Trump Administration Requests to Delay Another Higher Ed Oversight Regulation

By Joelle Fredman, NASFAA Staff Reporter

As the Department of Education (ED) is working to rewrite gainful employment and borrower defense to repayment regulations after hosting a series of negotiated rulemaking sessions following an announcement to delay the rules last summer, the Trump administration may push off the effective date of another set of regulations aimed at protecting students from abuse by universities — this time related to distance education programs.

ED sent a proposed rule to the Office of Management and Budget (OMB) Thursday requesting to delay “state authorization” regulations set to go into effect July 1, though it is unclear for how long. ED had previously mentioned plans to rewrite the regulations in a January 2017 Federal Register notice, along with other Obama-era rules that had yet to take effect, such as those related to borrower defense and TEACH Grants.

ED published final rules related to state authorization of distance education in December 2016, following a Notice of Proposed Rulemaking. The regulations would require institutions that offer distance education programs or correspondence courses to students in states where the institution is not physically located to meet those states’ requirements for legally offering postsecondary distance or correspondence education, or to participate in a state authorization reciprocity agreement such as SARA. The regulation also mandates that institutions document that there is a state process for review and appropriate action on student complaints for each state the institution enrolls students or, where applicable, via reciprocity agreement.

Additionally, the regulations would require institutions that offer at least 50 percent of a program in a foreign country to obtain authorization to operate from the government in that country, and create 11 new disclosures for distance education programs, such as consumer complaints and state refund policies.

Several outstanding questions remain from the December 2016 rules. While then-Undersecretary of Education Ted Mitchell provided a written response in January 2017 to a request for clarification from the National Council for State Authorization Reciprocity Agreement (NC-SARA) and WICHE Cooperative for Educational Technologies (WCET) about the recognition of reciprocity agreements when there is a conflict between the agreement and state law, no formal guidance has been issued to definitively address the concerns raised by those organizations. Other language in the rules refers to the student’s state of residence despite the fact that state authorization is based on the location of the student while enrolled, leading to concern about whether institutions must collect both the student’s location and legal residence.

ED recalled two other Obama-era consumer protection regulations last summer. Borrower defense and a central disclosure requirement of the gainful employment regulations were set to go into effect July 1, 2017, though one month prior, Education Secretary Betsy DeVos announced they would be subject to rewrites following negotiated rulemaking sessions. The borrower defense session concluded in February, and gainful employment sessions finished last month — both with no consensus from negotiators. It is still unclear what the process will be following the potential delay of state authorization regulations.

While the regulation cleared Congress in early 2017, when it was eligible for repeal by the new session, House Republicans included intentions to strike these regulations in their bill to reauthorize the Higher Education Act (HEA). Their proposal, the PROSPER Act, has been awaiting a vote on the floor since December.


Publication Date: 4/24/2018

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