Section 20-3-250.10 - Surety bonds; filing; release of surety; suspension upon release of surety(a) As part of the application review process, the commission shall conduct a financial assessment of each institution that applies to the commission for initial or renewed authorization to operate. If a financial assessment includes findings or notes raising concern about such applicant's institutional internal controls or recommends that such applicant should be placed on financial monitoring status, the executive director in his or her sole discretion may require such applicant to file with the commission a surety bond in such sum and with such surety or sureties as the executive director may require. Such bond shall be conditioned upon the faithful performance of the applicant's obligations under this part and the rules, regulations, and policies of the commission. Such obligations shall include, but shall not be limited to, the institution's duties regarding responsibility for negligence, proper management of the institution's accounting, management, and other internal controls, and other requirements of this part. Such bond shall also be conditioned to provide indemnification to the Tuition Guaranty Trust Fund established in Code Section 20-3-250.27 and to any student or enrollee or that person's parent or guardian or class thereof determined to have suffered loss or damage as a result of any act or practice which is a violation of this part or of rules and regulations promulgated pursuant thereto by such nonpublic postsecondary educational institution and that the bonding company shall pay any final, nonappealable judgment rendered by the commission or any court of this state having jurisdiction, upon receipt of written notification thereof. If a bond is in force at the time of an institutional closure, the surety shall be required to remit the full face value of the bond. Regardless of the number of years that such bond is in force, the aggregate liability of the surety thereon shall in no event exceed the penal sum of the bond. The bond may be continuous. Such bond shall be executed by the applicant as principal and by a surety company qualified and authorized to do business in this state with at least a B+ bond rating. Such bond shall remain in effect until the institution's authorization to operate terminates or the commission determines that the institution's financial or other issues requiring the bond have been resolved to the satisfaction of the executive director in his or her sole discretion.(b) If the bond filed with the initial application to operate remains in effect, it shall be sufficient when an application is made for the renewal of authorization to operate, unless the amount of the bond must be increased because of increased gross tuition to comply with requirements set forth by the commission.(c) The surety bond to be filed under this Code section shall cover the period of the authorization to operate except when a surety shall be released as provided in this Code section. A surety on any bond filed under this Code section may be released therefrom after such surety shall serve written notice thereof on the executive director at least 90 days prior to such release; but such release shall not discharge or otherwise affect any claim theretofore or thereafter filed by a student or enrollee or that person's parent or guardian or class thereof for loss or damage resulting from any act or practice which is a violation of this part or of rules and regulations promulgated pursuant thereto alleged to have occurred while such bond was in effect or from an institution's ceasing operations during the term for which tuition has been paid while such bond was in force.(d) Authorization for an institution to operate shall be suspended by operation of law when such institution is no longer covered by a surety bond as required by this Code section, but the executive director shall cause such institution to receive at least 30 days' written notice prior to the release of the surety to the effect that such authorization or permit shall be suspended by operation of law until another surety bond shall be filed in the same manner and like amount as the bond being terminated.Amended by 2022 Ga. Laws 789,§ 8, eff. 7/1/2022.Amended by 2021 Ga. Laws 230,§ 4, eff. 7/1/2021.Amended by 2015 Ga. Laws 23,§ 6, eff. 7/1/2015.Amended by 2002 Ga. Laws 980, § 4, eff. 7/1/2002.