On November 1, 2019, the U.S. Department of Education published the Final Regulations for accreditation and state authorization. This notice focuses on the updates to State Authorization of Distance and Correspondence Education. The effective date will be July 1, 2020, with early implementation allowed at the discretion of each institution or agency for sections § 600.2, § 600.9, § 668.43 and § 668.50 (described herein). The rule is the product of consensus negotiated rulemaking. The regulations address the role of reciprocity agreements, update the language regarding student location, clarify required state authorizations for distance education programs, and revise consumer disclosure requirements.

Summary of the Major Provisions of This Regulatory Action:

These regulations—

  • Define State authorization reciprocity agreements and reaffirm that such agreements meet the requirements of the State authorization regulations for States that elect to participate in them. Clarify that a reciprocity agreement may supersede a state's own requirements related to state authorization of distance education.
  • Make clear that an institution must identify the State in which a student is "located" and, therefore, the State in which the institution must have authorization.
  • Eliminate requirements for States to establish new or separate consumer complaint processes for students enrolled in distance learning programs, while providing other options to ensure consumer protection.
  • Expand consumer protections for students enrolled in programs that lead to occupational licensure, including those enrolled in ground-based courses or programs.
  • Enable institutions to determine the States for which it will determine occupational licensing requirements, while requiring institutions to report that information accurately to students.

Early Implementation

The Secretary is exercising her authority under section 482(c) of the HEA to allow for early implementation beginning on November 1, 2019, at the discretion of each institution. Institutions choosing early implementation may implement the new state authorization rules on or after the publication of the rules in the Federal Register on Nov. 1, 2019. Until the Department offers further guidance, we recommend that institutions document the early implementation internally.

34 CFR § 600.2

The revisions make clear an institution's responsibilities and the role of State reciprocity agreements. The definition for "state authorization reciprocity agreement" at 34 CFR §600.2 from 2016 has been revised to define a State authorization reciprocity agreement as an agreement between two or more States that authorizes an institution located and legally authorized in a State covered by the agreement to provide postsecondary education through distance education or correspondence courses to students located in other States covered by the agreement.

The Department further revised the definition to provide that it does not prohibit any member State of the agreement from enforcing its own general-purpose State laws and regulations outside of the State authorization of distance education. The language that included "or specifically directed at all or a subgroup of educational institutions" has been removed.

According to the Department press release, "States that join a reciprocity agreement can no longer layer additional State higher education authorization requirements on institutions that participate but can continue to apply other State laws and regulations that apply to all entities doing business in a State." In the preamble, the Department made clear that "A reciprocity agreement may supersede a State's own requirements related to State authorization of distance education and may prohibit a State voluntarily participating in that agreement from adding additional requirements on institutions that also participate in the agreement." They further explained "It would not be acceptable, for example, for a State to participate in a reciprocity agreement in order to advantage its own public institutions and yet apply additional or alternate requirements related to State authorization of distance education to institutions that participate in the reciprocity agreement but may be located in a different State."

34 CFR §600.9(c)

Language was added to 34 CFR §600.9(c) to remove the concept of a student's "residence" and replace it with "location." This is a conforming change to ensure that institutions have consistency in determining where students are located for purposes of this regulation.

Based on the preamble, the institution should determine the student's location at the time of initial enrollment based on the information provided by the student, and update accordingly based upon receipt of information from the student that their location has changed. It is not necessary for an institution to determine location for all enrolled students annually, but rather at the time of a student's initial enrollment and upon a formal notification by the student of his or her change of address to another State.

34 CFR § 600.9(c)(1)State Authorization and Student Complaint Process

The Department has clarified the requirement to document a complaint process for distance education students. An institution must disclose at least one point of contact for filing student complaints—the location of the student or the home State of the institution or a third party identified by a State or State reciprocity agreement.

An institution offering distance education in a State in which the institution is not physically located or in which the institution is otherwise subject to a State's jurisdiction, as determined by the State, must meet any of that State's requirements to be legally offering distance education in that State. However, even if the State does not have any specific approval requirements for an institution to be offering distance education in that State, § 600.9(a)(1) requires that, for an institution that has a physical presence in a State, that State must offer a process to review and appropriately act on complaints concerning the institution, including enforcing applicable State laws, for the institution to meet the State authorization requirements.

The Department clarifies that the contact information provided may be for whichever entity or entities the State designates to receive and act upon student complaints. Contact information is not necessarily required for each of the following: a State approval entity, a State licensing entity, and another relevant State official or agency. If the State has only designated one of these types of entities, contact information for that one entity is sufficient.

In previous notices on July 23, 2019, July 26, 2019, and August 5, 2019, we summarized aspects of the 2016 State Authorization Rule and the implications for non- SARA institutions. The new rules fully resolve those issues for institutions through early implementation.

34 CFR § 668.43 Institutional information and Consumer Disclosures

The rule includes revised consumer disclosure requirements that apply to both on-ground and distance education programs. New language impacting programs leading to professional licensure has been added to 34 CFR §668.43 to ensure that notifications are being made to all students. Section 668.43 is expanded to include disclosures that were previously required for distance education programs under Section 668.50. These rules include requirements for both general and direct disclosures for enrolled and prospective students as to whether or not a program's curriculum meets State educational requirements for licensure or certification. An institution will also be required to provide disclosures when a determination cannot be made.

If an educational program is designed to meet educational requirements for a specific professional license or certification that is required for employment in an occupation, or is advertised as meeting such requirements, information regarding whether completion of that program would be sufficient to meet licensure requirements in a State for that occupation, including—

(A) A list of all States for which the institution has determined that its curriculum meets the State educational requirements for licensure or certification;

(B) A list of all States for which the institution has determined that its curriculum does not meet the State educational requirements for licensure or certification; and

(C) A list of all States for which the institution has not made a determination that its curriculum meets the State educational requirements for licensure or certification.

If the institution has made a determination that the program's curriculum does not meet the State educational requirements for licensure or certification in the State in which a prospective student is located, or if the institution has not made a determination regarding whether the program's curriculum meets the State educational requirements for licensure or certification, the institution must provide notice to that effect.

If the institution makes a determination that a program's curriculum does not meet the State educational requirements for licensure or certification in a State in which a student who is currently enrolled in such program is located, the institution must provide notice to that effect to the student within 14 calendar days of making such determination.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.