On October 11, California Governor Arnold Schwarzenegger signed Assembly Bill 48, the California Private Postsecondary Education Act of 2009. To summarize the act’s 57 pages of tiny type, it gives students a financial parachute should the private school they attend run out of gas or suffer an operational or structural failure.
Most public and private schools accredited by agencies recognized by the Department of Education are not affected by new California requirements because they are imposed by the accrediting agency, all of which charge hefty fees for the service. The Act is for schools with no outside oversight of their business operations.
Which might be why the proposed regs that put the Act to work lift the exemption once enjoyed by FAA-approved flight schools. If approved, says National Air Transportation Association, to operate in the state, schools that train commercial pilots must pay a $5,000 fee and earn approval from the Bureau of Private Postsecondary Education, just like every other private school that educates people for a profession.
This application for approval requires third-party audited financial statements showing that the school has at least a 1:1 asset to debit ratio and requires it to pay 0.75 percent of its annual revenue to the California Student Tuition Recovery Fund, along with with other admin and recordkeeping requirements.
Understandably, this doesn’t sit well with flight schools. NATA President Jim Coyne wrote Governor Schwarzenegger a letter urging him to reconsider the flight school requirements:
“This legislation and the ensuing regulations are intended to ensure that students pursuing post-secondary education in the State of California are treated fairly and receive a quality education,” writes Coyne. “My concern arises from the fact that AB 48 removes the exemption for FAA-approved pilot schools….The inclusion of flight training…imposes a series of requirements, designed for larger classroom-type institutions on the unique and primarily small business-owned flight training industry.”
Not to go all Jon Stewart here, but isn’t this just another example of the bifurcated logic that has kept professional pilot training trapped in the 1950s? We want students to get a good education and to be treated fairly by schools, except when someone asks us to grow up and walk our talk of being credible institutions that provide a top notch education for serious students who want to be a professional pilot.
Yeah, the requirements are tough, demanding, and expensive. So what? Nobody ever said education was easy. As highlighted in the ongoing discussion in Pro Pilot Training Evolving to Industry Needs, what makes pilot training any different than the education required for other professions, from medicine and the law to plumbing and cosmetology?
Absolutely nothing.
Some schools have a lot of money tied up in classrooms. So do flight schools, except that some of their classrooms fly. It’s still a classroom. What matters most to any profession is the quality of education delivered in it. There’s no denying that toeing the line on California’s new requirement will hurt, and it will kill some schools, but if it makes for better professional pilot training, and improves the reputation of the industry that provides it, aviation will be the better for it. — Scott Spangler
This is nothing more than a tax imposed on aviation. $5000 per school to help grow the government, and it is conveniently disguised to look like the government is doing something to help the little guy.
Doesn’t sound any different than any other tax the government imposes on its citizens. This is not good for aviation, or for America for that matter.
Sorry, Scott, I’m having real trouble with the way you stated this. If I try to summarize the message I get from your piece in one sentence, it’s “nothing good comes from a part 61 operation, so tax them away, good riddance”.
I may not be a jet-jock pro myself, but I’ve been around aviation quite a long time, and some of the best folks in the business that I know came up through small-time part 61 schools. It’s because they were cautious, capable, and made it work for them to the best of their abilities (and weaknesses).
That doesn’t mean that some of the big-time schools (strictly 141, by implication) don’t turn out some good folks, they generally do. A lot of them are simply “airline pilot factories” too. Just because they can afford the tax (and pass the costs along to their students) doesn’t necessarily improve anything.
The big time operators will deal with this, both good and bad. Some of the bad small-time ones will simply give up, and maybe that’s good (for the wrong reasons). But some of the really good small ones will simply pack up shop (in California), and that is a loss for California-based students.
All that comes out of this is a loss of opportunity for some motivated kids without deep pockets, or who are justifiably guarded of a Big Student Loan. And that’s really unfortunate.
Where is it written that deep pockets = credibility?
Wow. Aviation is slowly dying, partially due to there being a lack of flight schools in some places. Sure, you can find planes to rent in the Bay area and LA area, but take a look at what you find in the less-populated areas of California – And now, any flight schools that *were* there, are going to be gone, meaning that the folks who do live in those areas will not have access to reasonably-close flight training.
