Benjamin Franklin University, a privately owned business school that has operated for 74 years in downtown Washington, has been put on notice by the city that it must broaden its curriculum and modernize its administrative and academic organizations if it is to continue granting degrees to its graduates.

The D.C. Educational Institution Licensure Commission has voted to give the university only provisional authority to grant its degrees until next March 5, and has told it to establish courses in the liberal arts and fields other than business and accountancy, which have been its specialities.

The commission, which oversees all educational institutions that are not operated by the District government, gave Ben Franklin until May 31 to file plans for improvements and other documents.

"We're on the way to getting it [the commission's requirements], straightened out," Harold W. Goldblatt, the school's dean of faculty, said yesterday. "We were already in the process of doing it," before the commission acted, he added.

The commission came on a routine application by the university for continuation of its degree-granting power. Since the commission came into being about two years ago, all schools under its jurisdiction have been required to undergo such a review. Last year, prior to the review, the commission questioned Franklin's right to award bachelors' and masters' degrees in commercial science, but in the end it permitted the school to award such diplomas to 75 affected students.

Franklin grants two types of associates' degrees for two-year courses and two bachelors' degrees for four-year courses in business fields, and a master of science degree in financial management and taxation.

In its order, the licensure commission also told Franklin to submit evaluation reports by accrediting agencies and to present a plan to establish new governing procedures, an academic structure with more formal procedures than now exist and an administrative organization "reflecting a more contemporary approach to management. . ."

Franklin, founded in 1907, has operated under its present name since 1925. It has had only two presidents in the ensuing 56 years -- the late John T. Kennedy and his widow, Clephane, 84, who currently holds that position. The Kennedy family owns the university building on the northwest corner of 16th and L streets NW.