[House Hearing, 112 Congress]
[From the U.S. Government Printing Office]





                     EDUCATION REGULATIONS: FEDERAL
                    OVERREACH INTO ACADEMIC AFFAIRS

=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON HIGHER EDUCATION
                         AND WORKFORCE TRAINING

                         COMMITTEE ON EDUCATION
                           AND THE WORKFORCE

                     U.S. House of Representatives

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

             HEARING HELD IN WASHINGTON, DC, MARCH 11, 2011

                               __________

                           Serial No. 112-11

                               __________

  Printed for the use of the Committee on Education and the Workforce


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                COMMITTEE ON EDUCATION AND THE WORKFORCE

                    JOHN KLINE, Minnesota, Chairman

Thomas E. Petri, Wisconsin           George Miller, California,
Howard P. ``Buck'' McKeon,             Senior Democratic Member
    California                       Dale E. Kildee, Michigan
Judy Biggert, Illinois               Donald M. Payne, New Jersey
Todd Russell Platts, Pennsylvania    Robert E. Andrews, New Jersey
Joe Wilson, South Carolina           Robert C. ``Bobby'' Scott, 
Virginia Foxx, North Carolina            Virginia
Duncan Hunter, California            Lynn C. Woolsey, California
David P. Roe, Tennessee              Ruben Hinojosa, Texas
Glenn Thompson, Pennsylvania         Carolyn McCarthy, New York
Tim Walberg, Michigan                John F. Tierney, Massachusetts
Scott DesJarlais, Tennessee          Dennis J. Kucinich, Ohio
Richard L. Hanna, New York           David Wu, Oregon
Todd Rokita, Indiana                 Rush D. Holt, New Jersey
Larry Bucshon, Indiana               Susan A. Davis, California
Trey Gowdy, South Carolina           Raul M. Grijalva, Arizona
Lou Barletta, Pennsylvania           Timothy H. Bishop, New York
Kristi L. Noem, South Dakota         David Loebsack, Iowa
Martha Roby, Alabama                 Mazie K. Hirono, Hawaii
Joseph J. Heck, Nevada
Dennis A. Ross, Florida
Mike Kelly, Pennsylvania
[Vacant]

                      Barrett Karr, Staff Director
                 Jody Calemine, Minority Staff Director

        SUBCOMMITTEE ON HIGHER EDUCATION AND WORKFORCE TRAINING

               VIRGINIA FOXX, North Carolina, Chairwoman

John Kline, Minnesota                Ruben Hinojosa, Texas
Thomas E. Petri, Wisconsin             Ranking Minority Member
Howard P. ``Buck'' McKeon,           John F. Tierney, Massachusetts
    California                       David Wu, Oregon
Judy Biggert, Illinois               Timothy H. Bishop, New York
Todd Russell Platts, Pennsylvania    Robert E. Andrews, New Jersey
David P. Roe, Tennessee              Susan A. Davis, California
Glenn Thompson, Pennsylvania         Raul M. Grijalva, Arizona
Richard L. Hanna, New York           David Loebsack, Iowa
Larry Bucshon, Indiana               George Miller, California
Lou Barletta, Pennsylvania
Joseph J. Heck, Nevada














                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held on March 11, 2011...................................     1

Statement of Members:
    Andrews, Hon. Robert E., a Representative in Congress from 
      the State of New Jersey, submission for the record:
        Letter, dated Feb. 16, 2011, to Secretary Duncan, from 
          the American Council on Education (ACE)................    77
    Foxx, Hon. Virginia, Chairwoman, Subcommittee on Higher 
      Education and Workforce Training...........................     1
        Prepared statement of....................................     3
        Letter, dated Mar. 10, 2011, from the American Council on 
          Education..............................................    73
    Hinojosa, Hon. Ruben, ranking member, Subcommittee on Higher 
      Education and Workforce Training...........................     4
        Prepared statement of....................................     5
    Thompson, Hon. Glenn, a Representative in Congress from the 
      State of Pennsylvania, submission for the record:
            Letter, dated Mar. 1, 2011, to Secretary Duncan from 
              Citizens for Responsibility and Ethics in 
              Washington (CREW)..................................    39

Statement of Witnesses:
    Dowden, G. Blair, president, Huntington University...........    12
        Prepared statement of....................................    14
    Ebersole, John, president, Excelsior College.................     8
        Prepared statement of....................................    10
    Tighe, Kathleen S., Inspector General, U.S. Department of 
      Education..................................................    16
        Prepared statement of....................................    18
        Supplemental material submitted for the record...........    81
    Wolff, Ralph A., president, the Accrediting Commission for 
      Senior Colleges and Universities of the Western Association 
      of Schools and Colleges (WASC).............................    19
        Prepared statement of....................................    21
        Additional submissions:
            Memo, dated June 30, 2010, ``State by State Analysis 
              (34 C.F.R. Sec. 600.9)''...........................    25
            Letter, dated Mar. 2, 2011, to Secretary Duncan......    31
            Letter, dated Feb. 16, 2011, to Secretary Duncan.....    77

 
     EDUCATION REGULATIONS: FEDERAL OVERREACH INTO ACADEMIC AFFAIRS

                              ----------                              


                         Friday, March 11, 2011

                     U.S. House of Representatives

        Subcommittee on Higher Education and Workforce Training

                Committee on Education and the Workforce

                             Washington, DC

                              ----------                              

    The subcommittee met, pursuant to call, at 10:00 a.m., in 
Room 2175, Rayburn House Office Building, Hon. Virginia Foxx 
[chairwoman of the subcommittee] presiding.
    Present: Representatives Foxx, Kline, Petri, Thompson, 
Hinojosa, Tierney, Bishop, Andrews, and Davis.
    Staff present: Katherine Bathgate, Press Assistant; James 
Bergeron, Director of Education and Human Services Policy; 
Colette Beyer, Press Secretary-Education; Kirk Boyle, General 
Counsel; Casey Buboltz, Coalitions and Member Services 
Coordinator; Daniela Garcia, Professional Staff Member; Jimmy 
Hopper, Legislative Assistant; Amy Raaf Jones, Education Policy 
Counsel and Senior Advisor; Barrett Karr, Staff Director; Brian 
Melnyk, Legislative Assistant; Mandy Schaumburg, Education and 
Human Services Oversight Counsel; Linda Stevens, Chief Clerk/
Assistant to the General Counsel; Alissa Strawcutter, Deputy 
Clerk; Aaron Albright, Minority Deputy Communications Director; 
Tylease Alli, Minority Hearing Clerk; Daniel Brown, Minority 
Staff Assistant; John English, Minority Presidential Management 
Fellow; Jamie Fasteau, Minority Deputy Director of Education 
Policy; Brian Levin, Minority New Media Press Assistant; Megan 
O'Reilly, Minority General Counsel; Julie Peller, Minority 
Deputy Staff Director; Melissa Salmanowitz, Minority Press 
Secretary; Laura Schifter, Minority Senior Education and 
Disability Policy Advisor; and Michael Zola, Minority Chief 
Investigative Counsel.
    Chairwoman Foxx [presiding]. Good morning. A quorum being 
present, the subcommittee will come to order. I want to welcome 
everyone to the subcommittee's first hearing of the 112th 
Congress.
    And I want to give a special thanks to our witnesses for 
being with us today. We appreciate your time and look forward 
to your testimony. We are here this morning to examine 
burdensome regulations imposed on institutions of higher 
education and accrediting bodies via the Department of 
Education.
    We can all agree today that the United States has the 
finest higher education system in the world and it draws 
students from all around the globe. But we are also aware of 
the strain federal regulations can place on schools.
    In this era of limited resources these regulations can 
serve to distract schools from efficiently delivering services 
to their students. That means onerous mandates force 
institutions to dedicate scarce resources towards compliance 
instead of focusing on meeting student needs.
    At a time when we should be encouraging common sense 
education reforms, more regulatory hurdles serve only to 
undermine the strength of the nation's education system.
    In late 2010 the administration introduced regulations on 
14 separate higher education issues. While many of these new 
regulations inject the federal government into areas that have 
historically been the responsibility of the states or 
institutions of higher education.
    Two of them are particularly alarming; the new state 
authorization regulation forces states to follow federal 
requirements when deciding whether to grant a college or 
university permission to operate within the state.
    Many institutions fear this is only the beginning of the 
federal government and states exercising more control over 
their colleges and universities.
    For schools providing distance education programs this 
regulation could require them to obtain authorization in every 
state where an enrolled student resides to participate in the 
federal student aid programs.
    Even if a school has just one student from a state enrolled 
in an online program, the institution will still be required to 
go through the process of obtaining authorization in that 
state.
    Schools with more advanced online education opportunities 
could be forced to deal with this process in all 50 states. 
Another worrisome regulation creates the first federal 
definition of a credit hour and requires specific criteria to 
be used when assessing an institution's definition of a credit 
hour.
    School officials are concerned that this regulation will 
restrict their ability to determine the number of credit hours 
for each course, an inherently academic function. While the 
credit hour is important to the distribution of federal student 
assistance, institutions of higher education fear they will be 
required to check in with the government before creating 
courses and programs eligible for such funding.
    To make matters worse, very little information exists on 
how these regulatory changes could affect students. The state 
authorization regulation could restrict the student's ability 
to enroll in a distance education program if the school is not 
recognized as an accredited online institution in his or her 
state. The credit hour regulation also stands to restrict the 
efficiency and productivity at an institution by limiting their 
ability to create innovative ways to educate students in 
shorter periods of time.
    Many institutions of higher education have been left in the 
dark on how to proceed. In fact we have just received a letter 
from the American Council on Education asking us to request the 
delay of one year of these regulations because of the 
confusion.
    Unless the Department can provide some clarifying guidance 
before the July 1, 2011 deadline, schools, states, and 
accreditors will be left to wonder whether their inability to 
comply with the unclear regulations will jeopardize schools 
eligibility to receive federal financial aid.
    As such, a delay or complete withdrawal, actually, may be 
the appropriate action here.
    These regulations constitute a federal overreach into 
academic affairs. Like many other burdensome government 
mandates, both reduce local control and create uncertainty in 
the higher education system.
    Escalated intervention by Washington bureaucrats has done 
little to fix the problems in our education system. Instead of 
more regulations we need to support policies that streamline 
the government's role in education and provide for more 
flexibility for states and education institutions.
    We look forward to hearing your thoughts on federal 
regulations like these and gaining your perspective on what 
should be done in Washington to decrease their negative impact.
    I would now like to recognize Ranking Member Ruben Hinojosa 
for his opening remarks.
    [The statement of Chairwoman Foxx follows:]

 Prepared Statement of Hon. Virginia Foxx, Chairwoman, Subcommittee on 
                Higher Education and Workforce Training

    A quorum being present, the subcommittee will come to order.
    Welcome everyone to the subcommittee's first hearing of the 112th 
Congress. I would like to thank our witnesses for being with us today. 
We appreciate your time and look forward to your testimony.
    We are here this morning to examine burdensome regulations imposed 
on institutions of higher education and accrediting bodies by the 
Department of Education.
    We can all agree today that the United States has the finest higher 
education system in the world, which draws students from around the 
globe. But we are also all aware of the strain federal regulations can 
place on schools. In this era of limited resources, these regulations 
can serve to distract schools from efficiently delivering services to 
their students. That means onerous mandates force institutions to 
dedicate scarce resources toward compliance instead of focusing on 
meeting student needs. At a time when we should be encouraging common 
sense education reforms, more regulatory hurdles serve only to 
undermine the strength of the nation's education system.
    In late 2010, the administration introduced regulations on 14 
separate higher education issues. While many of these new regulations 
inject the federal government into areas that have historically been 
the responsibility of the states or institutions of higher education, 
two of them are particularly alarming.
    The new state authorization regulation forces states to follow 
federal requirements when deciding whether to grant a college or 
university permission to operate within the state. Many institutions 
fear this is only the beginning of the federal government and states 
exercising more control over their colleges and universities. For 
schools providing distance education programs, this regulation could 
require them to obtain authorization in every state where an enrolled 
student resides to participate in the federal student aid programs. 
Even if a school has just one student from a state enrolled in an 
online program, the institution will still be required to go through 
the process of obtaining authorization in that state. Schools with more 
advanced online education opportunities could be forced to deal with 
this process in all fifty states.
    Another worrisome regulation creates the first federal definition 
of a credit hour and requires specific criteria to be used when 
assessing an institution's definition of a credit hour. School 
officials are concerned that this regulation will restrict their 
ability to determine the number of credit hours for each course, an 
inherently academic function. While the credit hour is important to the 
distribution of federal student assistance, institutions of higher 
education fear they will be required to check in with the government 
before creating courses and programs eligible for such funding.
    To make matters worse, very little information exists on how these 
regulatory changes could affect students. The state authorization 
regulation could restrict a student's ability to enroll in a distance 
education program if the school is not recognized as an accredited 
online institution in his or her state. The credit hour regulation also 
stands to restrict efficiency and productivity at an institution by 
limiting their ability to create innovative ways to educate students in 
shorter periods of time.
    Many institutions of higher education have been left in the dark on 
how to proceed. In fact, we have just received a letter from the 
American Council on Education asking us to request a delay of one year 
of these regulations because of the confusion. Unless the department 
can provide some clarifying guidance before the July 1, 2011 deadline, 
schools, states, and accreditors will be left to wonder whether their 
inability to comply with the unclear regulations will jeopardize 
schools' eligibility to receive federal financial aid. As such, a 
delay--or complete withdrawal actually--may be the appropriate action 
here.
    These regulations constitute a federal overreach into academic 
affairs. Like many other burdensome government mandates, both reduce 
local control and create uncertainty in the higher education system. 
Escalated intervention by Washington bureaucrats has done little to fix 
the problems in our education system. Instead of more regulations, we 
need to support policies that streamline the government's role in 
education and provide for more flexibility for states and education 
institutions.
    We look forward to hearing your thoughts on federal regulations 
like these and gaining your perspective on what should be done in 
Washington to decrease their negative impact. I would now like to 
recognize the Ranking Member, Ruben Hinojosa, for his opening remarks.
                                 ______
                                 
    Mr. Hinojosa. Thank you Chairwoman Foxx. Today our 
discussion will focus on two vitally important regulations; the 
definition of a credit hour and the criteria the secretary uses 
to determine that institutions are authorized to provide post-
secondary education in their states.
    In my view, these regulations are greatly needed to 
strengthen the accountability and review of institutions of 
higher education that participate in the federal student aid 
programs. Every year the federal government spends billions of 
dollars on student financial aid. It is imperative that 
Congress and the Department of Education provide strong 
oversight for these federal student dollars.
    On May 24, 2010 the Office of the Inspector General, the 
IG, issued a review of the Higher Learning Commission, I will 
refer to it as HLC, of the North Central Association of 
Colleges and Schools. I continue to be troubled by what the 
Inspector General found in its review.
    The IG's report raised serious concerns about the HLC's 
accrediting practices and the evaluation of Title IV 
institutions. Specifically the report highlighted the case of 
American Intercontinental University, an institution which HLC 
approved for accreditation on May 14, 2009, despite finding 
that AIU had assigned about double the amount of credit hours 
in certain undergraduate and graduate programs.
    To avoid having institutions overstate credit hours or 
inflate the federal student aid paid for students attending 
those programs we must have consistent measures for credit 
hours.
    The regulation being discussed today sets some minimum 
standard for the work needed to equal a credit hour for the 
purposes of federal student aid programs. The rule defines a 
credit hour as ``one hour of classroom instruction and 2 hours 
of homework each week for approximately 15 weeks per semester 
or 10 to 12 weeks for one-quarter hour of credit. Or, an 
equivalent amount of work.''
    The regulation also requires accrediting agencies to review 
an institution's procedures and policies setting credit hours 
and determine whether such policies and procedures meet the 
regulatory standard.
    I would also like to underscore that the credit hour 
definition creates some flexibilities for institutions in 
determining the appropriate number of credit hours for student 
course work.
    The credit hour definition is a minimum standard that does 
not restrict an institution from setting a higher standard that 
requires more student work per credit hour. The definition does 
not dictate particular amounts of classroom time versus out of 
class student work. And the institution may take into 
consideration alternative delivery methods; measurements of 
student work, academic calendars, disciplines and degree 
levels.
    In addition, an institution may use separate measures of 
credit hours for the federal student aid programs and for its 
own academic purposes or other institutional needs.
    In regard to state authorization, the Higher Education Act 
of 1965 has always required an institution to be legally 
authorized to offer a program of education beyond secondary 
education by the state in which it is located. Under that rule 
a state must have a process to review and act on complaints 
concerning that institution, including enforcing applicable 
state laws.
    The regulation also provides students, prospective students 
and families the ability to identify which institutions are 
legally authorized to offer post-secondary education in a 
state.
    An institution offering distance education to students 
located in states other than the one in which the institution 
is located for example, must meet the authorization 
requirements of those states.
    Finally, religious institutions exempted from state 
authorization requirements under state law are exempt from this 
regulation.
    In closing, I believe that we as members of this committee 
must address these issues and protect the interest of students 
and taxpayers.
    As ranking member for this subcommittee, I intend to be 
fully engaged in these discussions and will work with the 
Secretary and my colleagues in both the House and the Senate to 
ensure that these regulations are implemented.
    With that, Madam Chair, I yield.
    [The statement of Mr. Hinojosa follows:]

Prepared Statement of Hon. Ruben Hinojosa, Ranking Member, Subcommittee 
               on Higher Education and Workforce Training

