Reasonable Cause and Voluntary Membership: The Key Objectives When Institutions Wish to Change a Primary Accreditor

Today, WCET’s policy team shares important updates about guidance from the Department regarding approval for accreditation changes.

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Due to an important federal regulatory change that became effective July 1, 2020, which expanded formerly “regional accreditors” beyond specific geographic areas for institutional accreditors and a new state law in Florida requiring public institutions to change their accreditor on a periodic basis, the U.S. Department of Education determined the need to issue guidance addressing institutions’ changes of accreditors. This very functional guidance is important for institutions to understand the steps that institutions must take when making a change in their primary accreditor or obtaining accreditation by multiple agencies. Additionally, accreditors will benefit from clarifications regarding the Department’s review process to approve accreditor changes.

The guidance released on Tuesday, July 19, 2022, included direction to institutions as to appropriate purpose and specific process steps to make changes plus direction to institutional accrediting agencies to ensure that the changes are for “reasonable cause” and are “voluntary.” Simultaneously, the Department released a post, Postsecondary Accreditation Cannot Become a Race to the Bottom, in its blog HOMEROOM, The Official Blog of the U.S. Department of Education, to further clarify its reasoning for issuing new guidance. Institutions should carefully consider the Departments’ documents as they operationalize the process described by the guidance.

The guidance documents include the following:

1. (GEN-22-10) Guidance for Institutions Seeking to Change or Add Accrediting Agencies – addresses how the Department evaluates the materials provided by the institutions when requesting to change accrediting agencies to ensure “reasonable cause” for a change.

• (GEN-22-11) Procedures for Institutions Seeking Approval of a Request to Change or Add Accrediting Agencies – addresses the process steps the institutions must follow when changing their primary accrediting agency or wish to obtain accreditation by multiple agencies.

• Letter from the Department to institutional accrediting agencies – addresses the requirement that accreditation membership by the institution is to be voluntary as directed by Federal statute in the 1992 HEA reauthorization (Section 1099b(a)(2)) and implemented through Federal regulation found in 34 CFR 601.14(a).

Guidance for Institutions Seeking to Change or Add Accrediting Agencies

To make a change or add an accrediting agency, institutions are statutorily required by the Higher Education Act to submit materials concerning the change to Federal Student Aid (FSA) to demonstrate “reasonable cause” for the change. Federal regulation, 34 CFR 600.11 provides the implementation structure for the statutory requirement by directing institutions to submit materials to establish “reasonable cause” in order for the Department to approve the change.

Federal regulation directs that the FSA will not provide a determination of “reasonable cause” if the institution’s accreditation has been terminated for cause or the institution placed on probation or suspended for cause in the preceding 24 months unless the termination is rescinded or due to accreditor improper action.

Review by FSA is on an institution-by-institution basis which will include specific circumstances related to the institution’s history of compliance, financial stability, and other institutional information supporting the institution’s request for change.

The Department’s guidance, which provided a nonexclusive list of factors to evaluate the request for change of accreditor, include:

1. The institution’s stated reason for the proposed change or multiple accreditations.
2. Whether the institution is seeking to change accrediting agencies or multiple accreditations to lessen oversight or rigor, evade inquiries or sanctions, or the risk of inquiries or sanctions by its existing accrediting agency.
3. Whether the proposed change of agencies or multiple accreditations would strengthen institutional quality.
4. Whether the institution is seeking to change agencies or seeking multiple accreditations because the new agency and its standards are more closely aligned with the institution’s mission than the current accrediting agency.
5. Whether the proposed change or addition involves an accrediting agency that has been subject to Department action.
6. Whether, if ultimately approved by the Department and the accrediting agency, the institution’s membership in the accrediting agency would be voluntary, as required for recognition of the accrediting agency under 34 CFR § 602.14(a).

The Department made it clear in its guidance that it is the responsibility of the institution to provide sufficient evidence through its materials to the FSA to reach a finding of “reasonable cause” for the requested change.

