


North Carolina
North Carolina: A Step By Step Guide To Obtain State Approval For A Private Post Secondary Institution
Licensing Agency
North Carolina Board of Governors (UNC System Office – State Authorization Unit) – Responsible for licensing degree-granting private postsecondary institutions.
North Carolina State Board of Community Colleges (via State Board of Proprietary Schools, NCCCS) – Responsible for licensing non-degree (vocational, career) private postsecondary institutions.
Agency Contact (Degree-Granting)
UNC System Office – State Authorization Unit
223 S. West Street, Suite 1800, Raleigh, NC 27603
Phone: (919) 962-4550
Email: stateauthorization@northcarolina.edu
Agency Contact (Vocational/Proprietary Schools)
Office of Proprietary Schools – North Carolina Community College System
5001 Mail Service Center, Raleigh, NC 27699-5001 (mailing)
200 West Jones Street, Raleigh, NC 27603 (office location)
Phone: (919) 807-7061
Executive Director: Mr. Scott Corl (Office of Proprietary Schools)
Degree-Granting Institutions
Process
North Carolina law (N.C. Gen. Stat. §116-15) requires any nonpublic institution to secure a license from the UNC Board of Governors before conducting post-secondary degree activity in the state (awarding degrees or offering for-credit instruction), unless the institution qualifies for an exemption. This applies to both in-state colleges and out-of-state institutions offering programs to North Carolina residents (including online programs, unless operating under a SARA agreement). Key steps in the licensure process include:
- Determine Exemption Status – Confirm whether the institution is exempt from licensure under law. Certain categories (e.g. institutions offering only religious/theological degrees, those continuously operating in NC since before 1972, programs on federal military bases, or purely online programs under SARA) do not require a UNC license. If the school does not clearly fall under an exemption, proceed with the licensure steps.
- Preliminary Conference – Contact the UNC System Office’s State Authorization Unit to schedule a Preliminary Conference, which is a required first step. In this meeting, state authorization staff provide an overview of licensure requirements, the 15 standards for licensure, and the application procedure. Completion of the preliminary conference is mandatory to gain access to the online application portal.
- Submit Application – After the conference, prepare and submit the licensure application via the UNC online portal. The application is program-specific (each degree program to be offered in NC must be included) and must demonstrate that the institution meets the Board’s standards for quality in areas such as curriculum, faculty, facilities, library resources, governance, and finances. All required documentation supporting each standard should be uploaded (see Checklist below for required items).
- Fees Payment – Pay the required application fee to the UNC System Office. The base fee is $5,000 for an institution’s initial application (this covers review of up to four programs at the associate/bachelor’s level, two at the master’s, or one doctoral program). Programs beyond those limits incur additional fees (e.g. an extra $1,000 for each additional associate program, $1,500 per additional bachelor’s, $2,000 per master’s, $3,000 per doctoral program). The institution is also responsible for costs associated with any on-site evaluation visits and external academic reviews during the process. Payment instructions are provided by the UNC System Office during application.
Review & Evaluation – UNC System Office staff will review the application for completeness and compliance. This includes assessing academic content, faculty qualifications, financial stability, and institutional policies. A site visit will be scheduled for new applicants, where a team visits the NC location to verify facilities, resources, and operations (for online-only out-of-state institutions, a virtual or home-state site evaluation may occur). Subject matter experts may be engaged to evaluate program quality. The timeline for review can vary; expect a thorough evaluation process that may take several months, including time for the institution to address any deficiencies identified by reviewers.
Additional Requirements – An institution chartered outside North Carolina must also register with the NC Secretary of State (obtain a Certificate of Authority to Conduct Business in NC) before a license can be granted. While regional or national accreditation is not required for state licensure, the institution should have a plan to ensure academic quality (North Carolina does not mandate accreditation for licensure, but accredited status can bolster the application). If professional programs (e.g. nursing, teaching) are included, the institution may need to coordinate with relevant NC professional licensing boards for program approval or notify them as part of the licensure process.
Licensure Decision – Once all standards are met and the review is favorable, the UNC System Office will present the application to the Board of Governors for action. The Board of Governors issues the license to confer degrees in North Carolina, listing the approved degree programs. The license is typically granted without a fixed expiration date but is subject to annual review and fees (i.e. the institution must comply with ongoing requirements and pay yearly fees to maintain licensed status). The official licensure is communicated via a formal certificate or letter from the UNC System Office.
