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Rule2026-22174

Accreditation, Innovation, and Modernization: The Secretary's Recognition of Accrediting Agencies; Institutional Eligibility Under the Higher Education Act of 1965, as Amended; Student Assistance General Provisions

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Published

October 30, 2026

Effective

July 1, 2027

Issuing agencies

Education Department

Abstract

The Department revises the existing accrediting agency recognition regulations to implement the directives set forth in Executive Order 14279, Reforming Accreditation to Strengthen Higher Education, and other Administration priorities, align the regulations more closely with statute, and reduce regulatory burden.

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[Federal Register Volume 91, Number 209 (Friday, October 30, 2026)]
[Rules and Regulations]
[Pages 68626-68734]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-22174]

[[Page 68625]]

Vol. 91

Friday,

No. 209

October 30, 2026

Part II

Department of Education

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34 CFR Parts 600, 602, and 668

Accreditation, Innovation, and Modernization: The Secretary's
Recognition of Accrediting Agencies; Institutional Eligibility Under
the Higher Education Act of 1965, as Amended; Student Assistance
General Provisions; Final Rule

Federal Register / Vol. 91 , No. 209 / Friday, October 30, 2026 /
Rules and Regulations

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DEPARTMENT OF EDUCATION

34 CFR Parts 600, 602, and 668

[Docket ID ED-2026-OPE-1042]
RIN 1840-AD82

AGENCY: Office of Postsecondary Education, Department of Education.

ACTION: Final rule.

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SUMMARY: The Department revises the existing accrediting agency
recognition regulations to implement the directives set forth in
Executive Order 14279, Reforming Accreditation to Strengthen Higher
Education, and other Administration priorities, align the regulations
more closely with statute, and reduce regulatory burden.

DATES: This final rule is effective July 1, 2027.
Implementation dates: For the implementation dates of the
regulatory provisions, see the Implementation Date of These Regulations
of this document.

FOR FURTHER INFORMATION CONTACT: For further information related to
recognition of accrediting agencies, Elizabeth Daggett, Director,
Accreditation Group, Office of Postsecondary Education, Telephone:
(202) 453-7615. Email: <a href="/cdn-cgi/l/email-protection#82e7eeebf8e3e0e7f6eaace6e3e5e5e7f6f6c2e7e6ace5edf4">[email&#160;protected]</a>. For all other
information related to this document, Aaron Washington, Office of
Postsecondary Education, Telephone: (202) 987-0911. Email:
<a href="/cdn-cgi/l/email-protection#3c5d5d4e5352124b5d4f5455525b4853527c5958125b534a">[email&#160;protected]</a>.
If you are deaf, hard of hearing, or have a speech disability and
wish to access telecommunications relay services, please dial 7-1-1.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Executive Summary
1. Summary of Major Provisions
2. Summary of Costs and Benefits
II. Purpose of this Regulatory Action
III. Background
IV. Implementation Date of These Regulations
V. Authority for the Regulatory Action
VI. Analysis of Public Comments and Changes
VII. Regulatory Impact Analysis
1. Regulatory Planning and Review Including Regulatory Impact
Analysis
a. Need for Regulatory Action
b. Summary of Comments and Changes From the NPRM
c. Discussion of Costs, Benefits, and Transfers
d. Accounting Statement
e. Alternatives Considered
2. Regulatory Flexibility Act
3. Paperwork Reduction Act of 1995
4. Congressional Review Act
Intergovernmental Review
Assessment of Education Impact
Federalism

