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WORKING
GROUP
REPORT
PROGRAM
INTEGRITY
REGULATIONS
University
of
Wisconsin
System
Administration
March,
2011
................................................................................................................................................
INTRODUCTION
2
2
SUMMARY
OF
CHANGES
TO
REGULATIONS
....................................................................................................
2
State
Authorization
&
Distance
Learning
Requirements
(§600.9)
...............................................................
2
State
Authorization:
.................................................................................................................................
5
Distance
Learning
Education:
..................................................................................................................
5
Penalty:
....................................................................................................................................................
12
Disclosure
Requirements
(§668.43)
...........................................................................................................
13
Incentive
Compensation
(§668.14)
............................................................................................................
....................................................
Definition
of
Credit
Hour
and
Accreditation
Process
(§§600.2,
600.24)
14
18
Validity
of
High
School
Diplomas
(§668.16(p))
..........................................................................................
20
Satisfactory
Academic
Progress
(§§668.16,
668.34)
..................................................................................
21
Repeat
Coursework
(§668.2)
.....................................................................................................................
..................................................................................
Student
Aid
Disbursement
and
Refunds
(§668.164)
22
24
R2T4
(Return
of
Title
IV
Aid)
Withdrawal
(§668.22(a),
(b),
(f))
..................................................................
26
Gainful
Employment
(§§600.2,
600.4,
668.6)
............................................................................................
Student
Eligibility
&
Aid
Determination:
Ability
to
Benefit/Approval
of
Independent
Tests
(§668.32,
28
Subpart
J
of
Part
668
(§668.141,
et.seq.)
..................................................................................................
30
Verification
and
Updating
of
Student
Aid
Application
Information
(Subpart
E
of
Part
668)
.....................
32
Misrepresentation
(Subpart
F
of
Part
668)
................................................................................................
34
Written
Arrangements
Between
Institutions
(§§668.5,
668.43)
...............................................................
35
ATTACHMENTS
TO
REPORT
...........................................................................................................................
35
Program
Integrity
Regulations
(by
CFR
section)
................................................................................
...................................................................
Eduventure/WCET
“Starter
List”
(revised
January
2011)
35
University
of
Wisconsin
System
Administration
Working
Group
Report
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PROGRAM
INTEGRITY
REGULATIONS
INTRODUCTION
On October 29, 2010, the Department of Education issued a new set of administrative rules
covering a variety of topics under the rubric of “program integrity.” While the rules have been
widely characterized as targeting abuses in the for-profit sector, all institutions that participate in
Title IV student aid programs will be impacted. The breadth and depth of these rules cover a
wide range of topics and will substantially impact institutional operations. A significant number
of questions have been raised by the University of Wisconsin (UW) institutions relating to the
impact and intent of the rules, as well as the recommended approaches for ensuring compliance.
For example, under the State Authorization requirements, institutions must be legally authorized
by name to operate postsecondary education programs in a state where the institution has a
physical presence. In addition, states must establish a complaint process under which states can
receive, review, and respond to public complaints regarding postsecondary education. A new
provision was added to require institutions to obtain approval from any state where a student
who enrolls in a distance learning/online education program is located. Even though some states
maintain certain requirements for distance learning, the new regulations now impact all fifty
states where UW students may reside. The other example includes the Gainful Employment rule
requires institutions to track student post-graduation placement, income and other data. While
degree programs are exempted from this specific requirement, the changes will require additional
resources to monitor certificate, continuing education and other non-degree programs. Due to
these changes, among others, a working group was established to provide guidance and direction
toward compliance with the new program integrity regulations. This report is intended to offer
an overview of the regulations, the potential impact upon UW institutions, and suggestions
toward compliance.
SUMMARY
OF
CHANGES
TO
REGULATIONS
State
Authorization
&
Distance
Learning
Requirements
(§600.9)
Summary:
State
Authorization:
Regulation: In response to the Department of Education’s concerns over the inconsistent
approval and oversight methods of States in regard to institutions offering postsecondary
education, the “State Authorization” requirements were amended to force States to take a
more active role in approving an institution’s postsecondary education by authorizing
institutions by name, and creating a complaint process in which a State (or its equivalent) can
receive, review and respond to public complaints relating to postsecondary education.
In general, these regulations are applicable to institutions of higher education, proprietary
institutions of higher education or postsecondary vocational institutions that maintain a
physical presence within a State and/or offer postsecondary education through distance
learning or correspondence education in a State where the institution is not physically
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located. (Note that the specific regulations addressing the distance learning education are
found under §600.9(c) as discussed below) This includes all UW institutions within the State
of Wisconsin along with their respective online or distance learning education courses or
programs (whether funded by the institution or as a cost-recovery program).
Applicable Definitions:
Institution of Higher Education is defined as an accredited public or other nonprofit
institution in any state that is legally authorized to provide a program of education
beyond secondary education. This includes institutions that provide: (1) a program that
leads to a bachelor’s degree; (2) a not less than a 2-year program that is acceptable for
full credit toward a bachelor’s degree; (3) a degree that is acceptable for admission to a
graduate or professional degree program; or, (4) a not less than a 1-year program of
training to prepare students for gainful employment in a recognized occupation.
An institution is legally authorized by the State if the State establishes the institution by name
as an educational institution through its charters, laws, constitutional provisions or articles of
incorporation that authorize an entity to offer postsecondary educational programs, including
programs leading to a degree or certificate. As stated in the Comments of the Federal
Register, “unless a State provides at least this minimal level of review, we do not believe it
should be considered as authorizing an institution of offer [postsecondary education].” 75
Fed. Reg. 66859, 66863. If a state has additional approval or licensure requirements, the
institution must also comply with those requirements in order to be considered legally
authorized. If the entity is established as a business or nonprofit charitable organization (i.e.
not an educational institution), the entity must obtain authorization to offer postsecondary
educational programs.
According to the Comments, public institutions established by state law, such as the
University of Wisconsin System and its institutions, are considered instrumentalities of a
State government and thereby considered compliant with the provisions of §600.9(a)(1)(i).
However, if, for example, the State of Wisconsin maintains additional state requirements in
regard to operating a postsecondary educational institution, public institutions must
demonstrate that they have met all additional requirements in order to remain compliant
under §600.9(a). 75 Fed. Reg. 66861.
Complaint Process: Even though public institutions may be considered “authorized”
pursuant to their home state’s authority, institutions will not be legally authorized to offer
postsecondary education under §600.9(a)(1) unless the State has a process under which it can
receive, review and appropriately act on complaints concerning postsecondary education,
including the enforcement of applicable State laws. §600.9(a)(1).
“If a State declines to provide an institution with legal authorization to
offer postsecondary education in accordance with §600.9, the
institution will not be eligible to participate in Federal [student Title
VI financial aid] programs.” 75 Fed. Reg. 66859.
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The purpose of the complaint process shall be to determine whether an institution or
education program is complying with state laws, including licensure and approval
requirements. It must address three ranges of complaints: 1) violations of state consumer
protection laws (e.g., false advertising); 2) violations of state laws or rules relating to
licensure of postsecondary institutions; and 3) complaints relating to quality of education or
other state or accreditation requirements. 75 Fed. Reg. 66865-66866. If the current
complaint process fails to address these three areas, the process will be considered
noncompliant with §600.9(a)(1) and the institutions operating within such State will not be
“legally authorized” to offer postsecondary education.
A State may delegate this authority to one or more regulatory state agency or the State’s
Attorney General’s Office to manage the complaints; however, the State must remain
responsible for the official response and resolution of the complaints. The State may also
defer an initial review of a complaint to an accreditation agency, but the State retains the
primary role and responsibility in determining the appropriate resolution to assure student
consumer protection against fraudulent or abusive practices by postsecondary institutions. 75
Fed. Reg. 66866. The State cannot assign this responsibility to a higher education board or
agency, as the process must be separate and apart from an educational institution’s complaint
and sanctioning process in order to provide an independent review.
Extension to Delay Effective Date: If a State fails to implement a mechanism to authorize
institutions to offer postsecondary education within its territory by July 1, 2011, the affected
institution may request a one-year extension, and if necessary, an additional one-year
extension (up to July 1, 2013) from the Secretary of the Department of Education. The
institution’s request for an extension must include an explanation from the State as to how an
extension will permit the State to comply with §600.9(a)(1). If the extension is granted, the
effective date of §600.9(a) and (b) is extended to the new date. According to the Discussion
section of the Federal Register, such time frame should be sufficient to permit a State to
modify its procedures to comply with the new regulations. 75 Fed. Reg. 66863.
