Status: Not in effect – this rule was vacated by a federal court in 2011 (and the court’s decision was upheld in 2012 on appeal). ED is currently proceeding with a new negotiated rulemaking to potentially re-introduce the Distance Education Rule.
Summary: This is the rule that most institutions and the State Authorization Network (SAN) have focused upon over the past couple of years and that gave rise to the State Authorization Reciprocity Agreement (SARA). In short, it required an institution to be authorized in any state in which it enrolls students into a distance education programifstate law requires the institution to be so authorized. This rule did not require states to regulate institutions providing distance education and did not establish minimum criteria that states must use to authorize institutions. It simply required institutions to prove to the Department upon request that they have all necessary approvals as a condition to Title IV eligibility.
How to Comply: The Distance Education Rule was thrown out by a federal court inAPSCU v. Duncanand ED is currently prohibited from enforcing it, but underlying state laws are entirely unaffected by the court ruling. Those state laws are still in effect. So, failing to obtain authorization in a state where your institution is required to be authorized under state law is a violation of state law but generally not a violation of the federal requirements for participating in Title IV. (Misrepresenting your approval status, however, or failing to disclose the applicable complaint agency in any state, would violate the federal Title IV rules.)
Common Misconception:“The Department’s Dear Colleague Letter (DCL) gave an extension untilJuly 1, 2014, so I don’t have to worry about authorization for my institution’s distance education programs until then.”
Fact: In 2011, ED issued a DCL granting an extension until July 1, 2013 to institutions making a “good faith” effort to comply with the Distance Education Rule; however, this guidance is no longer in effect because the rule was struck down. That DCL has no impact whatsoever on an institution’s obligation to get authorized under state law. A May 2013 DCL granted a separate extension that only applies to the On-Ground Rule (which is discussed next). Thus, whether your institution needs to be authorized in a state where it is providing distance education is currently only a matter of state law – and there is no federal extension regarding the need to comply with state law. Any “good faith” extension is at the discretion of the state regulators. If the Distance Education Rule comes back, the Department will determine a new effective date upon publication of a final rule (which may or may not include a built-in “grace period”).