Buying a school or training business in Florida

This covers three quite different businesses. Tutoring and test prep centers sell hourly sessions, packages or monthly memberships, mostly to parents, and follow the school calendar: busy around report cards and exam dates, quiet in summer. Private schools (kindergarten through 12th grade) collect annual tuition, often paid monthly. In Florida, many are paid partly through the state's Family Empowerment and Florida Tax Credit scholarships, which flow through scholarship funding organizations. Career schools teach a trade or job skill, such as health care support, beauty or technical work, and are paid per program by students, employers or student aid.

In all three, revenue recurs once a student enrolls, and all three depend on reputation, because families and students choose by word of mouth and results. The team is usually a director, teachers or instructors (often part time in tutoring), and someone who handles enrollment and billing.

• Students who come back: high re-enrollment at a school, renewing memberships at a tutoring center, steady class starts at a career school.
• Results you can show, such as test score gains, where graduates go next, and completion, job placement or licensing exam pass rates.
• Teachers and a director who run the place without the owner in every class.
• More than one source of tuition, so a change in one scholarship program or employer contract isn't fatal.
• A building zoned and approved for the use, with room to add classrooms.
• A clean record with the state, scholarship organizations and any accreditor.
• Written enrollment contracts with clear refund and withdrawal terms.

It depends on the type.

• Tutoring and test prep. No state license. The Commission for Independent Education, which licenses private career schools and colleges, doesn't cover schools that offer only avocational (hobby or personal interest), exam preparation or professional development courses (section 1005.06). You'll need a local business tax receipt and the right zoning.
• Private K-12 schools. Not licensed: by law, the state doesn't intend to regulate or accredit them. Schools register with the Department of Education and file an annual survey, and a new owner must file fingerprints with the state within 5 days of taking ownership (section 1002.42). Schools in the Family Empowerment or Florida Tax Credit scholarship programs must also screen owners and any staff with unsupervised access to students, and notify each scholarship family at least 30 days before an ownership transfer (section 1002.421).
• Career schools. Licensed by the commission. The license doesn't transfer. The school must notify the commission in writing at least 30 days before a change of ownership or control, and the commission decides whether to issue a new license (section 1005.31 and rule 6E-2.0081). A school that takes federal student aid loses eligibility at a change of control unless the U.S. Department of Education approves its continued participation, so start early.

• Prepaid tuition. Tuition already collected for terms not yet taught is a debt you'd pay off by teaching. Make sure the price accounts for it.
• Enrollment trend. Look at several years by term or grade, not one good fall.
• Scholarship reliance. Find out how much tuition comes through scholarships, how promptly it's paid, and whether the school has had any compliance notices.
• Career school outcomes. Completion and placement rates, student complaints, refund obligations and accreditation status all carry over to you.
• The owner's role. At many tutoring centers and small schools, the owner is the main teacher or the reason families come.
• Background checks and insurance. Confirm that every employee has been screened and that liability coverage includes abuse claims.
• The building. Check fire code and occupancy approvals and the lease term.

• How has enrollment changed over the last three years, and how many students return each year?
• How much tuition comes from scholarships, employers or student aid compared with families paying directly?
• Who teaches most of the classes, and which teachers would stay through a sale?
• How much tuition have families or students already paid for terms you haven't taught?
• Have you had any site visits, audits or complaints from the state, a scholarship organization or an accreditor?
• What would you change about the building or schedule to grow enrollment?
• For career programs: how many students finish, and how many find work in the field?