Notice and Disclosure of Authorization: Once an institution has received legal
authorization, it must provide documentation to the Secretary of the Department of Education
to verify that it is legally authorized to provide postsecondary education programs within the
State. It must also provide its enrolled and prospective students with a copy of the state
approval or licensure upon request. Finally, the institution must provide its enrolled and
prospective students with the contact information of the applicable state agency or office
where complaints may be filed. (See Disclosure Requirements herein).
Reciprocal Agreement: If a State that has a reciprocal agreement with another state to
recognize each other’s authorization, the Department of Education will consider the
institution legally authorized in both States as long as the institution provides appropriate
documentation of authorization from the home State and of the reciprocal agreement. 75
Fed. Reg. 66867. (Note: As stated herein above, in addition to the reciprocal agreement, both
States must have a complaint process for the institution to be considered “authorized” under
§600.9.)
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Distance
Learning
Education:
Regulation: Under §600.9(c), if an institution is offering postsecondary education through
distance or correspondence education to students in a State in which it is not physically
located or in which it is otherwise subject to State jurisdiction as determined by the State, the
institution must meet the State’s requirements to be legally offering postsecondary distance
or correspondence education within that State.
“If an institution is offering postsecondary education through distance
learning or correspondence education to students in a State in which it
is not physically located or in which it is otherwise subject to State
jurisdiction as determined by the State, the institution must meet any
State requirements for it to be legally offering postsecondary distance
learning or correspondence education in that State.” §600.9(c); 75
Fed. Reg. 66947
Documentation: Upon request by the Secretary of the Department of Education, the
institution must be able to document that the State has approved the institution to offer
postsecondary distance learning or online education within its borders. §600.9(c); 75 Fed.
Reg. 66947. For those States that have set requirements regarding online or distance learning
education, the institution must obtain approval before offering distance learning or online
education to a student located in that State. This means that in order for the student to be
eligible for Title IV/ HEA funds, the institution must identify the student and seek approval
from the State before enrolling the student in an online course or program. In order to remain
eligible, the student’s location must be reevaluated each time that the institution makes a new
award. [See USDOE “Dear Colleague” Letter, Mar 17, 2011]
If a State does not have an approval process in place, the institution may continue to offer its
distance learning education as long as it can document that it sought approval from the State
(and the State confirms this fact). If a State does not regulate such activities by out-of-state
institutions, the institution will be considered to be legally operating in that State.
Notice and Disclosure Requirements: Even if a State does not regulate out-of-state distance
learning education, the institution is still required to provide its students and prospective
students with contact information for filing complaints with its accrediting agency and with
any relevant State official or department that would appropriately handle a student’s
complaint. See Disclosure Requirements herein; 75 Fed. Reg. 66866; See USDOE “Dear
Colleague” Letter, Mar 17, 2011.
Penalty:
The penalty for failing to comply with the provisions of §600.9 may include, but are not limited
to: 1) the institution’s loss of eligibility to participate in the federal student financial aid
programs; 2) loss of eligibility to participate in the federal student financial aid programs with
respect to the particular State in which the institution is not approved/in compliance; and 3)
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reimbursement by the institution of Title IV funds that were obtained without the requisite State
authorization or approval to receive them. [See USDOE “Dear Colleague” Letter, Mar 17, 2011]
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Impact:
State Authorization Requirements: Because the University of Wisconsin System was
created as a “system of institutions of learning known as the University of Wisconsin
System”, any university or organizational equivalent designated by the Board of Regents of
the University of Wisconsin (whether a university, college or extension) is a part of the
University of Wisconsin System and is thereby authorized by the State of Wisconsin to
provide postsecondary education in compliance with §600.9(a)(1)(i)(A). Wis.Stat., §36.03.
[Note that if the State of Wisconsin has additional licensure or approval requirements
through State boards or agencies, the UW System and its institutions must also demonstrate
compliance with such additional state law requirements, including any provisions relating to
distance learning or online programs.]
However, that is only one part of §600.9(a) for purposes of compliance. In order to fulfill the
state authorization requirements under §600.9(a), the State of Wisconsin must have a
complaint process through which to receive, review and respond to concerns relating to
postsecondary education. Failure of the State of Wisconsin to establish such a complaint
process prevents the UW institutions from being “legally authorized” to provide
postsecondary education for purposes of Title IV eligibility. Therefore, the State must act to
create such a process on or before July 1, 2011 in order for the UW institutions to be
considered in compliance with §600.9(a)(1) and avoid the loss of federal aid eligibility and/or
a loss of students’ eligibility to receive federal aid.
The UW System and its institutions may seek an extension beyond the July 1, 2011 deadline
by submitting an explanation from that states how the extension will permit the State to
comply with §600.9 (authorization and complaint process). 75 Fed. Reg. 66833 and 66863.
If the UW institutions continue to operate after July 1, 2011 and the State is noncompliant
with §600.9(a)(1), the institutions will not only risk losing federal aid eligibility for purposes
of Title IV, HEA, but the institutions may be required to reimburse the Department of
Education for any funds received during this period.
Distance Learning: This change will also have a significant impact on UW institutions’
distance learning and correspondence programs offered to students who are located in states
other than Wisconsin. As of July 1, 2011, institutions offering distance learning or
correspondence education outside of the State of Wisconsin will be required to verify that
they have either met a respective state’s requirements for offering out-of-state distance
learning or correspondence education within that state, or, in the alternative, verify that the
institution has contacted the state and determined that no approval or requirement exists.
This will require additional time and resources of university staff. Two UW institutions have
already confirmed that their distance learning education programs have at least one or more
students located in each of the fifty states, thereby requiring the institutions to seek approval
from each of the fifty states on or before July 1, 2011.
To go a step further, national speakers proclaim that due to the general nature in which the
regulations are written, the institutions must assume that the approval process will cover not
only distance learning programs, but any form of education, whether it is an online course or
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some form of distance correspondence. For example, the rules would cover non-degree
seeking students who enroll in random courses without declaring an interest in a particular
program. In addition, there are continuing students from some campuses who may head
home for a summer and seek to enroll in an online course when they are back in their home
state. The regulations fail to define “students in a State,” thereby leaving open the question of
whether it applies to students with permanent residency or merely located within the State at
the time of enrollment. The guidance provided by the USDOE suggests that UW institutions
must seek and obtain the approval requirements of a State in which the UW student is
merely located at the time of enrollment for purposes of eligibility. [See USDOE Dear
Colleague Letter, Mar 17, 2011] For every award period thereafter, the institution will be
responsible for reevaluating the student’s location to determine whether he or she remains
eligible for Title IV, HEA funds. There is no minimum enrollment for purposes of
complying with the requirements hereunder. For example, if a student is enrolled in an
online course in the State of Missouri and moves to the State of Texas, the institution must
verify that it has approval to offer this course in the State of Texas. If the State of Texas
refuses to approve the institution’s course or program, the institution must cease the course or
program immediately. This adds another dimension to this issue regarding the termination of
a student’s enrollment mid-course and the ramifications of such act, including potential
reimbursement of tuition and fees, reduction in courses which could impact the student’s
financial aid eligibility, and more.
In addition, the fees and costs associated with the authorization process will likely result in
an increase in the operational costs of the distance learning programs due to the application,
registration and/or licensure fees that will likely be required to continue offering online
education within a state. A number of states have application fees ranging from $500
to$3000 with an additional fee of $500 per program. Other states have not established a
specific application or licensure fee for distance learning because they have not previously
regulated this type of activity. However, those states now have the opportunity to create a
fee structure that may provide an opportunity for additional revenue during difficult
economic times. These costs may result in either an increase in costs associated with these
distance learning programs or a reduction in programs that are offered. Either result would
likely cause a decrease in student enrollment. Ultimately, since a number of states do not
regulate or license distance learning education and/or do not apply state requirements to these
types of educational options, it is difficult to predict the full extent of the impact on each
institution.
One possibility for reducing the impact of complying with the requirements of the State
Authorization (§600.9(a)(1)) and Distance Learning (§600.9(c)) regulations would be for the
State of Wisconsin to pursue reciprocal agreements with other states which recognize public
institutions as being “authorized” for purposes of offering postsecondary education within
that state. UW institutions would be able to provide postsecondary education within such
states without the required application, licensure or related costs. For example, if Wisconsin
and Minnesota created such agreement, the public institutions from each state could offer
postsecondary education in the other state as if they were legally authorized to do so.
