We Need YOU! ...to comment on Federal State Authorization Regulations
Published by: WCET | 7/13/2017
Tags: Distance Education, Financial Aid, Regulation, SAN, State Authorization, Title IV, U.S. Department Of Education, WCET
The Department of Education seeks comments about higher education regulations that may be “appropriate for repeal, replacement, or modification.” WCET and the WCET State Authorization Network (SAN) will comment about the federal state authorization regulations that are scheduled to be effective on July 1, 2018.
In recent months, we have seen several federal higher education regulations become sidelined through delays and reviews by the Department of Education as described in Russ’s blog post from last week, “Federal Regulations: Delays, Reviews, and a Call for Comments.”
It is time to make your voice heard.
You may wish to review our comment themes, concern about misstatements, and the process for you to submit comments below. We hope you will submit comments by the August 21, 2017 deadline. Volume matters!
Two Themes for Our Comments to The Department
Removing the Federal Regulation Has No Impact on State Regulations
First, we will advise that elimination of federal state authorization regulations WILL NOT ELIMINATE state regulations for institutions to complete any state-mandated compliance requirements in states where students are enrolled or receive services from the institution. We support the intent of the federal regulation to provide additional consumer protection for students by requiring that the institutions follow state laws where they serve students if they wish to participate in Title IV funding. We maintain that proof of state authorization provides transparency. Additionally, we maintain that providing notifications and disclosures eliminates ambiguity. We will raise the point that not only do these regulations protect the student as a consumer, but also compliance with these regulations protects the institution from possible violations of federal regulations such as Misrepresentation per 34 CFR 668.81-668-75 or a similar state-based rule. Simplification of the regulation is possible, but elimination leaves students less protected.
If the Department Retains the Regulation, Clarifications are Needed
Second, if the Department chooses to move forward with the regulations with no changes, we ask questions and seek clarification on several items that are unclear in the regulation’s wording or have become unclear due to subsequent actions. 
We don’t want to see a repeat of the 11th hour enforcement delays witnessed over the last few weeks and we want to make sure that institutions are following the most current expectations.
The clarifications include the following:
- Will the Department enforce all or part of the regulation on July 1, 2018?
- Clarification on state of compliance location? Use of the word “reside” is inconsistent with state laws.
- Definition clarification of state authorization reciprocity agreement.
- Complaint Process/Authorization in California where there is no complaint process for out of state public or non-profit institutions.
- Definition of Solely Distance Education – what about hybrid programs?
- Disclosures and written acknowledgments.
- Public Disclosures – regarding Adverse Actions.
- Individualized Disclosures – regarding the definition of “prospective” student and desired form of acknowledgements.
Watch for Myths about the Federal Regulation Elimination
Myth 1—Eliminating the Federal Regulation Makes State Authorization Go Away:
A classic example of a misunderstanding of the states’ role was reported by The Chronicle of Higher Education, in their breaking news articles under the headline The Ticker. Per the recent request by the Department for comments, an anonymous commenter from Maryland indicated supporting the rescission of “State authorization rules” because the state authorization rules require a significant amount of time and money signing agreements, and coordinating with each state, and monitoring the location of the students. The commenter also referenced offering a teacher preparation program.
Reality 1:
The Department released the Final Rule on State Authorization of Postsecondary Distance Education, Foreign Locations in December 2016. The essence of the regulation is that to participate in Title IV financial aid funding, the institution must be compliant in the states that the institution enrolls or provides services as REQUIRED BY THE STATE. States have had these regulations on their books long before the Department of Education decided to add it in 2010 and they will remain regardless of what actions the Department takes.
Dear commenter from Maryland,
NONE of those tasks will go away with the elimination of the state authorization federal regulation. Has your institution considered applying to become a SARA institution to minimize the application workload and possibly the financial requirements for authorization by the state higher education agencies? Tracking your students is important to your institution for marketing and financial planning of the institution, accreditation review, and financial aid compliance as well as state authorization compliance management. Finally, you mention that you are offering a teacher preparation program. Are you aware of the prerequisites for licensure and certification in the states where your institution wishes to offer the teacher preparation program and do you have approval by those states’ licensure boards? Please consider joining the State Authorization Network (SAN) for further resources, training, networking, and support. Or just read our many pieces of advice for free.
