Neg reg 101

Abstract

The United States Department of Education will soon begin rulemaking on issues that are near and dear (or, at least, near) to the CBE community’s heart, including the credit hour and regular and substantive interaction. The process of rulemaking, as well as what can and cannot be accomplished by rulemaking, is not always clear. In this piece, I will try to shed some light on what the process of rulemaking looks like, as well as share some thoughts on the possibilities and dangers are of the upcoming rulemaking for CBE and what the CBE community can do to help shape this important endeavor.

You may have heard of negotiated rulemaking (sometimes also called “neg reg”) but what is it? Most simply, it is a way that federal agencies get public input from a variety of stakeholders who are likely to be affected by rules (aka regulations) the agencies put out. Federal agencies get input in a number of ways, including public hearings and calls for public comments, but negotiated rulemaking is a much more choreographed and elaborate process. Any federal agency can use negotiated rulemaking to get public input, but the U.S. Department of Education (the Department) is the only one of a small number of agencies required by Congress to use this form of input for certain types of regulations.

When the Department wants or needs to make regulations having to do with federal financial aid, it cannot just write a rule and implement regulations on its own. It must work with a group of stakeholders in a highly formalized process to try and come up with a rule that everyone can agree on.

The Department starts the process by first publishing a notice saying it intends to regulate in certain areas. The notice announces the hearings or meetings in which the public can weigh in on the areas under consideration. After hearing from the community, the Department will then put out another notice spelling out what it intends to regulate on and will ask for individuals representing key stakeholder groups (e.g., institutions of various types, accreditors, students) to volunteer to serve on a committee to help draft a rule. These committee members are called negotiators, since they are working together to negotiate a rule that, ideally, will represent the collective wisdom of a variety of interests. From the people nominated (the Department cannot include someone on the negotiating committee at this stage that has not been nominated), the Department puts together a group of negotiators that it believes will represent those who will be affected by the rule, hires a neutral third party to facilitate the meetings, and puts out a schedule of meetings. These meetings are open to the public, but the public may only comment at the end of each day. Once the meetings are underway, anyone can petition the negotiating committee to be added even if they were not nominated.

The process is time-consuming and labor intensive for the Department and the community. Generally, a negotiating committee meets for three sessions of 3 days each over a several-month period (although this can vary) to discuss what a rule should include. At the first session, the Department usually presents language for the committee to consider. The committee will spend the first session discussing, debating, and suggesting changes to the Department’s language describing the proposed change. Between sessions, the Department modifies the proposed language based on the previous conversations and agreements with negotiators and shares new language in advance of the next meeting with negotiators to discuss at the next session. If all of the negotiators and the Department can agree on language by the end of all of the sessions that will become the proposed rule that the Department will present to the public for final consideration. If everyone does not agree, however, the Department is free to write the rule on its own (taking into account the considerations raised by negotiators and the public). It will then publish its proposed rule and ask for public comments on the proposed regulations. Once all the comments have been read and addressed, the Department may publish the final version of its rule.

In late July of 2018, the Department put out a list of items that it intends to regulate on in the coming year. It is a long list of disparate topics from accreditation to regulatory activities for the upcoming year include state authorization, accreditation, the credit hour, and regular and substantive interaction. There will be public hearings in three states in September, and the public may also weigh in with written thoughts on the topics suggested by the Department by September 14th. Below, we will discuss the history and possibilities of legislative and regulatory efforts around two issues of interest to the CBE community: (a) the credit hour rule and (b) regular and substantive interaction.

As anyone involved in Competency-Based Education knows, the credit hour is the bedrock of federal financial aid. Virtually all calculations of students’ enrollment intensity, a critical measure that affects the amount of aid for which they are eligible rests on credit hours. This was not at all the original intent of the credit hour, which was devised by Andrew Carnegie over a 100 years ago in order to determine which faculty worked enough to qualify for a free pension plan, but it morphed and ossified into its current form and is now seemingly inescapable. As much as we love the whole history of the credit hour, which we detailed in our paper Cracking the Credit Hour, the purpose of the upcoming negotiated rulemaking is to deal with the federal definition of a credit hour—which is a much more recent development.

