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How to Start a Driving School in Colorado: A Step-by-Step Guide

Here you’ll learn everything you need to start your Driving School in Colorado

Colorado’s process for starting your commercial driving school is easy and straightforward, although you’ll have to contact the state DMV for the forms.

You will be able to offer behind-the-wheel and classroom instruction to your students once you start up your commercial driving school.

How to open your driving school in Colorado

Driving School Licensing and Requirements

General requirements

To operate a driving school in Colorado, you will need to be licensed by the state. Licenses are valid for one year. The forms are not available online; the entire packet is available from us, however, but you should contact the DMV anyhow as you begin the process. In addition to a completed application form, your application packet should include the following:

  • Copies of your state/county/municipal business licenses
  • Copies of home occupation permits, if you are operating from home.
  • The complete curriculum you will be offering for both the core 30-hour course and the 6-hour behind-the-wheel course you will offer.
  • A surety bond of $10,000.
  • Enter into a contract with the Department
  • A copy of your lease/rental agreement for your premises.

The current regulations for Commercial Driving Schools are straightforward and clear–scroll to Rule 8.

Colorado requires the following minimum liability insurance coverage:

  • $1,000,000 general liability insurance
  • $1,000,000 automobile liability

If you have employees, you must carry workers’ compensation insurance covering them–and potentially you–in the event of injury while on the job. You should, of course, consider higher coverages and/or an umbrella policy to cover your operations.

Driving School Owner’s License

Colorado places few personal requirements on owners of driving schools. The main bar would be conviction for a number of crimes involving fraudulent behavior or moral turpitude.

You may not operate without a license for your program.

You must be recertified annually. Your certification expires on December 31 each year.

Driving Instructor’s License

Driving school instructors must demonstrate certain qualifications before they receive a license from Colorado. Submit the application form. Instructors must meet the following qualifications.

  • Be at least 21 years old. and have at least a high school diploma (or the equivalent).
  • Have a valid Colorado driver license
  • Pass a background check.
  • Have no more than 8 points on their driver’s license.

The instructor’s other qualifications, training, and experience are up to the commercial driving school.

Your instructors may become Basic Operator’s Skill Testing (BOST) tester.

Instructor licenses must be renewed annually.

Location

You are generally free to establish your business anywhere you see fit–meeting the requirements outlined below. You must have classroom space available, and you may not operate out of a residence.

You must also be able to store forms issued by the DMV securely. Your office hours must be posted conspicuously. If you are using public facilities for your classroom, instructors must have a copy of the school’s certification and classroom waiver in their possession.

Your office space must meet local and state building requirements, and it must be accessible to the public during your regular business hours. It must be accessible to persons with disabilities.

Your classroom must be large enough for all students and the instructor, have current presentation equipment, clean restroom facilities, and adequate parking. The Department must approve all classroom facilities.

Your school certificate must be displayed prominently, along with signage which indicates that your school is not an agency or representative of the DMV

If you offer classes at temporary or remote sites–a high school classroom, for example–you have to file with the department on a monthly basis..

Records must be maintained at your main business office.

If you are a BOST organization, you must also designate two testing routes, which must be approved by the department. You will need to administer at least 24 drive tests per year–as well any BOST testers on your staff.

Your school name cannot be substantially similar to that of another driving school, and you may not use the words “State”, “Government”, “Municipal”, “City”, or “County” in the school name, and you must use your school’s name only in advertising and publicity.

Don’t ever give a student or parent the impression that your instruction guarantees receiving a driver’s license–you may mention your pass rate.

Vehicles

Your vehicles need to have dual controls for the brakes. They must have passed the most recent Colorado safety and emissions inspections.

Records and Contracts

You will need to keep records of all students and instruction for at least three years after they finish their training with you. The records you need to keep are outlined in Section 500 of the regulations:

  • All contracts and records of instruction for each student, including student name, date of birth, license/permit number, and for ADEC schools, the dates and types of instruction, signed by the instructor.
  • All agreements with other persons to provide instruction, including details.
  • Driving skill tests records

Your advertising must indicate your principal training location.

You must provide students with written contracts. The contracts must contain, at a minimum, the following:

  • Classroom instructions–dates, times, lengths of each lesson; total hours; cost.
  • Behind the wheel instruction–length of each lesson, number of lessons, rate per lesson, vehicle charges, and cancellation/rescheduling policies.
  • Statements indicating that the agreement is the entire contract between the school and student, and that an instructor may provide behind-the-wheel instruction to more than two students in a session.

The Driving School Curriculum in Colorado

Driving schools in Colorado offer the core course of 30 hours classroom instruction and 6 hours of behind-the-wheel training. You may also offer the four hour driver awareness course.

Colorado places no time restrictions on your course. You may organize it as you see fit, being realistic about teen availability on school days.