Continuous Compliance – After licensing, institutions must operate in strict accordance with the terms of approval and state rules. This includes maintaining the tuition guaranty bond (a surety bond protecting student tuition — minimum $10,000 or higher, based on the maximum unearned tuition held at any time) on file for student protection. Schools must notify the UNC System State Authorization Unit of any substantive changes: adding new degree programs (which requires separate approval and possible fee), changes in location or name, significant curriculum revisions, or changes in ownership or accreditation status. Institutions are expected to uphold student consumer protection policies (clear disclosures, fair refund policies as per state law) and submit any annual reports requested by the state. Failure to maintain the required standards can lead to probation or revocation of the license.
Renewal – License renewal is an ongoing requirement. Each licensed institution must renew its authorization annually by paying the prescribed annual fee and updating any required information. The UNC System Office will notify schools of the annual license fee, which is scaled based on the number of programs offered in North Carolina. (For example, an institution offering up to 5 programs pays $4,000 per year; the fee increases in tiers, up to $16,000 for over 30 programs.) Annual fees and a simple renewal form (or report) are typically due at the time specified by the UNC System (often aligned with the institution’s licensure anniversary or fiscal year). As long as fees are paid and no compliance issues exist, the license remains in effect continuously. Institutions that do not renew or that lapse in payment may have their authorization suspended until compliance is restored.
Checklist of Required Items (Degree-Granting License Application):
- Preliminary Conference Completion: Evidence of having completed the required preliminary meeting with UNC licensure staff (usually confirmed by the UNC System Office before allowing application access).
- Completed Application Form: All sections of the UNC online licensure application filled out, including institutional profile and program-specific proposals for each degree to be offered.
- Institutional Charter Documents: Copy of Articles of Incorporation, governance documents, and if incorporated out-of-state, the NC Certificate of Authority from the Secretary of State. Include a list of owners or board members and organizational structure.
- Program Curriculum Details: Detailed outlines for each proposed degree program (program descriptions, course list, credit hours, learning outcomes, duration of study, etc.), demonstrating how each meets state standards for content and length.
- Faculty Qualifications: A roster of instructors and administrators for the programs, with CVs, degrees, and experience highlighted. Faculty should be academically/professionally qualified for the subjects they will teach (e.g. master’s or doctoral degrees for higher degree programs).
- Financial Statements: Evidence of financial stability. For an established institution, provide recent audited financial statements (balance sheet, income statement, cash flow). For new institutions without operating history, provide a detailed budget projection for at least two years and documentation of financial resources (such as bank statements, letters of credit, or parent company guarantees) to support the school’s operations.
- Facility and Equipment Information: Description of the physical facilities in North Carolina (campus address, classrooms, labs, etc.) or, if instruction is online, the administrative office in NC. Include any facility lease or deed, floor plans (if relevant), and a summary of instructional equipment and technology to be used. If library resources are needed for the programs, provide details on the library facilities or access arrangements (on-site library or online library services agreements).
- Policies and Catalog: A current school catalog or student handbook that includes all required student policies (admissions requirements, attendance, conduct, grading standards, degree requirements, academic calendar, student records retention, etc.). The catalog must also contain a tuition and fee schedule and the institution’s refund policy that meets or exceeds the minimum state refund rules (e.g. full refund if student withdraws before classes start, prorated refunds within the early part of the term).
- Surety Bond Documentation: Proof of a tuition guaranty bond (or equivalent financial security) filed in favor of the UNC Board of Governors. The bond amount must be at least $10,000 and sufficient to cover the maximum prepaid tuition on hand. Typically, a bond form or a bond certificate from an authorized surety company is submitted, along with calculation of the required bond amount.
- Fee Payment Receipts: Copies of receipts or confirmations for all required fee payments (application fee and any supplemental program fees). These are often provided by the UNC System Office upon payment and should be included to show that fees have been paid in full.
