2-Year Delay for State Authorization Rule

U.S. (again) pushes back controversial regulation requiring online programs to gain approval from states in which they operate, this time to 2020.

May 25, 2018
 
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(Note: This article has been updated from an earlier version to add context and responses to the department's announcement.)

The U.S. Education Department formally announced in the Federal Register last week what it implied earlier this month: it will delay for two more years implementation of its controversial regulations requiring online programs to show that they are approved to operate in every state where they enroll students.

If the government actually publishes the regulations in July 2020, the new target date, the saga of the state authorization rules, as they are known, will have lasted a full decade.

The Obama administration drafted them as part of a set of "program integrity" rules that included regulations governing gainful employment and the credit hour. The state authorization rules were immediately controversial.

A federal court struck down the portion of them pertaining to distance education in 2011, prompting the government to go back to the drawing board (and the negotiating table) in 2014 for another round of deliberations to try to craft a rule more acceptable to colleges and state regulators alike.

The Education Department published a new, final version of the regulation in December 2016 as the Obama administration was leaving town, with an effective date of July 1, 2018.

In the intervening months, though, the Trump administration has taken a much more skeptical stance on many higher education regulations, identifying state authorization as one target. During this period, higher education leaders and state officials have banded together to create a reciprocity agreement for state approvals that they assert provides many of the consumer protections the Obama administration argued required the federal rule.

Colleges and universities and their lobbying groups, meanwhile, have continued to question the wisdom of the rules, and in its notice announcing the delay, the Education Department cited letters from the American Council on Education and a coalition of groups that work on distance education issues seeking a series of clarifications to the guidance that department officials say they believe cannot be adequately addressed without a new round of negotiated rule making, which the department already plans.

"We believe that delaying the final regulations would benefit students and that many students will still receive sufficient disclosures regarding distance education programs during the period of the delay due to steps institutions have already taken in this area," the department's Federal Register notice said.

A Mixed Response

Jared Bass, senior counsel for education and strategy in the education policy program at New America, said he was disappointed that the department had chosen to delay the rules, which he said were “state-forward and student-forward.”

There were two main issues with the rules that university groups sought clarification on from the department, said Bass -- how to issue disclosures to students to ensure they take the right program for their desired profession, and how to determine where students reside.

“To delay the rule for those two administrative issues is akin to canceling a commercial flight because two passengers didn’t show up,” said Bass. “It doesn’t make sense.”

Bass said he doesn’t believe the department will make a good-faith effort to implement the Obama-era rules going forward. He added that the department’s decision to enter the rules into their third round of negotiated rule making in a decade is a “waste of government resources” and a case of “political maneuvering.”

But Sharyl Thompson, CEO of Higher Education Regulatory Consulting, said she was pleased the department announced a delay and will hold another round of negotiated rule making.

“My hope is that this time, the department will really pay attention to the comments and input from people who have real experience in state authorization,” said Thompson. She would like to see the rules simplified, with more care taken to align terminology in federal rules with existing state rules.

Russell Poulin, director of policy and analysis for the WICHE Cooperative for Educational Technologies, said that he and others had been asking for clarification from the department for more than a year. Given that clarification was not forthcoming, there was really “no choice” but to delay the rules, as “institutions weren’t clear on how to comply,” he said.

Daniel Madzelan, associate vice president for government relations for the American Council on Education, agreed that without additional guidance, a delay was the best option for universities. Madzelan said he was heartened by the department’s pledge to take a closer look at the issue of state authorization in the negotiated rule-making process.

Madzelan expects that notice of the department’s intention to begin the new negotiated rule-making process will be given this fall, with a panel appointed in early 2019. The final rule would need to be published by Nov. 1, 2019, in order for it to take effect in July 2020, said Madzelan. It's too early to say what that final rule might look like, said Madzelan.

Ed Klonoski, president of Charter Oak State College, said the department should just drop the rules altogether. Klonoski said that the State Authorization Reciprocity Agreement had already addressed many of the same issues. “We’ve solved the state authorization problem,” said Klonoski. “They can let it go now.”

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