Although the credit hour allows students and institutions to receive hundreds of billions of dollars in federal financial aid, up until very recently, how credit hours were defined rested solely in the hands of colleges and their accreditors. But starting in 2009, the independent Inspector General (IG) of the Department of Education started highlighting insufficient oversight by the three regional accrediting agencies of credit hour processes. These accreditors oversaw one-third of all institutions that received federal financial aid, yet the IG found they had no established definition for a credit hour and exercised inadequate oversight on credit hour assignment processes for their institutions. For instance, one accreditor approved an institution that granted nine credits for a 10-week course—far beyond traditional colleges’ usual three credits for 15-week courses. The accreditor raised concerns about the excessive granting of credits for the course; but approved the institution’s subsequent proposal of breaking the course into two four-and-a-half credit, 5-week courses without further question. In response to the IG’s reports and recognizing the potential scope of the problem, the Department of Education developed a regulatory definition of a credit hour that sought to protect both the integrity of federal financial aid programs and allow for emerging non-time based innovations in higher education. It did this by allowing for three distinct ways of defining a credit hour. The first effectively restates historic practice: Credits are awarded based on time—time spent in class and time spent on work. The second is “evidence of student achievement,” which can mean many things but should be the foundation of any process for awarding grades and credits. The third method is estimating the “amount of work represented” in achieving learning outcomes. This method nods toward the logic of asynchronous courses offered at a distance; colleges can not very well base credits on the length of time students spend in class if students are not meeting in a classroom to learn. In the last part of the definition, the Department acknowledges that the amount of work spent learning and the time spent attending class are not the same thing, suggesting that traditional 15-week semesters can be translated into “the equivalent amount of work over a different amount of time.” Work turned out to be the Department’s middle ground between time, an easily measured but poor proxy for quality, and learning, difficult to measure but a true indicator of quality.

The definition—which the Department is allowed to create through regulation—allows for both a time and learning-based definition of credit hours but does not fundamentally change the fact that the credit hour is embedded in nearly every part of the law that oversees federal financial aid. It is in law that there are some barriers to the efficient disbursement of federal aid in CBE programs—but the Department can not change the law. Only Congress can do that.

So what, then, can the Department do vis-a-vis the credit hour in its upcoming negotiated rulemaking sessions? A likely scenario is that it returns to a world in which there is no federal definition of a credit hour. While this may sound appealing, it would not change the fact that credit hours are baked into nearly every aspect of awarding federal financial aid. What it will do is revoke a minimum standard for the amount of time or learning expected to represent a credit hour. This will likely have little to no impact on the many good providers of high-quality CBE programs. In fact, since the rule took effect, there has been an impressive growth in the number and type of CBE programs. Repealing the rule or removing a minimum floor for work or learning would, however, provide an opening to unscrupulous providers to gain access to more federal Pell grant and loan dollars by inflating the number of credit hours students (and, therefore, the institution) receive.

For several years, there has been a robust, if niche, conversation about the need to update the requirements for “regular and substantive interaction with the instructor” for distance CBE programs. The law (not the Department of Education’s regulations) requires that distance education programs of all kinds have “regular and substantive interaction with the instructor”. Programs that do not have this type of interaction are still eligible to have students receive financial aid but only under the restrictions imposed on correspondence programs. The restrictions include less federal financial aid or no federal financial aid at all if more than 50% of the institution’s students or programs are offered through correspondence.

Many of us working on CBE have been deeply engaged in these discussions, working to carefully and thoughtfully assess opportunities to re-envision the regular and substantive interaction requirement for high-quality CBE programs.