Best of Luck!
Cheryl, Russ, and your State Authorization Network friends
Myth 2 – States are Using State Authorization as a Revenue Generating Tool:
The Senate-sponsored 2015 report Recalibrating Regulation of Colleges and Universities: Report of the Task force on Federal Regulation of Higher Education indicated that state authorization requirements are a revenue generator in many states.
Reality 2:
Our work with state agencies has shown differently. In most states, we have noted modest fees for the agency providing oversight of the institution offering activity in the state. Fewer states have unreasonable requirements for travel to or from the state for reviews. Regardless, elimination of the state authorization federal regulation will not change the state compliance required costs for the institution. The institution will still be legally mandated to provide all compliance costs either directly to the individual states for compliance or through their fees to the SARA state portal agency and NC-SARA, if the institution is operating under SARA for compliance.
Institutions may minimize compliance costs due to fees and staff time by applying to become a SARA institution. The institution should do a cost benefit analysis to compare the costs of state and national SARA fees with the fees associated with the individual state’s authorization fees and staff time costs to manage individual state’s authorization requirements in the states the institution wishes to offer activities.
Process for Commenting
The Request for Comments was published in the Federal Register on June 22, 2017. The deadline to submit comments is August 21, 2017. 
Please be sure if you are providing the official comment for your institution that you receive proper approval at your institution. Your other option is to comment as an individual. If you choose to include your current position, please make it clear that you are commenting on your own.
The request requires that comments are to be submitted through the Federal eRulemaking Portal (www.regulations.gov) or via postal mail, commercial delivery, or hand delivery. The Department WILL NOT accept comments by fax or email. You must also include the DOCKET ID (ED-2017-OS-0074) at the top of your comments.
The Department indicates that they strongly encourage that comments be sent electronically, but the appropriate address for mail or delivery is as follows:
Hilary Malawer
400 Maryland Avenue SW., Room 6E231
Washington, DC 20202.
We strongly encourage your participation! This request for comments indicated no restrictions and simply asked for input on regulations that may be appropriate for repeal, replacement, or modification. WCET will probably be commenting on other issues. Watch for those updates in the future.
This is your time to be heard! Let’s do this together!
Cheryl Dowd
Director, State Authorization Network
WCET
Russ Poulin
Director, Policy and Analysis
WCET
7 replies on “We Need YOU! …to comment on Federal State Authorization Regulations”
I am still unclear on several points, even knowing that more advice may be coming:
1. Definition of DE: The related but not synonymous term “online” has often been used for years to include hybrid, as suggested below. Can this be changed at this late date, given the percentages of online that matter to some states’ definitions? If so, how many examples do we need to give? What about SARA’s Rule of 10, which implies hybrid?
2. Is the reply to Maryland’s specialized college meant to model our replies to the Fed, minus perhaps the invitation to join SAN?
3. For those of us who have been involved with state regulations since about 2012 and have since joined SARA, are we to compare state costs over the years with current SARA fees?
I feel I need to ask these questions before anyone seeks further clarification from the Fed.
Thanks.
Evan Smith
University of Missouri
Evan,
Thank you for your questions and I will address them for you.
First, regarding the definition of Distance Education. This is a challenge. This term is so embedded in many regulations, that it is no simple matter to redefine that term. However, we are asking for clarification of Solely through Distance Education excluding internships and practicums. We believe that additional clarification is important and are also concerned about how hybrid programs should be classified.
Second, you referred to our reference to a Maryland commenter. This is not a model. The somewhat lighthearted note was meant to highlight our concern regarding the misconception that elimination of the Federal regulation will eliminate the need for institutions to be compliant in the states where activity of the institution occurs. We all know that the states currently have and will maintain their own state requirements regardless of the fate of the Federal regulation.
