BILL ANALYSIS Ó
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|Hearing Date:May 2, 2011 |Bill No:SB |
| |675 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Curren D. Price, Jr., Chair
Bill No: SB 675Author:Wright
As Amended:April 27, 2011 Fiscal: Yes
SUBJECT: Private postsecondary education: non-English speaking
students.
SUMMARY: Requires that private postsecondary education institutions
subject to the California Private Postsecondary Education Act of 2009
(Act) administer a test of English language proficiency to a nonnative
speaker of English, as defined, prior to enrolling the student.
NOTE : This measure was heard in the Senate Committee on Education on
March 30, 2011, and passed out of the Committee by a vote of 6-2. The
measure was heard by this Committee on April 25, 2011 and failed
passage by a vote of 2-3. It is up for reconsideration at this
hearing.
Existing law:
1)Establishes the Bureau of Private Postsecondary Education (Bureau)
within the Department of Consumer Affairs (DCA) and provides for
Bureau oversight and regulation of California private postsecondary
institutions (Business and Professions Code(BPC) § 101 and Education
Code (EC) § 94820) .
2)Specifies that, notwithstanding the inoperative status or repeal of
the former Private Postsecondary and Vocational Education Reform Act
of 1989 (Former Act) on or after July 1, 2007, any claim or cause of
action in any manner based on the act that was commenced on or
before June 30, 2007, whether or not reduced to a final judgment,
shall be preserved, and any remedy that was or could have been
ordered to redress a violation of the act on or before June 30,
2007, may be ordered or maintained thereafter.
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3)Defines "Ability-to-benefit student" (ATB) as a student who does not
have a certificate of graduation from a school providing secondary
education, or a recognized equivalent of that certificate. Provides
that before an ATB student may execute an enrollment agreement, the
institution shall have the student take an independently
administered examination from the list of examinations prescribed by
the United States Department of Education (USDE). Specifies that
the student may not enroll unless he or she achieves a score
demonstrating that the student may benefit from the education and
training being offered. (EC § 94811 and EC § 94904)
4)Specifies that an enrollment agreement shall be written in language
that is easily understood and that if English is not the student's
primary language, and the student is unable to understand the terms
and conditions of the enrollment agreement, the student shall have
the right to obtain a clear explanation of the terms and conditions
and all cancellation and refund policies in his or her primary
language. Also specifies that if the recruitment leading to
enrollment was conducted in a language other than English, the
enrollment agreement, disclosures, and statements shall be in that
language. (EC § 94906)
This bill:
1) Makes a number of findings and declarations regarding the
challenges faced by immigrant students and the intent of the
Legislature to protect these students including: limited
proficiency of immigrants who may be induced to enroll in diploma
or degree courses at private postsecondary schools; the vast
majority of these students are poor or of moderate income and can
qualify for the maximum amount of federal student grants and loans;
the vast majority of these students will not benefit from courses
in English, will not obtain employment from their training, will
default on student loans and as a result will not be able to obtain
future public monies for English language instruction or job and
educational training; abusive practices of enrolling these students
have returned since expiration of the Former Act; loan defaults
result in seized income and benefits.
2) Specifies various definitions, including: "English learner" as a
nonnative speaker of English whose difficulties in speaking,
reading, writing or understanding the English language may be
sufficient to deny the ability to successfully complete course work
and classes in English; "Nonnative speaker of English" as a person
who was not born in the U.S. and whose first language was not
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English, whose primary language spoken at home is other than
English or whose native language is other than English, and who
was born in a country other than the U.S. and attended kindergarten
or any grades 1-12 inclusive in a U.S. school for three or less
years; "Prospective student" as a nonnative speaker of English who
seeks to enroll in a program of instruction taught in English.
3) Prohibits an institution from entering into an agreement for a
program or course of instruction given in English with a
prospective student who is a nonnative speaker of English unless
the person first takes and passes an English proficiency test, as
specified.
4) Requires that any English proficiency test(s) be given by an
independent test administrator, off campus, without charge to the
student, and according to procedures and requirements specified by
the test publisher.
