Office of Postsecondary Education - U.S. Department of Education

Federal Register / Vol. 75, No. 209 / Friday, October 29, 2010 / Rules and Regulations66863WReier-Aviles on DSKGBLS3C1PROD with RULES2that the Department should accept Statelaws and regulations that can bereasonably interpreted as meeting therequirements of § 600.9 especially ifState officials interpret their laws andregulations in such a manner.One commenter requested that theDepartment explain how it wouldaddress currently enrolled students if aState is deemed not to provide sufficientoversight in accordance with Federalregulatory requirements. Anothercommenter asked how the Departmentwill avoid such negative consequencesas granting closed school loandischarges for large numbers of enrolledstudents. One commenter requested thatthe Department provide for seamlessreinstatement of full institutionaleligibility when a State meets alleligibility requirements after losingeligibility.Discussion: We do not anticipate thatall institutions in a State will lose titleIV, HEA program assistance due to anyState failing to provide authorization toits institutions under the regulations,because States may meet thisrequirement in a number of ways, andalso with different ways for differenttypes of institutions. If a State were toundergo a change that limited orremoved a type of State approval thathad previously been in place, it wouldgenerally relate to a particular set ofinstitutions within a State. For example,a licensing agency for truck drivingschools could lapse or be closed at aState Department of Transportationwithout providing another means ofauthorizing postsecondary truck drivingprograms. Only the eligibility of truckdriving schools in the State would beaffected under § 600.9 while the Statecould continue to be compliant for allother institutions in the State. It alsoseems likely that the State wouldconsider alternate ways to provide Stateauthorization for any institutionsaffected by such a change.We believe that the provisions inamended § 600.9 are so basic that Statecompliance will be easily establishedfor most institutions. The determinationof whether an institution has acceptableState authorization for Federal programpurposes will be made by theDepartment. We also note that theregulations permit a delayed effectivedate for this requirement under certaincircumstances discussed below, and thisdelay will also limit the disruption tosome institutions within a State.If an institution ceased to qualify asan eligible institution because its Statelegal authorization was no longercompliant with amended § 600.9, theinstitution and its students would besubject to the requirements for loss ofeligibility in subpart D of part 600 andan institution would also be subject to§ 668.26 regarding the end of itsparticipation in those programs. If aninstitution’s State legal authorizationsubsequently became compliant withamended § 600.9, the institution couldthen apply to the Department to resumeparticipation in the title IV, HEAprogram.Changes: None.Comment: Several commenters wereconcerned that students may loseeligibility for title IV, HEA programfunds if a State is not compliant withproposed § 600.9. Some commentersnoted that States may have to take stepsto comply, which may include makingsignificant statutory changes, and theregulations therefore need to allowadequate time for such changes,reflecting the various State legislativecalendars. In some cases, thecommenters believed a State’snoncompliance would be because theState could no longer afford to meet theprovisions of proposed § 600.9. Onecommenter believed that alternativepathways should be allowed for meetingState authorization and that States thatexempt or grant waivers from licensingshould be considered to fulfillrequirements of proposed § 600.9 andanother questioned whether a State thatis not in compliance would have anopportunity to cure perceived problemsbefore all institutions operating in theState lost institutional eligibility.Discussion: We recognize that a Statemay not already provide appropriateauthorizations as required by § 600.9 forevery type of institution within theState. However, we believe theframework in § 600.9 is sound andprovides a State with different ways tomeet these requirements. Unless a Stateprovides at least this minimal level ofreview, we do not believe it should beconsidered as authorizing an institutionto offer an education program beyondsecondary education.If a State is not compliant with § 600.9for a type or sector of institutions in aState, we believe the State and affectedinstitutions will create the necessarymeans of establishing legalauthorization to offer postsecondaryeducation in the State in accordancewith amended § 600.9. However, in theevent a State is unable to provideappropriate State authorizations to itsinstitutions by the July 1, 2011 effectivedate of amended § 600.9(a) and (b), weare providing that the institutionsunable to obtain State authorization inthat State may request a one-yearextension of the effective date of thesefinal regulations to July 1, 2012, and ifnecessary, an additional one-extensionVerDate Mar2010 14:10 Oct 28, 2010 Jkt 223001 PO 00000 Frm 00033 Fmt 4701 Sfmt 4700 E:\FR\FM\29OCR2.SGM 29OCR2of the effective date to July 1, 2013. Asdescribed in the section of the preambleentitled ‘‘Implementation Date of TheseRegulations,’’ to receive an extension ofthe effective date of amended § 600.9(a)and (b) for institutions in a State, aninstitution must obtain from the State anexplanation of how a one-year extensionwill permit the State to modify itsprocedures to comply with amended§ 600.9.Changes: None.Comment: A few commentersrequested that the Department identify,publish, and maintain a list of Statesthat meet or do not meet therequirements. One commenter cited ananalysis that estimated that 13 Stateswould comply with the proposedregulations upon implementation; 6States would clearly not be incompliance; and 37 States would likelyhave to amend, repeal, or otherwisemodify their laws. One commenterrequested data to be provided by theDepartment for each sector ofpostsecondary education, includinghow many States are out of compliance,how many institutions are within thoseStates, and how many students areenrolled at those institutions.Discussion: We do not believe thatthere is a need to maintain and publisha list of States that meet, or fail to meetthe requirements. States generallyemploy more than one method ofauthorizing postsecondary education.For example, a State may authorize aprivate nonprofit university throughissuing a charter to establish theuniversity, another private nonprofitcollege through an act of the Statelegislature, a for-profit business schoolthrough a State postsecondary educationlicensing agency, a cosmetology schoolthrough a State cosmetology board, anda truck-driving school through theState’s Department of Transportation.We believe that an institution ofwhatever sector and type already isaware of the appropriate Stateauthorizing method or methods thatwould establish the institution’s legalauthorization to offer postsecondaryeducation and publication of any list isunnecessary.Changes: None.Comment: One commenter expressedconcern with whether a State mustregulate the activities of institutions andexercise continual oversight overinstitutions.Discussion: While a State must havea process to handle student complaintsunder amended § 600.9(a) for allinstitutions in the State except Federaland tribal institutions, the regulationsdo not require, nor do they prohibit, any