Last, it is always important to know where your institution currently participates in activities (tracking your students) so that the institution can weigh the costs for individual state authorization vs. the cost of SARA. It is very likely that most institutions will see quickly that the NC-SARA fee + any state SARA fee is much less than the total of fees for individual state authorizations. You may be aware of the states that have a cost per program for authorization. In such a state, just that state alone could be more costly for authorization than the fees paid by the institution for participation in SARA. You may wish to review our October 2015 post about Making a Business Case for Joining SARA or Not Joining SARA.
I hope these answers have been helpful!
Cheryl Dowd
Director, WCET/SAN
SAN friends and others:
I think I need some fresh eyes. As I prepare to comment, I am looking at 34 CFR 600.2. This is the section for definitions. For some reason, I’m not seeing “state authorization reciprocity agreement.” The FR from 12/19/16 mentioned it, so it must be hiding in plain sight. Can anyone point me in the right direction?
Another question that jumps out at me is whether the clarifications from Ted Mitchell’s letter January 18 will apply moving forward. Would this be something to comment on?
http://wcet.wiche.edu/sites/default/files/Ted-Mitchell-Reciprocity-Response.pdf
Cites to each bullet in the “areas for clarification” listed in this blog post would be really helpful. I’m finding most of them in 34 CFR 600.2 and 600.9 (as well as some references to 34 CFR 668.) But a double check would be nice.
In my comment, I plan to resubmit the bold an unrealistic idea that for the purpose of this regulation, an institution authorized to provide higher education in its own state is also authorized to serve students from any other state in the country. This effectively eliminates the need for SARA, of course, but is otherwise the cleanest and clearest solution. Does anyone want to join me on this?
-Dan Silverman
I retract my last suggestion. I realize that it is beyond the scope of the Department of Ed to prohibit states from enacting their own laws. Rats.
Dan,
You raised some good questions and I am happy to address them. First, let’s start with a URL to the 34 CFR 600.2 definition of state authorization reciprocity agreement: https://www.ecfr.gov/cgi-bin/text-idx?SID=92b2da89e3f30253ec9d7c93847eb421&mc=true&node=20161219y1.141 In the Federal Register you can find it on p.92262 in the first column under Definitions.
Second, you are right, asking about the letter from Ted Mitchell is important for a comment. That letter provided us with some insight about the intent when the regulation was written, but the letter does not carry the weight of a clarification in a Dear Colleague Letter.
Third, you asked about tying the bullets to the regulations.
• Clarification on state of compliance location? Use of the word “reside” is inconsistent with state laws. 34 CFR 600.9(c)(1)(i)
• Definition clarification of state authorization reciprocity agreement. 34 CFR 600.2
• Complaint Process/Authorization in California where there is no complaint process for out of state public or non-profit institutions. 34 CFR 668.5(b)(3)
• Definition of Solely Distance Education – what about hybrid programs? 34 CFR 668.5
• Disclosures and written acknowledgments.
o Public Disclosures – regarding Adverse Actions. 34 CFR 668.5(b)(4)
o Individualized Disclosures – regarding the definition of “prospective” student and desired form of acknowledgements. 34 CFR 668.5(c) (i-ii)
Last, you mentioned an overall federal rule to grant compliance in any state if the institution is authorized in its own state. I appreciate that you later noted that the Federal regulations cannot overrule the purview of the states to enforce their own laws.
Thank you for your questions and I hope the answers were helpful!
Cheryl Dowd
Director, WCET/SAN
Hi Cheryl,
Yes, all of this is helpful. For some reason, I’m finding this comment a challenging thing to wrap my head around and write. Hopefully your public replies to my basic questions will help others.
-Dan
[…] left ineligible for Title IV Federal Financial Aid. As the final regulations were in limbo through 2017, we again addressed the concern when the Department asked for comments on Federal Regulations. We asked for clarification about what to do about states such as California […]