5) Requires the institution to pay for the test(s) and that the test
be scored by an off campus independent test administrator.
6) Prohibits any employee or school representative from being at the
test location or in any way influencing the giving, monitoring or
scoring of the test(s).
7) Requires that the student alone complete the test without
assistance, but clarifies that nonsubstantive assistance to
accommodate the disability of a handicapped person is not
prevented.
8) Prohibits the administration of another English proficiency test
for at least a week, or longer, as specified, if a prospective
student fails to achieve a passing score, and requires that
subsequent tests administered to the student be substantially
different.
9) Requires that the proficiency tests and cutoff scores demonstrate
that the student has the necessary English language proficiency in
reading, writing, listening, and speaking to successfully complete
the postsecondary course of instruction in which the student seeks
to enroll.
10)Authorizes the demonstration of English proficiency to be
accomplished by any of the following: minimum scores, as
specified, on the paper-based, computer-based, or Internet-based
Test of English as a Foreign Language (TOEFL); a minimum score of
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4.5 on the International English Language Testing System (IELTS);
meeting or exceeding cutoff scores (as established by Bureau
regulation) for any English proficiency test authorized by the
Bureau.
11)Requires a nonnative speaker of English to take and pass an English
proficiency test whether or not the student is a high school
graduate and has a high school diploma.
12)Provides that violation of any of the bill's provisions by an
institution:
a) Renders the enrollment agreement and any other
contract with the institution unenforceable.
b) Requires the institution to refund all payments made
by, or on behalf of, a student including fees, penalties, or
interest associated with related educational loans.
c) Establishes the right of a student to bring a
private right of action against the institution and outlines
the remedies, relief, and penalties and student rights that
result, including the right to attorney's fees and costs.
13)Narrows the existing compliance authority of the Bureau by
prohibiting the provisions of the bill from being construed as a
"minor" violation by the Bureau.
14)Establishes the authority of the Bureau to investigate and compel
compliance with the bill's provisions and to order restitution, and
expands the Bureau's authority to pursue remedies for these
students beyond those established by the Act.
15)Requires any written contract or agreement for educational services
signed by a nonnative speaker of English to:
a) Disclose the requirement that the student take an
English proficiency test.
b) Include the specific test taken, score achieved, and
required passing score and that this information be placed
in the student's file after enrollment.
16)Provides that the provisions of the bill are severable.
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FISCAL EFFECT: Unknown. Legislative Counsel has keyed this bill
fiscal.
COMMENTS:
1. Purpose. The Author is the Sponsor of this bill. According to the
Author, poor and moderate income students, including the ones
protected by this bill, are attractive targets for private
postsecondary schools because they qualify for the most money in
federal grants and loans. The Author notes that some private
postsecondary institutions in California and other states have been
able to evade ATB protections by assisting immigrant students in
obtaining phony high school diplomas, which in turn exempts the
prospective student from having to take and pass an ATB test before
enrollment. The Author is concerned that with a phony high school
diploma, these limited English proficient students can obtain
federal financial aid permitting them to enroll in any private
postsecondary institution regardless of their English language
proficiency. The Author states that by prohibiting private
postsecondary institutions from entering into an agreement with an
English learner, regardless of having a high school diploma, unless
the student passes an English proficiency test, these students will
be better protected because of provisions in the bill ensuring that
the enrollment agreement and any other contract with the
institution is unenforceable and the student's tuition money has to
be returned if a school is in violation.
The Former Act required that students pass a test indicating the
student had attained adequate proficiency in oral and written
English to comprehend instruction in English, but the Act as
reconstituted by AB 48 does not have the same provision. This bill
seeks to address that omission by restoring language based upon
relevant provisions of the Former Act.
2. Concerns Regarding Private Postsecondary Institutions. Media
outlets, efforts at the Federal level and increased scrutiny by
state legislatures have recently highlighted unease about the
operations and functions of private postsecondary schools. While
the sector serves upwards of ten percent of postsecondary students
and provides a path to higher education that may not always be
available for all students, there are increased questions about
these institutions and their accurate representation of what they
are able to offer students. There are also concerns that schools
provide training at a steep cost that does not balance the earnable
income an individual may be eligible for based on that training or
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upon completion of a program.
