Recently, DETC Executive Director Michael P. Lambert sat down with Mr. Russell Kitchner of American Public University System to discuss the university’s experiences with State Authorization, and the effects it has on the institution’s operations:
Q. What in your view, Russell, has been the most serious impact of State Authorization for online institutions? Has there been any serious deleterious impact on how an online college has to operate in the era of “every state getting into the act?” Has the Federal Government opened a Pandora’s Box by offering to “police” compliance with state rules?
Thank you Mike. I welcome the opportunity to address some of the issues surrounding the Department of Education rule on State Authorization. Perhaps the most significant impact of the rule is the confusion it generated. Many states did not have specific policies in place prior to this rule being established, and the policies in other states were outdated or otherwise less-than-clear regarding the all-important definitions and details. Furthermore, there is no question that relatively few, if any of the states were prepared to deal with the resulting volume of inquiries, much less the potential workload, leaving many institutions in a form of regulatory limbo. When coupled with the significant institutional costs associated with seeking authorization or approval, more than a few institutions found themselves in the regrettable position of reducing their geographical footprint—ironically with a corresponding reduction in educational opportunities for the residents of those states. This scenario may not rise to the level of a Pandora’s Box, but it appears to confirm that this policy decision on the part of the Department of Education did not reflect thoughtful input from the states, from higher education institutions, or from the Congress whose constituent interests are now held hostage by the subsequent attempts to develop coherent state policies and administrative rules.
Q. A District Court struck down the Federal regulation about State Authorization last June on a technicality. Do you believe institutions can take comfort in this ruling and do nothing now? Or will we see the Court decision appealed, or worse, will States brush it aside and continue to try to register out of state colleges?
Institutions sit on their hands at their peril. In my opinion, there is merit at the core of the state authorization rule, which essentially was an affirmation of existing law. The problem with the rule is that it was imposed on state and institutional communities that were not prepared for it, and that were not permitted a reasonable opportunity to consider the very complex set of definitions and logistics that are inherent to its implementation. As for the legal considerations, I think we can be sure that the courts will be actively engaged with this issue for the foreseeable future, unless a different administration and Congressional legislation renders the issue moot.
Q. The State Authorization rule, according to the Department of Education, is nothing new. Institutions getting Title IV Aid were always required to be in compliance with any State laws, and the new regulation merely reinforced the idea that Title IV participating institutions need to document compliance with all State laws. But in fact, did the Federal regulation stir up other matters that have now created a new set of challenges to the online college?
As noted in a previous comment, the Department didn’t create a Pandora’s Box, but perhaps it opened one. I respectfully believe that few at the Department were sufficiently aware of the complexity of the state regulatory landscape, and the most significant issues that have arisen appear to reflect a resulting lack of consideration for the many variables that are inherent to state authorization. I do not fault the Department for its intentions, but like many others, I regret its preemptive and perhaps less-than-well-informed, unilateral initiative. This issue is particularly problematic given that many state regulations pre-date on-line learning, and given this context, the Department’s otherwise good intentions have led to policy decisions that are now subject to second-guessing and back-tracking.
Q. We have heard at national meetings that there are several reasons many states now want to do their own thing in registering colleges outside of their borders, including:
- They do not trust accrediting agencies or other states to protect their students;
- They fear that online schools—even when regionally or nationally accredited—may be “Degree Mills”; and
- They realize that reciprocity between states is never really going to happen.
What is your view on these reasons for duplicative regulatory efforts? Do you know of any recognized accreditor that has accredited a Degree Mill of late?
Some state agency personnel have expressed skepticism of accreditation agencies and their associated policies and practices. There is a basis in fact for some concern, although I seriously doubt that any reputable association has knowingly accredited a so-called “degree mill." The bright lights of Congressional hearings and the scrutiny of the media have served notice that the well-intentioned, traditionally collegial approach to measuring institutional integrity may not be sufficient in light of the public’s demand for accountability and its desire for credentials. The relative ease with which such credentials can be generated in the absence of academic substance is a matter of genuine concern for everyone associated with higher education. Clearly the regional and national associations that understand this dynamic should defend what historically has been effective and proper in terms of past practices, and I am sure that in doing so they will address actual deficiencies while exposing and dismissing the imaginary ones.
