State Authorization of Institutions for Out-of-State Activities
States expect institutions to obtain approval for regulated activities that occur in their state. These activities may include; online learning, practical experiences, faculty teaching from another state, marketing, advertising, and more. The requirements as to which activities require authorization, the application processes, and the costs to comply vary greatly from state-to-state.
In 2010, the U.S. Department of Education (USED) issued a regulation tying an institution's ability to offer federal financial aid in a state to the institution being authorized in the student's state. The regulation, 34 CFR 600.9 (c), was subsequently "vacated" by federal court ruling and therefore unenforceable.
December 2016, USED released the new federal regulations for State Authorization of Postsecondary Distance Education, Foreign Locations. Effective date: July 1, 2018. https://www.gpo.gov/fdsys/pkg/FR-2016-12-19/pdf/2016-29444.pdf
Regardless of the status of the federal regulation, institutions are legally obligated to comply with the laws and regulations of the states where the institution participates in regulated activities.