    Thank you Chairwoman Foxx.
    Today, our discussion will focus on two vitally important 
regulations: the definition of a credit hour and the criteria the 
Secretary uses to determine that institutions are authorized to provide 
postsecondary education in their states.
    In my view, these regulations are greatly needed to strengthen the 
accountability and review of institutions of higher education that 
participate in the Federal Student Aid programs. Every year, the 
federal government spends billions of dollars on student financial aid. 
It is imperative that Congress and the Department of Education provide 
strong oversight for these federal student aid dollars.
    On May 24, 2010, the Office of the Inspector General (IG) issued a 
review of the Higher Learning Commission (HLC) of the North Central 
Association of Colleges and Schools. I continue to be troubled by what 
the Inspector General found in its review.
    The IG's report raised serious concerns about the HLC's accrediting 
practices and evaluation of Title IV institutions. Specifically, the 
report highlighted the case of American Intercontinental 
University(AIU), an institution which HLC approved for accreditation on 
May 14, 2009 despite finding that AIU had assigned about double the 
amount of credit hours to courses in certain undergraduate and graduate 
programs.
    To avoid having institutions overstate credit hours or inflate the 
federal student aid paid for students attending those programs, we must 
have consistent measures for credit hours.
    The regulation being discussed today sets a minimum standard for 
the work needed to equal a credit hour for the purposes of Federal 
Student Aid Programs.
    The rule defines a credit hour as one hour of classroom instruction 
and two hours of homework each week for approximately 15 weeks for a 
semester or 10-12 weeks for one quarter hour of credit, or an 
equivalent amount of work. The regulation also requires accrediting 
agencies to review an institution's procedures and policies setting 
credit hours and determine whether such policies and procedures meet 
the regulatory standard.
    I would also like to underscore that the credit hour definition 
creates some flexibilities for institutions in determining the 
appropriate amount of credit hours for student coursework.
    The credit hour definition is a minimum standard that does not 
restrict an institution from setting a higher standard that requires 
more student work per credit hour.
    The definition does not dictate particular amounts of classroom 
time versus out-of-class student work, and the institution may take 
into consideration alternative delivery methods, measurements of 
student work, academic calendars, disciplines, and degree levels.
    In addition, an institution may use separate measures of credit 
hours for the federal student aid programs and for its own academic 
purposes or other institutional needs.
    In regard to state authorization, the Higher Education Act of 1965 
has always required an institution to be legally authorized to offer a 
program of education beyond secondary education by the State in which 
it is located.
    Under the rule, a State must have a process to review and act on 
complaints concerning the institution, including enforcing applicable 
State laws. The regulation also provides students, prospective 
students, and families the ability to identify which institutions are 
legally authorized to offer postsecondary education in a State.
    An Institution offering distance education to students located in 
States other than the one in which the institution is located, for 
example, must meet the authorization requirements of those States.
    Finally, religious institutions exempted from State authorization 
requirements under State law are exempt from this regulation.
    In closing, I believe that we as the members of this committee must 
address these issues and protect the interests of students and 
taxpayers. As Ranking Member for this subcommittee, I intend to be 
fully engaged in these discussions and will work with the Secretary and 
my colleagues in both the House and the Senate to ensure that these 
regulations are implemented.
Questions for the Panelists:
    I would like to welcome our distinguished guests and say that I am 
pleased to see that Kathleen Tighe, the Inspector General, is here 
today.
    1. Question for Inspector General Kathleen Tighe (T-i-e), U.S. 
Department of Education:
    Ms. Tighe, in your testimony, you indicate that the explosion of 
on-line education in recent years has made it even more difficult to 
assign credit hours and assess student achievement.
    What are national and regional accrediting agencies doing to ensure 
that on-line educational programs provide quality, content, and 
academic rigor at the postsecondary level?
    2. Question for Inspector General Kathleen Tighe:
    Ms. Tighe, in your testimony, you indicate that the definition of a 
credit hour protects students and taxpayers from inflated credit hours, 
the improper designation of full-time student status, the over-awarding 
of Federal Student aid funds, and excessive borrowing by students 
especially with distance, accelerated, and other programs not delivered 
through traditional classroom format.
    What type of impact do you believe this regulation will have on 
regional and national accrediting agencies?
    What can regional and national accrediting agencies do to improve 
their accreditation practices to ensure that students and taxpayers 
receive what they are paying for?
    3. Question for Ralph A. Wolff, President of the Accrediting 
Commission for Senior Colleges and Universities of the Western 
Association of Schools and Colleges (WASC):
    Mr. Wolff, absent a definition of a credit hour, what do your 
accreditation teams evaluate on campus to assess institutional 
assignment of credit hours?
                                 ______
                                 
    Chairwoman Foxx. Thank you very much Mr. Hinojosa. Pursuant 
to Committee Rule 7 C, all subcommittee members will be 
permitted to submit written statements to be included in the 
permanent hearing record.
    And without objection, the hearing record will remain open 
for 14 days, to allow statements, questions for the record and 
other extraneous material referenced during the hearing, to be 
submitted in the official hearing record.
    It is now my pleasure to introduce our distinguished panel 
of witnesses; Mr. John Ebersole serves as the President of 
Excelsior College and has over 40 years of education 
experience. Prior to his current appointment Mr. Ebersole has 
held positions responsible for extended and online education at 
Boston University; Colorado State University; The University of 
California, Berkley and; John F. Kennedy University.
    Mr. Ebersole is also the current chair of the American 
Council on Education's Commission on Lifelong Learning.
    Dr. G. Blair Dowden has served as President of Huntington 
University since 1991. He has previously served as board chair 
of the Council for Christian Colleges and Universities; chair 
of the Council of Presidents of the National Association of 
Intercollegiate Athletics and is chair of the Indiana 
Conference for Higher Education. In addition to his impressive 
career, he is a frequent speaker on topics related to 
leadership, philanthropy, and Christian Faith.
    The Honorable Kathleen Tighe was sworn in as the Inspector 
General for the Department of Education on March 17, 2010. 
Prior to this she served as the Deputy Inspector General at the 
U.S. Department of Agriculture and as counsel to the Inspector 
General Services Administration.
    Ms. Tighe is a member of the public contract section of the 
American Bar Association and is a former chair of the Council 
of Councils to the Inspector General. That is almost a tongue 
twister.
    Mr. Ralph Wolff has been at the Senior College Commission 
of the Western Association of Schools and Colleges, WASC, for 
30 years and was appointed president in 1996. In that capacity 
he has led WASC to the forefront of accreditation as an agent 
of public accountability and innovation.
    At the national level he has been appointed to represent 
regional accreditation in negotiated rule making sessions held 
by the Department of Education in 2006, 2008, and 2010. Did 
they give you combat pay for that?
    Before I recognize each of you to provide your testimony 
let me briefly explain our lighting system. You will each have 
5 minutes to present your testimony. When you begin the light 
in front of you will turn green.
    When 1 minute is left the light will turn yellow and when 
your time has expired the light will turn red. At which point I 
would ask that you wrap up your remarks as best you are able.
    After everyone has testified members will each have 5 
minutes to ask questions of the panel. And I will tell you that 
they have announced that we will probably have votes around 12 
to 12:30 and I said earlier it is something to see when 
everyone is trying to vote and get out on a Friday afternoon.
    So I am hoping that we can move things along and not have 
an unseemingly exodus from the room. So I want to thank you all 
again for taking the time to testify before the committee 
today.
    I want to ask Mr. Hinojosa if he has any other comments he 
would like to make.
    Mr. Hinojosa. Not at this time.
    Chairwoman Foxx. Thank you.
    Now, I would like Mr. Ebersole if he would begin.

             STATEMENT OF JOHN EBERSOLE, PRESIDENT,
                       EXCELSIOR COLLEGE

    Mr. Ebersole. I am John Ebersole, President of Excelsior 
College. I would like to thank you Chairwoman Virginia Fox and 
also Ranking Member Ruben Hinojosa and members of the 
Subcommittee on Higher Education and Workforce Training, for 
the opportunity to testify on these unnecessary regulations.
    Founded by the State of New York's Board of Regents as 
Regents College in 1971 and chartered as a private not for 
profit institution in 1998, the college was renamed Excelsior 
College in 2001. We are based in Albany, New York, accredited 
by the Middle States Commission on Higher Education and we are 
a recognized leader in removing obstacles to the educational 
goals of adult learners.
    We provide efficient, affordable access to higher education 
through multiple avenues of degree completion. Excelsior 
provides distance learning opportunities to adult learners with 
an emphasis on those historically underrepresented in higher 
education.
    I should say that 30 percent of our students of which there 
are 30,000, represent themselves as being minorities. We also 
have about 10,000 Iraq duty military.
    The college meets students where they are academically and 
geographically, offering quality instruction in the assessment 
of prior learning. We share the stated goals of this 
administration and the previous administration to increase 
degree completion over the next 10 years. We understand that is 
necessary to maintain our economy and to be competitive in a 
global market.
    I believe that online institutions have the capacity to 
deliver that access to students who would not receive a quality 
education under other circumstances. This is a time when the 
traditional brick and mortar public institutions are cutting 
enrollment, reducing access and increasing costs.
    In the 2010 Sloan Survey of Online Learning, we found that 
online enrollments have risen by almost 1 million students from 
a year ago. That report also found that three-quarters of 
institutions report the economic downturn has increased demand 
for online courses and programs. Nearly 30 percent of those in 
higher education, of which estimate at 19 million today, now 
take at least one course online.
    The 21 percent growth rate for online enrollments far 
exceeds the 2 percent growth rate in the overall higher 
education population. Seventy-nine percent of college 
presidents agreed that launching and expanding online education 
courses and programs provides a way for their institutions to 
serve more learners. A recent survey done by Inside Higher 
Education found that three-quarters of presidents have plans to 
enter the online market as a part of their future strategy.
    In regard to state authorization, every institution is 
authorized to operate in its home state. In the case of 
Excelsior, we are chartered by the New York State Board of 
Regents, which I believe is the only state agency which is 
recognized by the U.S. Department of Education as an 
accrediting agency in its own right.
    We also hold Middle States accreditation and the new 
federal regulations would require Excelsior to not only have 
that accreditation that we document that we are authorized to 
operate in 54 jurisdictions recognized by the United States 
Department of Education.
    Under Title 4, the new regulations require all colleges to 
comply with individual state regulations to distance learning 
if they have enrolled 1 or more students receiving student 
financial aid.
    Failure of an institution to comply with these state 
authorization rules may result in institutional penalties 
ranging from a return of all federal financial aid distributed 
while out of compliance, up to removal of the institution's 
authorization to participate in Title 4.
    Due to a lack of, what I believe is forethought, the 
proposed state authorization regulations from the Department 
would create a particular roadblock for those of us in online 
education at a time where I believe it is most needed.
    Excelsior has led the President's Forum, a consortium of 
public and private institutions with a shared mission of 
serving adult students that are distance, for 7 years.
    We have been trying to advance the innovative practices and 
the excellence that can be a part of online learning. You 
should know that even before these regulations were promulgated 
we were working with the states trying to bring about greater 
uniformity and standardization between the 50 states.
    We continue to be at a loss as to why these regulations, 
running directly contrary to the shared, stated goals of the 
administration and to thousands of higher education 
institutions across the country have been put forward.
    As written, the regulation would unfairly target and stifle 
the growth of online education options for students, 
particularly of nonprofit institutions. We support the right 
and responsibility of states to regulate the quality and nature 
of the education being delivered within their borders, work 
that we have been trying to advance.
    However, the regulation on state authorization essentially 
places the federal government in the role of enforcing state 
statutes would force a state to create a new regulatory regime 
and make an additional financial burden at a time when many 
states do not have the funds, capacity or structure to comply 
with this regulation. And they certainly will not have such by 
July 1st of this year.
    One state has already said publicly that it could not 
consider applications in its state for at least a year to 
determine how it will even respond. Another has stated that 
upon receipt of our application it will require 6 to 9 months 
of review and then be subjected to the second review if any of 
the education leads to licensure within that state.
    Furthermore, there is no way to guarantee that an 
institution has met the Department's interpretation of any 
state's regulations and no way for the institution to ensure it 
would satisfy these federal interpretations if audited.
    These uncertainties will stifle innovation and force 
accredited, not-for-profit institutions with legitimate and 
creative distance education programs to withdraw from certain 
jurisdictions potentially leaving the students with the 
greatest need with a few options to further their education.
    Thank you.
    [The statement of Mr. Ebersole follows:]

   Prepared Statement of John Ebersole, President, Excelsior College

    Good morning. I am John Ebersole, President of Excelsior College. I 
would like to thank Chairwoman Virginia Foxx, Ranking Member Ruben 
Hinojosa, and members of the Subcommittee on Higher Education and 
Workforce Training for the opportunity to testify on these unnecessary 
proposed regulations.
    Founded by the State of New York Board of Regents as Regents 
College in 1971 and chartered as a private, nonprofit institution in 
1998, the College was renamed Excelsior College in 2001. Excelsior 
College is based in Albany, NY and accredited by the Middle States 
Commission on Higher Education. We are a recognized leader in removing 
obstacles to the educational goals of the adult learner. We provide 
efficient and affordable access to higher education through multiple 
avenues to degree completion. Excelsior College provides distant 
learning opportunities to adult learners with an emphasis on those 
historically underrepresented in higher education. The College meets 
students where they are--academically and geographically, offering 
quality instruction and the assessment of prior learning.
    We share the stated goals of this Administration and the previous 
Administration to increase degree completion over the next ten years to 
maintain our economy and be competitive in the global market. I believe 
that online learning institutions have the capacity to deliver that 
access to those students that would not receive a quality education 
under any other circumstances. This is a time when the traditional 
brick and mortar public institutions are cutting enrollment, reducing 
access and increasing their costs. In fact, The 2010 Sloan Survey of 
Online Learning reveals that online enrollment rose by almost one 
million students from a year ago. The report also found that:
     Three-quarters of institutions report that the economic 
downturn has increased demand for online courses and programs.
     Nearly thirty percent of higher education students now 
take at least one course online
     The 21% growth rate for online enrollments far exceeds the 
2% growth in the overall higher education student population.\1\
---------------------------------------------------------------------------
    \1\ Allen, I. Elaine and Jeff Seaman. Class Differences, Online 
Education in the United States, 2010. Babson Survey Research Group, 
2010.
---------------------------------------------------------------------------
     78.1% of College Presidents agreed that launching/
expanding online education courses and programs provide a way for 
institutions to serve more learners.\2\
---------------------------------------------------------------------------
    \2\ Green, Kenneth C., Scott Jaschik and Doug Lederman. 
Presidential Perspectives: The 2011 Inside Higher Ed Survey of College 
and University Presidents. Inside Higher Ed, 2011.
---------------------------------------------------------------------------
State Authorization
    Every institution is authorized to operate in its home state. In 
the case of Excelsior College, we are chartered by the New York State 
Board of Regents (one of the accrediting agencies recognized by the 
U.S. Department of Education), and the Middle States Commission on 
Higher Education. These new federal state authorization regulations 
would require Excelsior College to document that it is also authorized 
to operate in all 54 jurisdictions recognized by the United States 
Department of Education. Federal Title IV regulations require all 
colleges to comply with individual state regulations related to 
distance learning in which they have enrolled one or more students 
receiving federal student financial aid. Failure of an institution to 
comply with these state authorization rules may result in institutional 
penalties ranging from return of all federal financial aid distributed 
while out of compliance up to removal of the institution's 
authorization to participate in Title IV funding.
    Due to a lack of forethought, the proposed State Authorization 
regulation from the Department of Education would create a road block 
for online education, perhaps at a time when it is needed the most. 
Excelsior has led the Presidents' Forum, a consortium of public and 
private institutions with a shared mission of serving adult students at 
a distance, for seven years with the goal of advancing innovative 
practice and excellence in online learning. We continue to be at a loss 
as to why these regulations run directly contrary to the shared, stated 
goals of the Administration and thousands of higher education 
institutions across the country. As written, the regulation would 
unfairly target and stifle the growth of online education options for 
students.
    We support the right and responsibility of states to regulate the 
quality and nature of the education being delivered within their 
borders. However, the regulation on State Authorization essentially 
places the federal government into the role of enforcing state statutes 
and would force a state to create a new regulatory regime and take on 
additional financial burden when some states do not have the funds, 
capacity or structure to comply with this regulation by July 1, 2011. 
One state has already indicated that it could take a year to determine 
how it will respond. Furthermore, there is no way to guarantee that an 
institution has met the department's interpretation of any state's 
regulations and no way for the institution to ensure it would satisfy 
these federal interpretations if audited. These uncertainties would 
stifle innovation and force accredited institutions with legitimate and 
creative distance education programs to withdraw from certain 
jurisdictions, leaving the students with the greatest need with little 
option to further their education.
    It is impossible to predict the future skills that our workforce 
will need. In order to properly prepare our students for this ever-
changing landscape, our higher education curriculums need to be 
innovative and adapt to those changes.
Impacts to Excelsior College
    Excelsior represents at least one student in all 54 jurisdictions 
that are recognized by the Department of Education. The federal state 
authorization regulations would require Excelsior to review each 
individual state's rules and regulations and to document that Excelsior 
College is in compliance with those rules in each jurisdiction where it 
is serving Title IV recipients. In order to be fully compliant, we 
would have to either complete the authorization process within each 
state or produce documentation for states where this would not be 
necessary. We have estimated that the average cost for authorization is 
approximately $2,500 per state. There are some states that have a fee 
much lower than this number but there are also states where costs would 
exceed tens of thousands of dollars. In considering these demands, 
Excelsior College will have to budget $150,000-200,000 per year to 
comply with these federal mandates. When those costs are multiplied by 
nearly 3,000 institutions offering online education, this sector is 
looking at least a half a billion dollars cost of compliance. These 
additional costs to institutions will undoubtedly be passed on to 
students in the form of increased tuition and fees. That will raise the 
cost of learning and deter access.
    Arkansas is an example of a state that is very granular in its 
approval process. We are required to provide details on every program, 
course, faculty member, credit determination, and projected outcomes. 
For instance, in the case of our faculty members, Excelsior College was 
required to provide an individual form describing the qualifications of 
each faculty member teaching students in the state of Arkansas for 
review. All of these disclosures take time and man power. In the case 
of Arkansas, Excelsior spent in excess of 400 man hours preparing over 
400 pages for submission.
    As a result of these burdensome, costly and vague regulations, 
students from around the country will be denied access to the high-
quality college programs as many reputable accredited institutions, 
such as Excelsior, discontinue their distance learning programs or 
limit them only to states with larger enrollments. As the delivery of 
online courses becomes limited and problematic for legitimate colleges, 
many students will turn to less reputable, locally based, non-
accredited schools for their degree. This would clearly cheapen the 
education offered to those students in need.
    Excelsior's student body is very diverse and we educate many 
students enlisted in the military. These students and their families 
are frequently transferred to different states based on their position. 
Currently, they are able to continue their education and not miss class 
time following a transfer. However, should this regulation take effect, 
those military spouses could be transferred to a state that has not 
authorized Excelsior and they would not be able to continue their 
coursework.
    By explicitly defining a credit hour, our education system 
regresses by looking at the input rather than using a more forward 
looking approach that evaluates learning outcomes. The proposed 
definition of a credit hour will further block and limit innovation in 
higher education. President Obama recently applauded the creation of an 
accelerated learning program at Carnegie Mellon for its innovative 
online courses. They have found that students can learn more quickly 
with specially designed online courses. These regulations would have 
killed that program. By attempting to impose a single definition, the 
Department would be inserting itself in academic judgments made at the 
departmental and institutional level. It is of note that Federal law 
prohibits the Department from interfering in academic decisions without 
explicit Congressional authorization.
Impacts to Growth of Online Education Industry
    For those institutions that are examining and creating online 
education programs, these regulations will give them great pause 
whether to continue that development or abandon the endeavor all 
together. These institutions will not want to risk their Title IV 
funding based on a confusing regulatory market for online programs. As 
the capacity for higher education decreases among the traditional 
sources of learning, we should be promoting online programs and 
services that can help those in need to further their education.
Conclusion
    The resulting ambiguity and confusion over these requirements will 
limit responsible innovation by institutions at the very time that the 
Administration is seeking new routes to academic achievement.
    It is our hope that you will ask the Department of Education to re-
evaluate the rule it has adopted and to see how the rule can be amended 
to avoid the unintended consequences of the current approach.
                                 ______
                                 
    Chairwoman Foxx. Thank you very much Mr. Ebersole.
    Dr. Dowden?