The online educational environment is having a nearly unprecedented impact on access to educational opportunities—perhaps exceeding that of both the Morrill Acts and the post-World War II GI Bill combined. That said, unlike those landmark initiatives, it is not funding or educational philosophies that are expanding access, but rather the forces of technological innovation. The Internet remains an imperfect educational modality that can be abused and misused. However, the on-going consideration of both its merits and its limitations is also causing many thoughtful educators to look at traditional learning modalities with a more critical eye. In the long term, the real legacy of on-line education, beyond its capacity to increase capacity, may well be its impact on how we view teaching and learning.
Q. Even if the Department does not appeal or re-issue the regulation, are the States standing still on this? What have you seen happening in the States? Is it true, as one wag has put it, that the Federal Government has poked the State Regulator Bear, and the Bear is now awake?
The states are not standing still, and fortunately, even if the regulation is dramatically modified or revoked, I doubt that many of them will revert to whatever previous state of regulatory oversight might have existed prior to the Department issuing the State Authorization rule. In my opinion, the Department’s action should be seen as a positive motivator in support of institutions behaving properly in those states in which they should be authorized. The fact that “physical presence” is an amorphous notion whose definition seems to depend primarily on one’s personal or political views certainly complicates the matter, to the point that neither state nor consumer interests are at all times well-served. Some of the states whose residents could benefit most from high quality, on-line programs are the least accommodating to the institutions that could provide access to those programs. Rather than eliminating the rule, I would campaign for a thoughtful, national conversation of how such terms should be defined and incorporated in sound educational policies that serve sound educational objectives.
Q. We have heard experts say that the regulation is not all that burdensome, and the costs to register in the States is a modest amount, and no more than $10,000 in fees being assessed at the top end. Do these figures square with your experience in working with States? How much money can a larger online university expect to budget to comply with all of the States that require registration?
Those who would suggest that State Authorization is “not all that burdensome” are either woefully uninformed or have a much different sense than I of what constitutes a burden. There are several states that require program-by-program review, with the total expected costs exceeding $100,000 per state. Several others charge in excess of $50,000, depending on a variety of factors. These are outliers, to be sure, but for universities that offer 50 to 75 programs within five or six levels/types of degrees, the costs associated with authorization/certification in all 50 states and the District of Columbia can approach $500,000, and this figure does not take into account the costs of staff, travel, and associated expenses. Such numbers are daunting by any definition, but the fact that such excessive costs do little, if anything, to enhance the educational experiences of students represents a very real waste of resources. Equally disturbing is the fact that many of these processes have already been paid for several times over in the form of institutional accreditation and program-specific certification protocols. Unfortunately, these points are likely a matter of polite interest to those who deem half a million dollars of superfluous or redundant overhead costs to be “not all that burdensome.”
Certainly there is mischief afoot in a few states as a result of State Authorization. Some have made it clear that significant fees associated with this rule are a windfall in the face of budgetary constraints that would otherwise result in agency staff reductions. Others have not said as much, but their emerging policies offer sufficient evidence to imply that this is a strategic tactic. Frankly, I am not opposed to a reasonable fee structure, provided that
- It applies to all institutions, regardless of funding sources;
- It does not apply to institutions that are not physically located—i.e., no buildings owned, leased or otherwise used for instructional or administrative purposes—within a state agency’s physical jurisdiction; and
- The fees are not used to underwrite the costs associated with a duplicative process of program/institutional review.
Regarding this last point, I have yet to find a state regulatory review process that exceeds, or is in conflict with, national and regional accrediting standards. Consequently, for a state agency to ask institutions to pursue a duplicative, pro forma exercise that is expensive in terms of time, effort and money, and without adding educational value is simply indefensible.
Q. The “Pandora's Box” effect we mentioned earlier seems to have caused a number of states to revisit and amend their laws and regulations. What results of these efforts at change have you seen? What is the general import of the changes?
In general, the result of state agency initiatives to revisit and amend their administrative rules reflects an appropriate, if not overdue, recognition that the world of higher education has changed. Enabling legislation written even 15 years ago is likely uninformed at best, and perhaps irrelevant. Consequently, agency administrative rules based on that legislation are equally questionable in terms of their effectiveness or applicability. The majority of state agencies with which I am most familiar have taken a refreshingly realistic and practical approach to policy revision, with results that will not only ease the regulatory burden on appropriately accredited institutions, but also enhance the educational opportunities for the residents whose interests those agencies serve.