However, the reciprocating state must have a complaint process in order for the institution to
be “authorized” under §600.9. This option would likely require, at a minimum, involvement
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from other executive branches of state government and could not be accomplished by the
UW System alone.
The UW institutions will be required to create and maintain a database or record-keeping
system whereby it can verify that it is legally authorized by name to provide postsecondary
education in the State of Wisconsin in addition to documenting that it has met applicable
State requirements in regard to offering postsecondary education through distance learning or
correspondence education. The documentation must be available to the Secretary of the
Department of Education upon request, and provided to prospective and enrolled students as
well.
Steps
to
Compliance:
Due to the significant impact of these regulations on UW institutions, both for purposes of being
legally authorized to offer postsecondary education programs within the State of Wisconsin and
providing distance learning or correspondence education outside of the State of Wisconsin, it is
highly important that the UW System Administration and its institutions prepare for the July 1,
2011 changes by taking the following steps, at minimum:
System Administration should designate an individual and/or office to serve as the System’s
official contact in regard to the preparation and implementation of the pending changes. This
individual and/or office should be familiar with the process involved in the State of
Wisconsin’s authorization and complaint process for postsecondary education within the
State, along with the process involved in the development, implementation and management
of distance learning and/or correspondence education offered by UW institutions outside of
the State.
System Administration should initiate contact with its state government representatives to
determine what is required, if anything, to verify that the State of Wisconsin has a process in
place to legally authorize the UW System (and/or its institutions) by name to offer
postsecondary education in the State of Wisconsin. In addition, it is imperative that the State
of Wisconsin create a process in which it can receive, review and appropriately respond to
complaints regarding an institution’s postsecondary education as required by §600.9(a).
Finally, System Administration should recommend to the State of Wisconsin that it consider
pursuing reciprocal agreements with other states to recognize UW institutions as authorized
to operate both on-site postsecondary education and distance learning programs within the
reciprocating state. Such agreement would significantly decrease the costs and resources
required to comply with out-of-state authorization licensure and approval requirements.
Each institution should designate an individual and/or office to work closely with all
academic units and distance learning programs affected by these changes to determine the
most effective and efficient method in complying with the State of Wisconsin’s authorization
requirements and out-of-state requirements for distance learning or correspondence education
(including those states where students currently reside along with those states where the
institution is offering or advertised its courses/programs for enrollment). This individual
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and/or office will also serve as a liaison between the campus and System Administration for
purposes of pursuing state authorization and state requirements, when necessary.
Each institution should take steps to catalog all academic programs which offer online
courses or distance learning education to determine the nature and extent of its staff resources
required to pursue the necessary state approvals for both existing and future programs or
courses by July 1, 2011.
Each institution should review the budgetary and funding requirements for the academic
programs offering online and distance learning education to determine the financial impact
that may result from seeking approval from those states in which students currently reside.
Until a decision is made in regard to the most effective and efficient manner in seeking
approval on behalf of those UW institutions offering online or distance learning education,
the institutions should engage in discussions regarding what steps need to be taken at the
campus level in order to comply with these new regulations.
For those institutions that are currently offering distance or online education to students
outside of the State of Wisconsin, a standard letter should be prepared that will be directed to
all affected states which indicates that the institution is responding to the new “state
authorization” federal regulations that go into effect on July 1, 2011. This letter should seek
state authorization for the programs offered and request that the State respond by indicating
what will be required to meet the State’s requirements, such as: 1) specific state
authorization/licensure/approval requirements for an out-of-state institution delivering online
programs into the state; 2) specific reference to the state’s governing law and regulations; 3)
application and materials required to be submitted; 4) time and calendar requirements for
submission; 5) length of time before the agency will act on a completed application, once
submitted; 6) the process that is employed for reviewing the application, including site visits
or external review processes; 7) cost to apply and any ongoing costs to the institution; 8)
whether any exemptions are allowable and if so, what are the procedures and costs for
requesting an exemption; 9) whether any reciprocal or consortial arrangements are
allowed/approved to meet the state authorization/licensure/approval requirements; and 10)
the period of time covered by the authorization/licensure/approval, if granted. 1 The letter
should also indicate that the institution is currently, or may in the future, enroll students from
that State in online/distance education.
Even though the regulations do not become effective until July 1, 2011, UW System
Administration and institutions should work together to coordinate the most effective and
efficient approach toward compliance with the new regulations, which should include
immediate action toward: 1) obtaining state authorization within the State of Wisconsin
(which will include verifying that the State of Wisconsin has a complaint process in place or
will establish such a process on or before July 1, 2011); and 2) determining the approval
requirements from each state within the country for purposes of receiving approval to offer
distance learning/online education to both current and prospective student(s) who are located
within said states(s).
1
This list was prepared and recommended by the University Professional & Continuing Education Association.
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In summary, there are more questions than answers in regard to the impact of these regulations
on institutions of postsecondary education that are eligible for Title IV/HEA funding. At this
point, the most effective approach toward reaching compliance is to designate appropriate UW
System Administration and institution officials who will oversee compliance efforts in regard to
the new regulations, continue to collect information regarding the interpretation of the
regulations, contact state officials to verify the existing mechanisms in place for purposes of state
authorization/complaint process, work closely with other campus officials to avoid duplicative
efforts, and create a detailed course of action toward compliance within the necessary
timeframes.
Guidance from Other Resources:
Due to the significant impact on educational institutions that offer online programs throughout
the country, and in response to many inquiries, a few organizations have prepared information
and guidance on these changes and the impact on educational institutions, such as National
Association of College and University Attorneys (NACUA), Eduventure and the WICHE
Cooperative for Educational Technologies (WCET). A useful resource from NACUA can be
found at: http://www.nacua.org/lrs/NACUA_Resources_Page/StateAuthorizationRule.asp. In
addition, Eduventure and WCET have worked together to create a “Starter List” as a resource to
assist educational institutions in determining the state-by-state licensure and authorization
requirements. (Attached). (Note that this information has not been verified for accuracy). In
addition, WCET has offered the following suggestions to prepare institutions for this change:
(Note: This information can be found on the WCET website at: http://wcet.wiche.edu/advance/state-
approval.)
1. Designate a person or office to be the institution’s main contact in regard to the
preparation and implementation of the pending changes. For example, some institutions
have dedicated up to four staff members to assume this responsibility.
2. Determine each institution’s distance learning or online program enrollment history. For
example, review the states in which the institution has advertised and provided distance
learning programs to students. Determine which states you need to address first.
3. Become familiar with each state’s regulatory requirements. For example, there are
resources available that provide an overview of state-by-state regulatory requirements for
state authorization. A number of states regulate all educational programs offered in the
state, but do not provide guidance on whether it would apply to online or distance
learning programs. Other states have no requirements. Some states expect every
institution to seek approval. For the vast majority of states, it will depend on what
educational programs the institution intends to offer.
4. Collaborate with Institution leadership and System Administration. Involve key officials
(distance education directors, provosts, chief financial aid officers, system administration
and legal) of how this issue will affect the institution and what steps you plan to take to
address the pending changes. For example, what impact will the new regulations have on
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the program’s budget (application and licensure fees by state)? What type of resources
will be necessary to comply with the regulations? Will the institution be required to
reconsider its current and future plans to offer distance learning or specific programs in
other states? Will there be legal exposure to the institution if it continues its current
distance learning programs?
5. Prepare a Snapshot Description of Institution’s programs offered in other states. Whether
the institution will be required to seek state authorization for its programs depends
entirely on the description and type of program being offered. Experts recommend that
institutions create brief “profiles” that describe the institution and its intended activities in
the state. This will assist the state regulatory agency in determining whether the
institution will be required to submit an application for licensure. An example of a
summary might include:
• Name of institution.
• Type of institution (public, for-profit, religious-based, etc.).
• Programs and degree levels in which you previously, currently, or plan to enroll
students in the state.
• List of activities within state (include information, such as: does the institution
maintain a local mailing address or phone number in the state, advertise in local
media, require students to take proctored tests, place recruiting officers or faculty
within the state, etc…).
• The institution’s contact information (by individual and office).
6. Document Institution’s Plan of Action. One of the requirements under the new regulation
is the ability to provide documentation regarding state authorization. Establishing a
record-keeping process will assist in these efforts, if and when it becomes necessary.
Disclosure
Requirements
(§668.43)
Summary:
Under Section 668.43(1)(b), institutions are required to make certain institutional information
available for review by enrolled and prospective students, and to provide other information to
enrolled or prospective students.
