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How to Start a Driving School in Oregon: A Step-by-Step Guide
Here you’ll learn everything you need to start your Driving School in Oregon
The Oregon rules for starting a driving school and becoming an instructor are pretty straight forward. The people involved in the office also seem to have a sense of humor.
Oregon driver training schools may offer classroom instruction, behind-the-wheel training, or both. Your students will be waived through the state skills testing if you pass them through your road course.
How to open your driving school in Oregon
- Starting a driving school in Oregon requires a license from the Department of Transportation
- Oregon driving school licenses last for the calendar year.
- Driving school owners/operators do not have to be driving instructors.
- Oregon driving school instructors must be at least 21 to teach behind-the-wheel.
- Your Oregon driver training school may be based anywhere.
- Your driving school vehicles must be insured and in safe operating condition.
- Your records must be kept at one location, but you are not required to have written contracts
- You may provide classroom driver education, behind-the-wheel training, or both.
- If you are an approved provider, your students may not have to take the state road test.
Driving School Licensing and Requirements
To operate a driving school in Oregon, you will need to be licensed by the state. Licenses are valid for one year, and expire on December 31. In addition to a completed application form, your application packet should include the following — most of the forms are in the application packet
- A completed insurance certification form and surety bond in the amount of $2,500.
- A copy of your schedule of fees and charges for instruction.
- An email address.
- Proof of registration with the Corporation Division of the Secretary of State’s office.
- The application fee of $200.
The current regulations for Commercial Driver Training Schools are straightforward and clear. Driving school instructors and owners should know and comply with them–they allow a wide range of operation but, since it’s Oregon, they are probably strictly enforced.
Oregon requires the following minimum liability insurance coverage:
- $100,000 bodily injury to one person
- $300,000 bodily injury to more than one person
- $50,000 property damage
If you offer classroom-only instruction, you do not need insurance on your school vehicles. General liability insurance covering your premises, however, is probably a wise idea.
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
Oregon places few personal requirements on owners/operators of driving schools. The main bar would be conviction for a number of crimes involving fraudulent behavior or moral turpitude.
Operators of a driving school in Oregon must be at least 21 years old. Operators and owners are subject to criminal background checks.
Renewal applications must be submitted by the 31st of December. The DMV will give a grace period of 45 days to allow the renewal application to be processed. We recommend submitting by the end of November.
You may not operate without a license for your program, and it is expected that your program of instruction will meet or exceed the requirements set by the DMV.
Driving Instructor’s License
While no specific requirements are set for driving school owners, instructors must demonstrate qualification before they receive a license from Oregon. Licenses expire every December 31, and there is no grace period; the state will mail a renewal notice to the school.
Submit the application form and the $100 fee. Instructors must meet the following qualifications.
- Driving instructors must be 19 to provide classroom instruction, and 21 to conduct behind-the-wheel instruction
- They must have been driving under a valid license for 3 years for classroom instructors, and 5 years for behind-the-wheel instructor.
- The instructor’s corrected vision in both eyes must be 20/24.
- The instructor has not been convicted of a variety of offenses.
You will have to pass written and behind-the-wheel exams, although classroom-only instructor do not need to take the latter exam.
You are generally free to establish your business anywhere you see fit–meeting the requirements outlined below. You can choose to have classroom space, or you may conduct classroom driver education at off-site locations, including local public or private schools. Your contract with the school or other location should be included in your license application.
Your office space must meet local and state building requirements, and it must be accessible to the public during your regular business hours. You must have at least one location where records will be maintained.
You may not locate your school within 1,500 feet of any office of the Division of Motor Vehicles.
Your school and instructor certificates must be conspicuously, along with any inspection reports. You must also post a complaint policy which includes DMV contact information. You must also have available, either on paper or via the internet, the most current Oregon Vehicle code at each location.
Records must be maintained at your main business office.
Classroom facilities must be in a building suitable for instruction. Compliance with local and state sanitation requirements is expected. The classroom must be equipped with suitable desks, tables, chairs and other items appropriate to the setting.
Do not provide behind-the-wheel instruction to students on routes used by the DMV for road tests.
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.
Your vehicles need to have dual controls for the brakes. They must meet current Oregon safety standards, have seat belts, and contain appropriate emergency equipment.