Your 30 hour course must be organized around the following topics:

  • Basic and advanced driving techniques
  • Rules of the road and state/local laws
  • Risk assessment and accident causes
  • Preparation and fitness for driving, including the effects of drugs and alcohol
  • Critical vehicle systems
  • Vehicle and community systems which help avoid crashes or protect the driver
  • Signs, signals, and highway markings and design
  • Rural, freeway, and urban operation
  • Pedestrian safety, motorcycles, and bicycles
  • Ownership and insurance responsibilities

Commercial Driver’s License Instruction

You’ll need to work with the Division of Private Occupational Schools and the Department of Higher Education to be licensed as a CDL school. The application is available online. It guides you through all the required material you must submit.

You will need to provide a surety bond as well as a catalog and program description. Your premises will need to be inspected before you open.

Much of the information you’ll need is in the FAQ document on the application page.

Instructors will need at least 2 years of work experience with a CDL of the class to be taught by that instructor. Instructors need to complete an application.

Starting a Small Business in Colorado

Your driving school is not just subject to the requirements for driver’s education in Colorado. You also need to establish your Driving School as a small business, and have to consider a number of factors. The form of business you take up, as well as the procedures, are appropriate topics of conversation with your lawyer and accountant. The considerations we offer here are not legal advice, but should provide you with things to think about as you set up your business.

Business Registration

All businesses need to register in Colorado, especially the business name—the “doing business as” certificate. Banks may not be willing to set up your account until you have that DBA form. We’ll include where to register in the business structures below.

You will also need to obtain a Federal Employer Identification Number. Banks may need it for your business accounts, and you may be wanting to employ people. To obtain an EIN, go to the IRS website and complete the application form you find linked there.

You should also register with the Colorado Department of Revenue.

Business name

Before you get going, you’ll want to check to see if the business name you want is in fact available in Colorado. You can search the Colorado database, as well as visit the office of the county recorder.

Once you know your business name is available, you can reserve it with the Secretary of State’s office.

Sole Proprietorship

Owning your own business is the easiest one to set up, but also may open you to liability concerns. As a sole proprietor, your business is simply part of your life. You keep a separate set of books, and complete a Schedule C for your 1040 form every April.

Sole proprietorships can expose the proprietor for full liability, even with insurance. That may mean that if you are sued, you may lose your home and property, as well as your personal bank accounts and other assets. This risk may not be worth the ease and independence.

In Colorado, the big step you have to take is to register your trade name with the Secretary of State.

Corporations and LLCs

You may set up a full corporation (“Inc.”) as your business structure. Corporations limit your liability for loss to your investment in it, as a general rule (although banks may require you to be obligated personally if you take out a loan to get your business going). This form of business keeps your personal assets safe.

As an owner of a corporation, you’ll have to set up your driving school consistently with the rules for corporations in Colorado. You’ll also have to decide whether to be an S Corporation or a C Corporation. Generally, the S Corporation form is set up for small businesses. It allows income and taxes to pass through to the owners. You will want to discuss these forms with your attorney and accountant.

You may be able to set your driving school up as an LLC in Colorado. The LLC form provides the same limited liability as a Corporation, but do not have to comply with the corporate formalities most states require, including items like bylaws, required stockholder meetings, and minutes (although minutes of meetings are probably a good idea).

You’ll have to discuss the advantages and disadvantages for the LLC with your attorney and accountant.

Both Corporations and LLCs file with the Secretary of State. In addition to name reservation, you’ll need to submit the following forms

Now What Do I Do?

Once you’ve complied with all the legal requirements to be both a driving school and a small business in Colorado, you need to get students.

Getting students requires marketing—largely on the internet. You will need the following systems set up to obtain students:

  • A website—focused on the types of students you want to attract, and aimed at your locality.
  • The website should also include a blog, which allows you write about a variety topics and engage in Search Engine Optimization—which will drive traffic to your site.
  • A Facebook page, linked to your website, to become noticed and drive traffic.
  • Getting testimonials from successful students.

Marketing is something you will have to devote time to. DrivingSchool.Marketing can help you get the best bang for your marketing buck.

Conclusion

That’s all there is. The Colorado process to start a driving school is easy and the regulations are both light and sensible.

Disclaimer: This page is part of DrivingSchool.Marketing’s series of state and provincial pages designed to help entrepreneurs like you start driving schools. States change their regulations, or the web pages they host their forms. While we believe these rules are accurate as of the date of publication, we cannot guarantee full accuracy. Please let us know if you spot any problems.

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Josh Meah

Josh Meah

Josh is the CEO of DrivingSchool.Marketing. His goal is to be the marketing and business development partner of driving schools around the world, helping them become thriving businesses while also expanding general awareness for the importance of traffic safety standards and education.

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