            STATEMENT OF G. BLAIR DOWDEN, PRESIDENT,
                     HUNTINGTON UNIVERSITY

    Mr. Dowden. Good morning Chairwoman Foxx and Ranking Member 
Hinojosa.
    I appreciate your invitation to share my concerns about the 
program integrity issue regulations. My name is Blair Dowden, I 
am President of Huntington University in Huntington, Indiana, 
and I have served in that capacity for the past 20 years.
    I am a past board chair of the Council for Christian 
Colleges and Universities and I have personally served as board 
member of the National Association of Independent Colleges and 
Universities.
    As a president of a private college I am concerned about 
the wide sweeping regulatory overreach that these regulations 
signal. The American higher education system is the best in the 
world largely because of its independence, innovation, and 
creativity. These regulations work to undermine these 
characteristics.
    Certainly, colleges and universities should be held 
accountable for their work and the expenditure of federal 
funds, in fact earlier this year, just about a month ago 
Huntington University was visited by the U.S. Department of 
Education for a routine review of our Title IV programs. After 
a week of review the Department representatives indicated that 
we were very clean in our operation and management of our Title 
IV funds. I believe that this type of oversight is appropriate.
    But the increase in regulation and oversight that is 
contained in some provisions of the Department's new program 
integrity regulations, I think, is not warranted and will 
severely burden colleges and universities.
    Specifically, two parts of these regulations are most 
concerning, the state authorization and credit hour provisions 
which are the topics of this hearing.
    The federal definition of a credited hour inserts the 
federal government squarely into one of the most sacrosanct 
elements of higher education. I believe that it is very 
problematic for the federal government to impose a one-size-
fits-all definition of a credited hour. For instance, a 
scientific laboratory class is different than practicing a 
musical instrument which is different again than engaging in a 
business practicum.
    I strongly believe that is the colleges, universities, and 
accrediting organizations, and not the government, that are 
best able to assess and quantify the learning that results from 
these varied experiences.
    Huntington is a private liberal arts university. We are 
also a Christian institution. Our Christ-centered mission is 
foundational to our educational purpose and forms every 
decision that we make. As president I am concerned that these 
new regulations have the potential to interfere with our faith 
based mission.
    In particular, the state authorization component of these 
regulations expands on the requirement that an institution must 
be authorized by the state in order to participate in Title IV 
funding. As you know, state authorization is currently required 
by the Higher Education Act, so is not at all clear to me what 
value would be added by these new, and I think, confusing 
requirements.
    These regulations clearly open the door for states to 
impose requirements that go well beyond authorizing an 
institution to offer postsecondary education. My concern is 
that there appears to be no limits to what factors a state can 
consider when granting or withholding authorization and no 
mechanisms for appeal or due process.
    As a president of a Christian institution, I am acutely 
aware that religion and religious practices can sometimes 
invoke strong reactions in people, reactions that sometimes 
motivate certain political positions and actions.
    The Department's new regulations delineate a very small 
category of institutions that are eligible to be exempted under 
state law if indeed the state should even chose to provide a 
religious exemption.
    This category of schools is so narrowly defined that 
neither Huntington University nor any other member of the 
Council of Christian Colleges and Universities would qualify 
for an exemption as outlined in these new regulations.
    This prospect is obviously very troubling and widely shared 
as a concern by my fellow Christian college presidents. I do 
not want to have our students' eligibility to receive Title IV 
funding placed solely in the hands of a politically motivated 
state entity.
    In addition, the possibility exists that certain states may 
use this new state authorization requirement as leverage to 
achieve their own higher education policy agenda at the expense 
of institutional missions. For instance, a state could require 
a certain curriculum or text books in order to gain 
authorization potentially violating both the academic 
prerogatives and religious convictions of the institutions.
    Let me conclude by assuring you that these concerns are not 
a denial for accountability and excellence in higher education. 
Nor are they out of a concern that Huntington University would 
not meet quality standards. To the contrary, Huntington 
University is ranked by U.S. News and World Report, among the 
Midwest's top-10 regional colleges and among the region's top-5 
best values. We are providing our students with an excellent 
education and equipping them for the future.
    Rather, I oppose these regulations because they 
unnecessarily interfere with the good work that my institution 
and many others are doing. And because they create the 
potential for misunderstanding, misapplication, and even 
mischief by politically motivated state actors.
    I appreciate your time today and look forward to your 
actions.
    [The statement of Mr. Dowden follows:]

Prepared Statement of G. Blair Dowden, President, Huntington University

    Good morning Chairwoman Foxx and Ranking Member Hinojosa: I 
appreciate your invitation to share my concerns about the ``program 
integrity issues'' regulations. My name is Blair Dowden, president of 
Huntington University in Huntington, Indiana, and I have served in that 
capacity for the last twenty years. I am a past Board chair of the 
Council for Christian Colleges and Universities, and I presently serve 
as a Board member of the National Association of Independent Colleges 
and Universities. I want to share my concerns with you today as the 
president of Huntington University--a private, accredited, four-year, 
Christian liberal-arts university and an institution whose religious 
character and mission is central to everything we are and everything we 
do.
    As a president of a private college, I am concerned about many 
specific facets of these regulations, but I am also concerned generally 
about the wide sweeping regulatory overreach that these regulations 
signal. As private institutions of higher learning come under ever-
increasing regulatory burdens, we find fewer and fewer differences in 
the level of government involvement between our institutions and our 
public counterparts. The American higher education system is the best 
in the world largely because of its independence, innovation and 
creativity. I believe that these regulations work to undermine, rather 
than strengthen, those valuable characteristics.
    Specifically, there are two parts of these regulations that are 
most concerning: state authorization and credit hour, the topics of 
this hearing. I strongly believe that the new regulations will elevate 
the level of involvement by the state and federal governments and 
significantly impact one of the hallmarks and strengths of the U.S. 
higher education system, institutional autonomy.
    I am not endorsing the premise that institutions should not be held 
accountable for their work and the expenditure of federal funds. In 
fact, earlier this year, Huntington University was visited by the US 
Department of Education for a routine review of our Title IV programs. 
After a week of review, the Department representatives indicated that 
we were a ``very clean'' operation in the management of Title IV funds. 
This type of oversight is appropriate. But the dramatic increase in 
regulation and oversight that is contained in some provisions of the 
Department's new program integrity regulations is not warranted and 
will severely burden our colleges and universities.
    One specific concern is the federal definition of the credit hour 
which inserts the federal government squarely into one of the most 
sacrosanct elements of higher education. Because of the diversity of 
institutions, programs, and methods of the delivery of academic 
content, I believe that it is very problematic for the federal 
government to impose one standard definition for and implementation of 
a credit hour. The effort to transform the credit hour into a simple 
accounting unit used for bookkeeping, shows, I believe, a fundamental 
misunderstanding of the credit hour. A credit hour is not only 
different from institution to institution, but is different even within 
an institution from program to program. A scientific laboratory class 
is different from practicing a musical instrument which is different 
from engaging in a business practicum. I strongly believe that it is 
colleges, universities and accrediting organizations--not the 
government--that are best able to assess and quantify the learning that 
results from these varied experiences.
    In recent decades, there has been significant innovation in higher 
education, especially for adult learners. Accelerated classes, distance 
learning, and hybrid format classes have opened up doors of educational 
opportunity and attainment for new groups of students. A restrictive 
definition of credit hour based on seat-time alone would turn back the 
clock and discourage the kind of innovation that enables colleges and 
universities to serve these students. It is one thing to measure how 
much time a student spends in a classroom; it is quite another to 
measure how much the student learned. As Sylvia Manning, president of 
the Higher Learning Commission testified to the House Committee on 
Education and Labor on June 17, 2010, a narrow definition of credit 
hour would not be particularly useful in measuring the learning 
outcomes of adult students or alternative delivery systems. It would 
deter innovation in higher education and ``require that colleges and 
universities divert resources away from helping students to 
demonstrating compliance with the regulation.'' Imposing a federal 
definition of a credit hour would usurp the role of accrediting 
organizations without effectively measuring or improving academic 
rigor, program quality, or learning outcomes.
    Huntington is a private liberal-arts university; we are also a 
Christian institution. Our Christ-centered mission is foundational to 
our educational purpose and informs every decision that we make. As 
president, I am also concerned that these new regulations have 
potential to interfere with our faith-based mission.
    In particular, the state authorization component of these 
regulations expands on the requirement that an institution must be 
authorized by a State in order to participate in Title IV funding. 
State authorization is currently required by the Higher Education Act, 
and it is not at all clear to me what value would be added by these 
new--and confusing--requirements. However, this clearly opens the door 
to have states impose requirements that go well beyond authorizing an 
institution to offer postsecondary education. My concern is that there 
appear to be no limits to what factors a state can consider when 
granting or withholding authorization, and no mechanisms for appeal or 
due process.
    For instance, what if an institution were denied state 
authorization because of a practice stemming from its religious 
mission? This would disqualify the college or university from 
participation in Title IV programs. As the president of a Christian 
institution, I am acutely aware that religion and religious practices 
can sometimes invoke strong reactions in people, reactions that can 
sometimes motivate certain political positions and actions opposing 
religious practices and institutions. That is why prior higher 
education legislation has contained strong religious exemptions. The 
Department's new regulations, however, do not actually create a 
religious exemption. Instead, they delineate a very small category of 
institutions that are eligible to be exempted under state law, if the 
state should choose to do so. This category of schools eligible for a 
state religious exemption is so narrowly defined that Huntington 
University and schools like us would not qualify. In fact, not one 
member of the Council for Christian Colleges and Universities would 
qualify for an exemption as outlined by the new regulations.
    This prospect is very troubling and is widely shared as a concern 
by my fellow Christian college presidents. I do not want to have our 
students' eligibility to receive Title IV funding placed solely in the 
hands of a political state entity, with no possibility of religious 
exemption.
    In addition, the possibility exists that certain states may use 
this new state authorization leverage to achieve their own higher 
education policy agenda at the expense of the mission of the 
institution. For instance a state could require certain curriculum or 
textbooks in order to gain authorization, violating both the academic 
prerogatives and religious convictions of the institutions. This would 
have the effect of putting colleges and universities in the position of 
choosing between state authorization and the ability to freely engage 
in their religious missions.
    According to some legal analysts, my state of Indiana is one of 
several states that would not be in compliance with the Department's 
regulations concerning state authorization. Although Huntington 
University has operated effectively for more than a century, new 
legislation might be needed to establish the state authorization 
required by these new regulations.
    My institution was founded in 1897 and has always been recognized 
by the state, and was formally authorized by statute since 1965. There 
has never been a problem or question about its authorization. Although 
the Department's new regulations require it, my state never saw a need 
to write institutional names into the law. It is unfortunate that, 
through a seemingly small requirement, the new rules open the potential 
for the state to take these new requirements as an opportunity to 
involve itself in areas that have not been the purview of the state 
before, such as curriculum or institutional mission.
    The Department's regulations require additional state regulation 
and oversight, without any offsetting reduction in federal regulation 
or oversight. The burden of compliance will increase, driving up costs. 
The price of higher education goes up when layers of government create 
well-intentioned but burdensome rules and regulations. Every dollar 
spent on compliance is a dollar that is not being spent on educating a 
student to succeed and contribute to society.
    This scenario brings to mind past experience with the 1992 
reauthorization of the Higher Education Act. The legislation required 
the establishment of a State Post Secondary Review Entity, or SPRE, in 
every state. While the effort was trumpeted as a way to increase 
accountability in higher education, the actual result was the 
multiplication of state and federal intrusions into the operations of 
colleges and universities. The SPRE concept severely eroded the 
independence of private colleges and universities and led to, in the 
words of one commentator, ``haphazard and capricious regulatory 
enforcement.''\i\ In 1994, the Department of Education notified nearly 
2,000 institutions that they had failed to meet certain criteria. SPRE 
was fiercely opposed by those who championed a smaller, less intrusive 
federal government. Fortunately, Congress defunded the SPRE project and 
ended implementation in March 1995.
---------------------------------------------------------------------------
    \i\ David L. Warren ``Why Faculty Should Care about Federal 
Regulation of Higher Education,'' Academe, July-August 1994: 19, cited 
in Terese Rainwater, ``The Rise and Fall of SPRE: A Look at Failed 
Efforts to Regulate Postsecondary Education in the 1990s,'' American 
Academic, March 2006: 107.
---------------------------------------------------------------------------
    Now, in 2011, it appears we are heading down the same misguided 
path with the new regulations promulgated by the Department of 
Education and due to be implemented in July.
    Let me conclude by assuring you that my concerns are not intended 
to deny the need for accountability and excellence in higher education, 
or out of a concern that Huntington University would not meet quality 
standards. To the contrary, Huntington University has a proven track 
record with the Department of Education, with our accrediting 
organization, and with third-party observers such as U.S. News & World 
Report, which ranks Huntington among the Midwest's top ten regional 
colleges and among the region's top five best values. Huntington 
University is providing our students with an excellent education and 
equipping them for the future.
    Rather, I oppose these regulations because they unnecessarily 
interfere with the good work that my institution and many others are 
doing, because they have the likelihood of raising costs without 
delivering value to students, and because they create the potential for 
misunderstanding, misapplication, and even mischief by politically 
motivated state actors.
    I appreciate your time here today and look forward to answering 
your questions.
                                 ______
                                 

        STATEMENT OF KATHLEEN TIGHE, INSPECTOR GENERAL,
                  U.S. DEPARTMENT OF EDUCATION

    Ms. Tighe. Thank you Chairwoman Foxx, Ranking Member 
Hinojosa, and members of the subcommittee.
    Thank you for inviting me here today to discuss the Office 
of Inspector General's work involving issues impacting the 
higher education community, specifically our work regarding the 
definition of a credit hour.
    Currently, the federal student aid programs are primarily 
dependent on the credit hour for making award decisions as are 
other forms of aid including state student aid programs and 
certain programs administered through the U.S. Department of 
Veterans Affairs and the Department of Defense.
    The credit hour is the most basic unit for determining the 
amount of federal student aid provided to students and funded 
by taxpayers. As the credit hour is a proxy measure of a 
quantity of student learning in exchange for financial 
assistance, it is in the federal interest to ensure that 
students are receiving an appropriate amount of funding and 
instruction and that taxpayer money is being used properly.
    Last year I testified before the full committee providing 
an extensive view of how the need for a definition of a credit 
hour evolved, and our work involving accrediting agencies. 
Because the role they play is vital--accreditation is one of 
the primary requirements for an institution's participation in 
the federal student aid programs and determines whether 
academic programs merit taxpayer's support--the Department is 
dependent on accrediting agencies to ensure that institutions 
provide quality content and academic rigor at the postsecondary 
level as it is itself prohibited from determining the quality 
of education funded by federal dollars.
    All the Department can do with regard to evaluating the 
quality of postsecondary education, is recognize accrediting 
agencies as reliable authorities for the quality of education 
funded by federal dollars.
    In anticipation of the 2009-2010 higher education 
negotiated rule making sessions, we updated work we had 
previously done that examined accrediting agencies definitions 
of program length and credit hour. Again, we found that none of 
the accrediting agencies--the regional accrediting agencies we 
reviewed--defined a credit hour or provided guidance on the 
minimum requirements for the assignment of credit hours.
    The definition of a credit hour protects students and 
taxpayers from inflated credit hours, the improper designation 
of full-time student status, the over awarding of federal 
student aid funds, and excessive borrowing by students, 
especially with distance, accelerated and other programs not 
delivered through the traditional classroom format.
    As the Department is prohibited from developing the minimum 
criteria for an accrediting agency's standards for 
accreditation or making determinations on curriculum and 
educational quality, it is not unreasonable for the Department 
to expect an accrediting agency to have developed its own 
minimum standards.
    The Department's new definition of a credit hour is based 
on the current funding assumption that a full-time student is 
academically engaged full time. To the extent that a full-time 
student is not expected by an institution or the institution's 
accrediting agency to be academically engaged on a full-time 
basis, federal student aid may in fact be over awarded.
    The OHE is required by the Inspector General Act to review 
and make recommendations regarding proposed regulations and 
statutes. In fulfilling this role we have provided the 
Department with information on a credit hour for its proposed 
program integrity regulations.
    Based on our work we also recommended that the definition 
of a credit hour include a requirement that accrediting 
agencies evaluate the assignment of credit hours.
    The Department's new regulations reflect our 
recommendations. We will monitor the implementation of this and 
all the Department's new regulations and we will do whatever we 
can to ensure that the new regulations assist in protecting our 
nation's students, parents, and taxpayers.
    Thank you, very much.
    [The statement of Ms. Tighe follows:]

      Prepared Statement of Kathleen S. Tighe, Inspector General,
                      U.S. Department of Education

    Chairwoman Foxx, Ranking Member Hinojosa, and members of the 
Subcommittee: Thank you for inviting me here today to discuss the U.S. 
Department of Education (Department) Office of Inspector General's 
(OIG) work involving issues impacting the higher education community. I 
appreciate the opportunity to share with you information on our efforts 
to ensure integrity and efficiency in the Federal student aid programs 
and operations. I look forward to working with this Subcommittee to 
help ensure these programs meet the needs of America's students and 
families.
    In today's testimony, I will discuss our work involving the 
definition of a credit hour--a critically important issue in the 
Federal student aid programs, as the amount of Federal student aid a 
student receives is based on the number of credit hours the student is 
enrolled in. This issue has become even more significant as online 
education has dramatically increased in recent years, making credit 
hour assignment difficult, and its comparison to traditional classroom 
delivery a challenge because online education generally does not 
involve a scheduled time or time commitment.
    Currently, the Federal student aid programs are primarily dependent 
on the credit hour for making award decisions, as are other forms of 
aid, including state student aid programs and certain programs 
administered through the U.S. Department of Veterans Affairs and 
Department of Defense. The Department of Education has stated that a 
credit hour is a unit of measure that gives value to the level of 
instruction, academic rigor, and time requirements for a course taken 
at an educational institution. The credit hour is the most basic unit 
for determining the amount of Federal student aid provided to students 
and funded by taxpayers. A credit hour is a proxy measure of a quantity 
of student learning in exchange for financial assistance. It is in the 
Federal interest to ensure that students are receiving an appropriate 
amount of funding and instruction and that taxpayer money is being used 
properly.
    Last year, I testified before the full Committee, providing an 
extensive explanation of how the need for a definition of a credit hour 
evolved and our work involving accrediting agencies and how they 
approach ensuring the adequacy of the assignment of credit hours. I 
have attached a copy of that testimony, which provided a history of our 
work in this area, detailed our findings, and identified the need for a 
clear definition of a credit hour for the purposes of awarding Federal 
student aid.
    As stated in that testimony, the role of accrediting agencies is 
vital: accreditation is one of the primary requirements for an 
institution's participation in the Federal student aid programs.
    Under the Higher Education Act of 1965, as amended (HEA) and the 
implementing regulations, the Department is dependent on accrediting 
agencies recognized by the Secretary of Education to ensure that 
institutions provide quality, content, and academic rigor at the 
postsecondary level. The Higher Education Opportunity Act of 2008 
included a provision that prohibits the Department from developing 
minimum regulatory criteria for an accrediting agency's standards for 
accreditation. The Department of Education Organization Act prohibits 
the Department from making determinations on curriculum and educational 
quality. Thus, the Department is prohibited from determining the 
quality of education funded by Federal education dollars. All it can do 
with regard to the quality of postsecondary education is recognize 
accrediting agencies as reliable authorities for the quality of 
education funded by Federal dollars.
    One of the primary roles of the OIG is to protect Federal taxpayer 
dollars funding the Department's programs and operations. Due to 
changes in the higher education regulations, we became concerned that 
the interests of students and taxpayers might not be protected. As a 
result, in 2002-2003 we examined accrediting agencies' definitions of 
program length and a credit hour. These efforts found that none of the 
regional accrediting agencies reviewed defined a credit hour and none 
of the regional accrediting agencies provided guidance on the minimum 
requirements for the assignment of credit hours. While the national 
accrediting agencies we reviewed defined a credit hour, the definitions 
only included hours of instruction, not expectations for outside 
academic engagement.
    In anticipation of the 2009-2010 higher education negotiated 
rulemaking sessions, where the definition of a credit hour was to be 
discussed, OIG once again examined this issue in order to provide the 
Department with facts for its work on the definition of a credit hour 
and to provide information to Congress on the state of the definition 
of a credit hour at regional accrediting agencies. Again, we found that 
none of the regional accrediting agencies we reviewed defined a credit 
hour and none of the regional accrediting agencies provided guidance on 
the minimum requirements for the assignment of credit hours.
    The definition of a credit hour protects students and taxpayers 
from inflated credit hours, the improper designation of full-time 
student status, the over-awarding of Federal student aid funds, and 
excessive borrowing by students especially with distance, accelerated, 
and other programs not delivered through the traditional classroom 
format. As the Department is prohibited from developing minimum 
criteria for an accrediting agency's standards for accreditation or 
making determinations on curriculum and educational quality, it is not 
unreasonable for the Department to expect an accrediting agency to have 
developed its own minimum standards.
    The Federal student aid programs assume that a full-time student 
enrolled in 12 credit hours is engaged in full-time study. The 
Department's definition of a credit hour is based on the current 
funding assumption that a full-time student is academically engaged 
full-time. The Department's definition is based on the common 
understanding that a full-time student is expected to spend 12 hours in 
class and 2 hours in outside academic engagement for each hour in 
class, resulting in 36 hours of academic engagement a week--the 
approximate equivalent of a full-time job. To the extent that a full-
time student is not expected by an institution or the institution's 
accrediting agency to be academically engaged on a full-time basis 
Federal student aid may be over-awarded.
    The OIG is required by the Inspector General Act of 1978, as 
amended, to review and make recommendations regarding proposed 
regulations and statutes. In fulfilling this role, we provided the 
Department with information on a credit hour for its proposed program 
integrity regulations. Based on our work, we recommended that the 
definition of a credit hour include a requirement that accrediting 
agencies evaluate the assignment of credit hours to new courses and on 
an ongoing basis to evaluate whether courses offered by an institution 
have maintained the credit hour value assigned to them. The 
Department's regulations reflect our advice and protect both students 
and taxpayers by including a definition of a credit hour that seeks to 
ensure equity in funding across institutions and among students based 
on the level of academic engagement and to help ensure appropriate 
funding based on the concept of a full-time student being academically 
engaged full-time.
    It is important to note, however, that even with strong 
requirements concerning credit hours, it could take up to 10 years to 
implement the regulation and for students and taxpayers to feel 
confident that the credit hours assigned to a course are appropriate 
and that value is being received. The regulation relies on the cycle of 
accreditation to review an institution's compliance with the new rule, 
but institutions are generally only required to be reaccredited every 
10 years. As such, the Department will need to be vigilant to ensure 
the effectiveness of this new regulation and determine whether further 
changes are needed. We will monitor the implementation of this and all 
of the Department's new regulations and will do whatever we can to 
ensure that the new regulations assist in protecting our nation's 
students, parents, and taxpayers.
    This concludes my written statement. I am happy to answer any of 
your questions.
                                 ______
                                 