I. Executive Summary

The Secretary of Education recognizes accrediting agencies under
existing regulations at 34 CFR part 602 to ensure that agencies are
reliable authorities regarding the quality of education or training
offered by the institutions or programs they accredit for the purposes
of the Higher Education Act of 1965, as amended (HEA), or for other
Federal purposes. Recognized institutional accrediting agencies serve
as key gatekeepers in determining which institutions may participate in
the Federal student aid programs, which currently provide more than
$100 billion in Pell Grants and Federal student loans annually. To
ensure that the Department only recognizes those accrediting agencies
focused on high-quality, valuable education for students, we are
realigning the regulations for recognition of accrediting agencies to
have a greater focus on student achievement and ensure programs provide
a high-quality, high-value education.
The final rule removes unnecessary requirements on agencies and the
institutions or programs they accredit. These regulations eliminate
requirements not required by statute, including the ``two-year rule''
for initial recognition of agencies, prescriptive site visit mandates,
unnecessary documentation requirements, and rigid, overly long
processing and procedural timelines.
These commonsense regulations also address the barriers that limit
institutions from adopting practices that advance credential and degree
completion and spur new models of education. They also remove existing
regulatory barriers impeding institutions' ability to change
accrediting agencies or work with more than one accrediting agency,
while agencies will have more flexibility to apply certain standards
that meet the needs of their accredited institutions and programs.
The final rule also introduces a new review framework for better
oversight of key institutional accrediting agencies that serve as the
primary gatekeepers for the Federal student aid programs, and whose
potential failures pose the greatest risk to taxpayers.
Additionally, to reduce administrative costs that are negatively
impacting college affordability, the final rule requires recognized
accrediting agencies to apply their standards in ways that minimize
institutional administrative burden, avoid duplicative reporting, and
support the implementation of lower-cost, higher-value educational
models. These changes also will shift the focus of institutions toward
more cost-effective practices for staffing, facilities, student
services, and program design.
The final rule promotes greater integrity in decision making by
recognized accrediting agencies and eliminates previous regulatory
exceptions that pose potential conflicts of interest. The final rule
also eliminates geographic-scope distinctions for institutional
accrediting agencies and makes other anticompetitive behavior a
negative factor in consideration of agency recognition.
The final rule reinforces the existing legal, constitutional, civil
rights, and consumer protection obligations already required of
recognized accrediting agencies and the institutions and programs that
they accredit. For example, under the final rule, accrediting agencies
recognized by the Secretary must ensure that the institutions and
programs they accredit have and apply policies consistent with all
Federal and State laws and respond appropriately to findings of
noncompliance by competent authorities. The final rule also prevents
recognized accrediting agencies from applying standards that direct
accredited institutions and programs to violate such laws. New student
outcome and program-level performance expectations for the applications
of agency standards will focus both accrediting agencies and
institutions on important objective measures of student and institution
performance such as course completion, licensure pass rates, and
economic returns.
Further, the final rule addresses the persistent and costly issues
with transfer of credit policies that have burdened students. These
regulations reduce the likelihood that students will be required to
undertake duplicative coursework and incur additional tuition charges
that are not necessary. Although institutions will continue to have
latitude to deny transfer of credit based on the credit failing to meet
the receiving institutions' standards, institutions will have to
explain those standards and provide written reasoning to the student
for such denial. These regulations also require greater transparency
before a student decides to transfer to another institution, so he or

[[Page 68627]]

she can have a full understanding of the scope and cost of transferring
to that institution.
Taken together, this student-oriented final rule realigns the
Secretary's recognition of accrediting agencies with a high-quality,
high-value education that is free from unlawful discrimination and
other violations of Federal law.

