(a) Pursuant to §1601.3571 of the Act, the Private
Barber School Tuition Protection Account is created to refund unused
tuition if a barber school ceases operation before its course of instruction
is complete.
(b) In each year in which the balance of the account
is less than $25,000 the department will determine a fee that shall
be paid by all permitted barber schools to the account.
(c) The necessity for assessing the fee will be determined
by the department when it conducts its annual account balance review
prior to December 31st. The fee that is assessed by the department
shall be in effect for a period of 12 months.
(d) The fee shall be paid by each permitted barber
school, upon annual renewal of the license during the 12-month period
and shall be paid in addition to the renewal fee. The renewal notice
sent by the department will reflect the fee due to the account.
(e) In addition to any other fees, all new schools
applying for a barber school permit shall pay the prescribed fee to
the account before a permit will be issued.
(f) The total payment of a claim from the account may
not exceed $1,000. The total amount of claims paid against a single
closed school may not exceed $2,500.
(g) The executive director may authorize payment to
a student from the account, if:
  (1) the student makes a claim for payment on a form
approved by the executive director;
  (2) a closed barber school has failed to refund unused
tuition to the student within 30 days after the date the student became
eligible for the refund;
  (3) the executive director determines after investigation
that the student is owed the refund; and
  (4) the student assigns to the department all rights
of the student against the barber school to the extent of the amount
paid to the student from the account.
(h) The department shall pay claims on a pro rata basis
from appropriated money available in the account if:
  (1) the account contains insufficient assets to pay
all claims;
  (2) insufficient money has been appropriated to the
department from the account to pay all claims; or
  (3) the total amount of claims against a single closed
school exceeds the amount specified in subsection (f).
(i) The department shall notify a closed barber school
of any claim made against the closed school under this section. Before
the executive director may authorize any payment from the account,
the school shall have 20 days from the date of notice of the claim
to dispute the claim and present evidence to the executive director
in opposition to the claim.
(j) If payment is made from the account on a claim
against a closed barber school:
  (1) the school shall reimburse the account immediately
or agree in writing to reimburse the account, on a schedule to be
determined by the executive director;
  (2) the school shall immediately pay the student any
additional amount due to the student under the Act or agree in writing
to pay the student on a schedule to be determined by the executive
director;
  (3) payments made by a school to the account or to
a student under this subsection include interest accruing at the rate
of eight percent a year beginning on the date the executive director
pays the claim;
  (4) the department shall be subrogated to all rights
of the student against the barber school to the extent of the amount
paid to the student; and
  (5) the department may assess administrative penalties
or sanctions against the school and may deny an application for a
license, certificate, or permit or an application for renewal of a
license, certificate, or permit filed by the holder of the barber
school permit.


Source Note: The provisions of this §82.40 adopted to be effective December 8, 2005, 30 TexReg 8075; amended to be effective October 11, 2007, 32 TexReg 7048; amended to be effective February 1, 2012, 37 TexReg 319