    Chairwoman Foxx. Mr. Wolff.

              STATEMENT OF RALPH WOLFF, PRESIDENT,
          WESTERN ASSOCIATION OF SCHOOLS AND COLLEGES

    Mr. Wolff. Thank you.
    Chairwoman Foxx, Ranking Member Hinojosa, members of the 
subcommittee, my name is Ralph Wolff. I have been introduced, 
the President of the Western Association of Schools and 
Colleges.
    I want to speak about both of these regulations because not 
only did I participate in the negotiation of them and expressed 
concerns there, I have been hearing from dozens of institutions 
and meeting with state representatives who also are greatly 
confused and concerned about them.
    First, I would like to address the state authorization 
regulation, expressly it was stated that this was to address a 
problem that arose in California several years ago. New 
legislation has been adopted so that issue has been resolved 
and we do not feel there is ample justification for the final 
regulation now adopted by the Department.
    In addition, we have several other concerns. For the first 
time the regulation establishes specific federal criteria that 
all states must conform to rather than relying on the judgment 
of each of the states for determining what is appropriate state 
licensure.
    Secondly, the impact of the regulation is unclear. During 
the course of negotiations we had a legal memorandum which I 
would like to submit to--for the record that found that as many 
as 37 states would need to modify their licensing statutes in 
one way or another. The Department has failed to provide a list 
of which states would need to make what changes.
    That has left states confused and as I said, states are not 
quite sure what is required to come into compliance. With 
respect to student complaints, there is confusion what the new 
act or the new regulations, excuse me, will require states to 
do.
    Whether existing rules or a new process must be established 
and how it will overlap with that already required and 
undertaken by accrediting agencies.
    You have heard already about the impact on religious and 
faith based institutions and distance education programs. We 
are hearing from a number of institutions, of both types, 
expressing serious concern about these regulations.
    Finally, there is no provision for enforcement, how this 
new regulation will be enforced and how states will know they 
have come into appropriate compliance. And an entire state's 
financial aid is at risk if compliance is not found to be in 
place.
    Establishing an enforcement system would be a problem in 
and of itself. In sum, this regulation fails to address a 
clearly stated problem, creates significant confusion, and will 
represent a major burden on states and institutions far 
exceeding the problem being addressed.
    Next, I would like to turn to the credit hour regulation on 
which we have spent a lot of time in negotiated rule making. 
Again, this does stem from the targeted review by the Inspector 
General's Office that focused on one institution in one region.
    As reflected in earlier comments before and in the response 
to the Inspector General's report, the accreditor had already 
identified the problem, had worked with the institution to 
resolve it and we think that the situation was effectively 
dealt with.
    But for the first time a federal definition is now being 
established for every course at every institution that receives 
financial aid, we are talking about millions of courses. 
Institutional accrediting agencies such as WASC must require 
compliance with this federal definition in all of our 
comprehensive reviews. We have several major concerns with 
respect to this regulation.
    First, we believe that the federal definition intrudes on 
the work of faculty across the country and will force faculty 
to fit their credit hour assignments to the federal definition 
rather than what they think is most appropriate.
    Secondly, it gives primary emphasis to seat time which is 
an outdated model of measuring quality.
    Third, there is an enormous cost to be realized in 
implementing this, in real dollars, and a shift in focus from 
the most important goals which are to increase completions of 
degree programs and improving quality of learning.
    Finally, it will expand the potential of federal intrusion 
as the Department and the National Advisory Committee on the 
Institutional Quality question and review the effectiveness of 
accrediting review, the size of our sampling, ultimately we 
believe, federalizing the entire system of credit awards.
    We have done a lot to improve quality at WASC; other 
regional accreditors are doing the same. We believe that we 
have focused on the right issues by improving attention to 
completion.
    We request that, with the 70 other higher educational 
organizations, supporting letters introduced by The American 
Council of Education, that these two regulations be withdrawn. 
If not, at least suspended for one year, until these issues may 
be worked out.
    [The statement of Mr. Wolff follows:]

   Prepared Statement of Ralph A. Wolff, President, the Accrediting 
    Commission for Senior Colleges and Universities of the Western 
               Association of Schools and Colleges (WASC)

    Chairwoman Foxx, ranking member Hinojosa, and members of the 
committee, I am pleased to present testimony to you today discussing 
regulations recently finalized by the U.S. Department of Education 
regarding State Authorization and the Credit Hour.
    My name is Ralph A. Wolff, and for the past 15 years I have served 
as the President of the Accrediting Commission for Senior Colleges and 
Universities of the Western Association of Schools and Colleges (WASC). 
WASC is one of seven regional accrediting commissions, and is 
responsible for the accreditation of institutions in California, 
Hawaii, Guam and the historic Pacific Trust Territories. I also serve 
as vice chair of the Council of Regional Accrediting Commissions (C-
RAC), which meets regularly to address policy issues affecting 
accreditation. On behalf of C-RAC I have participated as a primary or 
alternate negotiator in three negotiated rulemaking processes, most 
recently in 2009--10, leading to the federal regulations being 
discussed here today.
    During that negotiated rulemaking process, fourteen issues were 
debated, nine of which resulted in tentative agreement, including with 
respect to credit hour. Among the issues where agreement was not 
reached was state authorization.
    However, when the final regulations were released last year, they 
included significant changes to the tentative agreement related to 
credit hour. Nor were our concerns with respect to state authorization 
addressed.
    While we have appreciated the Department's willingness to listen to 
our concerns with respect to the final regulations, I along with my 
regional accreditation colleagues recently joined the American Council 
on Education (ACE) and more than 50 other higher education associations 
in submitting a letter to the Department calling for the withdrawal of 
these regulations. Together, all of these associations represent nearly 
the entire higher education community. I would ask the Chairwoman that 
both of these letters be submitted for the Record.
State Authorization
    I will first focus on the regulation dealing with state 
authorization, which for the first time establishes a specific federal 
set of criteria that all states must conform to in order for 
institutions within their state to be eligible for Title IV financial 
aid.
    The main rationale used by the Department in adopting this 
regulation stems from the expiration of the California Bureau of 
Private Postsecondary and Vocational Education (BPPVE) several years 
ago. Ironically, the California legislature and the Governor did not 
extend the legislation to continue this Bureau in operation because it 
was not doing a good enough job of weeding out inadequate institutions, 
and all agreed that tougher legislation was needed. In the interim 
period before new legislation was passed, all state licensed 
institutions were asked to maintain their same commitments to consumers 
as before and there were no problems reported by any accredited 
institution that called into question their financial aid from the 
federal government. USDE recognized accrediting agencies, such as WASC, 
maintained oversight of these institutions, and followed up on any 
consumer complaints as already required by federal law. Subsequently, a 
new law was passed and a new Bureau overseeing private postsecondary 
education in California is now in place and working.
    So, while the process may not have been as smooth as one would have 
liked, there were no significant problems that occurred in California 
as a result of this situation. This fact was confirmed publicly by the 
Department in negotiated rulemaking; yet, the Department nonetheless 
felt the need to develop a policy to address a possible set of 
circumstances similar to those experienced in California to deal with 
problems the might occur. Since the Department was unable to identify 
any fraud or abuse that resulted from this interim period in 
California, there is simply not sufficient justification for the 
considerable extension of federal authority the new regulation imposes.
    Beyond the lack of clear need, another major concern is that the 
regulation overreaches federal authority to instruct states how to 
establish their regulatory system for higher education institutions 
operating within their borders. States have utilized a number of 
statutory and regulatory approaches to license institutions to operate 
and award degrees, and this new regulation will only complicate and 
confuse these efforts. For example, the Department has never identified 
those states where it has found the state licensing process for private 
institutions to be a problem. Nor have they specifically identified 
those states that would need to change their regulatory or statutory 
arrangements to come into compliance with this regulation.
    WASC commissioned our legal counsel to undertake a review of state 
law using a draft of the regulation during the negotiated rulemaking 
process. Our lawyers found that as many as thirty-seven states would 
need to modify their licensing statutes in one way or another to comply 
with these regulations. While this memo was shared with the Department, 
the issues raised in it have never been addressed. Today, many states 
are confused regarding what, if anything, they need to do to come into 
conformity with the new regulations. At a time when so many states are 
suffering significant budget reductions, many states will likely be 
forced to expand their bureaucracies, increase their costs, and impose 
ever more administrative requirements upon their private institutions. 
And to think, this unnecessary and inappropriate extension of federal 
authority is all a result of an attempt to address a problem that even 
the Department admits failed to materialize when it was expected to 
occur in California.
    Which leads us to our current dilemma. States and institutions 
alike are confused regarding what they need to do to come into 
compliance with the new regulation. Institutions in California like the 
University of the Pacific founded in 1851, and Mills College founded 
in1852 and Stanford founded in 1891 must suddenly prove they are 
licensed to exist and potentially face a new level of oversight and 
review that they have not been subjected to before--despite the fact 
that there have been no identified problems. In addition, some believe 
this new regulation will require states to go beyond their existing 
processes and establish new complaint adjudication systems for all 
private institutions. This would be a significant expansion of state 
authority that could result in unprecedented interference in the 
internal operations of private institutions. Given that most complaints 
we receive are grade disputes or personnel matters, would these issues 
now become the subject of duplicative state reviews where the state is 
expected to second guess the actions of private institutions?
    A significant number of religious and faith-based institutions have 
also expressed concerns about the broad reach of this new regulation 
which limits the definition of a religious institution to only those 
that award religious degrees or certificates including, but not limited 
to, ``a certificate of Talmudic studies, an associate of Biblical 
studies, a bachelor of religious studies, a master of divinity or a 
doctor of divinity.'' This is an unprecedented narrowing of the 
definition of a religious institution. Again, in many states, religious 
institutions are defined much more broadly and we and other accrediting 
agencies accredit religious institutions that award a range of degrees 
well beyond those so narrowly defined in the regulation. These 
institutions are appropriately concerned that such a narrow definition 
will subject them to intrusive state monitoring of their activities and 
violation of their founding religious principles.
    Yet another area of great confusion and inappropriate federal 
intrusiveness is related to distance education programs. Under the 
regulations, institutions must: 1) meet any necessary state 
requirements to offer distance education legally in the state, and 2) 
upon request, document such legal authority. This puts the federal 
government in a position to determine if state law is met. It also puts 
institutions in an insurmountable quandary--if there is no state 
regulation must the institution nonetheless demonstrate it is not 
required to register with the state? Must states now issue letters 
indicating that institutions don't need to be registered? Will this 
lead states to enact new and likely contradictory, registration 
requirements for their states? This provision already has led to 
enormous confusion and uncertainty.
    Finally, there is no provision for enforcement. After states have 
gone to the trouble of working though these issues how will the 
Department determine whether the state has done what is required to 
conform to the confusing language of the regulation? There is no 
process by which the Department will assure that a state has come into 
compliance or that institutions have done so as well. Will an entire 
state's federal financial aid now be at risk? Will an institution's 
entire financial aid eligibility now be at risk if it fails to obtain 
the proper letters of authorization to offer distance education in each 
and every state? No one knows.
    In sum, this regulation fails to address a clearly stated problem; 
creates significant confusion in its implementation; and represents a 
major burden on states and institutions which far exceeds the nature of 
the problem being addressed.
Credit Hour
    An even greater set of problems arises from the adoption of the 
regulation on the credit hour. This regulation establishes, for the 
first time, a federal definition of a credit hour for all courses at 
all institutions receiving federal financial aid. Institutional 
accrediting agencies, such as WASC, in turn, must require compliance 
with this federal definition in all comprehensive institutional 
reviews, and are permitted to use a sampling approach. Deficiencies are 
to be corrected, and systemic problems are to be promptly reported to 
the Secretary of Education. While this may appear straightforward, each 
one of the elements of this regulation has already led to significant 
confusion and concern.
    As with the state authorization regulation, the justification used 
by the Department to impose this regulation is very limited. 
Specifically, this regulation stems largely from a targeted review by 
the Department's Inspector General. This review found that one regional 
accreditor, in the course of a site review, found an excessive award of 
credit for the amount of engagement required by some courses within a 
single institution. The accreditor required that the institution 
address this issue, and the institution corrected the credit award, and 
a follow up visit confirmed that the corrections had been made. In a 
nutshell, the existing system worked, and worked within a timely 
manner. Yet this example is cited as the basis for requiring every one 
of the more than 5,000 institutions of higher education to justify the 
credit award for each and every course offered.
    The primary concern regarding credit awards is not the traditional 
seat-time based classroom course--it is rather the accelerated course 
formats offered over intensive days or weekends, or online courses that 
may not have required interactions with faculty or other students 
(asynchronous). Existing federal regulations already establish that a 
change in modality will trigger a substantive change review and all 
accreditors closely monitor online programs, and are already required 
by the Department to review online programs and assure that all 
accrediting standards are applied to them. Similarly, all off-site and 
major new programs are reviewed prior to opening through the 
substantive change processes that review courses and curricula to 
assure that the programs are appropriately resourced and of sound 
academic quality. In our site reviews, we pay special attention to all 
of these types of programs. Thus, for those programs where credit 
awards are most likely to present an issue, there are existing 
procedures in place prior to programs being offered and as part of 
ongoing accrediting reviews that assure program integrity. There is no 
adequate rationale for requiring every institution to verify every 
course credit assignment as required by this regulation, especially 
given the close level of monitoring that accreditors already provide.
    The credit hour is a cornerstone of the American academic system, 
and the faculty at nearly every institution are responsible to set and 
oversee credit awards for all courses, certificates and degrees awarded 
in the name of the institution. This is a central role of the faculty, 
and one that has been well established and has proved to be highly 
effective in supporting the diversity of institutions within the 
American higher education system--which continues to be the best in the 
world. The application of the American credit hour system has been 
sufficiently flexible within and across institutions to adapt to the 
many different levels of courses across multiple disciplines, different 
delivery modes, and accommodate not only classroom courses but 
laboratory work, internships, online courses and programs, and other 
forms of academic endeavor. To apply a federal definition to all of 
these academic endeavors will intrude into the work of faculty across 
the country, and force their decisions to fit the federal definition. 
This makes no sense and will only lead to stifling new and innovative 
approaches to delivery as institutions worry that they may not be 
meeting an externally imposed definition of a credit hour.
    Moreover, the definition of the credit hour in this regulation 
gives primary emphasis to seat time. This returns to an outdated input 
model of measuring quality when we are working with institutions to 
focus increasingly on learning outcomes. All accrediting agencies have 
challenged institutions to be more explicit about identifying learning 
outcomes at the program and institutional levels, and reviewing the 
competencies and capacities of students at the completion of their 
programs. This regulation fundamentally shifts the focus to a smaller 
unit of analysis. We would like to see a more forward looking approach 
to addressing institutional quality than this outdated seat-time 
compliance model for each and every course offered in the US.
    There will be an enormous cost--in real dollars and in a shift in 
focus--to implement this regulation given that the more than 5000 
institutions eligible for financial aid offer millions of courses each 
year. A sense of scale is useful: Stanford University and the 
University of Southern California each offer close to 10,000 courses a 
year in several hundred degree programs; California State University, 
San Bernardino and San Francisco State University, medium sized 
institutions, offer over 8500 courses each annually; the University of 
California estimates they offer over 50,000 courses a year; the 
California Community Colleges over 180,000. Even a small comprehensive 
university like the University of San Francisco offers over 5000 
courses a year. The credit hour regulation requires institutions to be 
responsible to verify the ``reliability and accuracy'' of their credit 
awards, meaning that they will now need to divert extensive resources 
and faculty time to document course credit awards across the entire 
institution. While most institutions have systems in place for 
reviewing and approving new courses and programs, this regulation will 
lead institutions to review and document the credit awards for all 
existing courses of all types, even if offered for many years. There is 
no evidence that the issue of questionable credit awards applies to 
traditional course delivery formats, which comprise the majority of 
courses at traditional institutions. The breadth of this regulatory 
requirement, therefore, is unnecessary and will require an enormous 
amount of human and financial resources to implement.
    In addition, accrediting agencies are expected to evaluate the 
reliability and accuracy of institutional credit assignments, which 
means that a whole new dimension is added to the institutional 
accreditation review process. How will the ``reliability and accuracy'' 
of course assignments be determined without looking in detail at a 
significant sample of course syllabi and student assignments across a 
wide range of disciplines, levels and formats? While this surely can be 
done, is it the best focus to give to institutional reviews or quality 
and integrity? We think not. In undertaking these evaluations, the 
regulation permits a ``sampling'' approach. While this may sound 
simple, given the enormous number of courses offered each year by 
institutions, how large or broad must the sample be? No sample size is 
identified, but assume that a sample size of 10% of courses was 
undertaken for small to medium sized institutions, and even 5% for 
large institutions. Would this be considered enough? If one were to 
assume that it took a single evaluator up to 10-20 minutes per course 
to review a sample syllabus and the credit assignment for a medium 
sized institution offering 5,500 courses, as does the University of San 
Francisco, this would require up to 180 hours for just this one 
institution, or the equivalent of a single person working full-time for 
3--4.5 weeks on this task alone. For larger institutions, it is very 
likely that the amount of time would be even greater. The result is an 
incredible diversion of time and resources for both institutions and 
accrediting agencies to define and implement sampling methods.
    As president of an accrediting agency I am also concerned that 
regardless of how we, along with our institutions, decide to implement 
this regulation, we will still be subject to being overturned by the 
staff of the Department or of the National Advisory Committee for 
Institutional Quality and Integrity (NACIQI) when our agencies come up 
for recognition review. We could foresee such determinations as our 
reviews not being ``effective,'' as required in the regulation, through 
such identified issues as the sample size being found not large enough, 
or the scope of review, even at institutions with no history of 
problems, found not broad enough. Or being told that the evidence of 
``reliability and accuracy'' of credit awards, as determined by the 
institution, is not sufficiently scientific. In other words, it is 
possible that Departmental review of institutions and accrediting 
agencies will delve into actual institutional policies on credit 
awards, or course credit assignments, or the accrediting agency's 
review methodology--ultimately federalizing the entire system of credit 
awards.
Additional steps underway
    As an institutional accreditor serving the public as well as over 
160 institutions with more than a million students, we take our 
responsibilities to assure institutional quality and integrity 
seriously. We believe that both of these regulations are moving higher 
education in the wrong direction. I would urge that instead our 
attention be directed toward 1) increasing completion rates of all 
students; 2) assuring that the outcomes of degrees and certificates are 
of high quality; and 3) that high quality innovation be supported.
    At WASC, for the past several years, we have been requiring that a 
review and evaluation of retention and graduation data be a central 
part of each comprehensive institutional review, and are working to go 
beyond this to benchmark, within each institution's context, an 
appropriate graduation rate for key groups. Second, we are exploring 
the use of a common framework for the associate and bachelor's degree 
that focuses institutions on essential outcomes for these degrees. 
Third, we are working with institutions to improve methods of assessing 
student learning, share best practices, and establish external 
benchmarks that will be useful for assuring high quality. In addition, 
we are exploring increasing the transparency of the accrediting process 
through expanded public information provided by the institution and by 
WASC at the end of the accreditation review cycle.
    These steps are forward looking and the two regulations I have 
addressed today move us away from these goals. They impose unnecessary 
and extensive burdens on institutions, states and accreditors at a time 
when every dollar counts, and when the focus needs to be on focusing 
energies where there are real problems, and relying on using more 
effectively the existing systems already in place.
Conclusion
    In conclusion, these two regulations need to be withdrawn. At a 
minimum, since they require institutions, accreditors and states to be 
in compliance by July 1, 2011, there should be a one year extension to 
allow further discussion and resolution of these issues.
    Thank you for this opportunity to provide these comments.
                                 ______
                                 
