NAICU Washington Update

Negotiating Panel Undertakes Program Integrity

November 10, 2009

A Department of Education negotiating panel has started work on program integrity issues. This process is of significant interest to the private, nonprofit higher education sector, which is represented on the panel by Todd Jones, president of the Association of Independent Colleges and Universities of Ohio, as primary negotiator, and Maureen Budetti of NAICU as the alternate.

The first of the panel's three week-long sessions, held earlier this month, focused on exploring 14 issues put forth by the Department for consideration.

Although the proprietary sector was the primary target of some of the issues, other issues had implications for all sectors.

• During a discussion on verification of FAFSA data, panelists were provided an explanation of how the new Internal Revenue Service data retrieval "tool" will be used. Beginning in January, federal student aid applicants will be able to retrieve their income and tax data from the IRS and import it into the FAFSA.

• The definition of a "credit hour" provoked considerable discussion. In most cases, the definition is based on the Carnegie system, whereby an hour of instruction, plus two outside hours of study, constitute a credit hour. The Department, however, does not have a definition, despite its programs and aid being tied to credit hours. It has become increasingly concerned that some institutions are converting clock hours, with insufficient course content, to credit hours. The Department is especially worried that this abuse will be encouraged by the availability of two Pell Grants in an award year. The negotiators representing colleges and accrediting bodies want to leave the definition in the hands of accreditors, as is the current practice.

• Ability-to-Benefit (ATB) testing and reliability of high school diplomas also stimulated lively discussion. In August, the Government Accountability Office issued a report recommending that the Department strengthen its oversight to ensure that students at proprietary institutions are really eligible for student aid. There have been reports of test-takers receiving assistance while taking the ATB test, and of high school diploma mills.

The panel will meet twice more - once in December and again in January - to review and finalize regulatory language.

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