The Department of Education (DOE) has proposed new rules for accrediting colleges and universities, including expanding the power of states to authorize higher education institutions, definitions of what constitutes a “credit hour,” and de facto price controls through measures to ensure graduates’ “gainful employment.” According to the Council for Higher Education Accreditation, the new rules will mark a substantial shift in the accrediting process:

Current regulations do not define or describe the statutory requirement that an institution must be legally authorized in a state. Under the new rules, the institution’s authorization must be subject to adverse action by the state. [The DOE] notes that, while state authorization was in the past viewed as a “minimal” requirement, the Department now views state authorization as a “substantial requirement where the State is expected to take an active role” not only in approving institutions but also in monitoring and “responding appropriately” to public complaints about institutions.

The DOE has also proposed a new rule pertaining to the definition of a credit hour, which could include standardizing the definition of a credit hour by the federal government.

But Sylvia Manning, president of the Higher Learning Commission of the North Central Association (a regional accrediting agency for 19 states), argued that universities are better equipped to establish the metrics that demonstrate student learning than is the federal government, especially when it comes to non-traditional higher education—such as what the University of Phoenix offers.

“Alternative modes of delivery, most notably Internet-based distance delivery that permits a student to participate in classroom activities at any time from anywhere, make nonsense of the idea of seat-time,” says Ms. Manning. Federal overreach into the definition of a credit hour would end up increasing the amount of resources spent by universities in “demonstrating compliance with the regulation.”

Finally, the Administration has proposed a new “gainful employment” rule that would affect virtually all for-profit private higher education institutions. The new rule is based on a requirement in the Higher Education Act, which requires for-profit universities to provide “an eligible program of training to prepare students for gainful employment in a recognized occupation.” According to Inside Higher Ed, the new rule would create three tests for for-profit colleges to qualify for federal financial aid funding:

The debt-to-earnings ratio, the debt-to-discretionary income ratio, and the loan repayment rate. If a program does better than the department’s preferred standard on any one metric—8 percent debt-to-earnings, 20 percent debt-to-discretionary income, 45 percent repayment rate—then it is fully eligible for Title IV [funding].

Insider Higher Ed also notes that, according to Terry Hartle of the American Council of Education, the new gainful employment rule is “the most complicated regulatory package that the Department of Education has ever promulgated—this really is a brave new world.” The DOE will issue final rules by November 1, 2010, in order to have the new gainful employment regulations take effect by July 1, 2011.

Some U.S. Senators have voiced support for the gainful employment regulations, including Tom Harkin (D–IA), Dick Durbin (D–IL), and Al Franken (D–MN). But in a letter signed by numerous Representatives on the House Education and Labor Committee, Ranking Republican Member John Kline and others expressed concern that “the proposed regulation imposes arbitrary debt-to-income caps. The result will be virtually the same as federal price controls, rewarding low-cost institutions regardless of quality and limiting students’ access to higher-cost institutions.”

Whether it’s through new, powerful state accrediting authority, federal definitions of credit hours, or price controls imposed through gainful employment measures, the Obama Administration appears intent on limiting the growth of the for-profit college sector. But it’s not just the for-profit schools like Capella and DeVry Universities and technical colleges that could be affected.

In a July 30 letter sent to Education Secretary Arne Duncan, former Senator Bill Armstrong, now President of Colorado Christian University, expressed concern that the proposed rules would “subject both public (government owned and operated) colleges and universities and private schools to ‘substantive’ regulation by state government.”

The regulations under consideration by the DOE would have the net result of encumbering student access to higher education and weighing providers down with compliance burdens. Many for-profits could even be forced to close their doors.

During these tough economic times, the last thing the Obama Administration should be doing is creating a bottleneck in the pipeline to employment by limiting access to higher education for working-class families.

Manning summarizes the matter well:

Voluntary accreditation has been in place in the United States for over a hundred years and has handled issues related to the evaluation of quality for most of that time. … What strikes us as curious is that the call for minimum thresholds in matters such as the credit hour and program length runs counter to the country’s expressed interest in increasing, significantly and rapidly, our nation’s attainment in higher education. To meet our national goals for educational attainment and a workforce for the 21st-century economy, higher education is asked—by policy makers, legislators, foundations, opinion leaders—to break out of old molds, seek efficiencies, open doors, reach new populations. Strict accreditation requirements based in 19th-century models don’t seem likely to get us there.