    Mr. Wolff. And I would like to submit both of those letters 
into the record.
    [The information follows; a Feb. 16, 2011, letter is on 
page 77:]

TO: Ralph Wolff, Barbara Beno
FROM: Laurence W. Kessenick, Daniel I. Zacharia
DATE: June 30, 2010

RE: State by State Analysis (34 C.F.R. Sec.  600.9)

    This memorandum is our response to your request that we evaluate 
the impact on the State licensure schemes of the 50 States of a 
regulation, proposed by the U.S. Department of Education (``DOE ''), 
identified as 34 C.F.R. Sec. 600.9 in the Federal Register, dated June 
18, 2010 (the ``Proposed Regulation '').
    Existing federal law requires that, as a condition for eligibility 
for Title IV funding, private postsecondary institutions are legally 
authorized to operate within the States in which they are issuing 
degrees. Under the Proposed Regulation, an institution will not be 
considered legally authorized unless all of the following four 
conditions exist: (1) the State in which the institution operates has a 
method of formally approving of the institution, whether by charter, 
license or other document issued by an appropriate State agency or 
entity; \1\ (2) the authorization is specifically for programs beyond 
secondary education; \2\ (3) the authorization is subject to adverse 
action by the State; \3\ and (4) the State reviews and acts on 
complaints concerning an institution and enforces applicable State 
laws.\4\ In order to study the potential impact of the Proposed 
Regulation on the educational statutory schemes of the 50 States, we 
attempted to measure each state's licensure scheme against the above 
four conditions. To that end, we asked four questions:
---------------------------------------------------------------------------
    \1\ Subsection (a)(1) of the Proposed Regulation.
    \2\ Subsection (b)(1) of the Proposed Regulation.
    \3\ Subsection (b)(2) of the Proposed Regulation.
    \4\ Subsection (b)(3) of the Proposed Regulation.
---------------------------------------------------------------------------
    (1) Does the State have a system of laws that grant private 
postsecondary degree granting institutions approval or authority to 
operate in the State?
    (2) Is the approval or authority to operate granted by the State 
specifically for programs beyond secondary education?
    (3) Is the approval or authority to operate granted by the State 
subject to adverse action by the State?
    (4) Does the State have a process to review and appropriately act 
on complaints concerning an institution and enforce applicable State 
laws?
    We evaluated each State's laws under the premise that the laws 
would not comply with the Proposed Regulation if the answer to any of 
the four above questions is ``no'' with respect to a particular State's 
laws. If this is the case, the noncompliant State will either have to 
amend its existing laws, or adopt new laws, to bring itself into 
compliance with the Proposed Regulation. Otherwise, private 
postsecondary schools operating within those States face the prospect 
of losing their Title IV eligibility. In this regard, there is a large 
degree of ambiguity in the meaning and application of the terms of the 
Proposed Regulation. It is uncertain, for example, whether a State can 
rely on existing federal laws that relate to the accreditation of 
institutions receiving Title IV funds in fulfilling its ``adverse 
action'' responsibilities under condition (3), above. It is also 
uncertain whether State enforcement of laws unrelated to institutional 
licensure, such as common law fraud or false advertising laws, for 
example, could be used to meet condition (4), above. Accordingly, in 
many instances our evaluation could not determine with any certainty 
whether the laws will comply with the Proposed Regulation or not. In 
addition, please keep in mind that memo's conclusions with respect to 
each State were limited by time constraints, and that it is possible 
that State statutory or regulatory schemes beyond those identified 
below may impact the determination of the State's compliance with the 
Proposed Regulation. We do not practice law in 49 of the 50 states we 
evaluated. Therefore we cannot presume to be experts with respect to 
these States. It is quite possible that we missed relevant laws simply 
because we are not familiar with each States' overall statutory 
schemes.
    The results of the State-by-State analysis are as follows:
     the laws of twelve (12) States will, in our opinion, 
comply with the Proposed Regulation;
     the laws of six (6) States will, in our opinion, clearly 
not comply with the Proposed Regulation;
     the laws of thirty two (32) States will probably not 
comply with the Proposed Regulation (i.e., it is doubtful that the laws 
of these States will comply with one or more of the four criteria).
    Based on these results, it is likely that a total of thirty eight 
(38) States will have to amend, repeal or otherwise modify their laws 
to comply with the Proposed Regulation. We provide the complete 
analysis, in alphabetical order, below:
    1. Alabama. It is doubtful that Alabama law will comply with the 
Proposed Regulation. Although Alabama has a state licensure scheme, 
Alabama exempts schools from licensure on the basis of age or 
accreditation. Moreover, the law provides that such exemption ``shall 
not be construed to constitute approval or endorsement by the State of 
Alabama for any purpose.'' (See Code of Ala. Sec.  16-46-3. Contrast 
this with States that have exemptions from licensure schemes, but grant 
express approval on the grounds of such exemption, such as California's 
Education Code Sec.  94890.) Current law probably does not meet 
criteria 1, 2, and 4.
    2. Alaska. Alaska law should comply with the Proposed Regulation. 
It has a state licensure scheme, which includes adverse actions, review 
of complaints and enforcement. The exemption for accredited schools is 
discretionary. (See Alaska Stat. Sec.  14-48-010.) Current law probably 
meets all four criteria.
    3. Arizona. Arizona law should comply with the Proposed Regulation. 
The current law requires that an institution must be licensed by the 
State. The State Board for Private Postsecondary Education has adequate 
review and enforcement capability. (See A.R.S. Sec.  32-3001 et seq.) 
Current law probably meets all four criteria.
    4. Arkansas. Arkansas law will comply with the Proposed Regulation. 
Through the Arkansas Higher Education Coordinating Board, the State has 
an adequate system for authorization, review and enforcement. (See 
A.C.A. Sec.  6-61-301 et seq.) Current law meets all four criteria.
    5. California. It is doubtful that California law will comply with 
the Proposed Regulation. Although California recently enacted the 
California Private Postsecondary Education Act of 2009 (Cal. Ed. Code 
Sec.  94800 et seq.), and implementing regulations (5 C.C.R. Sec.  
70000 et seq.), it is unclear whether California would be deemed to 
have sufficient authority over WASC accredited institutions, which are 
exempt. Current probably meets criteria 1, 2, and 3, but probably not 
criterion 4.
    6. Colorado. It is doubtful that Colorado law will comply with the 
Proposed Regulation. Colorado has a state licensing scheme that 
requires state authorization and contains review standards that 
possibly comply with the Proposed Regulation; however, the scheme 
includes an exemption for accredited institutions. (See C.R.S. Sec.  
23-2-103.3.) Current law probably does not meet criteria 1, 2, and 4 
with respect to exempt institutions.
    7. Connecticut. It is doubtful that Connecticut law will comply 
with the Proposed Regulation. The State licenses and accredits private 
postsecondary institutions, and monitors them for compliance with its 
licensing laws, although there is a State exemption for programs 
accredited before 1965. (See Conn. Gen. Stat. Sec.  10a-34.) With 
respect to exempt institutions, current law probably does not meet 
criteria 1, 2, and 4.
    8. Delaware. It is doubtful that Delaware law will comply with the 
Proposed Regulation. Although there is a state licensure scheme, the 
State exempts accredited institutions and relies on accrediting 
agencies to conduct state authorization review. (See C.D.R. Sec.  14-
200.) Current law probably does not meet criteria 1, 2, and 4.
    9. Florida. Florida law will probably comply with the Proposed 
Regulation. There is a State licensure scheme, but the State exempts 
institutions that are granted licenses based on accreditation. However, 
exempt accredited institutions must still comply with the standards of 
fair consumer practices established by the State, and the State has the 
discretion to limit or revoke the exemption (See Fla. Stat. Sec.  
1005.32.). Current law probably meets all four criteria.
    10. Georgia. It is doubtful that Georgia law will comply with the 
Proposed Regulation. Although there is a state licensure scheme, and 
Georgia's State authorization review standards arguably comply with the 
requirements of the Proposed Regulation, the State law currently 
exempts institutions on the basis of accreditation, age and non profit 
status. (See O.C.G.A. Sec.  20-3-250.3.) With respect to exempt 
institutions, current law will probably not meet criteria 1, 2 and 4.
    11. Hawaii. Hawaii law will not comply with the Proposed 
Regulation. Hawaii does not have a traditional licensure scheme. 
Institutions accredited by an agency recognized by the U.S. DOE are 
exempt from regulation by the State (H.R.S. Sec.  446E-1.6); 
unaccredited institutions must simply comply with a short list of 
disclosures mandated by the State that fall short of complying with the 
State authorization review component of the Proposed Regulation (H.R.S. 
Sec.  446E-2). Current law would not meet any of the four criteria.
    12. Idaho. It is doubtful that Idaho law will comply with the 
Proposed Regulation. The State laws provide for the licensing and 
review of institutions, and enforcement of State laws, but exempt 
nonprofit institutions. (See Idaho Code Sec.  33-2402, and implementing 
regulations, IDAPA 08.01.11.001.) With respect to exempt institutions, 
current law will probably not meet criteria 1, 2, and 4.
    13. Illinois. It is doubtful that Illinois law will comply with the 
Proposed Regulation. Under the Private College Act (110 ILCS Sec.  
1005/0.01) and the Academic Degree Act (110 ILCS Sec.  1010/0.01), 
Illinois licenses and reviews institutions. However, the Private 
Business and Vocational Schools Act exempts certain postsecondary 
vocational schools that would be subject to the Proposed Regulation 
(See 105 ILCS 425/1.1). With respect to exempt institutions, current 
law will probably not meet criteria 2, 3, and 4.
    14. Indiana. Indiana law will not comply with the Proposed 
Regulation. Indiana has no state licensure scheme in place for private 
postsecondary institutions with regional accreditation, nor any laws 
that address the state's responsibility to conduct state authorization 
review. Indiana would have to enact comprehensive legislation to comply 
with the Proposed Regulation. Current law does not comply with any of 
the four criteria.
    15. Iowa. It is doubtful that Iowa law will comply with the 
Proposed Regulation. Although Iowa has a registration system for 
private postsecondary institutions, there is an exemption for 
accredited institutions, and Iowa does not have standards for state 
authorization review. (See Iowa Code Sec. Sec.  261B.3A, 261B.11.) With 
respect to exempt institutions, current law probably will not meet 
criteria 1, 2, and 4.
    16. Kansas. It is doubtful that Kansas law will comply with the 
Proposed Regulation. The State requires State approval for all private 
postsecondary institutions, without exception, and has the ability to 
suspend that approval. However, regulations for State review do not 
apply to accredited institutions. (See K.S.A. Sec.  74-32,162, and see 
K.A.R. Sec.  88-28-4.) Current law probably meets criteria 1, 2, and 3, 
but, with respect to accredited institutions, may not meet criterion 4.
    17. Kentucky. It is doubtful that Kentucky law will comply with the 
Proposed Regulation. Although Kentucky has a state licensure scheme, 
and system for State review, the State may exempt of schools from 
licensure on the basis of accreditation. (13 KAR Sec.  1:020.) Current 
law may not meet criteria 1, 2 and 4 with respect to exempt 
institutions.
    18. Louisiana. It is doubtful that Louisiana law will comply with 
the Proposed Regulation. The current law requires that an institution 
must be licensed by the State; but the State expressly allows 
accrediting agencies to conduct statute authorization review 
activities. (See LAC 28:IX.Chapters 1-5, 32 LR 386.) Current law 
probably meets criteria 1, 2 and 3, but not criteria 4.
    19. Maine. Maine law will probably comply with the Proposed 
Regulation. Maine has a state licensure scheme, and although it exempts 
certain schools from licensure, the State reserves the right to review 
institutions for exemption status on a case by case basis. (See 20-A 
M.R.S. Sec.  10708; and see C.M.R. Sec.  05-071-149.) Current probably 
meets all four criteria.
    20. Maryland. Maryland law will comply with the Proposed 
Regulation. The State has an approval process for private postsecondary 
institutions, which is subject to State review and action. (See COMAR 
13B.02.03, and 13B.02.02.08.) Current law meets all four criteria.
    21. Massachusetts. Massachusetts law will comply with the Proposed 
Regulation. The State Board of Higher Education fulfills all of the 
duties required. (See 610 CMR 2.01 et seq.) Current law meets all four 
criteria.
    22. Michigan. Michigan law will not comply with the Proposed 
Regulation. We could not locate a State system of licensing and review 
for private postsecondary educational institutions. Current law does 
not appear to meet any of the four criteria.
    23. Minnesota. Minnesota law will comply with the Proposed 
Regulation. (See Minn. Stat. Sec.  136A.61 et seq.) Current law meets 
all four criteria.
    24. Mississippi. It is doubtful that Mississippi law will comply 
with the Proposed Regulation. Although there is a state licensure 
scheme, the State exempts institutions that are accredited by S.A.C.S. 
from its licensing process and standards. (See Miss. Code Ann. Sec.  
37-101-241.) With respect to exempt institutions, current law probably 
will not meet criteria 1, 2, and 4.
    25. Missouri. Missouri law will not comply with the Proposed 
Regulation. We could not locate a State system of licensing and review 
for private postsecondary educational institutions. Current law does 
not appear to meet any of the four criteria.
    26. Montana. Montana law will not comply with the Proposed 
Regulation. The State's private postsecondary licensure scheme was 
repealed and Montana does not regulate private postsecondary degree 
granting institutions. (See former Mont. Code Anno., Sec.  20-30-101.) 
Current law does not meet any of the four criteria.
    27. Nebraska. Nebraska law will not comply with the Proposed 
Regulation. The State only requires approval for private postsecondary 
institutions created after September 1, 1999. (See R.R.S. Neb. Sec.  
85-1105.) Current law does not meet any of the four criteria.
    28. Nevada. It is doubtful that Nevada law will comply with the 
Proposed Regulation. The State requires licensure for all private 
postsecondary degree granting institutions operating in Nevada; 
however, the State accepts accreditation in lieu of compliance with its 
minimum standards, including those pertaining to consumer protection. 
(See Nev. Rev. Stat. Ann. Sec.  394.415, and Sec.  394.447.) Current 
law meets criteria 1, 2, and 3, but will probably not meet criterion 4 
with respect to accredited institutions.
    29. New Hampshire. It is doubtful that New Hampshire law will 
comply with the Proposed Regulation. The State has a system of 
approving institutions, but may accept accreditation by a U.S. DOE 
recognized institutional accrediting agency in lieu of State review. 
(See N.H. Admin. Rules, Pos 1001.05) With respect to accredited 
institutions, current law probably meets criteria 1, 2 and 3, but may 
not meet criterion 4.
    30. New Jersey. New Jersey law will comply with the Proposed 
Regulation. The State has a comprehensive system of licensure, review 
and enforcement. (See N.J. Stat. Sec.  18A:3B-1.) Current law meets all 
four criteria.
    31. New Mexico. It is doubtful that New Mexico law will comply with 
the Proposed Regulation. New Mexico exempts from state licensure and 
state authorization review all private postsecondary institutions 
accredited by a regional accrediting agency recognized by the U.S. DOE. 
(N.M. Stat. Ann. Sec.  21-23-4.) With respect to exempt institutions, 
current probably does not meet criteria 1, 2, and 4.
    32. New York. New York law should comply with the Proposed 
Regulation. (See N.Y. C.L.S. Educ. Sec.  224.) Current law meets all 
four criteria.
    33. North Carolina. It is doubtful that North Carolina law will 
comply with the Proposed Regulation. Although North Carolina licenses 
and reviews private postsecondary institutions, it exempts from 
licensure and state authorization review all institutions that have 
continuously conducted post-secondary degree activity in the State 
since July 1, 1972. (See N.C. Gen. Stat. Sec.  116-15.) With respect to 
exempt institutions, current law may not meet criteria 1, 2 and 4.
    34. North Dakota. It is doubtful that North Dakota law will comply 
with the Proposed Regulation. Although North Dakota licenses and 
reviews private postsecondary institutions for compliance with its 
consumer protection laws, it exempts all private four-year institutions 
chartered or incorporated and operating in the state prior to July 1, 
1977, so long as the institutions retain accreditation by national or 
regional accrediting agencies recognized by the U. S. DOE. (See N.D. 
Cent. Code, Sec.  15-20.4-02.) With respect to exempt institutions, 
current law will probably not meet criteria 1, 2 and 4.
    35. Ohio. Ohio law will probably comply with the Proposed 
Regulation. Private postsecondary institutions are subject to a 
comprehensive State licensure, review and enforcement scheme. (See ORC 
Ann. 1713.01 et seq.). Current law probably meets all four criteria.
    36. Oklahoma. It is doubtful that Oklahoma law will comply with the 
Proposed Regulation. Oklahoma exempts from state authorization all 
degrees offered by a private postsecondary institution accredited by an 
accrediting agency recognized by the U.S. DOE. (70 Okl. St. Sec.  
4104.) With respect to exempt institutions, current law may not meet 
criteria 1, 2 and 4.
    37. Oregon. It is doubtful that Oregon law will comply with the 
Proposed Regulation. Oregon exempts from state authorization degrees 
offered by nonprofit postsecondary institutions. (ORS Sec.  348.604.) 
With respect to exempt nonprofit institutions, current law probably 
will not meet criteria 1, 2 and 4.
    38. Pennsylvania. It is doubtful that Pennsylvania law will comply 
with the Proposed Regulation. The State certifies and reviews private 
postsecondary institutions, but exempts institutions incorporated on or 
before September 1, 1937. (24 Pa.C.S. Sec.  6503.) With respect to 
exempt institutions, current law may not meet criteria 1, 2 and 4.
    39. Rhode Island. It is doubtful that Rhode Island law will comply 
with the Proposed Regulation. Rhode Island requires State approval and 
review, but exempts certain institutions. (See R.I. Gen. Laws Sec.  16-
40-1Sec.  et seq., and 16-59-1 et seq.) With respect to exempt 
institutions, current law may not meet criteria 1, 2 and 4.
    40. South Carolina. It is doubtful that South Carolina law will 
comply with the Proposed Regulation. South Carolina licenses private 
postsecondary institutions, but exempts those domiciled within the 
State and accredited by S.A.C.S. (See S.C. Code Ann. Sec.  59-58-30.) 
With respect to exempt institutions, current probably will not meet 
criteria 1, 2 and 4.
    41. South Dakota. It is doubtful that South Dakota law will comply 
with the Proposed Regulation. South Dakota has a State approval and 
accreditation process for most nonpublic postsecondary institutions; 
however, South Dakota allows accreditation by an ``external third-party 
accreditation agency'' as an alternative means of approval for 
nonpublic schools. (See ARSD 24:43:04:01; and ARSD 24:43:04:03.) 
Current law probably will not meet criteria 1, 2, and 4.
    42. Tennessee. It is doubtful that Tennessee law will comply with 
the Proposed Regulation. Tennessee licenses and reviews institutions, 
but exempts institutions that are located and domiciled in Tennessee 
for at least ten (10) consecutive years and accredited by S.A.C.S. (See 
Tenn. Code Ann. Sec.  49-7-2001, and Sec.  49-7-2004.) With respect to 
exempt institutions, current law may not meet criteria 1, 2 and 4.
    43. Texas. It is doubtful that Texas law will comply with the 
Proposed Regulation. Texas requires State licensure or certification, 
and compliance with comprehensive consumer protection laws; however, 
these laws do not apply to institutions accredited by a regional 
accrediting agency recognized by the U.S. DOE. (See Tex. Educ. Code 
Sec.  61.303; and 19 TAC Sec.  7.4.) With respect to exempt 
institutions, current law probably will not meet criteria 1, 2 and 4.
    44. Utah. It is doubtful that Utah law will comply with the 
Proposed Regulation. Utah has a registration system for private 
postsecondary institutions, and requires compliance with comprehensive 
consumer protection laws; however, these laws do not apply to 
institutions accredited by a regional accrediting agency recognized by 
the U.S. DOE. (See Utah Code Ann. Sec.  13-34-105.) With respect to 
exempt institutions, current law probably will not meet criteria 1, 2 
and 4.
    45. Vermont. It is doubtful that Vermont law will comply with the 
Proposed Regulation. Although the State requires state board approval, 
and reviews institutions in accordance with federal standards 
established in 20 U.S.C. Sec.  1099a-3. (16 V.S.A. Sec.  2882.), it 
exempts religious institutions, and institutions accredited by an 
accrediting agency recognized by the State Board. (See 16 V.S.A. Sec.  
176.) With respect to exempt institutions, current law will probably 
not meet criteria 1, 2 and 4.
    46. Virginia. It is doubtful that Virginia law will comply with the 
Proposed Regulation. Virginia requires State licensure or 
certification, and compliance with comprehensive consumer protection 
laws; however, these laws do not apply to religious institutions, or 
nonprofit institutions accredited by an agency recognized by the U.S. 
DOE, or accredited institutions in operation for at least 10 years at 
the time the state legislation was passed. (See Va. Code Ann. Sec.  23-
276.2; and Sec.  23-276.4.) With respect to exempt institutions, 
current law will probably not meet criteria 1, 2 and 4.
    47. Washington. It is doubtful that Washington law will comply with 
the Proposed Regulation. Washington requires State licensure or 
certification, and compliance with comprehensive consumer protection 
laws; however, Washington's regulatory scheme does not apply to private 
postsecondary institutions that are religious oriented, or accredited 
by an agency recognized by the state board and have been operating 
within the state for 15 years or more. (See Rev. Code Wash. (ARCW) 
Sec.  28B.85.010 et seq.; and WAC Sec.  250-61-060.) With respect to 
exempt institutions, current law may not meet criteria 1, 2 and 4.
    48. West Virginia. It is doubtful that West Virginia law will 
comply with the Proposed Regulation. The State requires licensure and 
compliance with comprehensive consumer protection laws (See W. Va. Code 
Sec.  18B-4-7); however, it exempts institutions approved to operate in 
West Virginia prior to July 1, 2006, and waives significant levels of 
state authorization review for institutions accredited by regional 
accrediting associations. (See W. Va. CSR Sec.  133-20-9; and W. Va. 
CSR Sec.  133-20-4.) With respect to exempt institutions, current law 
may not meet criteria 1, 2 and 4.
    49. Wisconsin. It is doubtful that Wisconsin law will comply with 
the Proposed Regulation. The State approves and reviews private 
postsecondary institutions, but exempts institutions accredited by 
accrediting agencies recognized by the State board. (See Wis. Stat. 
Sec.  38.50.) With respect to exempt institutions, current law will 
probably not meet criteria 1, 2 and 4.
    50. Wyoming. Wyoming law will probably comply with the Proposed 
Regulation. Wyoming requires State licensure for all private 
postsecondary degree-granting institutions (See Wyo. Stat. Sec.  21-2-
401 et seq.; and W.C.W.R. Sec.  005-000-030). Current law probably 
meets all four criteria.
                                 ______
                                 