Specifically, institutions must make the following available for review by enrolled and
prospective students:
• Documents describing the institution’s accreditation; and
• Documents describing the institution’s State, Federal, or tribal approval or licensing.
[Note: UW institutions are not licensed by the State of Wisconsin, although reference
could be made to Wisconsin Statutes, Chapter 36.]
Institutions must also provide its students or prospective students with:
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• Contact information for filing complaints with its accreditor and with its State approval
or licensing entity (according to the Comments to the final regulations, institutions must
provide not only the contact information for the State or States in which it is physically
located, but also the contact information for States in which it provides distance
education to the extent that the State has any licensure or approval processes for an
institution outside the State providing distance education in the State); and
• Any other relevant State official or agency that would appropriately handle a student’s
complaint.
Impact:
This regulation requires certain basic disclosures to students. The impact is not expected to be
significant.
Steps
to
Compliance:
UW institutions should make arrangements to make available (perhaps by posting on
websites) documents describing accreditation. The same information should also provide an
explanation of the institution’s status under Chapter 36.
Separately, institutions should provide for prospective and enrolled students contact
information for filing complaints, including both with the appropriate agency in the State of
Wisconsin and in every state in which the institution is licensed or approved to provide
distance education. UW institutions should make reference to Chapter 36 of the Wisconsin
Statutes. UW institutions should work together to develop or seek from another organization
a comprehensive list of the entities taking complaints across the country so that this effort
need not be duplicated by each institution.
Incentive
Compensation
(§668.14)
Summary:
Institutions are not permitted to provide any commission, bonus, or other incentive payment
based in any part, directly or indirectly, upon success in securing enrollments or the award of
financial aid, to any person or entity who is engaged in any student recruitment or admission
activity, or in making decisions regarding the award of Title IV, HEA program funds. This
restriction does not apply to the recruitment of foreign students residing in foreign countries who
are not eligible to receive Federal student assistance.
Applicable Definitions:
Commission, bonus, or other incentive payment is defined as a sum of money or
something of value, other than a fixed salary or wages, paid to or given to a person or an
entity for services rendered.
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Securing enrollments or the award of financial aid is defined as activities that a person
or entity engages in at any point in time through completion of an educational program
for the purpose of the admission or matriculation of students for any period of time or the
award of financial aid to students.
Impact:
Although the regulation permits proper merit-based compensation adjustments and profit-sharing
payments, any employee who receives multiple compensation adjustments in a calendar year and
is engaged in any student enrollment or admission activity or in making decisions regarding the
award of Title IV/HEA program funds is deemed to have received such adjustments based upon
success in securing enrollments or the award of financial aid if those adjustments create
compensation that is based in any part, directly or indirectly, upon success in securing
enrollments or the award of financial aid.
The Comments to the final regulations state that recruitment of student athletes is not different
from recruitment of other students. Incentive compensation payments to athletic department
staff are also governed by these restrictions. If the payments are made based on success in
securing enrollments or the award of financial aid, the payments are prohibited; however, the
Department of Education does not consider “bonus” payments made to coaching staff or other
athletic department personnel to be prohibited if they are rewarding performance other than
securing enrollment or awarding financial aid, such as a successful athletic season, team
academic performance, or other measures of a successful team.
Steps
to
Compliance:
Institutions should review job duties to determine which employees are covered by this
regulation. Moreover, institutions should review compensation methods for all employees
and entities engaging in student recruitment, admissions activity, or decisions regarding the
award of Title IV/HEA program funds to ensure that merit based adjustments have no
relationship to success in securing enrollments or the award of financial aid.
Definition
of
Credit
Hour
and
Accreditation
Process
(§§600.2,
600.24)
Summary:
The Department of Education’s Program Integrity Rules apply to all academic programs offered
by U.S. institutions of Higher Education. The new rules create a quantifiable minimum definition
for credit hours primarily for use in “determining eligibility for, and the amount of, Federal
program funds that a student or institution may receive.” Under the new regulations, the
institution retains the right to determine the credit hours applicable to an amount of work verified
by evidence of student achievement. The proposed guidelines allow for a “reasonable”
approximation in establishing minimum credit hour requirements for other academic activities,
such as laboratory work and internships, etc., which amount to the equivalent level of work over
a different length of time. In determining their equivalent definitions of a credit hour,
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institutions may also use the baseline standard of “other commonly accepted higher education
academic practice.” Institutions may consider the unique characteristics of their program
offerings as well as its distinctive student populations provided that institutions establish other
measures that approximate the minimum standards. Institutions are required to submit their
definitions and related policies regarding credit hour to their accrediting agencies and receive an
official, recorded certification from that accrediting organization that the definitions meet the
new minimum definition of “commonly accepted practice.” [Note that the regulations do not
specifically define this commonly-used term.]
Applicable Definition:
Credit Hour is defined as an amount of work represented in intended learning outcomes
and verified by evidence of student achievement that is an institutionally established
equivalency that reasonably approximates not less than:
(1) One hour of classroom or direct faculty instruction and a minimum of two
hours of out of class student work each week for approximately fifteen weeks for one
semester or trimester hour of credit, or ten to twelve weeks for one quarter hour of credit,
or the equivalent amount of work over a different amount of time; or
(2) At least an equivalent amount of work as required in paragraph (1) of this
definition for other academic activities as established by the institution including
laboratory work, internships, practicals, studio work, and other academic work leading to
the award of credit hours.
Impact:
Although the new rules are primarily intended for use in “determining eligibility for, and the
amount of, Federal program funds that a student or institution may receive,” it is to be expected
that institutions will adopt the mandated credit hour definition (or its equivalent) for all
operations because it is difficult to distinguish between credit hour definitions needed solely for
federal financial aid and other purposes. However, UW institutions will be able to continue using
the long-standing credit-assignment practices that have proven to be the most effective for
determining credit hours or equivalent measures for academic purposes, as long as they
reasonably conform to the Department of Education definition.
Apart from the use for Federal programs, the rules do not limit or prescribe the method which
institutions use to assign credits to their courses for academic or other purposes.
The rules provide institutions with a baseline, not an absolute value. One hour can mean 50
minutes or one clock hour.
However, in some institutions, different programs/disciplines are allowed to use diverging
definitions of credit hours, e.g. different definitions used by the Department of Engineering in
contrast to the Department of Music. Under the new rules, these distinctions would have to be
eliminated and credit hour definitions would have to be applied uniformly to all degree
programs.
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The impact on online delivery might be the strongest. Institutions will have to examine three-
year degree options, accelerated classes and all distance learning and hybrid formats for
compliance. In addition short-term and long-term study-abroad programs need to be examined
for compliance with the new credit hour rule since they often accommodate out-of-class learning
in the community for college credit. At the very least, current policies and definitions regarding
equivalencies at each institution may be subject to review and change. Institutions may have to
create policies that set minimum requirements for what counts as direct faculty instruction in
asynchronous or flexible online delivery of curricula.
Overall, the impact on traditional delivery might be of lesser concern to UW System institutions
because, in essence, the new rules maintain a definition of credit hour similar to the Carnegie
Unit used at many institutions for the same purposes. In the latter, the measuring of a credit hour
is based upon the “seat time” students spend in formal instruction and in direct contact with the
instructor in a face-to-face or virtual classroom and, independently, upon the student’s time spent
for class preparation, studying, and take-home assignments.
Compliance with existing System and Accreditation-required Student Learning Outcomes needs
to be examined and changed, if necessary. Faculty may need to change courses and curriculum.
The requirement to adjust curriculum may interfere with academic freedom and shared faculty
governance. A legal review might be necessary. Quantity of Learning (as measured by the credit
hour definition) may need to be aligned specifically to Quality of Learning.
However, all current (existing) and future Federal Student Aid calculations may potentially be
impacted. Institutions will have to monitor students’ continued eligibility for Federal Student
Aid; this monitoring will require additional work time and budget allocations. Institutions may
need to correct Title IV disbursement amounts if definitions of credit hours used in submitting
the applications are/were not consistent with the new regulations. The amount of Federal Student
Aid the student qualifies for may have to be recalculated. The Department of Education may
determine a repayment liability if the institution calculated student financial aid under faulty
assignment of credit hours and may be required to pay back funds. Further, institutions must
make sure they do not significantly overstate the amount of credit hours a student earns in an
academic program because the Secretary of Education may fine the institution or limit, suspend,
or terminate its participation in federal programs.