What is a CFI with their own airplane who maybe trains a handful of students a year going to do? Tack $20/hr onto their rates? This is pretty ridiculous.
While I do applaud CA for trying to do something to avoid the problems encountered by students of operations like Silver State Helicopters (one of many examples), this one-size-fits-all approach does not work.
So, this is all ostensibly to refund students who’s school goes belly up while they are attending. (Is this really a big problem?)
All the small flight schools I’ve ever worked at were pay as you go, so there was no possible way for the student to lose any money if the school went away at any particular time.
This does not sound to me like a good thing.
The fees are high, the benefits – are low to nil.
This is the kind of taxation that makes businesses leave the state everyday.
So where was all the outrage before the bill was passed? Did no flight schools in CA see this one coming? I saw Coyne’s letter a few days before the bill passed, but never heard a thing about this before then, but I’m over in Illinois.
Did AOPA not know about it either?
Did anyone mount a campaign against this like Biz Av did against the Large Aircraft Security Proposal that turned the head of the TSA?
This regulation is long overdue. It’s time this industry (which offers the most expensive education costs in the US) gets regulated to make sure students are getting what they pay for as well as making sure these schools are properly capitailzed, insured and have adequate facilities and equipment to provide proper pilot training.
Flight school students in California have lost millions of dollars at California flight schools that were not properly capitalized and took the student’s money and did not provide the proper training.
For decades, flight schools have been exempt from any sort of regulation. This allowed any jack leg to set up a flight school and collect large amounts of money from students and then simply shut down or not provide the training. The students then lose their money with no recovery, no training and no refunds.
Here are two recent California schools that took millions of dollars from students:
Silver State Helicopters took MILLIONS of dollars from California students and did not deliver the training. The students lost their money because there were no laws regulating Silver State Helicopters.
Now there are proper laws and a company like Silver State Helicopters can no longer come in and steal millions of dollars in California.
In Merced, Califonia the American School of Aviation took millions of dollars from students and did not deliver the pilot training. They were able to do this becauase they were not regulated. Now they would be.
The good flight schools will comply with the regulations and will stay in business and become stronger.
The bad schools and the weak schools will close. That’s a good thing. We don’t need bad flight schools.
I am going on the record saying that government bureaucracy and taxation (which this is a thinly disguised form of) is never a good excuse for accountability and professionalism.
We have a fantastic method for holding flight schools up to the standard that we expect of them: the free market. Flight schools that stink don’t get business.
I don’t even think California has the money to administer this program, and $5000 per school won’t even begin to pay for the management costs of this ridiculous legislation.
I am an independent flight instructor that makes a living on providing all forms of flight training. I take my profession very seriously, I operate on the principle that if I am doing a bad job you can stop flying with me. I do not require my students to pay up front for thousands worth of training. This will essentially disallow me to teach commercial students, let’s not forget guys getting their multi-commericial add on rating. This is destructive to my business and as i suspect to most instructors like myself. No independent CFI will be able to do any training that will add on to a Commercial certificate or additional training for Commercial pilots. Terrible, and sad.
As I read the requirements, the California law DOES NOT affect independent CFIs providing training for any certificate or rating. The law specifically targets APPROVED SCHOOLS, as in FAA Part-141 approved.
My local independent CFIs are all panicked by this, they are under the impression that this rule will apply to them no matter what or how few students they have. An email forwarded from NATA says all CFIs, flight school or not, must comply. Or is it like Eamonn says that it would apply to CFIs teaching professional certificates? Or, as would make sense, it doesn’t apply to pay-as-you-go CFIs?
As I read the regulations, still in the proposal stage, it seems, apply only to approved training programs that are not accredited by another agency. The only approved flight training plans fall under Part 141, and I’ve never heard of a indpendent Part-141 approved CFI.
Remember that program was designed to protect students–and thei prepaid tuition–from schools that go out of business.
You can read the legislation and rules for yourself. The links are in the body of the post.
The law in California exempts schools charging less than $2500 total cost for the course.
Unless an independent CFI has his own plane, the CFI may be exempt from the regulations if that CFI charges less than $2500.
The best thing to do is call the Bureau of Post Secondary regulation in Sacramento and ask them if you are subject to the law and how to comply with the law if you are a CFI.