                                 
                                 
                                 
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    Chairwoman Foxx. Without objection.
    Thank you all very much again, for your comments. I would 
like to direct this question to Mr. Ebersole, Dr. Dowden, and 
Mr. Wolff. I understand the Department is working on some 
additional guidance for these regulations and it is been our 
understanding that the purpose of regulations was to provide 
additional clarity to the statute, not to further complicate 
it. But if you didn't cover in your testimony, could you 
provide us with some of the--some examples of unanswered 
questions you still have about these regulations?
    Mr. Ebersole.
    Mr. Ebersole. Thank you. We have a number of questions 
about these regulations. We have not received guidance, even 
though we have asked for and been granted one-on-one meetings 
with various officials within the Department of Education. We 
have been told that there is some form of Dear Colleague Letter 
which will be forthcoming. We have been waiting for a couple of 
months now for this.
    Meanwhile the clock continues to tick towards the effective 
date. And we have been told by a number of states that they do 
not know how they are going to enforce this rule and we are 
going to be put in a position of jeopardy where we are either 
going to have withdrawn from those states or put our Title IV 
eligibility at risk.
    We would prefer not to do either but we are quite confused 
at this point. We do know we have put money in our budget for 
compliance and we estimate that at our institution by the time 
we hire the additional staff that will be necessary to 
coordinate this and we pay the fees which each of these states 
requires we are going to have an annual recurring cost of 
somewhere between $150,000 and $200,000 which when multiplied 
by the number of institutions that offer online programs today, 
we are talking about an additional cost which will eventually 
be passed to students of $500 million.
    Chairwoman Foxx. Dr. Dowden.
    Mr. Dowden. I would answer that by saying that, in regards 
to the state authorization we, in preparation for this 
testimony called our state, and they at this point have no idea 
of how they are going to implement it, what it actually means 
for the state and what will be the requirements.
    For the credit hour, I think the definition is obviously 
clear but it is confusing and how it relates to a variety of 
educational experiences that we offer at the institution 
including practicums and student teaching experiences and many 
other experiences that don't include the formula of the seat 
time and that might be difficult to figure out an equivalency 
as proposed in the regulations.
    Chairwoman Foxx. Thank you.
    Mr. Wolff.
    Mr. Wolff. Three quick comments. First, the nature of Dear 
Colleague Letters issued by the Department are such they offer 
interpretations of regulatory language that themselves need 
further interpretation by the staff, that vary from region, 
from accreditor to accreditor, when accreditors come up for 
review.
    And institutions will not know until they have gone through 
their program review whether or not they have gone through 
their program reviews whether or not they have conformed. So it 
is a never ending, sub-regulatory interpretation approach.
    There are so many areas of confusion, let me identify one 
with each of the regulations. With respect to the credit hour, 
the accrediting agencies are expected or allowed to sample 
courses to ensure the reliability and accuracy and conduct 
effective reviews.
    The California community colleges offer over 180,000 
courses, the University of California, 50,000, Stanford 10,000. 
Even a small middle-sized institution like the University of 
San Francisco offers 5,000 courses. What would be an effective 
sample size, how much time will it take? We don't know and we 
are afraid that the--any sample size will require an enormous 
burden on the institutions.
    With respect to state authorization, for 40 years we had an 
arrangement with the State of California that student 
complaints would be referred to WASC, we would review them, and 
if we found they were serious they would be referred to the 
Attorney General. We have no idea if that would be continued or 
if a completely new and duplicative complaint process would 
need to be established. That is just two of many areas.
    Chairwoman Foxx. Thank you all very much.
    Mr. Hinojosa, you are recognized for 5 minutes.
    Mr. Hinojosa. Thank you. First I would like to welcome our 
distinguished guests and say that I am pleased to see that Ms. 
Kathleen Tighe, our Inspector General, is here today.
    My first question is directed to Inspector General Tighe. 
In your testimony you indicate that the explosion of online 
education in recent years has made it even more difficult to 
assign credit hours and assess student achievement. What are 
national and regional accreditation agencies doing to ensure 
that online education programs provide quality--that they 
provide content and academic rigor at the post-secondary level?
    Ms. Tighe. Well, I think that was one of the things we went 
in to look at when we did our review over the last couple of 
years. We went into three regional accrediting agencies who 
collectively were responsible for accrediting over 2,000 
schools including schools offering online education programs.
    I think the difficult problem in this area, that we have 
found, is when you don't have a definition of a credit hour or 
guidance as to program length or guidance as to assignment of a 
credit hour, when you have nontraditional format it is very 
hard to sort of make judgments as to the kinds of standards I 
think accrediting agencies should be making judgments on.
    Mr. Hinojosa. If you could expand Ms. Tighe, in your 
testimony you indicate that the definition of a credit hour 
protects students and taxpayers from inflated credit hours, the 
improper designation of full-time student status, the over-
awarding of federal student aid funds and excessive borrowing 
by students, especially with distance, accelerated and other 
programs not delivered through traditional classroom format. So 
what type of impact do you believe this regulation will have on 
regional and national accrediting agencies?
    Ms. Tighe. Well, I think that they will have to do what we 
believe they should be doing, which is really looking at 
schools in a way that--I think a definition of a credit hour 
will allow them to have sort of a common understanding and 
standard to judge these schools by. It is a challenge. There is 
no doubt about it--in the online environment--for coming up 
with something that makes sense.
    It appears to us that the Department has come up with a 
definition that provides enough flexibility to bring in student 
outcomes and I know those were some of the issues raised to us 
by HLC and Middle States also--that they relied on student 
outcomes and didn't want to be tied to a definition of a credit 
hour. I don't think those two concepts are inherently 
incompatible.
    So I think it is really a matter for us, in the Office of 
Inspector General, making sure Title IV money is spent wisely 
and that students do not over-borrow and that taxpayers aren't 
on the hook where they should not be.
    Mr. Hinojosa. Thank you.
    Mr. Wolff, absent a definition of a credit hour, what do 
your accreditation teams evaluate on campus to assess 
institutional assignment of credit hour?
    Mr. Wolff. Our teams--first of all, at the Western 
Association we have had a broad definition of a credit hour for 
many years. But I will say and that one other regional 
association does, the three that the Inspector General looked 
at did not have formal definition.
    But every--when a team goes and visits a campus, the first 
thing it does is it looks at a catalog, it looks at the range 
of courses that are offered, the kinds of courses that are 
offered, and what leads up to a degree. We are very concerned 
about how--the capacities of a graduate, at the time the 
student completes their program.
    We put primary attention on online programs, accelerated 
learning programs, where we think there are potential concerns. 
And so teams will go in. We look at syllabi, we look at what is 
in the kinds of work that is expected of students. We will 
often look at samples of student work. This is very labor 
intensive.
    And we have done so and required institutions to improve 
both--less their credit hour assignment, than the rigor of 
their work and the outcomes that are expected of the students.
    I would submit that the accrediting process is effective as 
it showed in the case of the Higher Learning Commission. In 
identifying issues we are primarily interested in the quality 
and the rigor of the work and think we do an effective job.
    Mr. Hinojosa. Dr. Dowden, how does it impact religious 
colleges like yours?
    Mr. Dowden. Well, if I could comment on the accrediting 
situation as well. I am a consultant evaluator for the Higher 
Learning Commission----
    Chairwoman Foxx. Mr. Dowden, I am afraid we are out of 
time, so I am going to ask you to submit that for the record.
    Mr. Dowden. Okay.
    Chairwoman Foxx. Thank you.
    I now would like to recognize Mr. Thompson, from 
Pennsylvania.
    Mr. Thompson. Thank you Madam Chairwoman for hosting this 
hearing. Thanks to all of the members of the panel for bringing 
your expertise on this very important issue. The--of higher 
education. Madam Chair I want to ask for unanimous consent to 
enter into the record a letter sent from the Citizens for 
Responsibility and Ethics in Washington, or CREW, to the 
Department of Education, Secretary Arne Duncan, dated March 1, 
2011.
    [The information follows:]
    
    
    
