The State Bar seeks public comment on proposed adjustments to law school fees.
Deadline: Aug. 18, 2017
NOTE: Publication for public comment is not, and
shall not, be construed as a recommendation or approval by the Board of
Trustees of the materials published
The Committee of Bar Examiners currently regulates 39 law schools in California:17 California-accredited law schools (CALS) and 22 unaccredited law schools, which includes fixed-facility, distance-learning and correspondence law schools.In addition, there are 21 law schools in California approved by the American Bar Association that are deemed accredited for purposes of qualifying applicants for admission to practice law in California, which the Committee does not regulate.
The current law school regulation fees vary by type (accredited or unaccredited) and student enrollment, but can largely be lumped into two main recurring categories: compliance and inspection.
Compliance fees are paid annually in November at the time the schools file their annual reports.The periodic inspection fees are paid every five years, based on the inspection schedule. There is a distinction between the unaccredited schools and the CALS in terms of the payment structure for inspection fees: unaccredited schools are charged a flat rate based on their student enrollment size, while the CALS are billed a fee at an hourly rate based on the total staff resources expended during the inspection and subsequent report drafting. Both the CALS and the unaccredited law schools pay for travel-related and meal expenses incurred during an inspection.
The current law school regulation process involves the following primary components:
For many years, the revenue received from the law school regulation program has not covered the cost of administering the program.While this has been true for some time, there have been efforts over the years to increase the program fees over time to close the gap.Law School fees in all categories were increased by 10 percent in 2015, and another 5 percent in 2016.
The State Bar’s Office of Research and Institutional Accountability (ORIA) recently completed an analysis of the program revenue and costs and prepared a proposal for increasing the fees associated with the program, which was considered by the Committee during its June 2017 meeting.The agenda item and attachments can be found online at:
In addition to analyzing program revenue and costs, the processes and fees assessed by other accrediting bodies, specifically the American Bar Association’s (ABA) and the Western Association of Schools and Colleges Senior Colleges and University Commission (WASC), were considered. This study focused on the ongoing annual or cyclical fees assessed once the initial school application process has been completed.The analysis found that the fees charged for the regulation of CALS and unaccredited law schools in California are substantially lower than those of other accrediting bodies.Increasing California State Bar Law School Regulation costs from the annualized minimum of $1,735 to the ABA cost would represent over a 600% increase in costs. Even taking the maximum annualized California State Bar cost and increasing it to the ABA level would represent a 65% increase.
To avoid imposing an unmanageable cost on the smallest law schools, fee increases of 20 percent (inspection) and 25 percent (annual reporting) designed to help reduce but not eliminate the funding shortfall, are recommended at this time.The proposed new fee schedules are provided as Attachment A.
In addition to increasing annual compliance report and hourly fees, modifying the inspection fee payment structure such that both the periodic inspection and annual reporting fees are paid on a flat annual installment basis for all schools, was also considered. Including a portion of the cost of periodic inspection fees along with schools’ annual reporting fees could be beneficial to both the schools and the State Bar for planning and budgeting purposes. Planning for known set fees would eliminate the peaks and valleys of payments for the schools, as they would be paying a portion of the site inspection fees each year in advance, regardless of when their inspection is scheduled.
The proposed CALS inspection fee of $22,200 was derived from a review of the fees charged over the last five-year CALS inspection cycle (historic CALS average of $18,500 plus a 20 percent increase).The inspection flat-fee fee payment model would require the CALS to pay a set inspection fee ($22,200, plus an additional campus fee as appropriate) prorated equally over a 5-year inspection cycle.The size of a school’s enrollment would have no bearing on the cost.An alternative model, called the “true-up” option, would require the CALS to pay the same pre-payment of the inspection fee; the final cost, however, would be determined by the actual number of hours expended during the visit and report-writing process (using the proposed hourly rate of $275 per hour).
Under the true-up approach, each of the CALS would be billed the sum total for the inspection (including travel and meal expenses incurred by the inspection team) once the report of the inspection has been finalized and the received by the Committee.The bill would reflect a credit for all annual installment fees that had been paid at the time of invoicing.
The flat-fee payment model is the easiest to administer for both the schools and the State Bar. It also protects both from fluctuations in costs or resources needed to conduct the Law School Regulation function. However, there is the potential that the adopted fee is too low as compared to the investment needed to regulate some CALS, and too high as compared to the investment needed for others. This risk has the potential to negatively impact both the State Bar and the CALS.
The Committee approved in principle the proposal to increase law school regulation fees, subject to a period of public comment.A decision, however, relative to whether a flat-fee or true-up periodic inspection fee should be approved was deferred pending consideration of public comment.The Committee will consider the public comments received and staff’s final recommendations concerning the proposal during its August 31, 2017 meeting.After approval by the Committee, the recommended revised fee schedules will be forwarded to the Board of Trustees for consideration and adoption during its September 2017 meeting.
If ultimately adopted, the new fee schedules would become effective January 1, 2018, and the annual compliance report and the first periodic inspection fee payment would be due November 2018.
Based on both the increased rates recommended and the partial pre-payment of future-years’ inspections, a revenue increase of $92,170 to the Admissions Fund could be realized in 2018.
The impact on the CALS and unaccredited schools is difficult to gauge. While the proposed fees for the majority of schools represent less than two percent of the average posted tuition per student, a few of the very small schools might not be able to sustain any increases, based on their current enrollment base.
Committee of Bar Examiners
Aug. 18, 2017
The State Bar of California
180 Howard St.
San Francisco, CA 94105