Students get notice Regency Beauty Institute immediately closing 79 campuses

Updated: 2:07 p.m. | Posted: 8:30 a.m.

Minnesota-based Regency Beauty Institute announced Wednesday that it's closing all 79 campuses nationwide immediately, including five locations in the state.

State officials are working to offer support for students at the closed cosmetology school to continue their education or recoup some of their expenses, but it's likely many students will still take a financial hit due to the closure.

In a statement posted to the school's website, the company said "the organization does not have the cash to continue to run the business."

Regency has had substantial financial losses for the last three years, as well as declining enrollment, said Betsy Talbot, manager of registration and licensing for the Minnesota Office of Higher Education. The state agency is offering support to students affected by the closure.

"We're trying to help students and really reduce the negative impact on them," Talbot said. "We won't be able to do it entirely, but there are state agencies and the federal government that are there as a resource."

The estimated 430 Regency students in Minnesota may be eligible to receive some tuition reimbursement from a state program, although there's only about $60,000 in total available funds. Students who took out federal loans may also be able to discharge some of those loans as long as they don't continue their cosmetology education at another school.

"There are some refund policies in place, but they generally do not make a student whole when there's an abrupt closure," Talbot said.

The state agency is also working with the company and Minnesota Board of Cosmetologist Examiners to arrange "teach-out" agreements with other schools that will allow students to complete their education and minimize extra costs, although no plans have yet been finalized.

According to a Google cache version of the company's website, Minnesota tuition and supplies at Regency reached almost $19,000 for 2016.

Taylor Armstrong has been enrolled in the Regency Beauty Institute in Mesquite, Texas, for a month. She was watching television with her grandparents at about 8 p.m. last night when she got a text telling her the school was closing.

"Nobody mentioned anything. Not one thing. Out of nowhere we get a text that it closed," Armstrong said. "That affects all the teachers and all the students, even the teachers that worked with them &mdash they had no idea."

The 19-year-old said she wants to be a makeup artist and hair stylist, which was part of why she enrolled in Regency instead of another cosmetology school. Other schools often focus on just hair styling and cutting instead of a wider range of skills.

"We didn't go to any other schools in Mesquite for a reason," Armstrong said. "We went to Regency for a reason, and now we have got to go to the other schools that we didn't want to go to."

Armstrong and her friends are worried about putting their career plans on hold due to the closure, and about whether they'll get any money back. But she said the company has already started sending students their transcripts, and are actively trying to find other programs for them to finish their educations.

"Even though they're closed down, they're really trying to help us out, that's the good thing," Armstrong said. "That's the only thing I'm happy about with Regency right now."

Regency's website lists a pair of two-hour time slots when students will be allowed onto company property to retrieve personal property.

Regency said in the posted statement that the company also had trouble obtaining financing because of declining numbers of cosmetology students and "negative characterization of for-profit education by regulators and politicians."

Rules designed to protect students from amassing large amounts of debt have put more pressure on for-profit schools in recent years.

Other for-profit schools have been investigated and sanctioned for wrongdoing , including ITT Technical Institute, which announced that it was closing all of its campuses earlier this month.

Regency denied in the statement that this is another case of a private school "being forced to shut down because it was accused of wrongdoing."

The company has operated cosmetology schools for over 50 years, according to its website. In Minnesota Regency operated schools in Blaine, Burnsville, Duluth, Maplewood and St. Cloud. A note for students of each of those locations asks students to check for updates starting the week of Oct. 3 or to call the state's board of cosmetology.

Regency Corp. is registered at the Minnesota secretary of state's office as a corporation based in St. Louis Park, with Joseph Gaylord listed as the company's chief executive officer. No one answered the phone at the company's office on Thursday morning, but a spokesperson sent a brief statement that said the company is committed to keeping core staff on board as they help students make the transition to another cosmetology program. The spokesperson did not respond to follow-up questions.