                                ------                                

    Chairwoman Foxx. Without objection.
    Mr. Thompson. Thank you.
    Inspector General, thanks for being with us. My first 
question is really to just touch briefly on this, have you seen 
the letter from CREW to the Secretary, requesting that he 
examine the role of hedge fund managers and outside interest 
groups that played in the Department of Education's regulations 
governing the for-profit education better known as gainful 
employment?
    Ms. Tighe. I have seen the letter, yes.
    Mr. Thompson. Okay. Great. And do you understand that CREW 
had obtained Freedom of Information Act request for emails of 
high-level Department of Education officials and their 
correspondence from outside groups with regards to the proposed 
gainful employment regulations?
    Ms. Tighe. That is my understanding.
    Mr. Thompson. Great. And are you aware that CREW has 
alleged, within the letter, that both Deputy Undersecretary 
James Kvaal and Budget Development Staff Director, David 
Bergeron had knowingly planned a leak of the proposed 
regulations 2 days in advance of the regulations anticipated 
public roll out?
    Ms. Tighe. That is what the letter says, yes.
    Mr. Thompson. I am sure you know--can understand the 
gravity of the situation. Gainful employment regulations have 
had an effect on proprietary schools. Any collusion or insider 
information would have a bearing on short sellers hedging their 
bets against proprietary schools. And I believe this is what 
the SEC refers to as ``insider training.'' I am certainly no 
expert in that area.
    Were you--my question for you is, will you seek the 
assistance of the SEC in conducting the review that the 
Secretary has asked you to undertake of shortseller contracts 
and the influence with department officials?
    Ms. Tighe. My understanding is a separate letter was also 
sent to the SEC with similar information and what I can tell 
you is that prior to receiving that particular letter we had 
also received an earlier letter from CREW and also from Senator 
Coburn, raising the same issues to us. It was pre--before FOIA 
request--response. And we had initiated an audit related to 
those issues and we are currently doing our work on that audit.
    Based on the further information CREW provided in that 
letter, that you spoke of, we gave that to our people looking 
at it and so they will take that all into account.
    Mr. Thompson. So will you at some point be working with the 
SEC given the implications of just a--just to be able to 
thoroughly investigate it from all areas.
    Ms. Tighe. Faced with them, it would seem to make sense to 
do so, yes.
    Mr. Thompson. Great, thank you. We--changing gears a bit. 
The--Pennsylvania's budget rolled out this week and cuts to 
higher education were as expected. I mean, this is tough times, 
both in the nation and across the states and support for higher 
education was reduced. And so I have a concern as we know that 
revenues, certain parts of revenues are growing smaller, that 
the cost regulations continues to grow larger.
    And so my question for the panel is we have been spending 
much of the month talking about the impact of federal 
regulations on students and schools and can you briefly discuss 
the amount of time and specifically money that you spend on 
complying with federal laws and statutes and how much is this 
going to cost the institution which in the end goes towards 
making higher education more expensive and less accessible.
    Start with Mr. Ebersole, if we can.
    Mr. Ebersole. I believe that this is going to have a great 
impact on the cost of education. As I indicated in my earlier 
comments, I believe that we are going to see something in the 
neighborhood of $500,000 just on the education side let alone 
what it is going to require for the states in order to be 
compliant.
    It is also going to bring into question programs such as 
that which the President lauded recently at Carnegie Melon 
where they were talking about accelerated learning. That would 
not be possible for any student studying under Title IV, given 
this definition.
    I am personally somewhat concerned that we in the higher 
education community, 4 years ago, spent a great deal of time 
and effort looking at learning outcomes. And we have been busy 
building learning outcomes which are being very much examined 
by accreditors rather than looking at inputs.
    The Inspector General talks about wanting to protect the 
taxpayers, I think what the taxpayers wants is, is learning 
occurring, not how many hours you have spent in a seat. Did you 
learn something?
    And we are actively at work right now assessing learning 
outcomes.
    Mr. Thompson. Thank you.
    Chairwoman Foxx. Dr. Dowden and Mr. Wolff, I think I am 
going to have to ask you to submit your answers for the record 
also. And I would now like to recognize Mr. Bishop.
    Mr. Bishop. Thank you very much Madam Chair. Mr. Ebersole, 
I want to engage you on the point you just made. I administered 
a college in New York State for 29 years before I came here. I 
wanted to get into a profession where politics was less of a 
factor. [Laughter.]
    Mr. Ebersole. I see you have succeeded sir.
    Mr. Bishop. I have, yes. When I was in New York we had to 
register every academic program we offered. With the State of 
New York it was something we simply had to do. And it wasn't 
just ministerial. It was a qualitative assessment by the New 
York State Education Department. We somehow managed to survive. 
Syracuse has somehow managed to survive. Lemoyne has somehow 
managed to survive. And we also had to follow the Carnegie 
definition of a credit hour or its equivalent.
    And I want to pick up on what you just said. You said that 
the kind of program that President Obama lauded at Carnegie 
Melon would not be possible under this new regulation. And I 
really want to challenge you on that because if that logic is 
correct then we would not be offering summer courses, we would 
not be offering interim courses, because that is accelerated 
learning.
    If a student can earn three credits over a 4-or 5-or 6-week 
summer term, by virtue of having the same number of clock hours 
or seat hours of instruction, that in fact is accelerated 
learning but it is the credit hour or its equivalent. Am I not 
right?
    Mr. Ebersole. No, sir, I don't think so.
    Mr. Bishop. All right, then educate me.
    Mr. Ebersole. What we are talking about is we are talking 
about gaining greater mastery over a subject area in the same 
or a less amount of time.
    Mr. Bishop. And that is precisely what a summer course is.
    Mr. Ebersole. But a summer program, to carry a certain 
number of units, still has to meet for a certain number of 
hours. Online and with the computer I can match my instruction 
to your learning style.
    Mr. Bishop. So let's be clear about one thing, because I 
think I agree with you. This issue is exclusively about non-
traditional modes of instruction, correct?
    Mr. Ebersole. Well, that is my concern sir. My institution 
could not----
    Mr. Bishop. Okay, and Dr. Dowden, do you all agree?
    I know you haven't had a chance to--you could----
    Mr. Dowden. I would not agree with that. I think we----
    Mr. Bishop. Right. Then help me. If it isn't about just 
non-traditional forms of instruction, would the curriculum 
committee at your school approve a full semester course that 
met for fewer than 45, 50-minute hours?
    Mr. Dowden. They could, just depending on what the out-of-
classroom-work requirement was. We would have to--under these 
regulations the----
    Mr. Bishop. But does that not again--I mean my 
understanding of the regulation--I am not trying to be 
argumentative. I want to make sure I understand this. Is that 
it would be the Carnegie--what we all call the Carnegie 
definition--a three-credit course would be 45, 50-hours?
    Mr. Dowden. Right. Yes.
    Mr. Bishop. Or its equivalent. So if your curriculum 
committee were to say, you know what, this instructor is 
phenomenal he can get this information transmitted to the 
students in 6 weeks. Would your curriculum committee approve 
that? 6 weeks of maybe 18 hours of instruction?
    Mr. Dowden. Let me say that at our institution faculty are 
very stingy with credit hour. It is the corn of the realm and 
they are very, very careful to award credit hour. In fact, they 
probably would award less than more in many cases.
    Mr. Bishop. You are making my point. I thank you for that.
    Mr. Dowden. But----
    Mr. Bishop. Because--so if it is about traditional modes of 
instruction I think what I just heard you say is your faculty 
would more likely err on the side of requiring more seat hours 
as opposed to fewer, am I right?
    Mr. Dowden. Perhaps in traditional modes of instruction. 
But there are a lot of other modes of instruction that the 
practicums and other----
    Mr. Bishop. I understand that. That is what I am trying to 
focus in on.
    Mr. Dowden [continuing]. Yes.
    Mr. Bishop. This issue is largely, if not exclusively, 
about non-traditional modes of instruction. Is that not 
correct?
    Mr. Dowden. It depends on how you define non-traditional 
modes. Is a practicum a non-traditional mode, I----
    Mr. Bishop. Yes, yes it is.
    Mr. Dowden. Yes, I would--probably largely, about that. 
Although, take a music class, let's say a student might have an 
hour but might be practicing for 8 or 10 hours during the week 
as opposed to a class in sociology where it would be fair 
standard with the definition that we are proposing. So it is 
not largely the non-traditional as you would define it but it 
would apply to the traditional classes as well.
    Mr. Bishop. Tell me what is so hard about determining an 
equivalent? My daughter just got a Masters in Library Science. 
She took some of her course work online, through a New York 
State institution which was required to assert that the 
instruction she took had its equivalent in 45, 50-minute hours.
    Now what is--why can that institution do it but this is 
going to create an enormous burden? I know I am over my time 
Madam Chair.
    Mr. Dowden. Well, the key is that that institution did 
that, it wasn't some definition of the federal government that 
is pretty unclear about how you determine equivalency.
    Mr. Bishop. Well, at the risk of--indulge me. It was 
pursuant to a New York State requirement that has existed at 
least as long as I have been involved which was 1973.
    I yield back.
    Chairwoman Foxx. Thank you Mr. Bishop and thank you for 
being sensitive to the time.
    I want to raise one example that I observed when I was in 
administration in a university. We often would have students 
who would come in and say that they had the knowledge to pass a 
course and would ask to take the final exam and they could pass 
that final exam and then they were awarded the credit for the 
course.
    As I read the regulations, there is no way to take care of 
that situation, and I think there are lots of others so I think 
Mr. Bishop, both of us having had some experience in university 
and college we could probably find lots of situations that 
aren't going to meet the definition of this regulation that are 
common practice right now within institutions and don't even 
deal with the new learning experiences.
    Thank you for indulging me on that comment. I now am 
keeping the chairman of the committee waiting and I apologize 
for that. I would like to recognize Mr. Kline.
    Mr. Kline. Thank you Madam Chair. I am feeling very humbled 
here in the presence of Mr. Bishop and Mrs. Foxx and their 
many, many years of experience in higher education.
    Mr. Bishop. Mr. Chairman, you will get over it I am sure. 
[Laughter.]
    Mr. Kline. I think I just did, thank you very much.
    And Madam Inspector General, we are very pleased to have 
you here today and I don't have a series of questions for you 
but I do have a plea, a statement and a plea. We had the 
Secretary here yesterday and I posed a question for the record, 
for him, on this issue of short selling. It is a very, very 
troubling issue. We hope that you are looking at this 
vigorously. We hope that there is cooperation with the SEC and 
that we will get an answer.
    Clearly, the impact on the entire sector, we saw stock 
prices move radically and rapidly and the potential for real 
mischief and felony activity is high. So I really hope that you 
will look into that and come back to us quickly with those 
results.
    Let me see, stepping off into this continuing discussion 
about the federal definition of the credit hour. Mr. Wolff, you 
said in your testimony that you thought that it would stifle 
innovation. But I understand there is an alternative in the 
regulation that was supposed to address this, why isn't that 
good enough? Can you tell us--and we don't--I don't think any 
of us here want to stifle innovation and the ability to move 
out and meet the demands of the work place. So why isn't that 
alternative good enough?
    Mr. Wolff. It is a fair question. I would personally say 
that to many of us the definition itself is unclear because it 
uses so many terms. It--I will just read to you some of the 
terms, ``intended learning outcomes, verified by student 
achievements, reasonable equivalency, classroom seat time'' so 
that you put all of these together and then accreditors are 
supposed to assure that the assignment of credit meets 
customary practice. Well is it the federal definition or is it 
customary practice?
    So, the definition itself is unclear. And what institutions 
have told us, they are afraid that whatever it is they do, that 
it may be possible to be found out of compliance.
    Secondly, institutions are held to be responsible to ensure 
the ``reliability and accuracy of the credit assignment.'' 
There are many concerns of how does one verify that without an 
enormous expenditure of time.
    Thirdly, there are, as others have said, new models that 
are coming forward. Carnegie Mellon for example has developed a 
computer based learning model that is shown to establish very 
effective learning outcomes with very little faculty 
interaction. It is not based on seat time. It is based on 
learning objectives.
    Here the question is: which is going to take priority, the 
learning objectives or the amount of work correlated to seat 
time?
    We are trying to move institutions to learning outcomes 
particularly as they coalesce or cohere together toward a 
complete set of outcomes at the degree level. This drives the 
whole conversation to a lower unit of analysis at the course 
level and we have heard that people are concerned that they are 
going to be found out of compliance and subject their entire 
financial aid at risk if they fail to meet the federal 
definition.
    Having this in the regulation federalizes and potentially 
increases the risk of violating a very confusing set of 
criteria.
    Mr. Kline. So they are just afraid to try?
    Mr. Wolff. I am sorry I didn't----
    Mr. Kline. So they are just afraid to try, is what you 
are----
    Mr. Wolff. I think that we may find, that at least some 
faculty committees will say, well--they are going to be 
focusing on the federal definition rather than what the 
institution is trying to accomplish.
    I think it is going to shift the focus and I think it may 
be up with others saying this may not meet the definition 
because it will inhibit experimentation.
    Let me also say that individual faculty members take a 
syllabus and try to play with it to improve learning. Do out of 
class assignments, some students are going to take more time 
than others. I think that is what it is going to inhibit the 
most because the institution is going to say, you can't do too 
much experimentation because you are violating the federal 
standard here. And it may inhibit individual faculty members 
from trying new approaches.
    Mr. Kline. Okay, I can see that my time is just about to 
expire. Yes, Dr. Dowden, jump in.
    Mr. Dowden. I was just going to say, I think if this 
definition goes through I would suspect that our faculty would 
need to review every single class we have and try to see if the 
credit hour allocation is appropriate and that would take a 
significant amount of time and really would deflect from the 
learning experience and emphasis on our students.
    Mr. Kline. Thank you. I yield back Madam Chair.
    Chairwoman Foxx. I thank the chairman for being so 
punctual. It occurred to me as you were talking Mr. Wolff that 
this sounds like No Child Left Behind, applied to the 
universities and colleges. I would now like to recognize Mr. 
Andrews.
    Mr. Andrews. Thank you Madam Chairwoman. Congratulations on 
your election as chair of the subcommittee. It is good to be 
working with you.
    And I thank the panel for being really expert, getting us 
into the details of this issue. And as a layperson I would like 
to leave the details for a minute and get to maybe 10,000 feet 
and ask a couple of questions at that level.
    I think there is universal agreement that students need to 
get what they paid for and they need some kind of standard that 
helps them know whether they are getting what they pay for.
    So the hypothesis behind the regulation on credit hour 
would be that there is rather systemic evidence that students 
aren't getting what they pay for. So therefore it is necessary 
to switch to a system where there is a federal, legal 
definition of credit hours so people can get what they pay for. 
This is kind of what this is about.
    And I want to ask the Inspector General--I know we had this 
report from last June--about the Northern Central accreditation 
problem. What other evidence is there? And that really was, as 
I understand it, one school that raised an issue and it was 
remedied. What evidence is there of any systemic failure of the 
status quo system on credit hour regulation?
    Ms. Tighe. Well, I think as far as the particular issue we 
looked at with the Higher Learning Commission, I would point 
out to my fellow panelists who raised this issue, that when we 
submitted our alert report to the Department it immediately 
went in and looked at the Higher Learning Commission and 
examined further institutions in addition to the ones that we 
had looked at.
    Mr. Andrews. And what did they find?
    Ms. Tighe. They found the instance we found with AIU was 
not an isolated incident.
    Mr. Andrews. How many others did they find?
    Ms. Tighe. I can't say that based on that, but I know that 
they found others. And I think if----
    Mr. Andrews. With all due respect, I would ask you to 
submit for the record, a quantification of that comment. I mean 
if it is four others that is not much concern. If it is 4,000 
it is a major----
    Ms. Tighe. Okay. I don't think it was 4,000. I don't think 
they would have looked at that many schools but we can let--we 
can----
    Mr. Andrews. What about other accreditation agencies beyond 
the Northern Central one?
    Ms. Tighe. Well, we know that the Higher Learning 
Commission was not the only--Higher Learning Commission is the 
largest regional, it accredits 975 schools. We looked at two 
other very large regional accrediting agencies. We also found 
they didn't--we didn't find the particular problems in the 
schools, but we also find they didn't define or give standards 
to a credit hour or assignment of a credit hour.
    Mr. Andrews. I do understand and we very much appreciated 
your testimony last June, when you pointed that out. But let me 
sort of summarize what I think the record shows.
    There was some examination of three accreditation agencies. 
The first is the Northern Central one and you said there is 
``some evidence of other problems at other schools.'' We would 
invite you to supplement the record of what that is.
    And then the other two, the evidence shows that there 
wasn't a standard or guidance articulated, but was there any 
evidence of students not getting what they pay for in those two 
regions?
    Ms. Tighe. Well, I would say--well my answer to that would 
be its sort of hard to tell without some uniform guidance on 
what a credit hour means. And I think in that lies the heart of 
the problem. I will say, I don't think the Department based its 
definition of a credit hour or the fact that it wanted to have 
a definition of a credit hour, based on our work. I think that 
may have fed into the discussion related to it, but I think 
they had other concerns based on information that----
    Mr. Andrews. My time is kind of fleeting here. I hope that 
is not a generic statement, or should be for this hearing.
    I understand that, although that kind of goes to the point 
of my question. Your work is to uncover, frankly, abuses of the 
law and taxpayer's dollars. And if there are such, let's fix 
it. But if the rules aren't based on your work, and I realize 
this is not your answer to give, but what is it, what are they 
based on?
    So that--the concern that I have is that if the evidence 
shows that there is systemic cheating of students and taxpayers 
because of the credit hour status quo I think we should fix it. 
But if the record shows that there isn't, then I wonder if this 
is not a solution in search of a problem.
    And if there is a problem here I think you are going to 
find a lot of support for fixing it. But I am one who wants to 
see the evidence of that before we take position.
    I would just also ask to submit for the record, a letter of 
February 16th, from The American Council on Education, Office 
of the President, if I could.
    Chairwoman Foxx. Without objection.
    Mr. Andrews. Thank you very much.
    Chairwoman Foxx. Thank you very much for your sensitivity 
to the time.
    Also, Mr. Tierney?
    Mr. Tierney. Thank you Madam Chairwoman. I want to thank 
all of the witnesses for their testimony. This is an 
interesting area, or at least I have found it interesting. 
Since the enrollments in online courses have started to 
increase, and I have always sort of struggled with the idea of 
how is there is an increase in, obviously, grant money--Pell 
grant money--and everything goes in that direction. The 
taxpayers' concern that they are getting their money's worth 
increases along with that.
    So if we don't have some standard or baseline against which 
to judge it, how do you propose we are going to be able to 
convince the taxpayer that their investments are well founded? 
Sir.
    Mr. Ebersole. I have been involved both as a chair of an 
accreditation team, recently. I also have been very involved 
with the President's forum where we have been looking at the 
creation of a method by which we can assess learning outcomes. 
This is something that has been incorporated into the standards 
of the middle states accreditation and I suspect others as 
well.
    We are looking at outcomes. We are looking at proof of 
learning and we are looking to make that proof of learning 
objective. And we also are publicizing it so that others can 
look at this proof of learning before making a decision as to 
whether to come to our institution.
    Mr. Tierney. Can you give me an idea of what would 
constitute proof or evidence of learning?
    Mr. Ebersole. Yes. Using objective criteria or objective 
instruments such as the standardized examinations, which are 
coming from the University of Indiana, the piece all. These are 
examinations which show the degree to which our students are, 
learning, and gives us the ability to compare----
    Mr. Tierney. Sounds suspiciously like No Child Left Behind, 
for all the people behind, written for all the people here. You 
are going to--I mean are you going to be teaching to the test? 
Are we going to see all this fight and battle back and forth 
again?
    Mr. Ebersole. Well, we don't have access to the test so we 
couldn't really teach to it. It is really very objective and we 
are using multiple methodologies. It is not a single 
methodology. And I suggest to you sir, that the measurement of 
seat time is kind of like measuring the number of books in the 
library and the number of dollars in the endowment as a way of 
defining quality. I don't believe that inputs tell us very much 
at all about what our tax payers are buying.
    Mr. Tierney. I don't necessarily disagree with what you are 
saying. I am just struggling with the idea of a course, some of 
the sociology courses, some history courses of different areas, 
other broader subjects like that a different faculty may attack 
those from different ways.
    I am having a difficult time struggling with how one test 
is going to satisfy all the different universities that may get 
people a lot of knowledge, just not the same set of knowledge 
on that. And I think you are going to have some difficulty 
probably dealing with that issue.
    Mr. Ebersole. Well, we are looking at some standards which 
have had some agreement relative to what it is we think that 
someone who possesses our degree, our faculty have come 
together and says that someone who is awarded a degree from our 
institution should be able to do the following. Whether that 
degree is in business, or liberal arts, or versing, they need 
to be able to think critically.
    They need to be able to communicate with both the written 
and the oral word. There are absolutely things which we believe 
define a baccalaureate education, and that is what we are 
testing for.
    Mr. Tierney. Dr. Tighe, do you think that would be a good 
substitution for the credit hour measure?
    Ms. Tighe. Well, I think student outcomes and a credit hour 
as defined by the Department are not inconsistent. What worries 
me, and what I hear here is that in the end you have to be a 
full-time student to get a full time--you know, a full time 
amount of student aid. What does that mean if you can't put 
some temporal, you know, measure on it that measures student 
engagement in some fashion?
    And I am not sure, without some definition of a credit 
hour--which does allow you for equivalents--you can get there.
    Mr. Tierney. To the other three panelists, if the 
regulation were better defined, if you could read it and easily 
understand what it said, would you have less of an objection or 
would you still be objecting on a philosophical level that you 
just don't want that standard or any standard in that regard? 
Mr. Wolff. Well, I am going to ask Mr. Wolff, he was in the----
    Mr. Wolff. I would still have concern in the sense that, I 
would agree with Dr. Dowden, that I think what institutions 
have to do is assure the reliability of every course offered 
and that the scale of this is quite extraordinary.
    Mr. Tierney. How do you do that, though? I mean, you keep 
saying that over again. Is it subjective? Are you sort of 
taking nods, saying I like that, I don't like something else? I 
mean, if you don't have a standard that is more tangible like a 
credit hour or something like that, do you just go in as a team 
and you say I don't like the way the professor is approaching 
it? What do you----
    Mr. Wolff. There is not--I think it is important to say, 
first of all, there is not a vacuum. Institutions already are 
doing this. There are faculty committees that review courses 
that look at the assignment of credit in relationship to the 
rigor. It is being done.
    The issue is, the federal definition that----
    Mr. Tierney. Okay, so you are out--you think that schools 
regulating themselves give the taxpayer the protection that 
they need to know that no school is dumbing it down or avoiding 
anything?
    Mr. Wolff. Well, in line with what Mr. Andrews was saying, 
that we asked repeatedly at the negotiated rule making, what is 
the scope of this problem so that we could help define a 
resolution. And we were never told what the scope was, beyond 
this one incident. So arguably, it ought--it is being done and 
we are not clear that what is being done is ineffective.
    Secondly, I can say that there already are existing 
regulations with the Department of Education that we must 
conform to that require us to approve an advanced distance 
education programs where we are looking at this.
    And secondly, to review, assure that all of our standards 
are being applied when we do reviews of institutions.
    Mr. Tierney. Thank you.
    Chairwoman Foxx. Thank you Mr. Wolff, and thank you Mr. 
Tierney.
    Someone just pointed out to me that the fact that you and I 
are agreeing on this and Mr. Andrews said, ``it looks like a 
solution in search of a problem'' was something I said 
yesterday. Something must be happening here that we are 
agreeing.
    I would like to recognize now Ms. Davis.
    Mrs. Davis. Thank you Madam Chairman. It is always a 
problem when you walk in after--excuse me, after a lot of 
questions. But let me--if I could just go back a second, 
because I know you have been talking about the type of 
standards that the accrediting agencies use when they are 
trying to accredit colleges and universities. Is that clear? Do 
those vary from state to state as well, when we are talking 
about this credit hour?
    Mr. Dowden. I would say they vary from institution to 
institution based on the knowledge of a faculty. The review 
of--a careful review of the faculty on what constitutes a 
credit hour and then I would recommend that that be held 
accountable, those credit hour allocations be held accountable 
by the accrediting associations rather than through a credit 
hour definition.
    Mr. Ebersole. I would like to say that for those of us in 
the online arena, this is a problem. We don't know exactly what 
the equivalent, acceptable equivalency is going to look like. 
There are definitely going to be differences of interpretation. 
Why we feel like that, rather than trying to say how much time 
does someone sit in front of a computer or how much time does 
one take before sitting for one of our assessments of prior 
learning, that in fact we look at the outcomes that are being 
produced by our institution.
    That I think is what the taxpayer is paying for and the 
student is paying for.
    Mrs. Davis. Dr. Tighe, would you say that in trying to 
bring that together that you were consulting these different 
agencies, how did you actually arrive at that in the first 
place? And perhaps you have already discussed this, I am sorry.
    Ms. Tighe. I am sorry?
    Mrs. Davis. The federal definition of the credit hour?
    Ms. Tighe. Well, the federal definition of a credit hour is 
not something we define. What we recommended in our work is 
that there be some definition of a credit hour. We did not 
dictate what that definition would be.
    We felt in our work in looking at the accrediting agencies 
and saw that there was no definition by which they were judging 
the institutions that they accredit, that that led to some 
inconsistencies in how those credit hours were being assigned.
    Mrs. Davis. Does it--is it your belief though that it 
should ensure flexibility in the way that----
    Ms. Tighe. Our reading of the definition is that it looks 
like it provides flexibility.
    Mrs. Davis. Okay, thank you.
    Mr. Wolff. Could I add that there are seven regional 
commissions, all of us focus on learning outcomes. Not only is 
it a federal requirement is our belief that constitutes real 
quality and will lead to excellence.
    We focus on the outcomes of the certificate or degree 
program. We assure that the courses are aligned to achieve it 
and that the outcomes build together to that. We all work 
together acceptable models, not a single model of a test or--we 
use portfolios, Cap-Stone courses and the like.
    So we do look at credit hours, but more importantly we look 
at, does it bring together to a set of learning outcomes that 
are appropriate for the degree or certificate being awarded. 
There is a great consistency across the seven regions.
    Mrs. Davis. Dr. Tighe, what kind of assistance is being 
granted to--just give some technical assistance--to folks that 
are going to be trying to comply with this?
    Ms. Tighe. I can't exactly speak for the Department but I 
am aware that they are trying to come out with guidance in 
these areas to further explain the issues that have been raised 
in the regulations.
    Mrs. Davis. Do you have a sense, I guess all of you, what 
is it that you most think is going to be needed as you move 
forward with this in terms of being clear about what is going 
on?
    Mr. Dowden. If I could say, there is 100 days until these 
regulations have to be implemented. And I think the regulations 
are not clear. We really don't have a lot of guidance from the 
Department of Education on how to implement them.
    The states don't have a lot of guidance on how to implement 
the state authorization and I think it's going to be an 
interesting 100 days if these, the credit hour and state 
authorization provisions remain in the statutes.
    Mr. Ebersole. In the area of state authorization there is 
no way that we can be in compliance. The states won't be in the 
position to accept our applications, will not be in a position 
to review them or act on them. Some states have program reviews 
which require stacks and stacks of documents covering every 
single course and every single faculty member in those 
programs.
    It took us 400 hours in one state just to register two 
programs. To think that 3,000 institutions with hundreds of 
programs will be able to register in these states is, frankly, 
not realistic.
    Chairwoman Foxx. Thank you Mrs. Davis. And I want to again, 
thank the witnesses for the taking of your time today. I want 
to thank all of the members of the subcommittee who came and 
have been so judicious in sticking to the time. We are very 
grateful to you. I am very grateful for the information you 
have shared with us.
    Mr. Hinojosa, do you have any closing remarks you would 
like to make?
    Mr. Hinojosa. I would just like to thank the presenters. I 
would insist that you have given us good information that we 
can work from. And that we are going to be working with all of 
our colleges and universities to help them be able to do their 
work. I know that this is the time in our country where 
legislators are cutting back on their investment in higher 
education and it is quite challenging for you to do your work.
    So we need to work together. It is important and I am one 
that believes that there should be definitions and regulations 
so that they aren't being interpreted differently by others and 
thus not doing what we should for our students.
    And since we have so much federal money that is going 
towards getting our students educated, I think it is our 
responsibility in Congress to take that as one of the 
priorities that in this committee we are going to see that is 
clear and doable.
    And so with that, Madam Chair, thank you for calling this 
hearing today and we will continue working with you.
    Chairwoman Foxx. Thank you very much Mr. Hinojosa.
    There being no further business, the subcommittee stands 
adjourned.
    [Additional submission of Mrs. Foxx follows:]
    