Good Idea, Joe. I think we would all be hard pressed to find a flight school charging less that $2500 dollars for any flight course, minus maybe ground school.
“but if it makes for better professional pilot training, and improves the reputation of the industry that provides it, aviation will be the better for it.”
It beats me, how does a tax make for better professional pilot training.
First, it’s not a tax, it’s a fee to process the necessary forms and reports and other requirements, and the contribution to the tuition reimbursement fund that goes to students stiffed by schools that go out of business.
What many seem to forget it that this is not just about aviation and flight schools. According to a document explaining the new requirements, about the new requirements, there are roughly a half million students attending private post-secondary schools in California that prepare them for about three dozen different careers and vocations.
As for the quality of training, remember that all schools, regardless of what they teach, are in the education business, and the quality of their business practices are directly related to the quality of the education they provide.
Scott,
You obviously have never been an instructor or owned a small business. Your comments are so far off base that you should move to a new state.
Well I have owned several small businesses including 3 that were regulated by state agencies to make sure that I had the financial capacity, and management ability to own and operate these businesses.
This protected my customers and made sure that I operated my businesses properly and within the law. The laws are not difficult to comply with and they insure that you properly operate your business to a professional standard.
If this industry had not buried their head in the sand for the last 30 years and just sat back and watched flight school students getting ripped off over and over again without doing anything to help prevent those rip offs–then we would not need this regulation.
Now the horse has left the barn and everyone will have to comply.
Where was AOPA while all these rip offs were going on? AOPA did nothing but remain “neutral” while collecting thousands of dollars in advertising (for their magazine) from some of these same rip off schools.
Why didn’t AOPA establish a bonding program for the industry like other trade associations do for their industry?
The bonding program would have protected the students tuition and there would not have been THIRTY MILLION DOLLARS lost in California over the past 4 years to flight schools that took students money and did not provide the contracted training.
Let’s hope that AOPA does establish a bonding program that protects student tuition so that this regulation does not sweep across the country.
The sad thing is that the money ripped off from the students could have been spent at a legitimate flight school and that legitimate flight school would have reaped the benefits as well as the students.
The regulation is not going away in California. Flight schools are collecting a lot of money from students and that money must be properly accounted for and protected.
Schools will have to comply with the regulation or they will go out of business.
I give the “Alphabet Groups” a pass on the late discovery of this law. If you actually read the bill (AB48) that was passed in October 2009 you’ll discover that all references to “FAA Certified Flight Schools” or any other “aviation”, “Flight Instruction”, etc. was removed from the text of the 1989 law on which AB48 was based. In short, with no mention of anything “aviation” in the bill there was no indication that there was any reason to spend time looking at it. As the AOPA rep told me, “the AOPA internet search engines are powerful, but they just couldn’t identify this document by the absence of the right words.”
Once the first Part 141 schools began receiving “compliance requirement” letters from the State the word spread quickly, first through NATA followed by AOPA … but that has only been a couple of months. Applaud AOPA for their presentation in Sacramento on the 7th of June, as well as the presence of a good number of other aviation-minded supporters.
Yes, there is room for improvement in the arena of oversight for flight schools. But this one is far, far too expansive with great consequences. Even the author of AB48 (Portantino, D-44th) admits to not realizing what an effect striking the aviation exemption may have caused. Unfortunately the bill he has proposed to “fix” problems with AB48 has already been targeted for the Governor’s veto because it also includes state funding for two school inspectors … and the “Governator” is killing anything that increases costs.
The Bureau of Private Postsecondary Education acknowledges that there will be hardships and even closures, but lacking guidance from the legislature, their assignment is to implement the law as written … and that has no provisions for selective compliance, waivers, or even extensions to comply.
The lack of good information is the greatest frustration … everyone has their own interpretation of how the law will be applied. Some say it will only be Part 141 Schools, citing the “FAA Certified Flight School” terminology … but remember, those words were removed from the current law!
Will it only involve people training for commercial/professional pilot programs? Again, not necessarily as those teaching Private Pilot programs are providing the required prerequisite for a Commercial regardless of the intent of the student. (Perhaps those working as “Sport Pilot Instructors” will be exempt as that’s not the immediate prerequisite for Commercial?)