1. Summary of Major Provisions

These final regulations:
<bullet> Amend Sec. 600.11 to make it less burdensome for
institutions that are changing accrediting agencies or wish to utilize
more than one accrediting agency.
<bullet> Amend Sec. 602.2 to require the Department to provide
public notice on its accreditation website if the Secretary denies
continued recognition to a previously recognized agency, or if the
Secretary limits, suspends, or terminates the agency's recognition
before the end of its recognition period.
<bullet> Amend Sec. 602.3 to define and use the term
``institution'' in these regulations instead of ``institution of higher
education'' which is defined in the HEA, and elsewhere in the
Department's regulations, referring to a narrower subset of
institutions, and to add a definition for ``related, associated, or
affiliated trade association.''
<bullet> Amend Sec. 602.10 to clarify that the Secretary's
recognition extends only to those accrediting agencies whose
institutions or programs actively participate in a Federal program.
<bullet> Amend Sec. 602.11 to require accrediting agencies to
clearly describe the scope of their accrediting activities and remove
geographic restrictions that restrict institutions and programs from
choosing an accrediting agency.
<bullet> Amend Sec. 602.12 to remove references to geographic
areas and geographic constraints and require review of contractions of
scope. Additionally, amend the regulations to clarify the policies and
capacity an accrediting agency must have to seek initial recognition,
and eliminates the ``two-year rule'' for initial recognition.
<bullet> Unreserve and amend Sec. 602.13 to specify that an
accrediting agency's recognition by the Department does not provide any
immunity from antitrust laws.
<bullet> Amend Sec. 602.14 to strengthen the fiscal and
administrative criteria an accrediting agency must meet to prove it is
fully separate and independent from any related, associated, or
affiliated trade or membership organization.
<bullet> Amend Sec. 602.15 to require accrediting agencies to
administer their standards, policies, and procedures in a manner that
minimizes unnecessary compliance costs and administrative burdens on
accredited institutions, as well as require agencies to maintain
appropriate conflict of interest controls and policies.
<bullet> Amend Sec. 602.16 to codify that an agency may establish
additional lawful accreditation standards that are consistent with
ensuring institutional or programmatic quality and integrity as it
deems appropriate.
<bullet> Amend Sec. 602.17 to clarify expectations for reviewing
student achievement and faculty related policies, including academic
freedom and intellectual diversity. Additionally, add new requirements
regarding institutional cost-benefit analyses, institutional
flexibility and mission, program length review, and safeguards against
misrepresentation.
<bullet> Amend Sec. 602.18 to require that accrediting agency
decisions be neutral with respect to viewpoint and ideology, except for
agencies with a religious mission.
<bullet> Amend Sec. 602.20 to provide guidance to accrediting
agencies on how to structure their arbitration procedures and remove
overly prescriptive requirements.
<bullet> Amend Sec. 602.21 to remove overly prescriptive review
requirements.
<bullet> Amend Sec. 602.22 to refine the list of changes requiring
agency approval, add prison education programs as a defined substantive
change, and remove outdated and overly prescriptive requirements.
<bullet> Amend Sec. 602.23 to require accrediting agencies to
ensure institutions comply with all applicable Federal and State laws
and remove overly prescriptive requirements.
<bullet> Amend Sec. 602.24 to strengthen accrediting agencies'
oversight of institutional changes, expand requirements for teach-out
planning, including transcript access, and increase transparency and
support for students when institutions face disruptions.
<bullet> Amend Sec. 602.24 to establish clearer, fairer rules for
credit transfer by defining consistent criteria, prohibiting
discriminatory denials, requiring acceptance of comparable credits, and
providing students with an appeals process.
<bullet> Amend Sec. 602.25 to remove overly prescriptive
requirements for demonstrating due process.
<bullet> Amend Sec. 602.26 to update and modernize the required
content of agency notices and better align these requirements with
contemporary methods of disclosure and allow temporary continuation of
eligibility for title IV, HEA funds for institutions to exhaust all due
process options.
<bullet> Amend Sec. 602.27 to require agencies to update the
Department's website on a regular, timely basis to display the current
accreditation status of all institutions and programs.
<bullet> Amend Sec. 602.28 to broaden the circumstances under
which an accrediting agency must re-evaluate an institution or program
following negative actions by other authorities.
<bullet> Amend Sec. 602.30 to modernize how accrediting agencies
submit applications and reports to the Department.
<bullet> Amend Sec. 602.32 and split into two sections: Sec.
602.31 and Sec. 602.32.
<bullet> Amend Sec. 602.31 to modernize and streamline the
procedures accrediting agencies must follow when submitting
applications for initial or renewed recognition.
<bullet> Amend Sec. 602.32 to modernize and clarify the processes
used to review an accrediting agency's expansion or contraction of
scope, compliance report, and increase in headcount enrollment.
<bullet> Amend Sec. 602.33 to modernize and streamline the
procedures for review of agencies during the period of recognition,
including the review of monitoring reports.
<bullet> Amend Sec. 602.34 to require the National Advisory
Committee on Institutional Quality and Integrity (NACIQI or Advisory
Committee) to review applications for contractions of scope, and for
accrediting agencies to post public notice of upcoming NACIQI reviews.
<bullet> Amend Sec. Sec. 602.35, 602.36, and 602.37 to update
cross references.
<bullet> Amend Sec. 668.43 to require transfer of credit
disclosures and direct applicable written notices to students.