Last fall, the U.S. Department of Education (DOE) adopted new rules
to rein in the recruiting practices of for-profit colleges by
changing standards for students to use federal Title IV money at
these institutions. The effort gained momentum following a report
by the U.S. Government Accountability Office (GAO) that found
potential deception by schools to students about graduation and job
placement rates in the process of getting them to enroll and sign
up for state and federal loans. Using undercover testing, GAO
found some schools encouraging students to falsify their financial
aid applications in order to qualify for federal grants. Other
schools misrepresented their programs' graduation rates,
job-placement rates and costs while recruiting students.
According to the National Conference of State Legislatures (NCSL),
17 states are considering legislation to further regulate these
institutions. In California, for-profit schools now face
restriction on the ability to receive state monies in the form of
Cal Grants, which provide over $20 million more annually to the
schools than to community colleges. Just recently, Maryland's
House and Senate enacted measures that would eliminate all state
aid to for-profit schools, ban commissions or bonuses for student
recruiting, and make all for-profit schools in the state contribute
to a fund to protect students if any college in their group
breaches a contract.
Recent budgetary and capacity issues in California's public
postsecondary schools, coupled with the current economic crisis
have led to growth in enrollment at private postsecondary schools,
as employees are increasingly out of work and more inclined to
enter training programs in the hopes of obtaining gainful
employment, at a cost they may not be able to make up once they are
employed. This Committee, at its March 2009 hearing entitled "The
Role of Private Education Institutions in Preparing California's
Diverse Workforce: Meeting the Challenges of our Workforce and Job
Training Needs" examined the ability of private postsecondary
institutions to fill the career preparation needs of California's
workforce and evaluated policy options that allow them to expand
their workforce development programs with the requisite amount of
oversight required to protect students. The private postsecondary
school sector has responded to additional regulation and oversight
proposals by noting that career colleges are an essential part of
the solution for restoring this country's global educational and
economic standing, citing the role these schools play in helping
lower unemployment, boost global competitiveness, fill jobs in key
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industries, and increase the number of college graduates by 2020.
According to federal data, more than 2.2 million students enrolled
in a private for-profit institution in the fall of 2009, almost 25
percent more than the previous year.
The Author and supporters of this bill highlight concerns about the
sector in general as rationale for updates to the Act. However,
this bill only adds additional oversight, requirements for English
learners.
3. History of California's Regulation of Private Postsecondary
Education. The state's program for regulation of private
postsecondary and vocational education institutions has been
plagued by problems for many years. During the late 1980's, the
state developed a reputation as the "diploma mill capital of the
world." During this period, the State Department of Education
regulated the private postsecondary education industry. As a
result of concerns about the integrity and value of the degrees and
diplomas issued, widely varying standards, the lack of enforcement
provisions, and exemptions from oversight authorized in the
statute, a comprehensive reform bill was enacted. SB 190 (Morgan)
created the Private Postsecondary and Vocational Education Reform
Act of 1989 (Reform Act) to overhaul the state's regulatory program
and transferred oversight responsibility for the program to the
20-member Private Postsecondary and Vocational Council (Council).
Concurrently, the Maxine Waters School Reform and Student
Protection Act (Waters Act) was enacted. The provisions of the
Reform Act and the Waters Act were merged, but doing so created a
fragmented structural framework for regulation of private
postsecondary and vocational education institutions with numerous
duplicative and conflicting statutory provisions which would plague
California's oversight of these institutions until the law sunsets
on July 1, 2008.
In the years following enactment of the Former Act, concerns were
expressed about the Council's implementation of the Act. In 1995,
the California Postsecondary Education Commission (CPEC) found
there were potentially up to 1,000 unapproved institutions
operating in California and the Council lacked the enforcement
powers or punitive measures needed to address these violations.
