Education Dept. Reminds States, Colleges of State Authorization Deadline

On Friday, the U.S. Education Department issued a Dear Colleague Letter (DCL) reminding institutions and state regulators of the looming July 1 effective date for the state authorization regulation for colleges that have a physical presence in different states.

The rule, originally drafted in 2010 to take effect in 2013, aims to set minimum standards for how a state approves colleges operating within its borders. The department twice delayed implementation of the rule amid colleges' complaints that the regulation is confusing, particularly for independent nonprofit and for-profit institutions, unlike public colleges and universities that are almost automatically considered to be authorized because of their direct state ties, according to Inside Higher Ed.

Under the rule, states must have a process for accepting student complaints about a college. The requirements also outline the conditions under which state regulators can use an institution's accreditation or business licenses as a substitute for a more intensive approval process.

The DCL serves as a reminder that the state authorization rule is tied to federal financial aid eligibility, but also makes clear that few colleges will face an immediate cutoff of student aid even if they have not been authorized under a policy deemed adequate by the agency. Institutions will have to show that they are authorized under a process that meets the regulation when they come up for their periodic recertification to participate in the student aid programs, though, which typically occurs every five or six years, reported The Chronicle of Higher Education. Additionally, they will have to show that they are in compliance whenever they apply for new programs or if their administration of student aid programs becomes subject to a review by the department.

For institutions in states that are still putting a sufficient process in place, the letter says the department will consider continuing a college's student aid eligibility "for a reasonable period" of time. Colleges that are denied authorization by their states, the DCL says, "will have their status resolved when the institutions are reviewed by the department staff in the ordinary course of business."

The state authorization rule referred to in Friday's DCL affects only those colleges that have physical locations and not distance education providers. The 2010 iteration of the regulations contained a provision requiring institutions to be licensed in all states where they operate and enroll students online. However, a court overturned that portion of the rules in 2011.


Related Links

U.S. Education Department's Dear Colleague Letter

Inside Higher Ed

The Chronicle of Higher Education