Fees & Timelines (Degree-Granting Licensure)
Vocational and Career Schools (Non-Degree)
Process
Private postsecondary career, trade, or vocational schools in North Carolina are governed by the Proprietary Schools Law (N.C. Gen. Stat. §115D-90 et seq.) and must obtain a license from the State Board of Community Colleges prior to advertising or offering instruction, unless exempt. This includes for-profit technical schools, trade programs, and career training institutions that do not grant college degrees. The licensing process is administered by the Office of Proprietary Schools (OPS) under the NC Community College System. The general process is as follows:
- Determine Exemption Status – Review the statutory exemptions (see State Exemptions list below) to verify if the school is subject to proprietary licensing. Certain non-degree programs are exempt, such as training offered by employers to their employees at no charge, purely avocational or recreational courses, programs overseen by other state boards (e.g. cosmetology schools), or nonprofit charitable schools that charge no tuition. If none of the exemptions apply, the school must proceed with obtaining a proprietary school license.
- Preliminary Application – Begin the licensing process by submitting a Preliminary Proprietary School License Application to the Office of Proprietary Schools. The preliminary application is a short form that captures basic information about the proposed school (ownership, programs, location) and is used by OPS to initiate an advisory review. Along with this form, the school must submit two certified checks: $5,000 for the Initial License Fee and $1,250 for the Student Protection Fund (both are non-refundable fees required by the state). Mail the application and fees to: Office of Proprietary Schools, NCCCS, 5001 Mail Service Center, Raleigh, NC 27699-5001. Upon receipt, the OPS will review the preliminary materials and provide guidance on completing the full application. (Note: North Carolina strongly encourages new school owners to carefully review the state’s Proprietary Schools Orientation materials at this stage, which outline compliance expectations.)
- Orientation – (Optional but recommended) OPS offers an orientation session or documentation for prospective school owners. This orientation covers state laws and rules that proprietary schools must follow – including curriculum standards, instructor qualifications, advertising guidelines, tuition refund requirements, and student consumer protection regulations. Engaging with this orientation process helps applicants understand the detailed requirements before moving to the full application, potentially reducing delays.
- Full Application – After the preliminary stage, complete the comprehensive license application (often done through an online portal or detailed paper application). The full application will require extensive documentation about the school’s programs and operations. This includes submission of detailed course syllabi, instructor credentials, facility descriptions, financial projections, school catalogs, and other materials (see Checklist below). The Office of Proprietary Schools will typically assign an analyst to work with the school during this phase, to ensure all required information is provided. All required fees (if not already paid) and the school’s guaranty bond must be arranged at this stage.
- Fees Payment – As noted, an Initial License Fee of $5,000 and a Student Protection Fund assessment of $1,250 are due with the initial application. These fees fund the state’s oversight and a student tuition recovery fund. Additionally, the school must obtain a surety bond in the amount determined by statute: for initial licensure, a minimum bond of $25,000 is required (the State Board may require a higher amount based on the school’s projected maximum prepaid tuition). The bond (in the form of a surety bond issued by an authorized company) must be made payable to the State Board of Community Colleges and submitted on the official bond form. Proof of securing this bond should accompany the application package.
Review & Evaluation – The Office of Proprietary Schools will review the full application for compliance with all criteria set by law and the State Board’s rules (Title 2, SBCC Code). The review covers: the adequacy of the curriculum for each program, qualifications of instructors (education and experience in the field of instruction), sufficiency of classroom facilities and equipment, the school’s financial soundness and business plan, and the completeness of student protection policies (catalog, enrollment agreements, etc.). If any part of the application is incomplete or unsatisfactory, OPS will notify the applicant to provide clarifications or make corrections. An on-site inspection of the school’s facilities may be scheduled by OPS staff, especially for new schools, to verify that the location and equipment meet requirements and that the school is prepared to operate. Once the OPS staff are satisfied that the application meets all standards, they will forward the application to the State Board of Proprietary Schools (an appointed board that reviews school applications) with a recommendation.
Additional Review – The State Board of Proprietary Schools (SBPS) typically meets periodically to evaluate license applications. School representatives may be invited to attend or be available for questions. The SBPS will vote on whether to recommend approval of the license. Upon a favorable recommendation, the application is sent to the State Board of Community Colleges for final approval. (If the SBPS recommends denial, the applicant is usually informed of deficiencies and may have an opportunity to address them and reapply.) It should be noted that if a program falls under the authority of another licensing body (for example, truck driver training regulated by the Division of Motor Vehicles, or CNA programs under the nursing board), that program would not be licensed through SBPS. Schools should ensure they pursue the correct authorization for such programs.
