Education and workforce development: statewide framework.

Plain English Breakdown

The official source material does not provide information on penalties for non-compliance with the franchise fee rules or funding specifics for the education framework implementation.

Education Framework and Franchise Fee Rules

This legislation requires the State Board of Education to create an education framework called 'Vision for California Education' by July 1, 2028, and sets rules for how franchisors must handle fees collected from franchisees.

What This Bill Does

• Requires the State Board of Education to work with the Department of Education to make a plan called 'Vision for California Education' that helps connect schools and colleges with jobs by July 1, 2028.
• Needs the State Board of Education to report every two years starting January 1, 2030 on how well they are doing with their education plan.
• Forbids franchisors from using fees collected from franchisees for anything other than what was promised and requires these fees to be kept separate from other money.
• Limits the amount of administrative expenses or overhead a franchisor can take from fees collected to 10% unless they tell franchisees exactly how much is taken.
• Requires franchisors to give franchisees an annual report showing all fees collected and how that money was used.

Who It Names or Affects

• The State Board of Education
• Franchisors and franchisees in California

Terms To Know

Vision for California Education

A plan to connect schools, colleges, and jobs across the state.

Franchise fee

Money a franchisee pays to a franchisor to use their business name or system.

Limits and Unknowns

• The bill does not specify what happens if a franchisor breaks the rules about fees.
• It is unclear how much funding will be provided for creating and implementing the education framework.

Official Summary Text

AB 2632, as amended, Hoover.
California Franchise Relations Act: fees for a stated purpose.
Education and workforce development: statewide framework.
Existing law establishes a system of elementary and secondary education in this state, under which school districts, county offices of education, charter schools, and state special schools provide instruction to pupils in kindergarten and grades 1 to 12, inclusive, at schoolsites throughout the state.
Existing law establishes the University of California, under the administration of the Regents of the University of California, the California State University, under the administration of the Trustees of the California State University, and the California Community Colleges, under the administration of the Board of Governors of the California Community
Colleges, as the public segments of postsecondary education in the state.
This bill, on or before July 1, 2028, would require the State Board of Education, in partnership with the State Department of Education, to establish a formal framework, to be known as the Vision for California Education, to serve as the primary guiding framework for education policy across the state’s elementary, secondary, and public postsecondary educational systems. The bill would require the vision to achieve specified goals, including, among other goals, establishing clear pathways that connect the state’s elementary, secondary, and public postsecondary educational systems and the workforce, as provided. The bill further would require the state board, on or before January 1, 2030, and every 2 years thereafter, to report to the Legislature on the progress made toward achieving the
vision’s goals.
Existing law, the California Franchise Relations Act, sets forth certain requirements related to franchises between a franchisor, subfranchisor, and franchisee. For these purposes, the act defines a “franchise fee” as any fee or charge that a franchisee or subfranchisor is required to pay or agrees to pay for the right to enter into a business under a franchise agreement, as specified, but excludes prescribed purchases and payments from that definition. Existing law provides that the act applies to any franchise when either the franchisee is domiciled in this state, or the franchised business is or has been operated in this state.
This bill would prohibit a franchisor from using any fee collected from a franchisee for a stated purpose, as specified, for anything other than the stated purpose and would require that such fees collected be segregated
from the franchisor’s funds at all times. The bill would prohibit the amount allocated to administrative expenses or overhead from exceeding 10% of the amount collected for a fee for a stated purpose unless the franchisor discloses the exact amount or percentage to be allocated to administration or overhead, as prescribed. The bill would also require a franchisor to provide franchisees with an annual detailed accounting as to the amounts collected and their use and application for any fees for a stated purpose.

Current Bill Text

Download Bill PDF