Comments to U.S. Department of Education on 2019 Regulatory Agenda

Aaron Washington,
US Department of Education,
400 Maryland Ave, SW
Room 294-12
Washington, DC 20202

RE: Request for comment on proposed regulations for the Federal Student Aid programs authorized under title IV of the Higher Education Act of 1965, as amended (HEA) (title IV, HEA programs) [ED-2018-OPE-0076]

Mr. Washington:

Thank you for the opportunity to comment on the US Department of Education’s (Department’s) recently published Federal Register notice seeking input on revising regulations pertaining to the Federal Student Aid programs authorized under Title IV of the Higher Education Act (HEA) of 1965, as amended. Below, we offer our comments on the core functions of accreditation, state authorization, regular and substantive interaction, the definition of the term “credit hour,” and the outsourcing of higher education programs. We fully appreciate your consideration.

Core Functions of Accreditation (34 CFR part 602)

Right now, college accreditors are supposed to ensure a basic level of educational quality. However, gaining an accreditor’s stamp of approval doesn’t always mean that a school provides a return on investment for students, as many accredited institutions still leave their students degreeless, underemployed, and unable to pay down their student loans after attending.¹ It’s imperative that accreditation better ensure good outcomes for students. Unfortunately, we are concerned these new actions proposed by the Department will lead to an even weaker quality assurance system than exists today.

As discussed at the National Advisory Committee on Institutional Quality and Integrity (NACIQI) on February 8, 2018, over 680 accredited institutions leave over half of their students degreeless, unlikely to earn more than an average high school graduate, and unable to pay down their student loans.² This not only puts students who attend these institutions at risk, it also places an undue burden on taxpayers, who help subsidize students’ educational pursuits at accredited institutions every year. In fact, just last year, over $14 billion taxpayer dollars flowed to these middling institutions, even though they left most of their students unlikely to graduate, earn a decent living, and pay down their loans.

Being that accreditation already lacks the ability to ensure that institutions are actually serving students well, we are concerned that the Department’s efforts to simplify the recognition process for accreditation agencies will pose an even greater risk to students and taxpayers. As the Department moves forward with revising these regulations, it’s critical that it strengthen, not weaken, requirements within the federal recognition process for college accreditors to ensure that federal student aid does not flow to institutions that show poor results for a majority of their students.

State Authorization (34 CFR 600.9 and 668.50)

States currently play a vital role in the oversight of institutions. They help to police fraud and abuse and ensure basic consumer protections at institutions that operate in their jurisdictions. This applies to students who attend both online programs and brick-and-mortar institutions.

We are concerned with the Department’s plans to modify the Program Integrity and Improvement rule requiring online programs to be authorized within every state in which they enroll students. By removing this requirement, a student may attempt to sit for a licensure exam only to discover the online program they completed in that subject area does not meet the licensure requirements in their state—only the state where their online institution is physically located. This renders these degrees effectively worthless—wasting time and money—all because the school was no longer required to get approval in the state where it offered students a postsecondary education.

Rolling back this protection not only diminishes states’ rights to protect their residents and regulate appropriately but also exacerbates workforce gaps in critical fields by graduating students unable to get the credentials they need to enter the labor market within the state where they completed their postsecondary credential. Limiting state oversight could also change the way programs handle complaints from students—limiting students’ ability to file complaints with their home states against wrongdoing, regardless of where the institution is located.

As the Department reconsiders this requirement, we ask that it ensure that students who enroll in online education programs are assured that they will be able to apply for licensure within the state in which they received their education, not only the state where their online institution is physically located.

Regular and Substantive Interaction (34 CFR 600.2, 600.7, and 668.10)

The number one reason why students seek a postsecondary education is to gain the knowledge and skills they need to find the jobs that will allow them to live stable and secure lives, whether they attend an online or brick-and-mortar institution. A primary component of being able to achieve that goal is having access to subject matter experts who can provide students with substantive engagement in their field of study. While online instruction is meant to provide a more flexible educational experience for those who require it, effective online programs should still require qualified instructors with subject matter expertise to spend time helping students learn. We are concerned that loosening the requirement for online institutions to provide students with “regular and substantive interaction” will result in instructors spending less face time with students, devaluing what a student pays to earn a credential or degree.

