Rules could prompt colleges to pull online programs from some states

Half of colleges said they would not seek authorization in all 50 states.

Online college students in Massachusetts, Arkansas, and Minnesota soon could have more limited school options as colleges and universities plan to withdraw their online programs from those states in response to a much-debated set of regulations.

Colleges with large online course selections that draw students from every state have railed against the U.S. Education Department’s “state authorization” rules, which require schools to gain approval from every state in which they have even one online student.

And even after a federal judge voided part of the state authorization rule in July, online education experts say ED probably will reintroduce the regulations in 2012.

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College officials have made it clear that they won’t serve students in states with the most onerous requirements to abide by. The costs of seeking approval in those states could prove to be too high, so many schools will provide online classes only for students who live in states that aren’t heavy-handed with compliance measures, according to a survey conducted by the Western Interstate Commission for Higher Education (WCET).

Six in 10 colleges and universities with online programs identified states they likely would not serve if state authorization rules are fully implemented. Twenty-nine schools said they would withdraw online classes from Massachusetts, 16 said they would leave Minnesota, and 15 wouldn’t serve college students in Arkansas.

“It’ll have a chilling effect on distance education, and students will start complaining and rising up about their freedom of taking classes being curtailed in the name of consumer protections,” said Russell Poulin, deputy director of WCET.

The cost of compliance, especially in states with myriad requirements, would be around $143,000 per college or university, according to the WCET survey of 230 institutions. Fifteen percent of school officials said the costs were too high, and three in 10 lack the staff to complete compliance forms.

Arkansas, for instance, requires all colleges to name every faculty member, even at colleges that employ thousands of professors and instructors to teach online courses. Kansas’s government needs signed affidavits from every faculty member before a college can make online classes available to students in that state.

“The difficult processes really start to pile up after a while,” Poulin said.

Perhaps most disturbing of all to advocates of online education: Less than half of colleges and universities surveyed plan to seek authorization in every U.S. state and territory.

“There’s a whole different return on investment now. We have to look at costs for each state and see if we can justify” hosting web-based classes there, said Robert Mendenhall, president of Western Governors University, a private, nonprofit online institution based in Salt Lake City.

Cynthia Gallatin, associate vice president in for online programs at Qunnipiac College in Connecticut, has led the school’s effort to comply with state’s higher education rules, and said while state regulators have been cooperative and helpful, the process has proved tedious and “very time intensive.”

“Many [colleges] are concerned with budgetary constraints while continuing to develop innovative methods for educating students,” Gallatin said. “The cost and time to comply with state regulations will prohibit some institutions from participating in online learning … and this process may deter some higher education institutions from continuing to develop innovative online models of education.”

At a meeting of online college presidents, provosts, and other decision makers in Washington, D.C., last year, ED officials ensured worried stakeholders that the department would not employ a rigid approach to state authorization compliance.

ED decertifies an average of two colleges and universities annually, said David Bergeron, the department’s acting deputy secretary for policy, planning, and innovation.

“We work with schools to bring them into compliance,” he said. “We don’t want to begin from a position of terminating an institution’s eligibility [for federal funds]. That’s just how we do things.”

ED said in a March 17 letter that it would not rescind the state authorization rule after a request from 60 higher-education organizations asking federal officials to scrap the regulation before it took effect July 1.

The ED letter said the department would be satisfied with a “good-faith effort” from colleges and universities.

Enforcement of higher-education compliance varies from state to state, Poulin said, with some states sporting a full staff of regulators that will institute fines for schools that refuse to comply.

A coalition of distance learning organizations, including WCET and the Presidents Forum, is working with the Council of State Governments to create an interstate reciprocity agreement that would help colleges avoid having to comply with state-by-state regulations.

In other words, if a state signs on to the still-forming pact, schools will be able to enroll students from that state without going through the often lengthy review process.

A college would only have to gain compliance in its home state, Poulin said.

Gallatin said a compact between states would mean colleges and universities could avoid extensive paperwork while meeting state requirements. Such an agreement, Gallatin said, would be similar to regional accreditation, in which a school is deemed in compliance in a group of states once the regional board gives it blessing.

A reciprocity agreement “would simplify the process for both higher education institutions and state agencies while continuing to provide for consumer protection,” she said.

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