While CPEC recommended amending the Former Act to provide the
Council with the authority and other resources to ensure that all
institutions operate in compliance with the Former Act, no action
was taken on this proposal.
In 1997, AB 71 (Wright) was enacted to create BPPVE within DCA,
transferred responsibility for administration of the Reform Act to
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BPPVE and extended the Reform Act's sunset date to January 1, 2005.
In 2000, the Bureau of State Audits (BSA) conducted an audit of DCA
determine whether the Department was properly overseeing its
regulatory boards and bureaus. The BSA reviewed four board and
bureaus in detail, including the BPPVE and found that DCA was not
fulfilling its oversight responsibilities and was allowing
weaknesses in licensing and complaint processing to continue.
In 2002, DCA's Internal Audit Office completed a review of BPPVE,
programs and operations. The Internal Audit Office made a number
of recommendations for BPPVE to modify and improve its operations.
During 2002, BPPVE completed its first Sunset Review before the
Joint Legislative Sunset Review Committee (JLSRC). As part of this
review, BPPVE committed to reestablish the Bureau's Advisory Board,
simplify and streamline its appeal procedures, sponsored
legislation to change current statutes and adopt regulations to
ensure comprehensive and effective application approval procedures,
enforcement and disciplinary actions and address deficiencies noted
in the BSA audit.
In 2003, SB 364 (Figueroa) required BPPVE to work with JLSRC staff
to streamline the Former Act, determine the cost and staffing
needed to meet its statutory obligations, improve its data
collections and dissemination systems and to report to the
Legislature on a number of the changes requested.
In 2004, the Joint Committee on Boards, Commissions and Consumer
Protection (Joint Committee) held a special hearing regarding BPPVE
and recommended the following:
The Former Act needed to be revised to make it
intelligible and enforceable.
The Administration and DCA should consider restoring, at
least temporarily, the Bureau's staffing resources to clear
out existing backlogs.
The Joint Committee also recommended that DCA appoint an Operations
and Enforcement Monitor to complete an objective assessment of
California's regulation of private postsecondary and vocational
education institutions, including both the administrative
operations of BPPVE and the provisions of the Former Act.
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In 2004, in response to the persistent problems with BPPVE, the
Legislature enacted SB 1544 (Figueroa, Chapter 740, Statutes of
2004), which required the appointment of an Enforcement Monitor
(Monitor) to provide an in-depth and impartial examination of
BPPVE's operations. The Monitor's report, presented to the Joint
Committee on Boards, Commissions and Consumer Protection on
December 7, 2005, outlined a "twenty-year record of repeatedly
identified, fundamental problems in every one of the Bureau's key
operations." The Report found that BPPVE both inadequately
protected consumers and impeded the expansion of quality
postsecondary and vocational educational opportunities.
The concerns and recommendations raised by the Monitor were
generally consistent with concerns raised by CPEC in 1995, the 2000
BSA report and DCA's own 2002 internal investigation. At the time
of its sunset, BPPVE had not addressed many of its fundamental
problems with oversight and enforcement. The Monitor's report
stated many of the root causes of enforcement and oversight
failures can be traced back to deficiencies within the Reform Act.
1. Findings of Monitor's Report Addressed in AB 48 (Portantino,
Chapter 310, Statues of 2009). After numerous legislative attempts
to remedy the laws and structure governing regulation of private
postsecondary institutions, AB 48 was enacted in January 1, 2010,
to make many substantive changes that both created a new, solid
foundation for oversight and responded to the major problems with
the Former Act. The Act as created by AB 48 requires all
unaccredited colleges in California to be approved by the new
Bureau, and all nationally accredited colleges to comply with
numerous student protections. It also establishes prohibitions on
false advertising and inappropriate recruiting. The Act requires
disclosure of critical information to students such as program
outlines, graduation and job placement rates, and license
examination information, and ensures colleges justify those
figures. The Act also guarantees students can complete their
educational objectives if their institution closes its doors, and,
most importantly, it gives the Bureau an array of enforcement tools
to ensure colleges comply with the law.