How can we predict that such an outcome will come true? Because before Congress addressed poor outcomes in correspondence courses in 1992 and later defined distance education as having “regular and substantive interaction” in 2008, many providers were abandoning students with textbooks and no instruction, leaving them to complete coursework on their own and charging taxpayers full price for it. Prior to those restrictions being written into law, correspondence courses displayed a student loan default rate twice as high as other colleges and universities.³ Without a clear and firm distinction between correspondence and distance education programs that require teachers to actually teach their students in exchange for taxpayer-funded grants and loans, billions in federal dollars will be wasted in poor-quality programs.

By loosening the current requirements we have in place, it’s likely that many institutions will revert back to this instructional practice, providing less help and support to students who enroll in online programs across the country. Moving in this direction will also result in more courses being offered through pre-recorded lectures, less interaction with knowledgeable instructors, and a lower likelihood of success for the students who attend. For institutions looking to cut costs, removing this requirement will result in students missing out on the important engagement and expertise from instructors in the subjects they are paying to study.

As the Department moves forward with their reconsideration of this regulation, we ask that it doesn’t ignore the risk involved in allowing institutions to adopt unproven student support services and instruction from less qualified staff. Instead, it should continue to require a minimum level of teaching by trained instructors in order to better ensure student success.

Definition of the Credit Hour (34 CFR 600.2, 602.24, 603.24, and 668.8)

Right now, Congress awards federal financial aid entirely on the basis of credit hours. This structure helps ensure that students’ federal aid and tuition dollars result in a comparable amount of learning as they earn a college degree, no matter what college they attend. The college credits earned by a student actually signify a baseline amount of time and learning they did while in school.

Before there was a definition of a credit hour in place, some institutions received more federal student aid dollars for less time spent on instruction than other comparable institutions. For example, prior to this rule, one institution was awarding up to 27 hours of credits for each semester (and receiving a corresponding amount of Pell Grants and federal loans), even though similar institutions evaluated the same workload as equivalent to only 18 credit hours.⁴

If the Department chooses to weaken the credit hour rule or remove a minimum floor for work or learning, we are concerned that this will allow institutions to receive more federal money for less time spent on education, ultimately leaving students without a quality education. Students will end up spending more—expending their eligibility for Pell Grants and taking out additional federal student loans—while ultimately getting less in return. Some institutions may also be less likely to accept transfer credits, as they won’t deem these courses as providing an equivalent educational experience. This could make it even more difficult to ensure future academic success for the 38% of students who transfer at least once within six years before earning a degree.⁵

As the Department reconsiders the definition of the credit hour, we ask that it work toward a policy that ensures students receive an equivalent and robust amount of learning for each degree awarded. We also ask that they consider how any definition will be received and interpreted by other institutions within the higher education community, as it may have an effect on the number of transfer credits that receiving institutions will accept.

Allowing Institutions to Outsource Educational Programs (34 CFR 668.5)

In order for an institution to use federal financial aid to fund its educational offerings, it must serve as the primary provider of any higher education program with support from other colleges or non-college educational organizations limited. However, the Department’s plans to revisit the regulations overseeing this protection could potentially allow an institution to outsource more than half of a program through contracts with unaccredited, unaccountable entities. This could result in students paying for a program that is lower quality and more expensive while being unaware that it is not being offered through the institution directly.

Today, consumers—and the taxpayers who finance their education—have a guarantee that the institutions they’re attending have been approved by the state, are accredited, and are subject to a number of requirements from the Department, such as passing a financial viability test. Letting colleges outsource their programming to untested and unproven entities obscures who’s really teaching students and how well they’re doing it, ultimately stripping these basic quality assurances. This means that some students may end up paying more for college programs that fail to prepare them to enter the workforce, all while being unaware that their institution wasn’t even teaching the classes they thought they were purchasing.

As the Department moves forward with its consideration of allowing institutions to outsource higher education courses, we ask that it weigh the risk of using taxpayer dollars to fund students’ educational pursuits at unaccredited and unproven non-college educational organizations. Allowing institutions to contract more than 50% of their educational offerings to outside providers will, ultimately, put students and taxpayers at an even greater risk of footing the bill for a substandard postsecondary educational experience.

We’d like to thank you for taking these comments into consideration as you work toward providing better postsecondary success for all students. It’s important that we continue to build off programs that are shown to be effective while limiting federal dollars flowing to those that are not. If you’d like to further discuss any of these issues in the future, you can reach me at [email protected].

Sincerely,
Lanae Erickson
Vice President, Social Policy and Politics
Third Way