Bills to Repeal Credit Hour and State Authorization Regulations Generate Bipartisan Support in U.S. Senate and House

Bills introduced in the U.S. Senate and House of Representatives to repeal new regulations by the U.S. Department of Education (USDE) establishing a federal definition of credit hour and creating new rules governing state authorization have generated bipartisan support. The House bill – H.R. 2117 – was introduced on June 3, 2011 by Virginia Foxx (R-North Carolina), Chair of the House Subcommittee on Higher Education and Workforce Training, and currently has 51 Republican and Democrat cosponsors. On June 15, the House Education and Workforce Committee passed the bill in a bipartisan vote of 27 to 11. The legislation now will be considered by the full House of Representatives; a date for discussion and vote on the legislation has not been set.

Identical legislation (S. 1297) was introduced in the Senate on June 29, 2011 by Senators Richard Burr (R-North Carolina), Ben Nelson (D-Nebraska), Tom Coburn (R-Oklahoma), Michael Enzi (R-Wyoming) and Richard Shelby (R-Alabama) and currently has 15 Republican and Democrat cosponsors.

In letters to Congress and to the USDE, the Council for Higher Education Accreditation (CHEA) and other higher education associations and accrediting organizations have strongly urged repeal of the credit hour and state authorization regulations (see Federal Update #16). Although state authorization regulations requiring distance education programs to be authorized in every state where they have students were recently struck down on procedural grounds by the U.S. District Court (see item below), USDE has several options: to accept the Court’s ruling, to appeal the decision or issue new proposed regulations sometime in the future.

It is important that Senators and Representatives hear from higher education institutions in their districts who support legislation to repeal state authorization and credit hour regulations. CHEA urges accredited colleges and universities, as well as recognized accrediting organizations, to call their Senators and ask them to cosponsor S. 1297, as well as calling their Representatives to ask them to vote for H.R. 2117 when it is considered by the full House.

Court Strikes Down state Authorization Regulations for Distance Education

On July 12, 2011 the U.S. District Court for the District of Columbia struck down the portion of new state authorization regulations applying to distance education, noting that USDE did not provide a notice-and-comment period prior to issuing the final rule. The Court’s ruling came in response to a lawsuit seeking to overturn USDE’s new state authorization, incentive compensation and misrepresentation regulations. The Court’s decision upheld the incentive compensation and misrepresentations rules.

House Subcommittees Hear Testimony Opposing Gainful Employment regulations

On June 8, 2011 the House Subcommittee on Higher Education and Workforce Training and the Subcommittee on Regulatory Affairs, Stimulus Oversight and Government held a joint hearing on USDE’s new gainful employment regulations.At the hearing, Representatives heard testimony from groups and individuals including Harry C. Alford, President and Chief Executive Officer, National Black Chamber of Commerce; Dario A. Cortes, President of Berkeley College in New York City; Karla Carpenter, a graduate of Herzing University; and Anthony P. Carnevale, Director of the Georgetown University Center on Education and the Workforce. Copies of their testimony and a Webcast of the hearing can be found on the Subcommittee on Higher Education and Workforce Training’s Website. (For more on the gainful employment regulations, see Federal Update #16.)

The hearing – titled “The Gainful Employment Regulation: Limiting Job Growth and Student Choice” – focused both on the costs of new reporting requirements on for-profit colleges and the impact the regulations could have on educational access for low-income minority students (a point made by three of the four panelists). A number of Republican members stated their continuing opposition to the gainful employment regulations, while several Democrat members noted the new rules are needed to help protect the government’s investment in higher education through student aid.

USDE Issues Two Announcements ProViDing Guidance on Gainful Employment regulations

USDE has issued two announcements to provide additional guidance on new gainful employment regulations. Both announcements were authored by David Bergeron, Deputy Assistant Secretary for Policy, Planning and Innovation at USDE’s Office of Postsecondary Education.

Gainful Employment Electronic Announcement #11, issued on June 24, 2011, provides information regarding which educational programs at higher education institutions are considered to be gainful employment (GE) programs under the Higher Education Act and therefore are subject to USDE’s new regulations. The announcement stated “virtually all educational programs offered by for-profit institutions are GE programs; all educational programs that lead to a degree awarded by a public or private non-profit institution are not GE programs; and virtually all non-degree educational programs awarded by a public or non-profit institution are GE programs.”

Gainful Employment Electronic Announcement #12, issued on July 8, 2011, provides guidance on determining the gainful employment status and reporting requirements for degree programs where a student may, in addition to earning a degree, also receive a certificate.