Tag Archives: Postsecondary

U.S. Department of Education Final Rule on Distance Education and Innovation: What You Need to Know

On September 2, 2020, the U.S. Department of Education (“Department”) published a Final Rule, available at https://ifap.ed.gov/federal-registers/FR090220, on distance education and innovation.  The regulations are effective July 1, 2021; however, institutions are permitted to voluntarily implement any or all provisions as of September 2, the date of publication of the final rule.  The Department states that the rule is intended to “strike a balance” between fostering increased innovation in distance education offerings while protecting students and taxpayers.The rule makes the following regulatory changes:

• Allowing asynchronous delivery of some courses or portions of courses delivered as part of clock hour programs (this significant change was made in response to public comments on the proposed rule);
• Providing flexibility to distance education, competency-based education (CBE), and other types of educational programs that emphasize demonstration of learning rather than seat time when measuring student outcomes;
• Clarifying the distinction between distance education and correspondence courses and more clearly defining the requirements of “regular and substantive interaction” between students and faculty and the permissibility of engaging instructional teams in the delivery of education through distance learning;
• Clarifying the requirements for direct assessment programs, including how to determine equivalent credit hours and how to distribute aid to simplify administration, reduce confusion, and protect taxpayers;
• Limiting the requirement for institutions with strong track records to obtain approval from the Education Secretary for only the first direct assessment program offered by the school at a given credential level;
• Requiring institutions to report to the Education Secretary when adding a second or subsequent direct assessment program or establishing a written arrangement for an institution or organization that is not eligible to participate in the title IV, HEA program to provide more than 25 percent, but no more than 50 percent, of a program;
• Recognizing the value of “subscription-based programs,” and simplifying rules regarding the disbursement of title IV funding to students enrolled in these programs; and
• Requiring prompt action by the Department on applications by institutions to the Education Secretary seeking certification or recertification to participate as an eligible institution in the HEA, title IV program.

The rule also adds a definition of “juvenile justice facility” to ensure that students incarcerated in a juvenile justice facility continue their eligibility for Pell Grants.

Additional regulatory changes include:

• Encouraging employer participation in developing educational programs by clarifying that institutions may modify their curricula based on industry advisory board recommendations without relying on a traditional faculty-led decision-making process;
• Simplifying clock-to-credit hour conversions and clarifying that homework time included in the credit hour definition do not translate to clock hours, including for the purpose of determining whether a program meets the Department’s requirements regarding maximum program length;
• Encouraging institutions to give students equal credit for time spent preparing for and participating in lecture and laboratory courses;
• Clarifying that an institution may demonstrate for purposes of participating in title IV, HEA programs, a reasonable relationship between the length of a program if the number of clock hours does not exceed either 150 percent of the minimum requirement to work in the State in which the institution is located or 100 percent of the minimum hours in an adjacent State;
• Providing that the Education Secretary will rely on the accrediting agency or State authorizing agency to evaluate an institution’s appeal of a final audit or program review determination by the Department that includes a finding about the institution’s classification of a course or program as distance education or the institution’s assignment of credit hours; and
• Encouraging closing institutions to offer quality teach-outs by permitting the application of sanctions to individuals or institutions affiliated with other institutions that closed without executing a viable teach-out plan or agreement. 

The final rule culminated a rulemaking that began nearly two years ago, building on the Trump administration’s Rethink Higher Education agenda that “challenged past practices, assumptions, and expectations about what ‘college’ is, what it should do, and how it should operate.” It remains to be seen whether these regulations would be subject to amendment from a change in Secretary, but we view this set of rules as less controversial than others amended or rescinded by Secretary DeVos (such as Gainful Employment and Borrower Defense to Repayment) and not likely to be a priority for change by a new Administration. Institutions of higher education should familiarize themselves with these rule changes as they develop distance education programs.

