State Authorization "On Ground" Rule: No More Delays, More Confusion to Come

The final state authorization deadline for “on ground” programs approaches quickly

A U.S. Department of Education regulation that outlines steps states must take in overseeing institutions within their own boundaries will take effect on July 1 of this year. It originally was slated to take effect in 2011, but has been delayed by a year for each of the last four years.

At the NASASPS (state regulator) meeting last week, Sophia McArdle informed participants that there will be no more extensions. Beginning in July, institutions that are undergoing financial aid reviews (which we lovingly call “audits”) will be asked to demonstrate that they are in compliance.

Can We Expect Confusion?

Oh yes.

First, the “on ground” regulations should NOT BE CONFUSED WITH THE FEDERAL DISTANCE EDUCATION regulations that were vacated by the federal courts. The distance education regulation is Chapter 34, §600.9(c). That regulation is not being enforced by court order. While the Department of Education is interested in bringing back the distance education regulation, they currently have not announced a timeline for doing so.  Dr. McArdle confirmed that this regulation is still on “pause.”  Since many in our sphere associate state authorization with distance education, there will be some panic about this. Please help in allaying their fears.

Second, regarding distance education, state regulations are still very much in place and states expect you to follow their laws. Some people are still in denial about this.

Third, while there are only a few provisions to the “on ground” regulation (see Chapter 34, §600.9(a) and (b)), guidance from the Department has sometimes been confusing. While many states were in compliance from the start, a few states that needed to make changes were slow to respond.

 What is Expected of Institutions (and Therefore States)?

The Department of Education can’t force states to adopt regulations or practices. To obtain federal financial aid, the Department can place many demands on institutions. They can “entice” states to want to follow a prescribed course of action.

To get the states to change their ways, the requirements are placed on the institutions. The loss of federal aid is a good enticement. I have a mental image of a driver waving a police officer over and requesting the officer search the car. It’s just not normal.

In brief, the state must authorize EVERY institution that seeks federal aid and must have a “process to review and appropriately act on complaints concerning the institution including enforcing applicable State laws .” For a more complete explanation, see a great post from Greg Ferenbach and Matthew Johnson of Cooley, LLP.

Who is at Risk?

Mostly institutions that don’t think they report to the state, at all. Most public and for-profit institutions are probably safe. Publics have a clear line of authority and states are interested in the actions of for-profit institutions.

At greatest risk are community colleges (that are not funded by the state) and non-profits institutions. At a recent meeting, a representative of a religious college assured us that the state has no say over what they do. Well, that’s fine if you don’t want federal student aid. I also will refer you to a great book by Alan Contreras (former state regulator, but now of SARA) in which he details the legal basis behind the state determining who can or cannot issue degrees.

The others at risk will be those in states in which they have not created complaint processes for institutions within the state. I’m not sure every state had done this.

What Should You Do?

Pretend that your institution is completing the financial aid review forms. Can you identify the state entity that oversees you? Can you identify the state entity that would act on complaints from a student who is not satisfied with the outcome of your internal complaint process?

• If you can answer “yes” to those two questions, you should be good to go.
• If you answer “no” to either question, it’s time to figure out how to rectify that situation. There will probably be a process for the state to issue you a letter to explain why they are not yet in compliance.

Next, you should make sure that you are properly notifying ALL students (on-campus and online, “enrolled or prospective”) students about external complaint processes. In place since July 2011, Chapter 34, §668.43(b) requires an institution to provide “contact information for filing complaints with its accreditor and with its State approval or licensing entity and any other relevant State official or agency that would appropriately handle a student’s complaint.” Be sure that you have this information in a place on your website that is reasonably discoverable by someone looking for it. Pairing this contact information with a description of your college’s internal complaint process is a good practice. In previous posts, we clarified misconceptions on this regulation and answered questions as a result of that first posting.

Finally, get ready for those calls when people think they will lose aid if your institution is not approved in other states. I’m sure you have all the approvals you need anyway. After all, it’s the law.

Russ

Russell Poulin
Director, Policy & Analysis
WCET – WICHE Cooperative for Educational Technologies
rpoulin@wiche.edu
Twitter:  wcet_info and RussPoulin

Photo credit: https://www.flickr.com/photos/kenyee/278775281/