The Monitor's report included various specific findings and
recommendations for overhauling the Former Act, many of which were
included in AB 48 and the new Act, including:
Enforcement . The Monitor found that BPPVE did not
conduct unannounced site visits as required by law, never
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revoked the license of a school and had never placed a school
on probation. The Monitor also found that the fine amounts
for unapproved schools ($2,500) were too low to promote
compliance and fines were rarely assessed. The Monitor noted
that inadequate staffing levels led to complaints that
unapproved schools were not being investigated and when
investigated, the investigations largely relied on documents
generated by the schools themselves. The Monitor noted that
even with better investigative resources, the remedies at
BPPVE's disposal were inadequate as it did not have the power
to order refunds or restitution to a student or group of
students. In response, AB 48 established a compliance and
enforcement program that directs the Bureau to take specified
actions for violations of the Act, requiring the Bureau to
cite unapproved schools with fines of up to $50,000, take
specified investigative actions, and provides the Bureau with
the power to order refunds and restitution to a student or
group of students.
Bureau Insolvency . The Monitor's report identified
significant problems with the fee structure and the
statute-imposed study found that revenue was "insufficient to
support ongoing operations," but BPPVE failed to recommend
raising fees. In response, AB 48 established a schedule of
higher fees to support the Bureau's activities.
Regulatory Burden and Arbitrary Practices . The Monitor
found BPPVE's regulatory practices were unpredictable,
creating a financially risky environment for schools seeking
to open California and which could potentially impede
educational opportunities. Specifically, the Monitor found
BPPVE assessed fees on schools without the statutory or
regulatory authority to do so. Due to the gross deficiencies
in its enforcement program, BPPVE attempted to pursue
enforcement by forcing schools to agree to conditions before
granting approval, and it inappropriately required schools to
submit re-approval applications beyond what was required by
law. In response, AB 48 provides a clear directive to the
Bureau, while providing it with appropriate discretion over
specific regulations and processes. AB 48 improved upon the
Former Act by creating a more clear and concise law, easing
the approval process, providing clear deadlines for the
adoption of regulations so that schools know exactly the rules
they will be expected to follow, and allowing for workshops to
be conducted by the Bureau to help schools navigate the
approval process and requirements of the Act.
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The Former Act's Structural Issues . The Monitor's
report also identified structural deficiencies within the
Former Act and made recommendations for addressing those
deficiencies. The report found that the Former Act's
different standards and requirements for different categories
of institutions were inherently complex. In response to the
recommendation for a consolidated system that would apply to
all institutions, the Act created a single category of
institution and established the same standards and
requirements for all institutions.
Insufficient sanctions and penalties . The Monitor found
the Former Act's sanctions and penalties were insufficient to
deter future misconduct by industry participants and
recommended providing the Bureau with the authority to issue
formal warning notices, increase fine amounts and separate
enforcement and renewal processes. In response, the Act
increases penalties, provides the Bureau with the authority to
issue a notice to comply, and generally separates the
enforcement process from the renewal process.
Prior to the enactment of AB 48, California was without any
regulatory body for private postsecondary institutions.
1. Related Legislation. SB 498 (Liu) abolishes the Bureau and
transfers the Bureau's powers and duties under the Act to CPEC.
The bill is a two-year bill pending hearing in this Committee.
SB 619 (Fuller) exempts flight instructors or flight schools that do
not require the upfront payment of tuition or fees, and that do not
require students to enter into a contract of indebtedness in order
to receive training, from Bureau regulation. The bill is pending
hearing in the Senate Committee on Appropriations.
AB 797 (Conway) exempts schools of cosmetology, as defined, from the
Act. The bill has not been set for hearing in the Assembly
Committee on Higher Education.
AB 1013 (Assembly Committee on Higher Education) clarifies provisions
of the Act, including authorization for the Bureau to publish a
list of eligible examinations for (ATB) students, if DOE does not
have an approved examination relevant to the specific occupational
training program and ensuring students are provided until the first
class day or the seventh day after enrollment, whichever is later,
to cancel a program and receive a refund. This bill is on consent
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on the Assembly Second Reading file.