Institutions may need to determine whether the Higher Learning Commission (HLC) will
evaluate the above named policies and definitions outside the ordinary institutional review cycle
or whether its current policies will have to be submitted for evaluation immediately, outside the
review cycle.
The accrediting agency might not review promptly or in a timely manner to allow the institution
to act within mandated time frames and federal, state, and local deadlines.
The HLC may need to come up with guidelines and publish evaluation criteria. This process
might delay the institution’s ability to act on Federal Student Aid computations and consequently
could result in student attrition or enrollment decline.
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Steps
to
Compliance:
At a minimum, institutions should review current credit hour assignments to ensure
compliance with the Program Integrity Rules and develop new policies and procedures as
appropriate. Institutions may be required to use the credit hour rules for determining
institutional eligibility, program eligibility and student enrollment status and eligibility in
regard to all federal programs. However, this is not clear from the language of the
regulations. In addition, the Board of Regents should consider whether a formal Board of
Regents rule or policy is necessary to provide direction and guidance to the institutions.
If an institution maintains a separate academic standard for measuring credit hour
requirements, it may have to publicly justify it (in writing) to the extent it differs from the
Department of Higher Education definition, even if it appears reasonable to the institution.
Faculty development and assessment of average time spent by students in completing out-of-
class assignments may have to take place in order to meet minimum requirements.
Instructors should design activities for out-of-class work in a manner that will require
students to utilize approximately two hours per credit hour to complete. Will instructors and
institutions be able to quantify how long each out-of-class assignment in different disciplines
will take individual students equipped with different abilities or time-management skills?
Departments will need to review syllabi or establish assessments to measure whether students
spend two hours out of class to earn one credit hour.
Institutions may also need to set limits for maximum time students are expected to spend out-
of-class on curricular activities related to the classroom hours of instruction.
In articulation agreements and in the computation of transfer of credits from other
institutions, compliance with credit hour minimum standards may have to be monitored.
Registrars, transfer advisors, and prior learning assessment coordinators should be informed
and trained to understand the extent of the new regulations.
In the entitlement and approval of new programs, academic planners at the institution and at
UW System will need to make sure that minimum credit hour requirements are met,
particularly when equivalencies are to be substituted for ordinary assignment during
standard-length semesters or internships, etc. ACIS 1 and AFGP Program Planning
guidelines may have to be revised.
Faculty Teaching Assignments and FTE calculations will have to correspond to the new
regulations in terms of teaching clock hours and credit hours/or equivalencies.
In cases in which teaching/grading is assigned to teaching assistants/co-instructors or
laboratory staff, institutions will have to determine whether that time is to be counted as
faculty instruction.
Institutions will perhaps need to come up with a published, standard reference conversion
chart to track equivalent amount of work over a different amount of time and be consistent
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across programs and departments. In the UW System, this conversion chart may require
Board of Regents approval.
Institutions may be well advised to establish binding equivalencies for inter-semester,
summer programs and study abroad courses. These policies and definitions will have to be
published online and in catalogs and shared with accrediting agencies.
Institutions may have to determine how many hours of work the student performs during
internships or service learning are equivalent to academic learning on a program-to-program
basis. If an internship, for example, lasts 15 weeks and students spend three hours at the
placement agency or site, will that count for one credit hour or are such out-of-classroom
non-academic hours to be counted differently? Institutions may have to establish rules or
equivalencies for internships, etc., that allow for flexibilities in the length of internships
during a semester and ensure that the hours spent are equivalent academically to hours spent
in the classroom or in direct contact with the instructor of a formal academic course.
Institutions may have to set a policy for what counts as “approximately” 15 weeks. Are 13.5
or 16 weeks approximate? State regulations and/or UW System rules may determine the
length of semesters in Wisconsin. If the total time of instruction is not identified as at least
approximate or more than required, what adjustment in the awarding of credit hours needs to
be made? Can a ½ credit hour be created for 7.5 weeks of instruction? Must the minimum
award of a credit hour be at least one or may partial credit hours be earned?
Finally, institutions should draft a definition of credit hour if they do not have one and
contact their HLC liaison immediately to receive detailed instructions regarding compliance.
Validity
of
High
School
Diplomas
(§668.16(p))
Summary:
The new requirements are effective for the 2011-12 award year. The new regulations will apply
to all students, and the 2011-2012 Free Application for Federal Student Aid (FAFSA) form will
include a question about the validity of the high school diploma. Whereas there is currently no
federal requirement for institutions to validate a student’s high school diploma, now institutions
must follow procedures or develop new policies that help registrars and admission officials to
evaluate the validity of a student’s completion of high school and the validity of the High School
Diploma issued. The determination of the validity of high school diplomas refers primarily to the
context of Title IV funds and Federal Student Aid. While institutions have discretion in
determining validity, the decisions must be reasonable and meet common academic practices.
The Department of Education will maintain a list of U.S. public and private high schools that are
proven to provide secondary school education and valid diplomas.
Student documentation or certification is not sufficient. Institutions must validate and verify the
validity of a diploma if they have “reason to believe” that there is a problem. An institution may
have to act on suspicion or doubt if:
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• It has knowledge that the diploma was purchased;
• It has knowledge that the required work for the diploma is not normally associated with
secondary school curriculum and little effort was needed to obtain the diploma;
• The student gives conflicting information about the high school diploma or the high
school itself; and
• There is a record that the high school has been named or suspected of being a diploma
mill.
Validation can be institutionalized by obtaining an official school-issued copy of the diploma
and high school transcripts. When evaluating foreign high school diplomas, institutions may
need to seek the expertise of outside organizations that are recognized assessors of high school
diplomas.
Students without validated high school diplomas may receive Title IV funds if they completed
six college credits and the institution’s program passes the Department of Education’s ability-to-
benefit test. (The exact procedure and requirements for “ability-to-benefit” are not clear at this
point).
Impact:
In registrars and admissions operations, specific procedures and steps that lead to validation, i.e.
checking of bona fide high schools and diplomas need to be established or strengthened.
Coordination with Study Abroad programs and international education experts (on-and-off
campus) will have to be established.
Criteria for non-acceptance of high schools and/or diploma need to be established, possibly
system-wide and validated by UW System or the Board of Regents.
Admissions officers and registrar’s office workers need to be trained to identify possibly fake
diplomas and also gain expertise in research. This training could be costly.
Steps
to
Compliance:
Each institution should take proactive steps to verify diplomas rather than wait until the
Department of Education notifies the institution that a particular school or a diploma is
questionable.
Each institution should create guidelines in determining what high school diploma
equivalents will be accepted for purposes of Title IV compliance, such as a GED certificate,
etc.
While Ability-to-Benefit Determinations set by the Department of Education establish
alternatives to the standard high school diploma requirement for federal student aid
eligibility, institutions may need to determine whether those same Department of
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Education’s alternatives necessarily also apply to students who do not seek financial aid or
those that do not seek federal student aid eligibility.
Prior Learning Assessment practices and regulations in UW System will need to conform
with criteria of Validity of High School Diplomas, including UW System’s competency-
based admission standards and ACIS 1 and other UW System and Regent policies.
An institution should also determine whether translations of diplomas will be accepted and
by which agencies or translators. If the institution seeks to verify that the student’s high
school is an entity that indeed provides secondary school education, equivalency rules for
alternative schools or home-schooling environments need to be established.
The institution must designate a person/officer who is authorized to validate and verify the
information required.
Satisfactory
Academic
Progress
(§§668.16,
668.34)
Summary:
Institutions are required under the new rules to review student academic progress periodically
and develop a structured and consistent approach to develop a policy measuring student
academic progress.
Applicable Definition:
Progress is defined as the student’s pace of progression towards completion of the
program within the time limits set by the institution.
With regard to eligibility for Federal Student Aid, students can become eligible for Title IV by
satisfactorily completing six semester hours toward a degree or certificate at an institution.
Students not making Satisfactory Academic Progress are not eligible for Title IV aid. Progress is
to be measured at the end of each disbursement period or at least annually to correspond to the
end of a disbursement period. The evaluation of Satisfactory Academic Progress must be based
on qualitative progress, e.g. grade point average and quantitative progress, e.g. credits earned
towards degree completion. Institutions must examine whether non-academic progress at the
time of evaluation at the end of the payment period allows for an appeal process. There are two
options:
1. If institutions evaluate Satisfactory Academic Progress only annually or less often than
each payment period, they must institute an appeal process and students can ask to be placed on
financial aid probation. After the end of financial aid probation the student must be making
Satisfactory Academic Progress.