However, while it is tempting for good actors who are trying to provide innovative programs to just say “throw it out,” we must remember the origins of and intent behind the law. It was a response to rampant fraud and abuse stemming from the increase in correspondence programs in the 1980s and 1990s (which came only a few decades after rampant abuse in correspondence programs aimed at veterans returning from war with GI Bill dollars to use). These programs promised flexible options for working adults, but the availability of federal dollars—with no strings attached to student outcomes—proved too tempting for unscrupulous providers to resist. Many students were taken for a ride, taxpayers were left on the hook, and Congress took action.

To reduce the risk of abuse, Congress created a definition for correspondence education and established additional restrictions for those programs, such as limiting the amount of federal financial aid for which they were eligible in the 1992 Higher Education Act Amendments. In 2006, Congress moved to make distance education programs eligible for federal financial aid, without placing the same restrictions on them as correspondence education, and so established a statutory definition that created a distinction between correspondence and distance education programs. The law and the regulations have helped to prevent many of the abuses spotted in correspondence education, in conjunction with the credit hour and other rules. These regulations do not appear to have hindered growth in distance education since enrollment in distance education has ballooned since 2008.

However, the rise of competency-based education programs that make use of new models for faculty, and technological advancements that allow CBE programs to design personalized, supported learning programs with proactive support from faculty, have raised new questions about regular and substantive interaction in the context of distance CBE programs. The CBE community has spent several years thinking about how to fix—and not throw out or gut—the regular and substantive interaction requirement in a way that enables high-quality, cutting-edge outcomes-driven programs that serve students well to thrive. Gutting or throwing out this requirement would be harmful to the field of CBE, as it could open the floodgates to unscrupulous actors that call themselves “CBE,” take students money and provide shoddy education, and ruin the reputation of the good actors in the field—and ultimately destroy the credibility of CBE itself. This must be done thoughtfully, and in consultation with CBE leaders and consumer protection advocates.

But the Department is extremely limited in terms of what it can do for just CBE programs in terms of regular and substantive interaction. Currently, there is no definition in the law for CBE, which means that if the Administration wants to make changes to regular and substantive interaction, it would have to change regular and substantive interaction for all distance education programs. This would be a huge threat to quality, program integrity, and to the CBE community, which has worked diligently over the past few years to hold itself up on its outcomes, not just on its delivery method. The CBE community has been willing to (and has wanted to) be held to a higher standard. The broader field of distance education has not yet done the same, meaning that any definition that would be acceptable to the broader distance education field would need to appeal to the lowest denominator and would most likely provide even less quality assurance than we have now.

While we understand the Department’s interest in addressing the regular and substantive issue for CBE programs, its options are limited by the law. And, again, only Congress can change the law. However, the Department can play a critical role in moving this conversation forward through its CBE experiment under the Experimental Sites Initiative, which is allowing CBE institutions to experiment with flexible definitions of regular and substantive interaction.

The Department should use information from these experiments to help Congress better understand the educational support and resources students need to progress through their programs, the content, activities, support, and resources needed to help students attain and demonstrate competency; to understand and address the role of faculty and faculty involvement in CBE programs, including how they effectively provide functions traditionally assigned to faculty using other staff; and to identify additional resources that may be needed for adequate oversight of CBE programs. All of this, of course, should be within the broader context of looking at the student outcomes (as opposed to inputs) in these programs. This could be critical information that Congress could use as it considers changes to the Higher Education Act to enable responsible, high-quality CBE programs.

The Department’s proposed list of items to cover in one rulemaking session is long and complicated. It will need thoughtful input from the community on how to enable responsible innovation that serves—rather than harms—students. There will be pressure to simply rollback or gut the rules, rather than doing the hard work of thinking through how to protect students while enabling innovative models. Members of the community can engage in any number of ways: participating in hearings, submitting public comments, and serving as members of a negotiating subcommittee on CBE, and serving as negotiators. Serving as a negotiator or on a subcommittee is tiring, often thankless work—but there is the opportunity to help carefully inform a process that will ultimately affect thousands of institutions, millions of students, and billions of dollars.