A r c h i v e d I n f o r m a t i o n

          FOR RELEASE              Contact: Stephanie Babyak (202) 401-2311    May 2, 1994                          Jane Glickman (202) 401-1307

NEW STUDENT AID RULES PROVIDE TOUGHER OVERSIGHT OF TRADE SCHOOLS, COLLEGES, UNIVERSITIES

Under new rules published by the U.S. Education Department, states will share in more rigorous, more coordinated monitoring of trade schools, colleges, and universities. Greater accountability and monitoring will also be expected of the agencies that accredit schools.

"These regulations are a significant step in providing greater consumer protection for students pursuing postsecondary education and in safeguarding the integrity of student aid programs," said U.S. Secretary of Education Richard W. Riley. The Secretary continued, "they are tough, but fair, and allow considerable flexibility in setting standards and policies."

The regulations implement provisions governing student aid programs of the Higher Education Act Amendments of 1992 (P.L. 102-325) which Congress toughened in response to reports of fraud and abuse.

The new rules establish a State Postsecondary Review Program and revise existing regulations regarding the agencies that accredit schools that participate in student aid programs.

As required by statute, states must:

designate a State Postsecondary Review Entity (SPRE) that will review schools the Secretary refers based on certain statutory criteria, such as high student loan default rates or dramatic fluctuations in grant or loan volume. The reviews will determine whether schools should be allowed to continue to participate in the federal student aid programs. All states (except Kansas, which requires legislative action) have established SPREs;
develop standards, in consultation with schools, in specific areas, such as success of the academic program measured by student performance, graduation and placement rates, and related matters; and
develop due process procedures that schools may use to challenge SPRE review findings and decisions. Schools can also challenge the accuracy of referral data before the department refers a school for a SPRE review or before a state-referred SPRE review is conducted.

About $21 million was appropriated for SPRE activities in the current fiscal year; the FY 95 request is $35 million.

As required by statute, accrediting agencies must:

assess student achievement in evaluating the schools and programs they accredit;
develop standards in 12 specified areas that reflect educational quality, including curricula, faculty and student achievement as measured by such indicators as course completion, job placement or state licensing examination rates; and
develop due process procedures to ensure that policies and standards are applied fairly.

In developing the regulations, the department held a series of meetings with the academic community and reviewed more than 3,000 letters. Changes were made in the draft regulations to eliminate overly prescriptive language and to reduce administrative and reporting requirements, as well as costs to agencies and schools.

The final regulations appear in the April 29 Federal Register.