Licensure Decision – The State Board of Community Colleges (SBCC) grants the official license to operate a proprietary school. The SBCC generally considers the recommendations of the Proprietary Schools Board at one of its regular meetings. Once approved, the school will be issued a North Carolina Proprietary School License certificate. Initial licenses are valid up to the next renewal cycle (licenses in NC are renewed on an annual basis, expiring June 30 each year unless otherwise prescribed). The license will list the school name, campus address, and approved program titles. The school can then begin advertising and offering those programs to students in North Carolina.
Continuous Compliance – Licensed vocational schools must continuously adhere to state regulations to maintain good standing. Key ongoing obligations include: maintaining an active tuition guaranty bond (the bond amount must be evaluated quarterly in the first years and adjusted to cover the peak unearned tuition; updated bond amounts are reported with renewals); contributing to the Student Protection Fund as required (the $1,250 initial fee is required, and additional assessments could be levied in future years if the fund falls below a threshold or in case of a school closure payout); and following all student protection rules. Schools must use state-compliant enrollment agreements and catalogs, and they are required to adhere to the minimum tuition refund policy set by law (at minimum, a full refund if a student withdraws before classes start, and at least a 75% refund if withdrawal occurs within the first 25% of the program’s duration). Additionally, any advertisements must not be misleading and should include the school’s licensed status. Schools are subject to inspections and audits by the state: the SBPS and NCCCS may conduct periodic site visits or request information to ensure ongoing compliance. If a school plans to make changes – such as adding a new program, relocating to a new site, or changing ownership – it must notify and get approval from the Office of Proprietary Schools in advance. Such changes often require submitting an amendment application and paying the applicable fee (see Fees & Timelines). Finally, licensed schools must submit an Annual Report each year (often as part of renewal) detailing enrollment numbers, financial status, and any other required data. Non-compliance with any of these obligations can result in enforcement actions, up to and including suspension or revocation of the license.
Renewal – Proprietary school licenses in North Carolina are renewed annually. The renewal cycle is generally tied to the fiscal year: all licenses expire on June 30, and schools must apply for renewal to continue operating on July 1. Each year, typically in late winter (January/February), the Office of Proprietary Schools will provide renewal instructions. Schools must submit a renewal application (which updates key information and confirms continued compliance) by the March 1 deadline, along with the $2,500 renewal fee. The renewal application may require updated financial statements, current catalog, proof of bond coverage, and any changes from the previous year. The State Board of Proprietary Schools reviews renewal applications in the spring and makes recommendations to the SBCC. As long as a school remains in good standing (no major compliance issues) and has submitted the required documents and fees, renewal is generally approved. The renewed license is issued for the next July 1 to June 30 period. Note: If a school misses the March 1 renewal deadline, it can still submit a late renewal (with an additional $500 late fee) before the end of June; however, operating without a renewed license as of July 1 is not permitted. Schools more than 6 years in continuous operation may have adjusted bond requirements tied to the Student Protection Fund’s status, but the renewal process itself remains annual.
Checklist of Required Items (Proprietary School License Application):
- Preliminary Application Form: Completed initial license application form with basic school information, signed by the school’s chief administrator or owner. (This form initiates the process and is submitted to OPS along with initial fees.)
- Fees – Initial Payments: Two separate certified checks or money orders: one for $5,000 (Initial License Fee) and one for $1,250 (Student Protection Fund assessment), both payable to the “North Carolina State Treasurer.” These must accompany the preliminary application.
- Surety Bond: A guaranty bond in the required amount (minimum $25,000). The bond must be executed by a surety company authorized in NC, and the original bond form must be provided. The bond ensures indemnification of students for prepaid tuition in case the school ceases operation. (If the bond is not ready at initial submission, proof of intent/ability to secure the bond may be required, but the license will not be granted without the bond in place.)
- Business Plan and Budget: A detailed business plan describing the school’s mission, target student population, and strategies for success, including a three-year financial plan. Also include a proposed operating budget for the first year of operation, broken down by month, showing projected revenues (tuition, etc.) and expenses (salaries, rent, equipment, marketing, etc.). This demonstrates the school’s financial feasibility.
