A new law championed by State Sen. Patty Pansing Brooks of Lincoln will provide greater financial protection for Nebraska students who attend a for-profit institution that closes. A provision of Legislative Bill 512, recently passed by the Legislature and signed into law this week by the governor, will establish the Guaranty Recovery Cash Fund. Pansing Brooks originally introduced LB 123 to establish the fund; this bill was later amended into LB 512.
The Guaranty Recovery Cash Fund will require that for-profit colleges and universities with a physical presence in Nebraska contribute to a fund that would be used primarily to reimburse students attending these schools if they go out of business. Nebraska for-profit institutions will contribute one-tenth of 1 percent of their annual tuition revenue to the fund until it reached $250,000. The Coordinating Commission will administer the fund.
Currently there are two schools in Nebraska that fall under this for-profit category: The Creative Center, in Omaha and National American University’s Bellevue campus.