Signage needs to be on the vehicle, identifying the name of the school and telephone number–letters must be at least 1.5” high and .5” wide, and be visitable from front and rear or the sides. “Student Driver” signs should also be visible from the front and rear.
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:
- Name, license/permit number for each student
- Name and certificate number of each Instructor working with the student.
- Hours, dates, and types of training for each student.
- All contracts with the student.
- A copy of the school’s grievance procedure.
- Instructor records including personnel information for all instructors.
- Copies of all Instructor certificates.
- A monthly roster for all instruction, including student information.
You are not required to have written contracts, but you’re probably wise to do so.
The Driving School Curriculum in Orego
Driving schools in Oregon may offer classroom instruction, behind-the-wheel instruction, or both. You can become an Approved Provider of driver education of teens under 18, subject to some higher restrictions from the state. The advantage of being an Approved Provider is that your students won’t have to take the state road test if they pass yours.
Your curriculum must be approved by the Department of Transportation. The Classroom portion must last for 30 hours. Students must also receive 6 hours behind-the-wheel, 6 hours of observation, and 5 hours of supervised practice. Hours are clock hours, and don’t include any breaks you build in.
Your classes are subject to the following time limitations:
- Classroom instruction must not exceed 3 hours per day and 6 hours per week.
- Behind-the-wheel instruction may not exceed 90 minutes per day and 120 minutes within 7 consecutive days.
- Observation time may not exceed 3 hours per day or four hours within 7 consecutive days.
- No fewer than 4 nor more than 10 hours of classroom instruction may take place before behind-the-wheel instruction begins.
- The supervised 5 hours is to be completed at home.
- A course may not be completed by a student in less than 35 days nor more than 180.
- During the summer, the course must last at least 3 weeks, with no more than 3 hours of classroom instruction per day, and 10 hours per week.
- Summer courses still must span 35 days total, and the behind-the-wheel times are not affected.
- With parental consent, observation time may be converted into behind-the-wheel time on a one-for-one basis.
You may use any curriculum, including creating your own, but using the Oregon Playbook completely will get automatic approval.
Instructors for this special curriculum must be certified. The requirements parallel those for regular instructors of adults. More continuing education is required.
You must include a parent meeting during the course (outside the 30 hours). The curriculum must cover:
- All types of Oregon roads
- Driver responsibilty
- Preparing and controlling the vehicle
- Use of signs, signals, markings, and roadway types
- Handling all types of intersections
- Maneuvers, traffic flow and time/space management
- Defensive driving and rulles of the road
- The laws of physics and driving
- The effects of physical and emotion condition on driving
- Imparied driving
- Emergency situations
Behind-the-wheel must be concurrent with the classroom instruction.
When students successfully pass your tests, their state skills tests are waived. You will need to have your drive test route approved. Click on the “Final Driver Route Forms and Information” menu to get the forms.
As an approved provider, if you provide scholarships of $75 to students who demonstrate eligibility for free/reduced lunches at school, the state will reimburse you $75 for each student.
You will be able to add a 12% profit onto your class after calculating income minus expenses related to the class. It’s probably the case that if you are incorporated and make yourself an employee of the corporation, you’ll be able to pay yourself a salary and claim the profit as well, but check with your attorney first.
The forms for reimbursement and the annual assurance of compliance are available on-line, at the “Forms” menu.
Commercial Driver’s License Instruction
CDL training is not required to get a license, but it’s certainly going to be helpful.
To open a CDL school you will need to be approved by the Oregon Higher Education Coordinating Commission as a Private Career School. The commission’s webpage provides all the forms you’ll need.
Starting a Small Business in Oregon
Your driving school is not just subject to the requirements for driver’s education in Oregon. 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.
All businesses need to register in Oregon, 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.
Your business, regardless of structure, must be registered before you apply for your license. Register your business with the Oregon Secretary of State.
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.
Note that it appears that the Department of Transportation requires you to register with the Secretary of State, even if you are not using an assumed name.
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 Oregon. 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 Oregon. 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.
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 Oregon, 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.
Oregon’s structure is designed to make sure that driving schools are affordable to all teens; but schools may teach adults as well with less regulation. You’ll have to decide the best approach for your business — although it’s fair to say that offering the full Oregon driver education course will appeal to a larger market.
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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