- Financial Resources Documentation: If the school is newly established (no prior operating history), provide evidence of financial resources to sustain the school. For example, personal financial statements of owners, bank statements showing available capital, lines of credit, or investor commitment letters. If an existing business is backing the school, include that entity’s financial statements. (Established schools should provide recent compiled or audited financial statements prepared by a CPA, including balance sheet, income statement, and cash flow.)
- School Catalog: A draft school catalog or bulletin that meets the content requirements of G.S. 115D-90. The catalog must include: the school’s official name and address; governance and faculty names; academic calendar with term start/end dates and holidays; admissions policies and entrance requirements; attendance policy (including conditions for interruption or dismissal for absences); grading and progress policy (grading scale, satisfactory progress standards, probation/dismissal rules, and re-admission criteria); student conduct rules and dismissal conditions; detailed schedule of tuition, fees, and any other charges; and the tuition refund policy (which must, at minimum, refund 100% of tuition if a student never attends or withdraws on the first day, and at least 75% refund if withdrawal is within 25% of the course). The catalog should be signed or certified as true by a school official.
- Program Outline for Each Course: A syllabus or program outline for each curriculum or course offered. This should include the program name, total number of clock or credit hours, duration of program (in weeks or months), course by course breakdown (with descriptions of each course/module), and the skills or competencies taught. If the program prepares students for a specific occupation or credential, note that as well.
- Instructor Qualifications: A list of instructors and staff for the school, with each person’s proposed teaching assignment and their qualifications. Include resumes or credential documentation for instructors, showing they meet minimum standards (usually instructors should have at least a degree, certification, or years of experience in the field they will teach). For example, if offering a HVAC technician program, instructors should be licensed/certified and experienced in HVAC.
- Facilities and Equipment: Documentation of the school’s facilities. Provide the address of the instructional site, a description of the building and classrooms (square footage, number of classrooms or labs), and an inventory of major training equipment or tools that will be used for instruction. If applicable, include floor plans or photographs. Also, include evidence of occupancy authorization (e.g. a copy of the lease or deed for the property) and confirmation that the facility meets safety codes (fire inspection or occupancy permit, if required by local regulations).
- Enrollment Agreements and Forms: Copies of all key student forms that will be used, including: the student enrollment agreement/contract (outlining terms of enrollment, tuition, cancellation and refund terms, etc.), student application form, financial payment plan or promissory note (if used), attendance record form, progress report or transcript form, and a withdrawal or termination form. These documents are reviewed to ensure they comply with consumer protection laws (e.g. the enrollment agreement should mirror the policies stated in the catalog and not contain misleading clauses). The state has sample templates available, and schools often use those as a model.
- Compliance Statements: Any additional certifications required by the application, such as an acknowledgment of understanding and intent to comply with state laws (often the school owner or director must sign a statement attesting to compliance). Also, if the school will seek federal student aid or VA benefits for students, note plans for accreditation (though not required for state licensure, accreditation plans might be of interest).
- Proprietary Schools Board Review Preparation: (Not a physical document to submit, but as part of the checklist it’s wise to prepare) – Be prepared to attend the State Board meeting if requested. Have a brief presentation or summary ready about the school’s mission and readiness to operate, and be prepared to answer questions. While not always formally required, responsiveness to the Board’s inquiries is part of the licensing process.
Fees & Timelines (Vocational/Proprietary Schools)
State Exemptions
Certain institutions and educational programs are exempt from state licensing requirements in North Carolina. Below is a list of all categories of schools and courses that do not require state approval under the relevant laws, provided they meet the specified conditions:
- Institutions Continuously Operating Since 1972 – A degree-granting institution that has conducted post-secondary degree activity in North Carolina continuously under the same name since before July 1, 1972. These long-established colleges are grandfathered and exempt from the Board of Governors licensure (per G.S. 116-15(c)). Once confirmed, they remain exempt without further action.
- Religious or Theological Institutions – Schools whose sole purpose is to provide religious education and confer degrees in disciplines such as theology, divinity, or religious education for the training of ministers or other religious vocations. If an institution’s programs are entirely devoted to religious instruction (e.g. Bible colleges, seminaries) and not secular subjects, it is exempt from degree licensure requirements (G.S. 116-15(d)). Note: This exemption applies on a program-by-program basis – a religious institution might be exempt for its ministry programs but would need a license if it offers secular degree programs.
