This bill streamlines the process for reviewing when colleges change ownership or when for-profit institutions convert to nonprofit status. Currently, the Department of Education takes years to review these applications, with some institutions waiting up to five years for approval. The bill requires the department to make decisions within 90 days of receiving a complete application, though it can request extensions in cases where good cause exists for longer review periods. To fund faster processing and better monitoring, the bill establishes fees for institutions submitting these applications: 0.15 percent of federal student aid revenue for typical ownership changes, and 0.30 percent for proprietary-to-nonprofit conversions. For conversions, half the fees go to the Internal Revenue Service to monitor tax-exempt compliance. The bill also establishes a five-year monitoring period for converted institutions, with annual fees up to $60,000 to ensure they comply with nonprofit requirements and don't improperly benefit former owners. These provisions apply to applications submitted on or after January 1, 2025, and the Government Accountability Office must report back within five years on how well the new system works.
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