ED's Delay of State Authorization Rules Evokes Mixed Reactions

By Emily Isaacman, NASFAA Communications Intern

The Department of Education (ED)'s May decision to delay implementing state authorization rules on distance education has been met with wide-ranging opposition and little support, according to comments from the public submitted in the weeks following the announcement.

The Program Integrity and Improvement rules were set to take effect July 1, 2018 as determined by a lengthy negotiated rulemaking process under the Obama administration.

ED cited confusion and administrative burden, identified through two letters it received in February, as grounds to reconsider the rules and prevent them from taking effect until 2020.

"These issues are more complex than we understood when we considered them in 2016," ED's notice said.

The regulations would require institutions offering distance education programs to students residing in states where the institution is not physically located to meet those states' requirements for legally offering distance education. This would ensure students have access to information that can help determine which program is appropriate for them. State authorization is a longstanding eligibility requirement for institutions to receive federal financial aid.

A letter from Sen. Patty Murray (D-WA) and Rep. Bobby Scott (D-VA), ranking members on the Senate and House education committees, respectively, wrote in comments to Education Secretary Betsy DeVos during a fifteen-day comment period that the state authorization rules would protect students and increase transparency.

"Contrary to the Department's claims, maintaining the effective date of the rule is practicable, necessary, and in the public interest," the lawmakers wrote.

Murray and Scott, along with several Democratic state attorneys general, asked ED to release additional guidance rather than embark on a complete re-write.

The lawmakers argued the delay would negatively affect students, state actors, and taxpayers by withholding key consumer protections and information.

State oversight is especially important for for-profit schools, the attorneys general wrote, where the majority of students are enrolled in some distance education courses.

But even Laureate Education, Inc., a for-profit college chain, submitted a letter advocating for supplementary resources such as Dear Colleague letters and a Frequently Asked Questions document in place of prolonging the regulations altogether.

"The presence of complexity and imperfection do not serve as justifications for delay of these long-sought regulations," the letter said.

If ED stands by its decision, the regulations will be added to a slew of proposed rules set to undergo negotiated rulemaking sessions this year. A new version could be enacted in summer 2020 at earliest — if they are negotiated at all.

The PROSPER Act, the House Republicans' bill for reauthorizing the Higher Education Act (HEA), would prohibit ED from regulating state authorization. While the bill is unlikely to come to the House floor for a vote, this provision would void any future negotiated rulemaking sessions on the distance education regulations.

Nicholas Kent, senior vice president of policy and research for Career Education Colleges and Universities, said the Obama Administration's focus on consumer protections in part encouraged states to develop robust consumer protections on their own, through state legislatures and administrative agencies.

If these protections are already established by the states, Kent said, it might be worth reassessing the need to implement similar regulations through the federal government.

"This over-regulating within the triad is one major cause for why tuition continues to rise at many of our nation's schools," Kent said. "In this instance, it may be more appropriate for the current administration to eliminate the rule rather than revise it."

The Obama administration held four sessions of negotiated rulemaking and considered 139 comments over four-and-a-half months before publishing the final rule in December 2016, when it entered a two-year waiting period due to existing statutory master calendar requirements.

ED has dismantled a number of Obama-era higher education regulations, including the gainful employment rule and the borrower defense rule, as part of DeVos' deregulatory agenda.

ED said the February letters — received four months before the regulations were set to take effect — allowed the department to bypass the standard 12-month negotiated rulemaking procedure required for determining a delay.

One letter, from the Western Interstate Commission for Higher Education (WICHE) Cooperative for Educational Technologies, the National Council for State Authorization Reciprocity, and the Distance Education Accrediting Commission, pointed out the regulations failed to define the term "residence," which is a key aspect of state authorization.

The other inciting letter, sent by the American Council on Education (ACE), simply requested ED clarify the rules — not revise or eliminate them.

Dan Madzelan, associate vice president for government relations at ACE, said he did not expect ED to delay the regulations, but was "not displeased."

"We think that perhaps they've been unable to clarify it in a way that they felt comfortable with," Madzelan said.


Publication Date: 6/15/2018

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