Negotiated Rulemaking Committee Reaches Consensus on Slew of Issues

By Allie Arcese, Director of Communications

By Allie Bidwell, NASFAA Senior Reporter

In a somewhat surprising turn of events, the negotiated rulemaking, or neg reg, committee convened to re-write federal regulations on accreditation and innovation, distance education, faith-based entities, and the Teacher Education Assistance for College and Higher Education (TEACH) Grant program ended its months-long work in consensus on Wednesday.

The group has been working to make changes to regulatory language on these issues since its first meeting in January, and, in a departure from previous neg reg sessions, assembled three subcommittees to work on specific issues and provide recommendations to the full committee. In another first, it also divided voting into three “buckets” of issues: accreditation, the credit hour, and the Robert C. Byrd Honors Scholarship Program; the TEACH Grant program and faith-based entities; and distance education, state authorization, and competency-based issues. The decision to group the voting into blocks in itself was controversial, as some questioned the legality of the move. In previous neg reg sessions, all issues were considered as one package for voting purposes, meaning that negotiators had to agree on regulatory wording for all issues on the agenda to achieve consensus. Splitting the issues into buckets allows for the group to achieve consensus on some, but not all, issues.

With three minutes left in the day, the committee voted to approve the third and final bucket on accreditation issues. The committee started off the day tentatively approving different sections of regulatory language regarding definitions and state authorization before voting late in the morning on the first of three issue “buckets”—the TEACH Grant program and faith-based entities.

“Today’s historic action proves just how much can be accomplished on behalf of students when we put their needs above all else,” said Secretary of Education Betsy DeVos, in a statement. “Rethinking higher education required each person at the negotiating table to challenge assumptions and examine past practice in order to better serve students. I commend them for doing just that.”

She went on to say that the changes made through the neg reg process will provide more flexibility for students “to work at their own pace to earn a college degree, obtain credit for proving what they already know and earn a credential aligned with employers’ job requirements.”

“These much-needed reforms will promote competition and raise standards for our accreditors, ensure that teachers get the proper credit for service in high-need fields, restore respect for an institution’s mission, particularly faith-based institutions, put more teeth into teach-out plans and agreements to protect students from precipitous closures and engage employers more fully to ensure that the workforce elements of higher education align with employer needs,” DeVos said. “Everyone at the negotiating table—students, employers, veterans, accreditors, financial aid administrators, student legal aid organizations, and minority-serving, faith-based, online, two-year and four-year, public, non-profit and proprietary colleges and universities—overcame the naysayers to achieve consensus. I want to thank all of the negotiators and our entire team for their hard work and congratulate them on a job well done.”

As the group came to discuss faith-based issues, including eligibility for Public Service Loan Forgiveness (PSLF), Steven Sandberg, representing faith-based institutions, suggested reverting to language originally proposed by the Department of Education (ED) that would strike language generally excluding borrowers who work for religious organizations from obtaining loan forgiveness.

“What we’re doing here is making a policy decision that’s not required by the Constitution and statute,” he said. “This is as indirect as it gets, and basically saying to someone that goes to a university, ‘You can go work for any nonprofit that you like and get your loan forgiven, unless you work for the wrong kind.’”

David Tandberg of the State Higher Education Executive Officers (SHEEO) questioned whether such a change would be subject to legal challenges.

“My guess is … if we strike those provisions around proselytizing, worship services, I think as soon as the regulations take effect, there will be lawsuits, which is okay, but that will definitely get contested in the courts, for better or for worse,” he said. “These provisions are trying to allow folks to do two things at once, but only count the time spent … unrelated to proselytizing. … I’m still struggling why you’re saying this excludes people, when they could spend 10 hours in the soup kitchen, count that towards the loan repayment provisions and then spend 10 hours proselytizing. They can still do that. It just doesn’t count.”

In the end the group decided to alter the language to say that a borrower is eligible if he or she is working full-time in a public service organization, or serving in a full-time AmeriCorps or Peace Corps position. An additional sentence would specify that any time spent participating in religious instruction, worship service, or proselytizing while employed by a 501(c)(3) organization is not included toward meeting the full time requirement.

The committee made a few small changes to regulatory language for the TEACH Grant program, specifically regarding the obligation to repay a grant converted into a loan. Karen McCarthy, NASFAA director of policy analysis, specified that the language should state that the period of time between when a grant was converted until it is reconverted should be suspended from the service time requirement and any qualifying teaching service during that time frame should be counted toward completing the borrower’s four-year teaching requirement.

[Note: NASFAA will publish a more detailed analysis of changes to the TEACH Grant program in the coming days. Stay tuned to Today’s News for updates.]

The group also debated regulatory language around the disclosure of job placement rates that are used in advertising as a means of attracting students, and how institutions would be required to substantiate those claims.

“I think the issue is integrity,” said Barbara Gellman-Danley, representing regional accrediting agencies. “If we think something’s going on, we can say … we’ve gotten complaints from 50 students that say they’re not getting placed, and then we can move it to action in interacting with [institutions].”

She urged other negotiators to not get “too prescriptive.”

“I support being less prescriptive and recognizing that as accreditors, at least, the integrity kind of things we have in our standards could open up to anything,” she said. “So be very cautious about getting too prescriptive. It will come back to bite you more than being opaque, in my opinion.”

Tandberg said there have been “egregious abuses” in this area, where students are “led to believe that they will get a job in an area, and it just is not the case.”

“That’s routinely done by bad actors, unfortunately, more often than not. We have to regulate the bad actor,” he said. “That’s what we’re doing here. And it has to be done because of what has happened. It’s been reported over and over again.”

Although ED’s original proposal would have added on to the existing requirement in the program participation agreement regulations by requiring institutions to disclose the source, time frame, and methodology used for any statistics used in job placement advertising, the group eventually agreed to revert back to the existing requirement as required by the statute.

The committee hit a few roadblocks as it tackled the final section on accreditation—perhaps the most contentious issue on the table

Robyn Smith, representing legal assistance organizations representing students, took issue with deleted language that would have required an accreditor to immediately take adverse action against an institution not in compliance, and newly negotiated language extending the maximum timeline an institution or program has to come into compliance, at the accreditor’s discretion. Proposed language would have set the maximum timeline to come into compliance to the length of the program for programmatic accreditation or 150 percent of the length of the institution’s longest program.  The current maximum timeline is two years.

“That would be for a four-year institution, up to six years for a school to remain in noncompliance and still be eligible for Title IV funding,” she said.

Others at the table, including federal negotiator Annmarie Weisman, pushed back, saying the issue was discussed extensively at the previous session and what was displayed Wednesday was compromise language.

“It’s very difficult to move mountains, and if performance is such that it needs to be improved, we want to make sure we give time for someone to improve,” she said. “We recognize the difficulty and the balance that we need to strike here, but I think the idea of relying on the good cause [as the basis for extending beyond the current two-year maximum timeline] is troublesome for me because that almost sounds like saying, ‘exceptional circumstances.’ And when you say that, the examples that we talked about last week, they’re not exceptional.”

Other negotiators suggested new compromise language to maintain a timeframe—to not exceed the lesser of 150 percent or four years—and allow for accreditor checkpoints along the way to push more timely action when necessary or relevant.

Because the group reached consensus on all issues, ED will publish the agreed upon regulatory language in one or more Notices of Proposed Rulemaking (NPRMs) for public comment. NASFAA expects ED to publish NPRMs in late spring or early summer, and any final rules resulting from the NPRM must be published by Nov. 1, 2019 to be effective on July 1, 2020.


Publication Date: 4/4/2019

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