State Approval: Updates, Cost to Comply, and Students

I have had many conversations on this issue in the past week.  As institutions begin (or have begun) enrollment for the summer term, this issue has become very real.  Students enrolling for courses beginning in June will be in courses that continue past the deadline.  While July 1 is the implementation date, institutions are making tough decisions now.

Updates

  • Call-to-action coming. Advocacy and next steps.  Several regional and national organizations have been working together this week to create a common voice on the ‘state authorization’ regulation.  This is a great advance.  Watch for letters advising you on next steps your institution can take and a call to contact your Congressional delegation.  Meanwhile, start working with your institution’s leadership and government relations team to be prepared to take action.  Last week, I suggested that your institution contact your Senators.  This week, I heard that the Senators in the Health, Education, Labor, & Pensions (HELP) Committee have had few contacts from their constituents on this issue.
  • State-by-state list coming. The updated version of “State Approval Regulations for Distance Education: A Starter List” will be released next week. We received updates or corrections from 40 states. The document is co-sponsored by the Southern Regional Education Board, American Distance Education Consortium, the University of Wyoming, and WCET.  Watch for an announcement about another organization assuming the duty of expanding and maintaining the list.

What Does It Cost to Comply?Academic mortar board and cash

Bob Larson from the North Dakota University System Online performed a financial analysis of how much it would cost for one institution in North Dakota.  The institution serves 615 students in 48 other states.  The institution needs to apply in 21 states and to register in four more.  The rough estimate for the total cost in fees for this one institution to apply or register for approval in those 25 states is $159,800.  The attached analysis focuses solely on fees and does not include the staff time necessary to research the regulations, complete the applications, and manage the process.

Based on this analysis, Gary Langer performed a similar analysis for the 32 colleges and universities of the Minnesota State College and Universities of what the first year would cost if all the system’s colleges and universities sought approval in the other 49 states.  Based upon his preliminary estimates of the states where approval or registration would be required, he estimated the total cost in fees would be $5.5 million.   That number should get the attention of your leadership.

Has your institution or system performed cost analyses of how much it will cost you to apply or register in the states where it will be required of your institution?  Have you done an analysis of how much it might cost you in terms of staff time?  If so, I invite you to share your calculations as a comment to this post.

What About Students?

Institutions are in a bad spot as their choices (if the July 1 implementation date holds) are to: a) pass along the costs to students, and/or b) stop serving students in some states.  Let’s be clear, I’m not advocating either position, but I’ve heard from several colleges that are weighing their options.  I empathize with their predicament.  Raising costs and reduced access for students seem to be at odds with the stated education goals of White House and its Department of Education.

127 days remaining until July 1.

Russ Poulin
Deputy Director, Research & Analysis
WCET – WICHE Cooperative for Educational Technologies
rpoulin@wiche.edu
State Approval page:   http://wcet.wiche.edu/advance/state-approval

Join WCET!  Support our work on this issue.

4 Comments

  1. Dave
    Posted February 24, 2011 at 2:26 pm | Permalink | Reply

    If a student doing an internship in a state constitutes institutional physical presence in that state, then that really changes things, doesn’t it? I figured the on line student presence in another state would at least be restricted to students who were out of state for tution purposes, and perhaps this could be monitored through the admissions process. But will we now have to get (and pay for) operating permission in any state in which a student wants to intern? What about student trips, such as for-credit or not-for-credit spring break trips? Do they constitute physical presence in the states to which student groups travel? The current answer, of course, is “yes, if a state defines physical presence that way.”

    This issue highlights the basic problem in the current federal regulatory attitude: if the regulatory authority is to reside with the states, then the enforcement authority needs to reside there to–it just won’t work to have the feds heavy-handedly enforcing 50 different state regulations without any oversight of the content of those regulations. You can’t have your cake (deferring to states’ regulations) and eat it too (telling the states how to enforce their regulations). Either give us workable federal regulations or trust the states and the accrediting agencies to do their jobs.

  2. Posted February 24, 2011 at 12:47 pm | Permalink | Reply

    Has anyone considered the cost to a consortium offering degree programs nation-wide? I wonder if a consortium could apply as one entity? Or, perhaps an entire system, such as the California State University system, could be considered one entity when applying for permission to operate in a state?

    • Posted February 24, 2011 at 12:54 pm | Permalink | Reply

      If a consortium could apply would be up to the laws and regulations of each state. In our research, we’ve yet to see a state that allows consortia to apply…but you can ask. The state agencies are overwhelmed and might like some creative thinking. This is especially true in states that have a long history of agreements, such as tuition reciprocity or other shared services agreements.

  3. Barbara
    Posted February 24, 2011 at 10:00 am | Permalink | Reply

    We decided to follow the “things you can do now” advice and wrote emails with a university profile attached which included what we do or do not do within a state (students, agents, etc) and our accreditation status among others. Of the 30 states we wrote to, about half have responded. Most cite the physical presence regulations of their state but also caution that physical presence rules apply to practica/externships/internships that students may engage in in-state – which constitutes physical presence. That may have implications for states where education online students do student teaching in-state. We’ve learned a lot in the process…including the fact that many states haven’t figured out what they are doing yet!

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