U.S. Department of Education Extends Clery Act Annual Security Reporting to December 31

In a welcome bit of regulatory relief at time when institutions of higher education are working to comply with a new Title IX rule by August 14, 2020, the Department announced on July 10 that it is extending the date for institutions to distribute their Annual Security Report (ASR) and Annual Fire Safety Report (AFSR) to required recipients to December 31, 2020 (from October 1). The Department does encourage institutions to distribute their reports on the normal schedule if possible.

In addition, the electronic annual crime and fire statistics survey will now be open now from November 18, 2020 through January 14, 2021 for transmission of data to the Department.

The Department states in its July 10 announcement that it “encourages schools to take appropriate steps to ensure the health and safety of their students and employees, to continue to act in accordance with their campus safety policies and procedures, and to advise the campus community about changing conditions that may affect their safety or any major changes to safety policies or practices.” Institutions continuing or returning to partial or full on ground operations should keep in mind that they are still obligated to comply with their published campus safety policies and procedures, including with regard to emergency notifications and crime statistics collection and reporting. Any changes to published procedures should be communicated to the campus community.

https://ifap.ed.gov/electronic-announcements/040320UPDATEDGuidanceInterruptStudyRelCOVID19

 

Foreign Gifts: New Online Portal Emphasizes DeVos “No Excuses” Approach to Reporting

On June 22, 2020, the U.S. Department of Education published an electronic announcement reminding institutions of higher education of their mandatory reporting obligations under Section 117 of the Higher Education Act (“Section 117”) (20 U.S.C. § 1011f) and launched a new reporting portal to streamline the mandatory reporting process: https://partners.ed.gov/ForeignGifts.

Secretary DeVos has explained that foreign gift reporting under Section 117 is essential to the “transparency and accountability” necessary to “protect academic freedom and our country’s national security and economic future.”

The Department has at least ten ongoing investigations of major universities underway regarding Section 117 compliance, and more are expected.  With this clear signal from the Department that this is a significant enforcement priority, colleges and universities should evaluate their past and current disclosures, past and current interpretation of Section 117 requirements, and make determinations about the extent of any additional reporting required or recommended.

Section 117 requires institutions of higher education to disclose to the U.S. Department of Education information about ownership and control by foreign sources, contracts with foreign sources, and gifts from foreign sources.  The reporting obligation applies to any institution, public or private, or, if a multi-campus institution, any single campus of such institution, in any State, that is legally authorized within such State to provide a program of education beyond secondary school, that provides a program for which the institution awards a bachelor’s degree (or provides not less than a two-year program which is acceptable for full credit toward such a degree) or more advanced degrees, and is accredited by a nationally recognized accrediting agency or association and to which institution Federal financial assistance is extended (directly or indirectly through another entity or person), or which institution receives support from the extension of Federal financial assistance to any of the institution’s subunits.

Institutions that are owned or controlled by a foreign source must file two disclosure reports per year—one no later than January 31 and the other no later than July 31. All other institutions that receive a gift from or enter into a contract with a foreign source, the value of which is $250,000 or more, considered alone or in combination with all other gifts from or contracts with that foreign source within a calendar year, must file a disclosure report no later than January 31 or July 31, whichever is sooner.

The announcement makes clear that foreign gift reporting is considered by the Department to be an “information collection” process subject to 18 U.S.C. § 1001, which provides that whoever knowingly and willfully falsifies, conceals, or covers up by any trick, scheme, or device a material fact; makes any materially false, fictitious, or fraudulent statement or representation; or makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry, may be subject to fines and imprisonment.

The Department also states that if an institution fails to report as required, the Secretary may request that the Department of Justice initiate a civil action in federal district court.

The Electronic Announcement is available at: https://ifap.ed.gov/electronic-announcements/062220ReminderRprtOwnerContrlContrctsGiftsForeignSrc

 

U.S. Department of Education Releases Additional CARES Act and COVID-19 Guidance

On March 15, 2020, the U.S. Department of Education published additional guidance for postsecondary institutions extending and clarifying regulatory flexibilities contained in the CARES Act and related to COVID-19.