    
    
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    [Identical letter submitted by Mr. Andrews and Mr. Wolff 
follows:]



                                ------                                

    [Additional submission of Ms. Tighe follows:]

              Supplemental Material Submitted by Ms. Tighe

    Chairman Miller, Ranking Member Kline, and members of the 
Committee: Thank you for inviting me here today to discuss the U.S. 
Department of Education (Department) Office of Inspector General's 
(OIG) reviews of accrediting agencies' standards for program length in 
higher education. This is my first opportunity to testify before 
Congress since my March confirmation as the Inspector General. It is an 
honor to lead this organization with its long history of accomplishment 
and to have the opportunity to work with this Committee, which has led 
the way in improving Federal education programs and operations so they 
meet the needs of America's students and families.
    As requested, I will provide information on our work involving 
standards for program length and the definition of a credit hour--
critically important issues in the Federal student aid programs, as the 
amount of Federal student aid a student can receive is based on the 
number of credit hours for which a student is enrolled.
    This issue has become even more significant as on-line education 
has exploded in recent years, making credit hour assignment difficult, 
its comparison to traditional classroom delivery a challenge, and its 
value increasingly important in order to ensure that students and 
taxpayers get what they are paying for.
Background on the OIG and Accrediting Agencies
    For 30 years, the OIG has worked to promote the efficiency, 
effectiveness, and integrity of Federal education programs and 
operations. We conduct independent audits, inspections, investigations, 
and other reviews, and based on our findings, make recommendations to 
the Department to address systemic weaknesses and recommend to both the 
Department and Congress needed changes in Federal laws.
    As members of this Committee know, the Federal student aid programs 
have long been a major focus of our audit, inspection, and 
investigative work, as they have been considered the most susceptible 
to fraud and abuse. The programs are large, complex, and inherently 
risky due to their design, reliance on numerous entities, and the 
nature of the student population. OIG has produced volumes of 
significant work involving the Federal student aid programs, leading to 
statutory changes to the Higher Education Act of 1965, as amended 
(HEA), as well as regulatory and Departmental operational changes. This 
includes extensive work involving accrediting agencies. Accrediting 
agencies are private educational associations that develop evaluation 
criteria and conduct peer reviews of institutions of higher education 
to ensure that the instruction provided by those institutions meets 
acceptable levels of quality. The role they play is vital, as 
accreditation is one of the primary requirements for an institution's 
participation in the Federal student aid programs and determines 
whether academic programs merit taxpayer support.
    Under the HEA, the Department is dependent on the accrediting 
agencies recognized by the Secretary of Education (Secretary) to ensure 
that institutions provide quality, content, and academic rigor at the 
postsecondary level. The Higher Education Opportunity Act of 2008 
included a provision that prohibits the Department from developing 
minimum regulatory criteria for an accrediting agency's standards for 
accreditation. The Department of Education Organization Act of 1980 
prohibits the Department from making determinations on curriculum and 
educational quality. Thus, the Department is prohibited from 
determining the quality of education funded by Federal education 
dollars. All it can do with regard to evaluating the quality of 
postsecondary education is recognize accrediting agencies as reliable 
authorities for the quality of education funded by Federal dollars. In 
1992, Congress established the National Advisory Committee on 
Institutional Quality and Integrity--an independent body charged with 
doing what the Department cannot: evaluating the adequacy of 
accrediting agencies' standards for accreditation and making 
recommendations to the Secretary as to those agencies that should be 
recognized. That input is vital, as the recognition of accrediting 
agencies by the Secretary is the primary tool available to the 
Department for ensuring that students receive value for the taxpayer 
investment in postsecondary education.
OIG Work Involving Accrediting Agencies
    In the late 1980s and early 1990s, OIG identified significant 
problems with some accrediting agencies' oversight of program length at 
some institutions. Our work contributed to significantly strengthening 
the requirements accrediting agencies needed to meet for recognition by 
the Secretary in the Higher Education Act Amendments of 1992. The 
Amendments also mandated that an academic year, for undergraduate 
programs, must be a minimum of 30 weeks of instructional time in which 
a full-time student is expected to complete at least 24 credit hours. 
The Department faced difficulty in applying this requirement to 
programs measuring student progress in credit hours but not using a 
semester, trimester, or quarter system, including nontraditional 
educational delivery methods. Therefore, the Department established the 
regulatory 12-Hour Rule. The 12-Hour Rule served as a surrogate for the 
Carnegie formula, which provided the standard unit of measuring credit 
in higher education, whereby one credit hour generally consisted of one 
hour of classroom work and two hours of outside preparation over the 
course of the academic year. ``One hour of classroom work'' is defined 
as 50 to 60 minutes. Under this method, a full-time student in an 
education program using a semester, trimester, or quarter system would 
have a workload of 36 hours per week through the academic year (12 
hours of classroom work and 24 hours of outside preparation per week). 
At the time, there was an assumption that the traditional semester, 
trimester, and quarter system provided a minimum level of instruction 
and that these programs closely followed the Carnegie formula.
    The 12-Hour Rule provided a tool for the Department to help ensure 
that students received a given quantity of instruction. The Department 
relied on accrediting agencies to ensure that the quantity and quality 
of instruction was at the postsecondary level. The assumption was that 
a full-time student attempting 12 credit hours in a semester would have 
12 hours of scheduled instruction per week. In 2000, we performed an 
audit where we found that an institution's programs offered much less 
classroom education than programs provided by traditional termbased 
institutions and that the institution was in violation of the 12-Hour 
Rule. A series of audits over the next two years identified other 
institutions that were in violation of the 12-Hour Rule.
    In 2002, the Department eliminated the 12-Hour Rule in favor of the 
One-Day Rule. Under this regulation, an institution is required to 
provide one day of regularly scheduled instruction during each week in 
an academic year. However, neither the HEA nor the implementing 
regulations define what constitutes instruction or the minimum amount 
of instruction that needs to be provided during the required one day of 
instruction. At the time of the change, much like today, there were 
many different delivery methods for instruction: the traditional 
residential term-based programs; residential programs not offered on a 
semester, trimester, or quarter system; correspondence courses; 
telecommunications programs; and independent study. There was no 
specificity in what could be included as instruction for determining an 
institution's academic year and credit hours for the awarding of 
Federal student aid funds.
    We informed the Department about our concern with the elimination 
of the 12-Hour Rule, as well as the need to address the definition of 
instruction, the appropriate amount of Federal student aid to be 
awarded in non-traditional programs, and accrediting agency oversight 
of nontraditional programs. As a result of this concern, in 2002-2003, 
we took another look at this issue and examined two regional 
accrediting agencies and two national accrediting agencies, evaluating 
their standards for program length and student achievement. The scope 
of recognition for regional accrediting agencies is limited to specific 
states for each accrediting agency, while the scope of national 
accrediting agencies is not limited to specific states. We found:
Program Length
     Neither regional agency had a definition of a credit hour 
that it required its institutions to follow. The standards these 
regional agencies applied to program length were vague and without 
definition, effectively allowing institutions to establish their own 
standards; and
     The two national agencies both had a definition of a 
credit hour in terms of the required hours of instruction needed to 
equate to a credit hour.
Student Achievement
     The regional agencies had not established minimum 
graduation, placement, and licensure rates for any of their 
institutions providing vocational education programs. For all education 
programs, these regional agencies permitted institutions to establish 
their own standards for student achievement, without any specified 
minimum standard; and
     The national agencies had established minimum graduation, 
placement, and state licensure rates for the institutions they 
accredited. However, at both agencies we identified problems in the 
methodology by which the rates were calculated that caused the rates to 
be overstated.
    As a result of these findings and in anticipation of the scheduled 
2004 reauthorization of the HEA, we made a recommendation that Congress 
establish a statutory definition of a credit hour stating: ``For 
programs that are not offered in clock-hours, credit hours are the 
basis for determining the amount of aid students are eligible for. 
Absent a definition of a credit hour, there are no measures in the 
[Higher Education Act] or regulations to ensure comparable funding 
across different types of educational programs.'' The recommendation 
was not included in the reauthorization.
Recent OIG Reviews
    As a follow-up to this work and in anticipation of the 2009-2010 
higher education negotiated rulemaking sessions in which the definition 
of a credit hour was to be discussed, OIG once again examined the issue 
in order to provide the Department with facts on program length and the 
definition of a credit hour in negotiated rulemaking and to provide 
information to Congress on the state of the definition of a credit hour 
at regional accrediting agencies. As regional accreditation has long 
been considered the ``gold standard'' in accreditation and information 
on what the regional accrediting agencies were doing with regard to 
credit hours could greatly inform the regulatory process, we determined 
that we would do reviews at the three largest of the seven regional 
accrediting agencies. The three accrediting agencies were: the Southern 
Association of Colleges and Schools Commission on Colleges (SACS); the 
Middle States Association of Colleges and Schools (Middle States); and 
the Higher Learning Commission of the North Central Association of 
Colleges and Schools (HLC). These three accrediting agencies represent 
one-third of the institutions participating in Federal student aid 
programs: 2,222 postsecondary institutions with more than $60 billion 
in Federal student aid funding.
    Our objectives were to determine: (1) what guidance the accrediting 
agencies provide to institutions regarding program length and credit 
hours; (2) what guidance the accrediting agencies provide to peer 
reviewers to assess program length and credit hours when evaluating 
institutions; and (3) what documentation the accrediting agencies 
maintain to demonstrate how they evaluate institutions' program length 
and credit hours. We found that none of the accrediting agencies 
defined a credit hour and none of the accrediting agencies provided 
guidance on the minimum requirements for the assignment of credit 
hours. At two of the accrediting agencies (HLC and Middle States), we 
were told that student learning outcomes were more important than the 
assignment of credit hours; however, these two accrediting agencies 
provided no guidance to institutions or peer reviewers on acceptable 
minimum student learning outcomes at the postsecondary level. The 
following is a summary of our results at each accrediting agency:
Southern Association of Colleges and Schools Commission on Colleges
     SACS provides guidance to institutions regarding program 
length and the required number of credit hours; however, it does not 
provide guidance on the minimum requirements for the assignment of 
credit hours or the definition of a credit hour;
     SACS provides guidance to reviewers regarding the 
assessment of program length, but does not provide reviewers guidance 
regarding the assessment of credit hours; and
     SACS maintains documentation to demonstrate that it 
evaluates institutions' program length and credit hours.
Middle States Association of Colleges and Schools
     Middle States does not have minimum requirements specific 
to program length and does not have minimum requirements for the 
assignment of credit hours; and
     Middle States senior staff stated that their main focus 
was on student learning outcomes; however, we did not find that Middle 
States provided any guidance to institutions and peer reviewers on 
minimum outcome measures to ensure that courses and programs are 
sufficient in content and rigor.
Higher Learning Commission of the North Central Association of Colleges 
        and Schools
     HLC's standards for accreditation do not establish the 
definition of a credit hour or set minimum requirements for program 
length and the assignment of credit hours;
     HLC does not provide specific guidance to peer reviewers 
on how to evaluate the appropriateness of an institution's processes 
for determining program length and assigning credit hours or on the 
minimum level of acceptability for accreditation when evaluating these 
processes;
     HLC maintains self-studies and team reports as 
documentation of its evaluation of institutions' program lengths and 
credit hours, but the amount of information related to program length 
and credit hours that institutions and peer reviewers included in these 
respective documents varied; and
     HLC determines whether institutions assess student 
learning outcomes; however, it does not define a minimum threshold for 
when the measures of achievement for student learning outcomes indicate 
poor educational or programmatic quality.
    While conducting our inspection at HLC, we identified a serious 
issue that we brought to the Department's attention through an Alert 
Memorandum, HLC evaluated American InterContinental University (AIU)--a 
for-profit institution owned by Career Education Corporation (CEC)--for 
initial accreditation and identified issues related to the school's 
assignment of credit hours to certain undergraduate and graduate 
programs. HLC found the school to have an ``egregious'' credit policy 
that was not in the best interest of students, but nonetheless 
accredited AIU. HLC's accreditation of AIU calls into question whether 
it is a reliable authority regarding the quality of education or 
training provided by the institution. Since HLC determined that the 
practices at AIU meet its standards for quality, without limitation, we 
believe that the Department should be concerned about the quality of 
education or training at other institutions accredited by HLC. Based on 
this finding, our Alert Memorandum recommended that the Department 
determine whether HLC is in compliance with the regulatory requirements 
for accrediting agencies and, if not, take appropriate action under the 
regulations to limit, suspend, or terminate HLC's recognition by the 
Secretary. The Department initiated a review of HLC and determined that 
the issue identified was not an isolated incident. As a result, the 
Department gave HLC two options for coming into compliance: (1) to 
accept a set of corrective actions determined by the Department; or (2) 
the Department would initiate a limitation, suspension, or termination 
action. In May 2010, HLC accepted the Department's corrective action 
plan.
Current Status
    With the explosion of on-line postsecondary education and 
accelerated programs, the value of a credit hour becomes increasingly 
important to ensure that students and taxpayers get what they are 
paying for. Currently, the Federal student aid programs are primarily 
dependent on the credit hour for making funding decisions, as are other 
forms of aid, including state student aid programs and certain programs 
administered through the U.S. Department of Veterans Affairs. To help 
address this, the Department will soon be issuing a definition of a 
credit hour through a notice of proposed rulemaking that we understand 
will be issued on June 18. Once a final rule is adopted by the 
Department, we will be closely watching its implementation and 
evaluating whether the definition of a credit hour is effective in 
protecting students and taxpayers.
Closing Remarks
    We view the recognition of accrediting agencies by the Secretary as 
the primary tool available to the Department for ensuring that students 
receive value for the taxpayer investment in postsecondary education. 
As the Department is prohibited from developing minimum regulatory 
criteria for an accrediting agency's standards for accreditation or 
making determinations on curriculum and educational quality, it is not 
unreasonable for the Department to expect an accrediting agency to have 
developed its own minimum standards.
    On behalf of the OIG, I want to thank you for the support Congress 
has given to this office over the years. We look forward to working 
with the 111th Congress in furthering our mutual goal of protecting 
students and serving the taxpayers.
    This concludes my written statement. I am happy to answer any of 
your questions.
                                 ______
                                 
    [Whereupon, at 11:24 a.m., the subcommittee was adjourned.]