2. For those institutions that evaluate Satisfactory Academic Progress at the end of each
payment status, a warning notice may be used and students may appeal to a review board.
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The institution has flexibility and may impose conditions for a student’s continued eligibility to
receive Title IV aid. That policy must specify the conditions under which a student may appeal
and apply for reconsideration of eligibility for Title IV aid. The appeal must include an
explanation of why the student failed to make Satisfactory Academic Progress and what changes
and adjustments have been made to make it likely that the student will meet the requirements for
Satisfactory Academic Progress at the next evaluation time.
Impact:
Institutions may need to establish a Satisfactory Academic Progress warning mechanism that
informs the student about impending non-eligibility for Federal Student Aid. Reliable
communication channels to reach each student must be established. The Family Educational
Rights and Privacy Act (FERPA) must be observed.
Students may be placed on Financial Aid Warning notice and may be required to make
Satisfactory Academic Progress after one payment period or appeal. Institutions may want to
seek guidance from the Department of Education to determine whether students may be placed
on probation after an appeal, and whether it is the institution or the student who files the appeal
with the Department of Education.
Institutions still have some flexibility to set their own policy, i.e. to monitor a student’s academic
progress more frequently than on an annual basis. However, progress must be measured during
each evaluation.
Steps
to
Compliance:
Institutions must decide what they define as “periodically” and “structured” and “consistent.”
The Board of Regents may supply a binding definition for all UW System institutions. In
determining these definitions, the advantages, disadvantages, and cost of annual review
versus bi-annual review will have to be examined.
The institution may need to develop an individual academic plan for each student to ensure
that the student will be able to meet Satisfactory Academic Progress standards by a set
deadline.
Note: A transfer student’s progress can be accepted by counting the hours accepted toward
completion of the academic program and/or hours attempted.
Repeat
Coursework
(§668.2)
Summary:
Under the new regulations, a student is allowed to repeat courses during a regular semester or
term. Repeat coursework may count toward a student’s full-time enrollment status. Students
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may re-take any course work previously taken to satisfy degree requirements of a program
provided it is not more than one repetition of a course that the student passed previously (e.g. to
improve grade point average). In order to count toward full-time enrollment status under the new
rules, a student may not repeat a previously passed course due to failing other coursework for
counting toward full-time enrollment status. This change in regulations effectively removes a
previous federal requirement that students receive credit for repeated coursework to be aid-
eligible.
Impact:
Campus regulations that allow students to take a class repeatedly until the student reaches a
certain desired grade or improves the student’s GPA will have to be changed.
For students not seeking Federal Student Aid, the repeat-policies may differ if the institution
chooses to maintain separate policies. However, tracking whether a student is financial-aid
eligible or receiving financial aid at the time of designated enrollment periods (often 9 to 12
weeks in advance of the beginning of a semester) might prove to be difficult.
For institutions that do not use the tuition plateau framework, the new regulation may result in
loss of tuition revenue.
Departments/colleges may have to articulate rules for special cases and exceptions. For
example, a student’s enrollment in a repeat course is not intended to be counting toward full-time
enrollment status, but merely to update the student’s skills and competencies required for an
advanced course.
Steps
to
Compliance:
Institutions may need to adjust financial aid allocation for students who intend to re-take a
class for a third time. It will be hard to determine during late enrollment periods whether a
student takes a class for the first or subsequent time. Computers and data-capture procedures
will have to be updated.
Student
Aid
Disbursement
and
Refunds
(§668.164)
Summary:
Institutions must provide a way for a student who is eligible for a federal Pell Grant to obtain or
purchase the required books and supplies by the 7th day of a payment period if, 10 days before
the beginning of the payment period:
• The institution could disburse the Title IV/HEA program funds for which the student is
eligible; and
• Presuming the funds were disbursed, the student would have a credit balance.
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Institution may issue bookstore vouchers, make cash disbursements, issue stored-value cards, or
otherwise extend credit to students to make necessary purchases. Institutions have the flexibility
to choose one or more of these methods or a similar method based on administrative needs,
constraints, and evaluation of costs/benefits.
The amount provided will be the lesser of the presumed credit balance or the amount needed by
the student, as determined by the institution. In determining the amount needed, institutions
could use the actual costs of books and supplies or the allowance used in calculating the
student’s cost of attendance.
In determining the presumed credit balance, institutions must consider all Title IV/HEA program
funds that a student is eligible to receive at that time. Institutions do not have to consider aid
from any other sources. To be eligible, a student must meet all eligibility requirements in
subpart C of 34 CFR part 668 at least 10 days before the start of the payment period. Therefore,
a student who has unresolved issues on the SAR or ISIR or has not completed the verification
process is not covered by the regulations.
Institutions must have a policy under which students may opt out of the way in which an
institution provides for the student to purchase books and supplies. If a student opts out, the
institution is not required to provide another way to purchase books and supplies, so long as it
does not otherwise delay providing funds to the student as a credit balance. The student
authorizes the use of Title IV/HEA funds at the time the student uses the method provided by the
institution. This means that an institution does not need to obtain a written authorization from
the student to credit his/her account.
Impact:
These provisions enable students with financial need to purchase books and supplies at the
beginning of the enrollment period and may prevent those students from taking out private loans
to pay for books and supplies that would otherwise be paid by federal Pell Grant funds.
The largest institutional impact will likely be found in the form of personnel resources to: 1)
analyze and make programming changes necessary to identify Pell Grant eligible students with
presumed credit balances, and 2) make the required disbursements. According to the Federal
Register, the programming changes are estimated to take, on average, 3 hours per institution.
UW institutions that operate textbook rental programs and include the costs of required books
and supplies in tuition/fees may meet the requirements of this regulation.
These provisions do not change how institutions handle the Return of Title IV Aid when a
student withdraws. However, if an institution provides bookstore vouchers, expenses for the
required course materials are considered institutional charges because students do not have a real
and reasonable opportunity to purchase the materials from any other place except the institution.
The institution must include the charges for books and supplies from the voucher as institutional
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charges in determining the portion of unearned Title IV/HEA assistance that the institution is
responsible for returning.
Steps
to
Compliance:
Each institution will need to:
Determine which federal Pell Grant eligible students would have credit balances if all Title
IV/HEA funds were disbursed 10 days before the beginning of the payment period;
Provide a way for these students to obtain or purchase required books and supplies through a
mechanism that meets the institution’s needs; and
Develop a policy to allow students to opt out of the selected mechanism.
Provisions are effective for the 2011-12 award year. [Note: For most UW institutions, the fall
2011 semester will be the first enrollment period in which this provision is effective. However,
for "header" UW institutions (i.e., those that count the preceding summer in the academic year),
implementation may need to occur in June 2011.]
R2T4
(Return
of
Title
IV
Aid)
Withdrawal
(§668.22(a),
(b),
(f))
Summary:
Currently, if a student ceases attendance after completing at least one course in one module
within the term, the student is not considered to have withdrawn and the requirements of §668.22
for the Return of Title IV Aid do not apply. However, other regulatory provisions concerning
recalculation may apply (e.g., revised enrollment status – part time vs. full time).
The following flowchart can be used to determine whether a student in a program offered in
modules is a withdrawal:
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WITHDRAWAL DECISION FLOWCHART ATTACHMENT 1
After beginning attendance, did the If no
student cease to attend or fail to begin a
Not a withdrawal
course he was scheduled to attend?
If yes
When the student ceased to attend or If yes
failed to begin a course, was the student
still attending any other courses?
If no
Did the student confirm attendance in a If yes
module beginning later in the period (45
days, for nonterm and nonstandard term
programs)?
Withdrawal
If no
(Note: These regulations do not change what it means to complete days for credit-hour programs
or clock hours for clock-hour programs, for the purpose of determining the amount of aid earned
by a withdrawing student.)
A student is not considered to have withdrawn if the student ceased attending the modules he/she
was scheduled to attend, but the institution obtains a written confirmation from the student at the
time of the withdrawal that he/she will attend a module that begins later in the same payment
period or period of enrollment. For non-term or nonstandard-term programs, a confirmation is
valid only if the module the student plans to attend begins no later than 45 calendar days after the
end of the module the student ceased attending.