Key components of the guidance include:

  • Extension of the time frame for authorization by the Department of temporary distance education approval for previously on-ground programs to include payment periods that overlap March 5, 2020, or that begin on or between March 5, 2020, and December 31, 2020.
  • Waiver of the Department’s requirement that an institution offering at least 50% of a program by distance education to be accredited for distance education by an accrediting agency that has distance education in the scope of its recognition. The waiver is effective for payment periods that begin on or before December 31, 2020.
  • Six month extension of the Title IV financial statement and compliance audit deadlines.

The guidance also includes important new information concerning:

  • Accreditation site visit extension flexibilities and requirements.
  • Extension by six months of the “materially complete application” requirements following a Title IV change of ownership and control to allow additional time for the institution to remain TItle IV certified while secure state and accreditor approvals as well as the audited same day balance sheet.
  • Waiver of MCAT score requirement for foreign graduate medical school admissions for students admitted to medical school during an admissions year in which the MCAT was unavailable to students for some period of time during that year due to COVID-19 related interruptions.
  • Additional flexibilities concerning verification of high school (or equivalent) completion status that applies until December 31, 2020, for both the 2019-2020 and 2020-2021 award years.
  • Treatment of the PPP loan forgiveness amount in calculating the institution’s composite score.
  • Treatment of student workers when determining the number of employees for PPP loan eligibility.
  • Tax treatment of HEERF and emergency financial aid grants to students.
  • Clarifications  regarding Campus-Based Waivers/Reallocation and FSEOG Emergency Aid Grants.
  • Clarifications regarding Leaves of Absence (LOA) flexibilities.
  • Return of Title IV Funds (R2T4) guidance and processing detail.
  • Clarifications regarding Satisfactory Academic Progress (SAP) flexibilities.
  • Clarifications regarding Teacher Education Assistance for College and Higher Education (TEACH) Grant Program flexibilities.

Institutions should carefully analyze the full guidance document and related Q&A , available here: https://ifap.ed.gov/electronic-announcements/051520UPDATEDGuidanceInterruptStudyRelCOVID19May2020

 

 

OCR Guidance on Disability Rights and Distance Learning During the COVID-19 Pandemic

On April 3, 2020, the Office for Civil Rights continued its guidance on how institutions can implement distance learning while complying with federal civil rights laws. This guidance is timely because, as we all know, distance learning due to COVID-19 is redefining how most educational institutions operate. When all levels of academic institutions had to close their doors due to stay-at-home orders, many of them opened the proverbial window by turning to online education.  Despite its increasing popularity over the past decade or so, distance learning remains an emerging and potentially scary (as well as exciting) landscape for many institutions as they navigate purchasing/installing new technology, implementing new methods of teaching, and ensuring connectivity with students. OCR’s guidance provides a roadmap to this new territory.

In further response to some institutions declining to use distance learning at all because they were unsure of being able to provide a free and appropriate public education (K-12) or appropriate accommodations (postsecondary) to students with disabilities, OCR reiterated: Continue reading OCR Guidance on Disability Rights and Distance Learning During the COVID-19 Pandemic

Department of Education Issues Guidance on Safeguarding Civil Rights During COVID-19 Pandemic

As with all crises, this pandemic is a rapidly evolving situation that is forcing schools to quickly implement new policies and practices, often operating on limited information and without the usual procedural safeguards and vetting. Such an environment creates a risk of the unintended consequences of those new policies/procedures being overlooked, resulting in potentially discriminatory effects to students.

Recognizing this risk, the Department of Education’s Office for Civil Rights published guidance on March 16, 2020, reminding schools that students’ civil rights must be safeguarded during responses to the COVID-19 pandemic. OCR’s guidance encourages schools to take measures to protect against COVID-19, but to do so in a manner that is free from discrimination and continues to accommodate people with disabilities.