Procedures for Institutions Seeking Approval of a Request to Change or Add Accrediting Agencies

Change in Process: Before applying to a new accrediting agency, institutions must first submit the required materials to the Department’s Federal Student Aid (FSA) and receive the Department’s approval.

Institutions should pay close attention to the steps provided by this guidance to seek FSA approval for a change a primary accrediting agency. This 2022 guidance updates, revokes, and supersedes previous guidance published in 2016. The significant change in process now directs that the institution must submit the required materials to FSA and obtain notification of approval prior to submitting an application to a new accrediting agency. The Department reminds institutions that failure to follow the procedures could affect the institution’s accreditation status and impact eligibility for Title IV HEA programs.

The new guidance directs that the institution must proceed with the following steps to seek a change to the primary accreditor or add a new accrediting agency:

1. Prior to applying to the new accrediting agency, notify FSA in writing of the intent to make a change primary accreditor or add a new agency. Notification must include the materials demonstrating “reasonable cause” and submitted via email to CaseTeams@ed.gov with a subject line that reads “Notification Regarding Accreditation.” 
2. Prior to submitting an application to the new accrediting agency, the institution must receive notification from FSA that the institution has provided the required materials, demonstrated “reasonable cause” and has the Department’s approval.
3. After the institution receives notification from FSA, as previously described, and has secured new accreditation or pre-accreditation by an agency recognized by the Department, the institutions must formally notify FSA of the new accreditation in the online electronic application (E-App) and update the “primary accreditor” if there is a change. The notification in the online electronic application should include documentation regarding the new accrediting agency.

Additionally, the Department guidance instructs institutions not to drop its association with the current accrediting agency until after:

1. Approval of the institution’s request for change or additional agency by FSA,
2. Granting of accreditation by the new agency, and
3. Acknowledgement by FSA by written notice of the new accrediting agency.

Letter from the Department to Institutional Accrediting Agencies

The Department, by public letter to institutional accrediting agencies, chose to address inquiries regarding the “voluntary membership” requirement as directed by Federal regulation 34 CFR 602.14(a) to implement the statutory requirement of the 1992 HEA Reauthorization. This letter, while not submitted within the typical Dear Colleague Letter structure of Department guidance, provides insight into the Department’s analysis of the Federal regulatory language and how it may affect institutions in Florida seeking to comply with new Florida Law SB 7044 (which took effect, July 1, 2022).

The letter shared the history of accrediting agencies, the recognition of the voluntary membership by institutions to accrediting agencies by Congress, and the important relationship of the program integrity triad. The Triad, which consists of states, accreditors, and the Department, is noted to have “distinct principal areas of responsibility” to work together to support quality in higher education. Additionally, the letter described the two guidance documents previously discussed addressing specific process and required FSA finding of “reasonable cause,” for FSA to approve a change of primary accrediting agency or additional accreditor.

Specific to the circumstances surrounding the new Florida state law, the Department expressed its concern that the new law potentially undermines the voluntary nature of accreditation and could impact the independent roles of the members of the triad. The Department advises accreditors to consider whether accrediting an institution will compromise the voluntary nature of the institutions membership prior to approving the institution’s membership application.

In addition to reasonable cause, the Department’s letter indicated that there will be an examination of voluntariness by FSA during the review of an institution’s request. The Department explained that even if there can be a finding of reasonable cause based on the institution’s materials, FSA will consider all relevant factors to determine that an accreditation agency has a voluntary membership. Upon a finding that the accrediting agency does not have a voluntary membership, the Department will not recognize the accrediting agency.

Conclusion

This three-part guidance provided a very practical application structure and useful insight of factors for application analysis for institutions to establish “reasonable cause” for a primary accrediting agency change or addition. Furthermore, the Department provided notice to institutional accrediting agencies and the public that in this application process, FSA will scrutinize the institution’s application and review all relevant information to determine if the accrediting agency has a voluntary membership.

We will continue to watch and share information on the institutional impact with the implementation of this structure and scrutiny in the next few years as institution’s seek new primary accreditors or additions either as a result of the change in Federal regulations or compliance with the new Florida law.

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