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PROGRAM
INTEGRITY
REGULATIONS
If the institution has not obtained a written confirmation that the student intends to return within
that time period, the student is considered to have withdrawn. If an institution obtains a written
confirmation but the student does not return as scheduled, the student is considered to have
withdrawn from the payment period or period of enrollment. Any return amounts are calculated
as if the student had not provided written confirmation of future attendance (i.e., back-dated
calculation). If a student does not provide confirmation of his/her intent to return but does return
within 45 days, the institution must “undo” the Return of Title IV funds calculation and treat that
student as if he/she had not ceased attendance.
In addition, the Program Integrity Regulations indicate that if an institution is required to take
attendance or requires that attendance be taken for some students, the institution must use its
attendance records to determine a withdrawal date.
Impact:
The Program Integrity provisions may increase the number of Title IV return calculations,
because the withdrawal ‘trigger’ has been extended throughout the payment or enrollment
period, instead of the completion of just one module. However, institutions have always had to
track students in module programs beyond the first course/module to determine whether the
student’s enrollment status changed and Title IV recalculations were necessary.
Additional effort may also be needed to obtain confirmation of anticipated return dates and
monitor whether that return actually occurred.
The attendance requirement will have little to no impact on institutions. If attendance is taken
for a particular course or for a particular instructor, those attendance records are already used by
institutions in calculating withdrawal dates.
Steps
to
Compliance:
Institutions will need to develop processes for obtaining confirmation of anticipated return
dates and monitoring whether students actually return at that time.
Gainful
Employment
(§§600.2,
600.4,
668.6)
[NOTE: additional regulations are pending and expected to be released in the near future.]
Summary:
The new regulations apply to programs at least one-academic-year in length that lead to a
certificate, degree, or other recognized educational credential and that prepare a student for
gainful employment in a recognized occupation. These rules do not cover: (1) degree programs
or (2) two-year programs that are fully transferable to a baccalaureate degree. Certain programs
provided by proprietary institutions of higher education or postsecondary vocational institutions
are also subject to this requirement. A recognized occupation is either: (1) identified by a
Standard Occupational Classification (SOC) code established by the Office of Management and
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Budget or an Occupational Information Network O*NET–SOC code established by the
Department of Labor; or (2) determined by the Secretary of Education in consultation with the
Secretary of Labor to be a recognized occupation.
For covered programs, institutions must report:
• Identifying information regarding which students are enrolled in a program and the
program’s CIP code.
• For students completing a program.
• The program name and CIP code;
• Date student completed the program;
• Amount student received from private educational loans and institutional
financing plans that the student owes to the institution upon completing the
program; and,
• Information whether the student matriculated to a higher degree program at the
institution or another institution.
• By name and CIP code for each program offered by the institution, the total number of
students who are enrolled in the program at the end of each award year and identifying
information for those students.
Institutions must report this information for the 2006-07 through 2009-10 award years by
10/01/2011, and by the date established by the Secretary of Education for information for
subsequent award years.
For each covered program, the institution must provide prospective students with the following
information, including posting it prominently on its website and including in promotional
materials:
• Occupations that the program prepares students to enter;
• On-time graduation rate for students entering the program (using the calculation included
in the rules);
• Cost of the program, including tuition & fees, books, supplies, and room & board;
• Placement rate for students completing the program as determined under a methodology
developed by the National Center for Education Statistics;
• Median loan debt incurred by students completing the program. Median loan debt from
Title IV/HEA program loans, private educational loans and institutional financing plans
must be reported separately; and,
• The Department of Education will develop a disclosure form that institutions will be
required to use.
Institutions must also calculate an on-time completion rate for each covered program and must
notify the Department of Education at least 90 days before the first day of classes when it intends
to add a new program that prepares students for gainful employment in a recognized occupation.
The institution must also provide certain information to the Department of Education regarding
any new programs
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Impact:
Depending on the number of covered programs at an institution, the impact could be significant.
Institutions will need to determine which programs are covered by this rule, monitor student
progress and develop the required information for each student who completes the program.
Institutions will also be required to calculate and make the required debt and graduation rate
information rate information available. Institutions may need to designate a compliance officer
relating to this rule.
Steps
to
Compliance:
Institutions should identify all covered programs and develop procedures to assess whether
any proposed programs would be covered by this rule. For covered programs, institutions
should review the regulations, and determine the relevant data and other requirements (such
as required disclosures in publications and websites).
Institutions may want to identify a compliance officer or designate one individual or office
with ensuring compliance.
Standard procedures should be developed so that the necessary calculations and reports
become part of general business operations and processes.
Student
Eligibility
&
Aid
Determination:
Ability
to
Benefit/Approval
of
Independent
Tests
(§668.32,
Subpart
J
of
Part
668
(§668.141,
et.seq.)
Summary:
These sections change how students become eligible for Title IV financial aid (Ability to
Benefit). Section 668.32 requires students, in order to qualify for aid under the former rules,
meet certain programmatic and other (such as satisfactory academic progress) requirements and:
• Have a high school diploma or its recognized equivalent (See Validity of High School
Diploma herein);
• Have obtained a passing score on an independently administered test in accordance with
subpart J of section 668 (see discussion below);
• Be enrolled in an eligible institution that participates in a State “process” approved by the
Secretary under subpart J of section 668 (see discussion below); or,
• Have been home-schooled, and either obtained a State secondary school completion
credential for home school or have completed a secondary school education in a home
school setting that qualifies as an exemption from State compulsory attendance
requirements.
The rules add a fifth mechanism for qualification to §668.32:
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• The student has satisfactorily completed 6 semester hours, 6 trimester hours, 6 quarter
hours, or 225 clock hours that are applicable toward a degree or certificate offered by the
institution.
In addition, the rules amend subpart J of section 668, which governs the approval of
independently administered tests and the approval of State processes to determine eligibility for
Title IV aid for students without a high school diploma or a recognized equivalent (one of the
five mechanisms for assessing Ability to Benefit). This subpart covers submission of tests to the
Secretary of Education and the requirements for a successful application and approval of a test,
including the determination of passing rates. An institution is liable for Title IV program funds
disbursed to a student whose eligibility is determined through the use of an independently
administered test if:
• The institution used a test that was not administered independently;
• The institution or an employee of the institution compromised the testing process in any
way; or,
• The institution is unable to document that the student received a passing score on an
approved test.
Subpart J also provides for the approval of State processes as alternatives to using or requiring a
passing score on an independently administered test. A State must demonstrate that students
admitted under the process have a success rate that is within 95 percent of the success rate of
students with high school diplomas. Participating institutions must provide each student without
a high school diploma or its equivalent who are admitted through this process with the following
services:
• Orientation regarding the institution's academic standards and requirements, and student
rights;
• Assessment of each student's existing capabilities through means other than a single
standardized test;
• Tutoring in basic verbal and quantitative skills, if appropriate;
• Assistance in developing educational goals;
• Counseling, including counseling regarding the appropriate class level for that student
given the student's individual's capabilities; and,
• Follow-up by teachers and counselors regarding the student's classroom performance and
satisfactory progress toward program completion.
As part of its process, States that establish a process must:
• Annually monitor each participating institution's compliance with the requirements and
standards contained in the State's process;
• Require corrective action if an institution is found to be in noncompliance; and,
• Terminate an institution from the State process if the institution refuses or fails to comply
with the process requirements.
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Impact:
For those students using the new Ability to Benefit/Eligibility option, the credits/hours used for
establishing eligibility for Title IV aid funds may also count towards a degree/program
completion. Therefore, a student cannot be paid Title IV funds for the payment period in which
these 6 credits are earned/hours accumulated, because the student has not established eligibility
under the Ability to Benefit until after the credits/hours are satisfactorily completed. Although
the coursework does not have to be applicable towards the particular program the student intends
to complete, it is expected that the coursework be applicable to a Title IV-eligible program at the
institution.
The changes to subpart J (approval/use of independently administered tests and State processes)
impose requirements and liabilities on institutions. For example, institutions will be responsible
for certain issues associated with an independent test. In those instances, an institution would be
liable for Title IV aid disbursed to affected students. In addition, the new rules require
institutions to provide certain services to those students who qualify using a State-established
process (see Summary section).
Steps
to
Compliance:
Institutions should develop a procedure for identifying and monitoring students who enroll
without a high school diploma or equivalent who are attempting to become eligible for Title
IV aid by successfully completing 6 semester hours applicable toward a degree or certificate
offered by the institution. This will ensure that students are not awarded aid prior to
establishing Ability to Benefit/Eligibility and students do receive aid once eligibility is
achieved.
