6) if applicable, documentation showing that all vehicles
used for instruction are properly insured.
(g) Denial, revocation, or conditional license. The
authority to operate a branch school ceases if a primary driver education
school license is denied or revoked. The operation of a branch school
license may be subject to any conditions placed on the continued operation
of the primary driver education school. A driver education school
license for a branch school may be denied, revoked, or conditioned
separately from the license for the primary school.
(h) School closure.
(1) The school owner shall notify the department at
least fifteen (15) business days before the anticipated school closure.
In addition, the school owner shall provide written notice of the
actual discontinuance of the operation on the day of cessation of
classes. A school shall make all records available for review to the
department upon request.
(2) The department may declare a school to be closed:
(A) when the school does not have the facilities, vehicles,
instructors, or equipment to provide training pursuant to this subchapter;
(B) when the school has stopped delivering instruction
and training in driver education and has failed to fulfill contractual
obligations to its students; or
(C) when the school owner allows the school license
to expire.
(3) If a branch school closes and a student is prevented
from completing the training at the primary location, a pro-rata refund
(without deducting any administrative expense) must be made to the
student.
(i) Branch schools shall adopt, use, and conduct business
with the same name as the primary school.
(j) A school shall not, by advertisement or otherwise,
state or imply that a driver's license, permit, or DE-964 is guaranteed
or assured to any student or individual who will take or complete
any instruction or enroll or otherwise receive instruction in any
driver education school.
(k) Contract site. A school shall receive approval
from the department prior to conducting a class at a contract site,
and approval may be granted by the department upon review of the agreement
made between the licensed driver education school and the contract
site. The course shall be subject to the same rules that apply at
the licensed driver education school, including periodic inspections
by department representatives. An on-site inspection is not required
prior to approval of the site.
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