The Department of Education focused on a few key areas as examples of potential pitfalls: Continue reading Department of Education Issues Guidance on Safeguarding Civil Rights During COVID-19 Pandemic

Avoiding Land Mines: Do Your Homework on that New Campus or Instructional Location

Authors: Julie Mebane, Partner (Real Estate) and Katherine Brodie, Partner (Higher Education)

Nothing is more unwelcome than a big surprise after your institution has invested hours and dollars in a new instructional location. Up front due diligence is essential, and it needs to identify issues that may impair your ability to operate at a new location or expose the institution to significant liabilities. Be sure to consider the following and utilize counsel well versed in college and university property acquisitions and applicable regulations to examine any problems you may encounter:

  • What is the zoning of the property? Is there a zoning report that can be reviewed (if not, consider ordering one)? Does the property have the number of parking spaces required by law or local ordinances?
  • Are there any CC&Rs (covenants, conditions and restrictions) recorded against the property? Get and review copies to make sure they don’t prohibit any intended uses.
  • Is there a conditional use permit (CUP) or planned development permit affecting the property? If so, review this for any use restrictions.
  • What is the current condition of the property and the physical plant? Check for current building permits, and consider getting a professional inspection report on the building’s systems.
  • Does the current owner have a title policy covering the property? Important information about the location and its history can be gained from this document.
  • Does the owner have a Phase 1 environmental assessment regarding any hazardous materials at the location? Request and review this for possible issues, and keep it as a baseline in case of future problems.
  • Are there any litigation or condemnation actions that have been filed relating to the property? These can be red flags for any future owner or occupant.
  • Is the property in a designated flood zone, near an earthquake fault line, or otherwise located in an area exposed to natural disasters? Natural hazard disclosure reports can be obtained without much expense.
  • Was the property previously used by an institution participating in U.S. Department of Education Title IV federal student aid programs and did that institution close with unpaid liabilities owed to the Department? If so, moving into that space by lease or purchase could expose your institution to assumption of the unpaid liabilities of the previous owner.
  • Do you know your state, accreditor and Department of Education reporting obligations? These agencies must generally be notified of any change of location or any new space where more than 50% of an eduational program will be offered, or the institution risks liability for all Title IV funds disbursed to students at the new location and potentially other regulatory sanctions.

Most of these questions can be answered with the help of a forthcoming landlord when negotiating a new lease and with the assistance of experienced counsel. If the property is being purchased, the seller is likely required by law to make certain representations and warranties and to disclose property-related information and materials during the buyer’s due diligence period.

So don’t be surprised – get the information you need before you commit to a new campus or instructional location.

 

The Trouble with Triggers: Newly Effective Postsecondary Institution Reporting Obligations Under the Borrower Defense to Repayment Rule

Specifically, this Alert explains the obligations of postsecondary institutions participating in Title IV, Higher Education Act (HEA) programs to affirmatively report to the Department the occurrence of certain “triggering” events that occur after March 15, 2019, many of which must be reported to the Department within 10 days of occurrence.

This Alert also describes the “grace period” provided by the Department in the guidance for institutions to affirmatively report to the Department certain triggering events that have already occurred between July 1, 2017, and March 15, 2019 (the period from the effective date of the 2016 BDR Rule to the date of the guidance). The deadline for reporting events occurring during the grace period is May 14, 2019.

As explained below, the 2016 BDR Rule contains both “mandatory” and “discretionary” triggering events that, after reporting, may cause the Department to recalculate the institution’s composite score—a ratio used by the Department to measure an institution’s financial health. If the recalculated score fails or is in the zone, it could lead to a letter of credit or letter of credit alternative requirement, heightened cash monitoring restrictions, provisional Program Participation Agreement status and/or other Title IV participation restrictions.

[…]

To read the full text of this Alert, please visit the Duane Morris website.