What Would Repealing the Federal ‘State Authorization’ Regulation Accomplish?

Last week, Cyd Grua, from the Utah System of Higher Education asked me:

OK, Russ, I am going to ask what is probably a really dumb question:  with or without Department of Education involvement, we all now know the states and territories have 50+ sets of criteria for doing business in a state.  And the state regulators, often an agency other than education, knows we know.  Even if DOE backs off further, do we not have an obligation to contact states and territories if we serve students within their borders?  Cyd

Cyd was responding to an announcement that I had sent to WCET members about federal legislation to repeal the ‘state authorization’ and ‘credit hour’ regulations.  Before I answer her question, here’s some quick background on the legislation and what might happen to the legislation as it moves forward.

The Legislation

The U.S. Department of Education released  regulations on state authorization last October and a new definition on credit hour earlier.  State authorization arose from concerns in protecting the federal financial aid process.  Rep. Virginia Foxx (NC) and 24 co-sponsors introduced H.R. 2117 (the ‘Protecting Academic Freedom in Higher Education’ Act) with the intent of repealing the two regulations.  Rep. Foxx called the measures a “classic case of federal government overreach.”  In support of the legislation, the American Council on Education sent a letter of support on behalf of 78 higher education organizations to Rep. Foxx, praising the repeal effort.

The House Education Committee approved the measure last week on a 27-11 vote.  Some were elated by this outcome.

What’s Next?

Well…I’m just some guy from Colorado, but here’s how I see it…

• House passage of the bill – very likely.
• Senate passage of the bill– not very likely at this time.
  • Sen. Harkin (IA)  seemed unhappy about the softening of the ‘gainful employment’ regulations and might rally the troops to hold the line.
  • The Senate HELP Committee, chaired by Sen. Harkin, has become fractured down party lines on the for-profit issues.  That will increase the difficulty of talking Senators into jumping the chasm, unless their constituents are very persuasive.
  • In a press release, Rep. Foxx states “The state authorization regulation requires states to follow federal requirements when deciding whether to allow individual colleges and universities to operate within the state.”  This is simply not true.  They will need better arguments.

• Signed into law by President Obama– not very likely at this time. This would undermine the President’s Department of Education, but could become law if it becomes part of an agreement on larger issues.  Stranger things have happened.

Six Reasons Why We Should Not Support the “State Authorization” Section of H.R. 2117

Below are reasons why we should not support the “state authorization” portion of this legislation.  As for the “credit hour” debate, that is a separable issue that I will leave for another time.

In developing these reasons, I received help from Diane Goldsmith (WCET’s Steering Committee Chair) about some core principles underlying our thinking.  We kept coming back to the underlying principle that:

        States have always had the right to regulate higher education offerings to those in their states.

1)  If H.R. 2117 becomes law, the state regulations still remain

This takes us back to Cyd’s original question.  She is correct.  Repealing the federal regulation will have no impact on the regulations already existing in the states.  Are Rep. Foxx, ACE, and the 78 agencies that signed the letter suggesting that institutions should ignore state laws and regulations?  That is the only way that they will achieve the relief they describe.

Accrediting agencies will still expect institutions to follow state laws.  States will expect them to do so, as well.

Personally, I cannot advocate that institutions continue to ignore state laws as they have in the past.

Believe me, I understand the objections to the rigorous requirements and outrageous costs for compliance in several states. I, too, object to those.  But, removing the federal requirement does not remove our responsibility to comply with state laws nor does it change the requirements in those states.

The states should not get off easy on this point.  I have come to the conclusion that:

        It is not unreasonable to expect institutions to follow state laws.

        State laws should not expect institutions to do the unreasonable.

It’s 2011 and an alarming number of state laws are antiquated.  Is the goal really consumer protection or protectionism?  How can we start a dialogue about reasonable requirements at a reasonable cost?

2) If H.R. 2117 becomes law, federal oversight becomes weaker

All H.R. 2117 does is repeal the law.  Admittedly, state authorization is a highly uneven mechanism for use in financial aid eligibility determination.  But, at least it is something. Accreditation can’t fill the void. What will?

3) If H.R. 2117 becomes law, the current wording might not have the desired effect.

The resolution states: “To the extent that regulations repealed by paragraph (1) amended regulations that were in effect on June 30, 2011, the provisions of the regulations that were in effect on June 30, 2011, and were so amended are restored and revived as if the regulations repealed by paragraph (1) had not taken effect.”  Ummm…from the U.S. Department of Education’s point-of-view, they have always expected that institutions follow state laws.  While this point is debatable, will the Department retain that expectation only we won’t have any regulations to guide us?

4) The Timeline for Complying was Our Big Objection

After the first ‘Dear Colleague’ letter was released, I critiqued the U.S. Department of Education’s responses in-depth.  I also said: “Reciprocal agreements could help, but they will take more than a year to develop. Let’s follow state and federal laws, but give us the time to do it right.”  The second ‘Dear Colleague’ letter extended the federal timeline to July 2014. The exact meaning and enforcement implications of the ‘good faith effort’ expectations are unclear, but I believe more guidance is coming.

5) If H.R. 2117 becomes law, the momentum to improving state regulations could be lost

The regulation has opened their eyes to what can be done in terms of saner state regulations, reciprocity, and single applications.  Should the federal regulation impetus be removed, the state regulations, but the momentum simplification and reciprocity could be lost.

In the April 20 ‘Dear Colleague’ letter, the Department of Education said: “we are interested in working with the community to support States’ efforts to develop model reciprocal agreements, common applications, or other methods that States could adopt to foster compliance.”  They need to get going on this or be ready for more attacks like H.R. 2117.

6) This is a distraction…

Since the legislation will have few, no, or unintended effects, let’s find other things to do with our time.

Thanks Cyd.  You ask good questions.

Russell Poulin
Deputy Director, Research & Analysis
rpoulin@wiche.edu

State Approval page:   http://wcet.wiche.edu/advance/state-approval
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Photo credit:  Morgue File http://morguefile.com/archive/display/606770