Sponsored by:
Senator TROY SINGLETON
District 7 (Burlington)
Senator JOSEPH P. CRYAN
District 20 (Union)
SYNOPSIS
Establishes process to monitor proprietary institution that converts to nonprofit corporation for transactions that constitute private inurement.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning oversight of certain institutions of higher education and supplementing Title 18A of the New Jersey Statutes.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. If a proprietary institution converts to a nonprofit corporation that is an educational and charitable corporation under the "New Jersey Nonprofit Corporation Act," P.L.1983, c.127 (N.J.S.15A:1-1 et seq.), the institution shall annually submit its Internal Revenue Service Form 990 to the Secretary of Higher Education for a period of five years following its incorporation as a nonprofit.
b. The secretary shall annually review the Form 990 to ensure that there exist no reportable incidents that constitute private inurement. The secretary may, upon a finding of a reportable incident, recommend to the Secretary of State that the institutions certificate of incorporation be revoked.
2. This act shall take effect immediately.
STATEMENT
This bill establishes a process to monitor a proprietary institution that converts to a nonprofit corporation for transactions that constitute private inurement.
The bill provides that, if a proprietary institution converts to a nonprofit corporation, the institution is to annually submit its Internal Revenue Service Form 990 to the Secretary of Higher Education for a period of five years following its incorporation as a nonprofit. The bill requires the secretary to annually review the Form 990 to ensure that there exist no reportable incidents that constitute private inurement. The secretary may, upon a finding of a reportable incident, recommend to the Secretary of State that the institutions certificate of incorporation be revoked.