Neg Reg Committee Dives Into State Authorization and Distance Education

By Hugh T. Ferguson, NASFAA Senior Staff Reporter

The Department of Education (ED) on Tuesday hosted its second day of negotiated rulemaking for issues related to program integrity and institutional quality, this time focusing on state authorization and distance education.

The state authorization issue paper primarily concerned the oversight framework of institutions of higher education and evaluated the current complaint system and governance in state authorization reciprocity agreements. ED cited concerns that certain exemptions of state approval and licensure requirements for institutions in current regulations, such as the exemption for institutions that have been in operation for at least 20 years, “do not ensure sufficient State oversight of those institutions.”

The proposed regulatory language would also make changes to state authorization reciprocity agreements which allow institutions located in one state to operate in other states covered in the agreement through distance education or correspondence courses. According to the department, the current reciprocity system allows for the manipulation of state rules, which ED said “prioritizes administrative convenience over student and taxpayer protection.”

ICYMI: ED Kicks Off First Negotiated Rulemaking Session for Program Integrity and Institutional Quality

ED proposes to remedy that issue with two changes.

First, under the draft text, reciprocity agreements would have to require institutions to have a system in place to report student complaints directly to the state in which they reside.

Second, ED is aiming to adjust the makeup of governing boards that oversee state authorization reciprocity agreements so that they only include representation from state employees and members of the public, as opposed to current rules that permit others such as institutional representatives on such boards, which ED officials argued has the effect of states passing off their role in the accountability triad to other parties.

But committee members expressed concern over ED’s proposed limits to the makeup of the governing boards, which according to negotiators, could prohibit willing service from members whose expertise could benefit the board.

The committee also considered a proposal offered by a pair of negotiators that would create an advisory board role in the process that could help inform a governing board, but would not have any decision-making authority.

Negotiators from ED remained open to the language and said they would review the proposed text, which is currently unavailable to the public.

ED also noted that its reference to National Council for State Authorization Reciprocity Agreements (NC-SARA) in the issue paper was merely meant as an example, and was not an entity whose practices the department was looking to target. ED’s negotiator stated that it is not the department’s intention to regulate NC-SARA but, rather, any state authorization reciprocity agreement, and noted NC-SARA was not referenced in the official regulatory text.

ED also underscored that its intent with the proposed regulations was not to eliminate reciprocity agreements or do away with distance education, but instead to strengthen state authorization rules and “appropriately” regulate distance learning.

In the afternoon, discussion turned toward state authorization exemptions. Some committee members urged ED to take actions to overhaul the higher education program integrity triad, Negotiators deliberated exemptions being made for schools who have been in operation for at least 20 years, as is laid out in the current regulations, noting that the practice of changes in ownership has increased since those regulations were written and arguing that having been in existence for 20 years is less meaningful if ownership had changed in that time.

The committee then began to review and discuss proposed regulatory text on distance education.

In its issue paper, ED sought feedback on two separate issues related to distance education, which were handled separately: virtual locations and clock hour programs delivered through asynchronous learning.

On virtual locations, ED proposed to require programs offered exclusively by distance education to have their own two-digit suffix in the school’s OPE ID, as institutions currently do for additional physical locations. By including this provision, ED would be able to obtain more data on student outcomes that are currently unavailable, and better identify enrollment trends for distance education students.

The department currently has only limited data on enrollment in distance education programs since it collects such information only at the institution and program level through IPEDS. The department argued that by designating programs offered entirely online as additional virtual locations it will now have individual student level data for Title IV recipients. Among the benefits of such a change would include easy identification of students eligible for a closed school discharge in the event that an institution ceased to offer distance education.

ED also urged the committee to think over data collection options and asked negotiators to think through how often schools would need to update information that the department may request.

The department then turned to its second part of the issue paper that would remove the allowance for clock-hour programs provided via distance education to be offered through asynchronous learning.

ED claims it has seen abuse in this area with programs not properly logging academic activity that students performed, primarily because they lacked the technology to do so, which according to ED is very expensive. ED made clear that the change would not preclude clock-hour programs from offering distance education; they just could no longer count asynchronous work toward the student’s completed hours for purposes of Title IV aid disbursements.

Negotiators asked ED when these regulations would be effective and what would happen if the effective date occurs when students are in the middle of a program. ED said it had not yet mapped out that timeline, but would look for suggestions from the committee as to how to address a potential transition period.

During the public comment period, participants detailed their experiences with postsecondary programs, urged the committee to include more student voices, and discussed the governance structure of state oversight.

The committee will reconvene on Wednesday to cover the R2T4 and accreditation issue paper.


Publication Date: 1/10/2024

Peter G | 1/10/2024 2:15:54 PM

While to a point I empathize with ED's wanting to look at some of these areas, from the standpoint of actual regulatory development this all feels way underbaked and with not enough of the right cooks in the kitchen to do it right on this pass.

On the R2T4 piece in particular, I was mildly optimistic when they said they were bringing it up for discussion, but I'm feeling mixed to negative about the issues (much less solutions) they have at the forefront.

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