Our best bet is to find a State Legislator who understands that “one size fits all” regulation is not appropriate and agrees to sponsor a bill that will give the aviation community the opportunity to participate in crafting words that actually make sense.
How about a confederacy of flight schools under an umbrella “parent” organization that can bear the burden of this oversight?
I think that flight school owners would benefit from voluntary accountability to such an organization.
Scott,
I just read the bill you linked to. There’s nothing to exempt a non-part 141 school in there. Have you read it?
Also, you’re focused on the wording of “Approved Schools.” This is defined, in the law, as schools approved by the law itself, i.e., schools that have paid the taxes (you call them fees, but when you can’t opt out, it’s a tax), filled out the paperwork and have been approved by California.
There is an arguable exemption that applies – d)2) below – but the state already says it doesn’t think so. If it did apply, it would apply to ALL flight instruction; there’s no reference to part 141 there either (nor anything that could be interpreted that way).
Article 94874: The exemptions are for:
a) purely avocational training (the open question is whether an instructor who doesn’t teach commercial or ATP qualifies for this)
b) programs sponsored by a bona fide… organization for its own membership (not applicable)
c) a program directly operated by the government (not applicable)
d)1) test preparation for admission to postsecondary education (n/a)
d)2) continuing education or license examination preparation, if the… program is approved by… a government agency… that licenses persons in a particular profession. (This reads to me like an exemption for flight instruction because the FAA licenses professional pilots, and flight instruction is either continuing education or it’s license examination preparation. However, the State of California already says this doesn’t exempt flight instruction. Of course, if it did, it would exempt ALL flight instruction – there’s nothing about Part 141 here.)
e) A religious organization (n/a)
f) An institution that does not offer degree programs and solely provides educational programs for total charges of less than $2,500. (Since you can’t offer anything other than BFRs for that, n/a)
g) an accredited law school (n/a)
h) a nonprofit meeting multiple requirements (joking aside, n/a)
i) an accredited university (n/a)
j) an institution meeting a long list of requirements, including being in business for at least 25 years (for practical purposes, n/a)
94874.1 also provides an exemption for institutions accredited by the US Department of Education (n/a)
Scott, I don’t see any exemption for the individual flight instructor who gets paid after each lesson.
Yes, I read it, several times. As I wrote in my subsequent post, Pay Attention to Calfornia School Regs, the one-size-fits-all language didn’t clearly address the unique nature of flight training, that students can get professional training from independent CFIs and Part 61 and 141 schools.
To clarify this I spent weeks playing phone tag with a knowledgeable official at BPPE, and we finally caught each other several days ago. She confirmed that AB-48 applies to anyone who provides professional training whether they be independent or a school’s faculty member.
Pay-as-you-go training is exempt, but the total must not exceed $2,500, which falls far below the total costs for pilot certificates and ratings.
Training for recreational purposes is exempt, so that covers sport, recreational, and private pilot certificates and instrument and multiengine ratings. The regs are less clear on commercial and ATP training, because many pilots earn these certificates to make themselves better pilots, not pursue a career.
One thing is for sure, it will take time to work out the details for each of the roughly three dozen careers and professions AB-48 addresses. It’s little consolation, but according to the BPPE official I talked to, aviation is not the only industry grappling with these details.
It is pretty simple for a flight instructor to get licensed working under a main flight school license in California if that instructor expects tocollect more than $2500 per student.
This allows the licensing cost to be spread out among a number of people.
For example, a flight instructor might pay the main flight school an (example) fee of $500 to work under that schools license. The amount can vary and it is all a matter of negotiation between the schools and the flight instructors. The same thing goes for the split.
This is the same type of business model that barber and beauty salons use. Licensed cosmetologists pay a “booth rental fee” to a licensed salon and use that space to operate their business.
If a flight instructor is just keeping their CFI alive and does not collect any more than $2500 per student then they are exempt from licensing. So BFR’s, proficiency flights, etc would not require a license.
Also, $2500 would allow up to 62.5 hours of flight instructor time at $40 per hour and that is enough for someone to get their private license since the FAA only requires 40 hours of flight time to get a private pilot license.
The key here to to have the student rent the plane from someone other than the flight instructor so that the plane rental fee is not included in the $2500.
Joe