- Intra-Military Programs – Postsecondary programs conducted exclusively on U.S. military bases in North Carolina, serving active-duty military personnel, their dependents, or civilian military employees. If an institution offers degree programs on base for those populations and not to the general public off-base, the school is exempt from UNC licensure (G.S. 116-15(e)). (However, if the same institution offers programs to non-military students in NC, licensure would be required for that activity.)
- Out-of-State Online Education via SARA – Institutions based outside North Carolina that are approved participants in the State Authorization Reciprocity Agreement (SARA) and only deliver online/distance education to NC residents (with no physical presence in North Carolina). Such institutions are exempt from needing separate NC authorization for those distance programs. (If the out-of-state provider engages in on-the-ground activities or is not in SARA, standard licensure would apply.)
- Nonprofit, Tuition-Free Educational Programs – Private schools or training programs conducted by bona fide charitable or religious 501(c)(3) nonprofit organizations that do not charge any tuition or fees to students. For example, a charity offering free job training to underprivileged individuals, or a church running free classes for members, would be exempt from proprietary school licensing.
- Employer-Sponsored Training – In-company training programs offered by an employer exclusively for its own employees, where no tuition or fee is charged. If a business provides training to its employees (and only its employees) as part of internal workforce development, it does not need to be licensed as a school.
- Fraternal and Civic Organization Courses – Instructional courses or classes sponsored by a fraternal society, civic club, or benevolent organization that are not operated for profit. For instance, a Rotary Club offering a leadership workshop to members, or a community volunteer club providing hobby classes at cost, would be exempt.
- Avocational and Recreational Programs – Schools or classes that are purely avocational (hobby or personal enrichment), recreational, or for self-improvement and not intended to lead to employment. The State Board (through the SBPS) determines which programs fall in this category. Examples: a photography class for hobbyists, a dance studio’s lessons, or a personal finance seminar series, when not marketed as career training, can be exempt.
- Programs Regulated by Other Licensing Boards – Any educational institution or program that is already subject to oversight by another legally existing State licensing or approving agency in North Carolina. This means if another state board regulates the school’s operations, the proprietary school license is not required. Common examples include: Cosmetology schools (regulated by the NC Board of Cosmetic Art Examiners), Real Estate pre-licensing courses (regulated by the NC Real Estate Commission), Nursing Assistant programs (regulated by the NC Department of Health and Human Services), among others. These schools are exempt from SBCC proprietary licensing because they fall under different regulatory regimes.
- Equipment-Specific Training by Manufacturers – Classes or training programs that are product-specific and provided by a manufacturer or vendor to teach purchasers/users how to operate equipment or products they have bought. For example, if a software company provides training to customers on using its software (and charges a fee for training), or a tractor manufacturer trains buyers on equipment operation, those classes are exempt, as they are incidental to the sale of the product and not general education.
- State-Recognized Public and Private Institutions – Established public or private schools and colleges that are recognized or regulated under other state laws are exempt from proprietary school licensing. This includes public K-12 schools, charter schools, community colleges, and UNC System universities, as well as accredited private colleges that award degrees (they fall under separate authorization processes). In essence, institutions accredited by accrediting agencies and authorized under other state frameworks do not need a proprietary school license for their programs. (However, note that a private college offering degrees does require UNC Board of Governors licensure unless covered by exemption #1 or #2 above. This category mainly reinforces that legitimate traditional schools are not treated as “proprietary schools” under Article 8.)
- Cross-Exemption with Degree Licensure – If an institution has obtained an exemption under the UNC Board of Governors’ licensure statute (G.S. 116-15), that institution is likewise exempt from the proprietary school law. For example, a religious institution exempt from degree licensure would also be exempt from needing a proprietary license for any non-degree religious programs it offers.
Each exemption is narrowly defined – institutions should carefully ensure they squarely meet an exemption category before foregoing licensure. When in doubt, schools can request an official determination from the UNC System Office or the Office of Proprietary Schools. Exempt institutions may still choose to seek voluntary licensure in some cases (North Carolina permits certain exempt schools, like religious institutions, to voluntarily get licensed if they wish to signal oversight and provide additional assurance to students, often with modified requirements such as no bond needed).
For personalized guidance on navigating the authorization process for your private post secondary institution in North Carolina, reach out to Expert Education Consultants (EEC) at +19252089037 or email sandra@experteduconsult.com