Q. Do you know of any direct evidence that would support all of this redundant effort by states that shows that educational quality and consumer protection has been significantly improved? Or is all of this duplicative control of institutions simply driving up costs to colleges, increasing tuition for students, and limiting educational opportunity for students, since smaller online colleges cannot afford to register in all the states where they currently have students?
While I know of no empirical evidence in support of the proposition that state regulation has enhanced educational outcomes (nor should we expect to find such a correlation), I am hopeful that it may have had—and that it will have—a deterring effect on unscrupulous operators and underperforming institutions. The jury is still out on those accounts, as it is on the degree to which this rule inhibits student access to programs offered by high-quality institutions. Unfortunately, there are disturbing examples of the latter consideration that appear to support the argument that an unintended consequence of state authorization is that modestly funded programs and institutions have left the field, or are planning to do so. To whatever extent these anecdotal instances are representative of a larger trend, they represent an unfortunate reduction in educational access, and consequently, a serious challenge to President Obama’s lofty “2020” goals.
Q. Is there any hope for relief from this new era of redundant regulation on the horizon?
I believe that the states themselves are in the best position to address the matter of regulatory redundancy, wherever it exists, and to whatever degree it exists. There are national associations (NASASPS and SHEEO, for example) and initiatives by The Presidents’ Forum that actively are working on administrative and policy protocols that could be effective in reducing or eliminating much of the problem. Ironically, the states themselves also represent the greatest potential obstacles to such initiatives, particularly those states that have a vested interest in maintaining income-generating policies, or those that retain a somewhat provincial attitude toward states’ rights in matters of educational policy. While I have a strong affinity for the Constitutional separation of powers, which clearly leaves the matter of higher education policies to the individual states, I wonder how Thomas Jefferson would have responded to a state’s unilateral denial of access to higher education on the basis of fluid, amorphous, sometimes illogically-defined regulations. Regardless, on-line learning is an arena in which litigation is likely, with the Commerce Clause being the likely focus.
Q. According to a survey of several hundred traditional colleges offering online programs, 7 out of 10 of them reported they have done nothing about seeking approval in other states. What does this tell you about the state of play in online learning? Do you foresee what this “civil disobedience” might have on the ultimate impact of the State’s attempts to enforce their laws everywhere? Are we going to experience selective enforcement?
I am not sure that I can explain this phenomenon Mike, but I am willing to place a large wager that some, if not all of the following impressions/implications are in play:
- Many traditional colleges and the states themselves were caught off-guard by this rule and many are still trying to find settled ground on which to determine how its provisions apply, and how to accommodate them.
- I am confident that a significant number of institutions expect the rule to simply go away, at least in terms of its applicability to them, either via rule modification or judicial/Congressional action.
- I am equally confident that many traditional institutions, particularly those with large, national, on-line programs will not abide the notion that any state agency outside of their respective home jurisdictions has the prerogative (or the temerity) to assert regulatory authority over their programs.
This dynamic undoubtedly will result in attempts by some states to incorporate discriminatory policies related to the application of the rule in order to avoid internecine conflict among those states and their respective institutions. Such a scenario is also likely to be fertile ground for litigation.
Traditional institutions have maintained a long-standing skepticism toward for-profit higher education, justifiable to an extent, but uninformed to a greater extent. Although the basis for that attitude is increasingly unrepresentative of reality, there are those who hope or expect that State Authorization will eventually be applied only to the for-profit sector. The rationale for this position will focus, at least in part, on the premise that “They can afford it.” This is a specious justification that likely will be embraced by the same individuals who will resist any attempt to bring across-the-board, uniformly-assessed educational outcomes and institutional performance metrics into the discussions associated with the regulation of American higher education.
I do not have the benefit of a crystal ball Mike, but I believe that the current debate over regulatory processes and politics will give way—and relatively soon—to more substantive discussions. Too many people are spending too much time and wasting too much money on the modest substance of the State Authorization rule. We need to fix this issue and move on so that we can redirect those resources in support of educational opportunities that have a meaningful and measurable impact on our Nation and its citizens.
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