LAS VEGAS SUN
Two computer training schools in Las Vegas have gone out of business in the past two months, apparently because of cash flow problems and extermination of the Y2K bug.
Students, however, have plenty of computer training options remaining in Las Vegas. And if they are due tuition because of the closures, they can recover funds through a state office.
The Commission on Postsecondary Education, which regulates private postsecondary schools in the state, has a $250,000 recovery fund from which students can be reimbursed.
David Perlman, administrator of the commission, said schools that have been in operation in Nevada for less than about three years also have bonds posted with the state that can be drawn upon if a school closes its doors. Perlman said he doesn't know if any students are owed tuition.
One expert believes changing trends in how people learn to use computers are to blame for the closure of the schools. Another said the Y2K bug may have been partially to blame.
Computer Skills Institute, one of the city's oldest training operations, closed Dec. 30, Perlman said. He said he hasn't heard directly from the company about why it closed and how many students are affected.
The school, which offered courses in Microsoft and Novell programs and Internet applications on IBM-compatible machines, was based at 1820 E. Sahara Ave. No. 201.
Calls to the school go unanswered and company's owner and president, Nancy McRight, could not be reached for comment.
McRight was the Small Business Person of the Year for the city of Las Vegas in 1998. Some of McRight's acquaintances said she told them the business was struggling last fall.
Another company that taught computer programming in Las Vegas has filed for Chapter 7 bankruptcy in Utah.
Vitrex Corp., an Ogden, Utah, company that last year was named one of the nation's fastest growing private companies by Inc. magazine, had four classrooms with a capacity of 52 students at the Credit Union Plaza, 3100 W. Sahara Ave.
The company offered weeklong classes in computer programming, with training in Java, C++, Oracle, Delphi and AS 400.
Vitrex was established locally in 1994 and had 35 employees.
The company acquired in 1997 the assets of the local office of New Horizons, a computer training franchise, to expand its Las Vegas presence. The company said at the time of the acquisition that it planned to turn the Las Vegas facility into a national training center.
Layton, Utah, attorney David Miller filed Vitrex's bankruptcy petition in January. A hearing on the petition is planned Feb. 17 before Judge Judith A. Boulden.
A Chapter 7 bankruptcy filing usually occurs when a company plans to liquidate its assets and cease operations.
The Vitrex facility in Las Vegas is closed and its telephone has been disconnected. The Associated Press reported the company's Ogden headquarters was empty and an answering machine was filled with unreturned messages.
The Standard-Examiner newspaper reported the Vitrex office in Layton, Utah, closed its doors in November and instructors were left without jobs and students without the training they had paid for.
Jim Mandeles, the director of Vitrex's Las Vegas operations when it acquired New Horizons, left the company two years ago and now works as a consultant for PCS Amerinet, Salt Lake City.
Inc. magazine reported Vitrex had 1998 revenues of $11.7 million, up from $369,000 six years earlier. The company grew from six employees in 1994 to 160 in 1998.
In December, the company sold an Internet service provider business and closed its sales offices.
Vitrex Chief Executive Officer Jerry Ropelato could not be reached for comment.
The Commission on Postsecondary Education's Perlman said his office has begun efforts to collect Vitrex's $10,000 bond. Companies are required to post a bond when they receive a nine-month provisional license to operate in the state. State regulations say schools must be bonded for two years beyond the duration of the provisional license.
In addition, the Nevada Legislature in 1995 required all private postsecondary schools to contribute to a student tuition recovery fund beginning in 1996. The legislation authorized the fund to grow to $250,000 and schools were required to contribute $5 for every new student they enrolled.
Because the fund has reached the $250,000 ceiling and is funded by compounded interest, schools no longer are required to contribute.
Now, the fund will be used to reimburse students who have paid for classes but haven't received instruction through school closures. Perlman said students must submit claims with receipts and other proof.
"We haven't had a closure like this in more than two years and now we've had these two recently," Perlman said. "Usually, when a school closes it's because of a merger.
"What's unusual is that Vitrex was one of the better computer schools and we never had a complaint about them," he said. "Students said they couldn't believe they would close. The equipment was new and the facility was nice."
Former Las Vegas Vitrex instructor Steve Weaver said staff members have found other jobs and students have been invited to finish their schooling with other companies.
Weaver is with a New Horizons franchise that late last month opened an office at Lake Mead Boulevard and Buffalo Drive.
Bob Wells, a former Union Bank of Switzerland executive in Chicago and New York City, retired from the banking industry and moved his family to Nevada to raise the New Horizons banner in Las Vegas.
The training center is in the process of obtaining its state license and can't yet accept individual customers. But regulations allow the school to train business clients and New Horizons offers classes in applications like word processing, building spreadsheets and data bases.
When the company becomes fully certified, it will add technical courses that will produce engineers that can administer networks in a business setting.
Wells said he has put out the welcome mat for former Vitrex students -- but so far, no one has come knocking at his door.
"We have offered to be of assistance," Wells said, "but no one has come forward to say, 'Please teach me.' If someone out there needs training and got stiffed by Vitrex, we want them to give us a call."
Wells said his company should offer some continuity for Vitrex students because he has Vitrex's lead technical instructor, Weaver, on staff.
Weaver, who went to work for Vitrex after it took over the original New Horizons, said his school and ExecuTrain of Las Vegas, 2300 W. Sahara Ave., have sought former Vitrex students.
Weaver said he received all the pay owed him by Vitrex and the company did everything it could to serve students and be fair to its employees. He attributed the company's failure to growing too fast and not having the cash flow necessary to maintain the rapid growth.
"They were slowly cutting back (through 1999)," Weaver said. "Then in the fall, things got worse and management didn't want to lay anyone off."
Weaver said in September and October, the demand for computer experts to handle Y2K computer glitches crashed.
"At around that time, people began saying, 'We really don't need this,' and the demand fell off," Weaver said.
Jaymie McMullin, head of JAG Media Design, whose company has graphic designers who receive computer training, said the method of learning computer programs is changing and that may affect training schools.
McMullin, who followed Computer Skills Institute's McRight as president of the Southern Nevada chapter of the National Association of Women Business Owners, said tutorial programs, on CD-ROMs or downloaded from the Internet, are giving computer operators flexibility in learning new programs without a classroom.
"Tutorials are available 24 hours a day," McNullin said, "so you can learn a new program at 3 in the morning if that's convenient for you."
Wells disagrees. He thinks the market, particularly in Las Vegas, is better than ever for in-class computer instruction.
"There are about 450,000 to 500,000 PCs in Las Vegas and the people who own them are using only 10 to 20 percent of their capacity," Wells said. "People do need training opportunities."
Wells said when the Windows 2000 upgrade is released by Microsoft, probably later this month, many operators will need to be trained in new applications or will have to have their certification upgraded.
He said many people who buy a tutorial look at it when they first get it, but don't follow through on the entire program. Classes, he said, are a more interactive learning experience.
Wells also said New Horizons plans to offer computer classes in Spanish to serve the rapidly growing Las Vegas Hispanic community. He said courses in Spanish will be more comfortable to people who use English as a second language.
"We really feel things are starting to happen on the technical side in this city, that's why I came here," Wells said. "Las Vegas used to be the laggards. Now, we're really starting to hit the map."
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-- Dee (T1Colt556@aol.com), February 19, 2000