AB 1889 (Portantino, 2010) included technical cleanup to AB 48,
allowed for the availability of remedies for actions after the
BPPVE sunset and altered the definition of graduates employed in
the field. The bill was vetoed by the Governor.
AB 2393 (Ammiano, 2010) altered the definition of "graduates employed
in the field" for apprenticeship and nursing programs. The bill was
vetoed by the Governor.
2. Arguments in Support. Supporters argue that students misled into
enrolling at a private postsecondary institution have no hope of
succeeding, but generally would already be indebted for tens of
thousands of dollars of student loans. Supporters also believe
that students lacking English proficiency are more vulnerable to
being victimized by such improper recruiting tactics and less
likely to seek out redress from a government agency. They note that
students who do not speak, read or write sufficient English cannot
understand enough of the curriculum to succeed at the course, or to
obtain work in the field, so they cannot repay their student loans.
The California School Employees Association (CSEA) believes this
bill will deter the practice of recruiting and enrolling students
with limited English proficiency and will protect students.
The Golden State Chapter of the Association of Certified Fraud
Examiners states that this bill, by requiring that non-native
speakers of English take and pass an English proficiency test which
would be independently developed and administered by nationally
recognized authority, will be extremely beneficial in protecting
student's rights and taxpayer dollars.
Legal Aid Foundation of Los Angeles writes in support of this bill,
noting that there was an English proficiency provision in the prior
law with a private right of action and that "for the most part, the
law was obeyed and enforcement was not necessary. This is not
likely to be the case if there was no private right of action. The
last Bureau of Private Postsecondary and Vocational Education did
not do a good or even a satisfactory job regarding enforcement of
the law even though the agency was required to spend half of it
revenue on enforcement." Legal Aid Foundation of Los Angeles also
argues that given the Bureau's past history of failing to protect
students or discipline errant schools, absent a private right of
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action there would be no downside for the school if it chose to
ignore the law. Legal Aid Foundation of Los Angeles is concerned
about students lacking sufficient English comprehension that need
protections when enrolling in a degree granting course because they
often do not have the skills necessary to pass the general
education courses.
3. Arguments in Opposition. The California Association for Private
Postsecondary Schools (CAPPS) states that "no institution can
educate and graduate a student who does not understand class
instruction." CAPPS argues that "attempting to enroll a
non-English speaker in an English program is a fail/fail strategy
for the student and institution" and adds that the Act and
implementing regulations are more than adequate to impose the
appropriate disciplinary actions for schools engaging in this
behavior.
Corinthian College opposes this bill, stating that it is
unnecessary and also discriminates against students whose first
language is not English and who prefer to attend a private college
by making them jump over another hurdle that is not required by
public colleges, nor required to obtain federal or state financial
aid. Corinthian believes that the bill would overlay new state
requirements on top of recently-adopted and soon to be effective
federal standards, and impose onerous legal liability on the
colleges.
8.Recent Author's Amendments. In response to concerns that this bill
would have removed uniformity created in the Act through a separate
set of standards for one category of students, including the right
of a student to bring a private right of action against an
institution for violations only pertaining to English learners and
nonnative speakers, this bill was amended. The amendments remove a
provision allowing for a private right of action. Criticisms of
previous legislation and laws governing private postsecondary
schools include code confusion and piecemeal approaches to setting
standards and providing legal remedies. The attempt to create
uniform standards and requirements for the regulation and oversight
of these institutions is one of the main reasons for rewriting the
Act and reconstitution of the Bureau. Including a private right of
action for these particular students assumes that the Act and Bureau
are not adequately and effectively protecting students, monitoring
institutions and promoting quality.
SUPPORT AND OPPOSITION:
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Support:
California School Employees Association (CSEA)
Consumer Federation of California
Consumers Union
Golden State Chapter of the Association of Certified Fraud Examiners
Legal Aid Foundation of Los Angeles
Two Individuals
Opposition:
California Association of Private Postsecondary Schools (CAPPS)
Corinthian Colleges
Consultant:Sarah Mason