Institutions should also establish procedures to ensure that any test accepted as evidence of
Ability to Benefit has been approved by the Secretary of Education and continues to be
considered valid. Institutions must also document a student’s score and ensure that it is
considered passing. If an institution uses a State process, it must ensure that the required
95% success rate is maintained by the State, and monitor/verify that each student admitted
under the process receives the set of services required by the rules.
Verification
and
Updating
of
Student
Aid
Application
Information
(Subpart
E
of
Part
668)
Summary:
In general, the regulations require institutions to verify the information submitted by applications
for financial assistance under the subsidized student financial assistance programs. Applicants
are required to provide the documents or information requested by the Secretary of Education or
the institution.
Applicable Definitions:
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Subsidized student financial assistance programs are defined as Title IV/HEA programs
for which eligibility is determined on the basis of an applicant’s Expected Family
Contribution (EFC). These programs include the Federal Pell Grant, Federal
Supplemental Educational Opportunity Grant (FSEOG), Federal Work-Study (FWS),
Federal Perkins Loan, and Direct Subsidized Loan programs.
Unsubsidized student financial assistance programs are defined as Title IV, HEA
programs for which eligibility is not based on an applicant’s Expected Family
Contribution (EFC). These programs include the Teacher Education Assistance for
College and Higher Education (TEACH) Grant, Direct Unsubsidized Loan, and Direct
PLUS Loan programs.
Impact:
If an institution has any reason to believe that an applicant’s FAFSA information is inaccurate,
the institution should not disburse funds until the information is verified and any corrections are
made. Changes in an applicant’s information may require the applicant or the institution to
notify the Department of Education and require recalculations. If an applicant fails to provide
the requested documentation within a reasonable time period established by the institution, the
institution may not make certain disbursements, employ or continue to employ or allow an
employer to employ the application under FWS. The applicant may also be required to repay the
institution any Federal Perkins Loan or FSEOG received for that award year. Institutions are not
required to verify an applicant’s FAFSA information if, for example, the applicant is eligible to
receive only unsubsidized student financial assistance.
Steps
to
Compliance:
Institution policies and procedures for verifying an applicant’s FAFSA information must be
reviewed to ensure the policies and procedures include:
The time period within which an applicant must provide any documentation requested by the
institution;
The consequences of an applicant’s failure to provide the requested documentation within the
specified time period;
The method by which the institution notifies an applicant of the results of its verification if,
as a result of the verification, the applicant’s EFC changes and results in a change in the
amount of the applicant’s assistance;
The procedures the institution will follow or the procedures the institution will require an
applicant to follow to correct FAFSA information determined to be in error;
The procedures for making referrals to the Office of Inspector General of the Department of
Education for investigation if there is any credible information that an applicant for Title
IV/HEA program assistance may have engaged in fraud or other criminal conduct in
connection with the application;
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The procedures the institution will follow in furnishing, in a timely manner, each applicant
whose FAFSA information is selected for verification, a clear explanation of the
documentation needed to satisfy the verification requirements, the applicant’s responsibilities
with respect to the verification of FAFSA information including the deadlines for completing
any actions and the consequences for failing to complete any required action; and
A statement that an applicant whose FAFSA information is selected for verification is
required to complete verification before the institution exercises any authority to make
changes to the applicant’s cost of attendance or to the values of the data items required to
calculate the EFC.
The institution should review the time period for applicants to provide requested information and
evaluate procedures for verifying financial aid application information. Employees working in
financial aid should be instructed on how to address requests for verification from the
Department.
Misrepresentation
(Subpart
F
of
Part
668)
Summary:
The prior regulations provided a review procedure whereby the Department of Education’s
“designated department official” reviewed allegations or complaints of misrepresentation to
determine the factual basis and seriousness. If the department official found the
misrepresentation to be minor and easily corrected, the official informed the institution and
sought an informal correction. If the designated department official found a substantial
misrepresentation as to the nature of the educational programs, the financial charges of the
institution or the employability of its graduates, the department official initiated action against
the institution which could include a fine or limit, suspension, or termination of the institution’s
eligibility to participate in the Title IV/HEA programs.
The new regulations remove the review procedure and provide the Secretary of the Department
of Education with the ability to take action against an eligible institution that has engaged in
substantial misrepresentation. An eligible institution is deemed to have engaged in substantial
misrepresentation when the institution itself, one of its representatives, or any ineligible
institution, organization, or person with whom the eligible institution has an agreement to
provide educational programs, marketing, advertising, recruiting or admissions services, makes a
substantial misrepresentation regarding the eligible institution, including about the nature of its
educational program, its financial charges, or the employability of its graduates.
Applicable Definitions:
Substantial misrepresentation is defined as any misrepresentation on which the person to
whom it was made could reasonably be expected to rely, or has reasonably relied, to that
person’s detriment.
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Misrepresentation is defined as any false, erroneous or misleading statement an eligible
institution, one of its representatives, or any ineligible institution, organization, or person
with whom the eligible institution has an agreement to provide educational programs, or
to provide marketing, advertising, recruiting or admissions services makes directly or
indirectly to a student, prospective student or any member of the public, or to an
accrediting agency, to a State agency, or to the Secretary. A misleading statement
includes any statement that has the likelihood or tendency to deceive or confuse. A
statement is any communication made in writing, visually, orally, or through other
means. Misrepresentation includes the dissemination of a student endorsement or
testimonial that a student gives either under duress or because the institution required the
student to make such an endorsement or testimonial to participate in a program.
Impact:
A violation may exist if the statement has a “tendency to deceive or confuse.” Moreover, a
violation may exist as a result of a single or isolated incident and even mistakes or inadvertent
statements may result in a violation. It is up to the Department of Education to determine if any
misrepresentation occurred and, if so, whether the misrepresentation is minor or the more serious
“substantial misrepresentation,” and the appropriate remedy for the misrepresentation.
If the designated department official determines that an eligible institution has engaged in
“misrepresentation,” it appears that the department will continue to address these issues on an
informal basis as before whereby the designated official would inform the institution and seek an
informal correction.
If the designated department official determines that an eligible institution has engaged in the
more serious “substantial misrepresentation,” the Secretary of the Department of Education may:
(1) revoke the eligible institution’s program participation agreement; (2) impose limitations on
the institution’s participation in the Title IV/HEA programs; (3) deny participation applications
made on behalf of the institution; or (4) initiate a proceeding against the eligible institution under
subpart G of part 668, which may include fining the institution, suspending the institution, or
terminating participation.
Steps
to
Compliance:
Institutions should educate all representatives and affiliates on proper recruitment and
admissions communications and the consequences of non-compliance.
Institutions should also consider providing representatives and affiliates with a point of
contact for questions to avoid non-compliance.
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Written
Arrangements
Between
Institutions
(§§668.5,
668.43)
Summary:
The provision governs written arrangements between UW institutions and other institutions to
provide part of an education program to students enrolled at UW institutions. Institutions are
prohibited from contracting with another entity whose eligibility under Title IV has been
revoked.
When an institution enters into a written arrangement with an institution or organization to
provide part of the educational program to its enrolled students, the degree-granting institution
must provide a description of written arrangements to enrolled and prospective students,
including but not limited to the following:
• Portion of the educational program that the institution is not providing;
• Name and location of other institutions that are providing the other portion of the
educational program;
• Method of delivery of the portion of the educational program provided by the other
institution; and
• Estimated additional costs that students may incur from enrolling in a program that is
provided in part by another institution (e.g., the Comments provide that “when the
coursework provided through the written arrangement is provided only, it would be
appropriate to include estimated additional costs such as the costs of purchasing a
computer and obtaining Internet access”).
These disclosures must be clear and understandable. The disclosure requirements do not apply
to individual, student-initiated written arrangements.
Impact:
The rule requires an additional audit of programs involving written arrangements with other
entities that are providing educational programs to UW students, and disclosures to students
when these arrangements exist. Institutions should consider whether other study-abroad or
exchange programs apply, and if so, confirm that the proper disclosures are provided.
Steps
to
Compliance:
Institutions should designate an academic officer to identify all written arrangements with
other institutions to provide part of an education program, to ensure that (1) the institution
providing the education program has not had its eligibility under Title IV revoked, and (2) to
ensure that students are provided the required disclosures about the educational program
provided by another entity.
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ATTACHMENTS
TO
REPORT
Program
Integrity
Regulations
(by
CFR
section)
State
Approval
Regulations
for
Distance
Education:
A
“Starter
List”
(revised
March
17,
2011)
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