NAICU Washington Update

Final Rules on Distance Learning and Innovation Published

August 27, 2020

The Department of Education has published final regulations that are intended to facilitate distance learning and educational innovation. The regulations are the result of months of negotiated rulemaking in which a broad array of higher education stakeholders debated a massive package of Title IV regulatory changes sought by the department.  

The final rules amend current regulations in order to reduce barriers that institutions may face when providing distance education or developing innovative new types of programs or methods of institutional delivery. In some cases, the previous regulations did not directly address the conditions under which non-traditional programs, such as distance learning, direct assessment, or competency-based education, qualify for Title IV assistance. The final regulations are intended to clarify these rules and encourage new and innovative forms of instruction. 

The final regulations are substantially similar to the proposed regulations. Many of the provisions in the final regulations are highly technical in nature. Key provisions would do the following:
  • Require the Secretary of Education’s approval of an institution’s first direct assessment program at each credential level, but allow institutions to add a second or subsequent direct assessment program without approval, so long as the change is reported to the Secretary;
  • Allow students enrolled in eligible foreign institutions to complete up to 25 percent of an eligible program at an eligible institution in the United States;
  • Clarify the conditions under which a foreign school may enter into a written arrangement with a non-Title IV eligible entity;
  • Require the Secretary to rely on requirements established by accreditors or state agencies when evaluating an institution’s appeal of a final audit or program review finding related to an institution’s assignment of credit hours or classification of a course as distance education;
  • Require the department to act promptly on an institution’s application to become a qualified eligible institution;
  • Prohibit an institution from being deemed financially responsible if an individual who exercises substantial ownership or control also exercised substantial ownership or control over another institution that closed precipitously;
  • Allow institutions using written arrangements to modify their curriculum at the recommendation of industry advisory boards or faculty review committees;
  • Clarify rules related to disbursement and return of Title IV funds for non-traditional programs;
  • Clarify satisfactory academic progress requirements for non-traditional programs;
  • Clarify or add definitions related to correspondence courses, distance education, subscription-based programs, credit hour, clock hour, and regular and substantive interaction.
The final rules are the third and final set of regulations that emerged from negotiated rulemaking. The first set of regulations on accreditation and state authorization became effective on July 1, 2020. The second set of rules on TEACH Grants and faith-based institutions were finalized earlier this month and will become effective on July 1, 2021. Likewise, the final regulations on distance education and innovation will also go into effect on July 1, 2021, although the department is permitting institutions to engage in voluntary early implementation once the official version of the final regulations appears in the Federal Register.

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