2. Summary of Costs and Benefits

As further detailed in the Regulatory Impact Analysis (RIA), the
final rule includes numerous provisions that may impact students,
institutions, accrediting agencies, and the Federal government.
Specifically, the final rule includes provisions related to transfer of
credit policies, which may benefit students by making it easier for
students to transfer credits to continue their postsecondary enrollment
at a new institution. Students will likely benefit from these changes
by spending less time and money retaking courses that failed to
transfer, whereas institutions may experience costs due to the
suspected foregone tuition revenue from transfer students.
The final rule also encourages accrediting agencies to include new
criteria that evaluate program and institutional outcomes. This may

[[Page 68628]]

impose new costs on accrediting agencies, which may need to develop
such criteria, and on institutions, which may need to implement changes
to meet such criteria. Furthermore, the final rule will remove several
barriers for new accrediting agencies to emerge and obtain Department
recognition, which may ultimately benefit accrediting agencies through
the reduction in administrative burden to gain initial recognition and
maintain recognition. Additionally, the final rule would also require
accrediting agencies to adopt several new policies and procedures that
aim to increase college affordability and innovation, while also
putting downward pressure on credential inflation. Students may benefit
from these provisions if the changes result in more affordable and
flexible educational opportunities.
As noted in the RIA, the Department does not estimate a significant
net budget impact on the title IV, HEA Federal student aid programs
from the final rule. In prior regulations \1\ the Department estimated
the accreditation reform would result in an increased number of
applications for recognition due to easier recognition of new
accrediting agencies. Increased petitions are also expected given an
expanded scope to new credential levels, and the option for alternative
standards to allow for faster introduction of innovative programs. In
2019, we did not estimate a significant change in repayment performance
as institutions with less favorable program outcomes could find more
lenient accrediting agencies. Institutions with strong programs can
take advantage of the flexibility allowed by the substantive change
policy revisions to expand their program offerings. At the time we
noted the uncertainty of the extent to which increasing accreditation
options and encouraging program innovation would shift Federal loan and
grant volumes among more options for students versus generating new
volume, and that uncertainty remains. Additionally, greater acceptance
of transfer credits may increase Federal grant and loan volumes by
encouraging some students to complete degrees but also may reduce
volumes by credits being recognized by the institutions receiving
transfers. In retrospect, we know the number of institutions that
changed agencies was fairly low and it is difficult to attribute
particular changes in volume to accreditation reforms given other
economic, demographic, and programmatic developments during the same
period.
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\1\ Student Assistance General Provisions, The Secretary's
Recognition of Accrediting Agencies, The Secretary's Recognition
Procedures for State Agencies--84 CFR 58834--<a href="https://www.federalregister.gov/documents/2019/11/01/2019-23129/student-assistance-general-provisions-the-secretarys-recognition-of-accrediting-agencies-the">https://www.federalregister.gov/documents/2019/11/01/2019-23129/student-assistance-general-provisions-the-secretarys-recognition-of-accrediting-agencies-the</a>.
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II. Purpose of This Regulatory Action

In accordance with Executive Order (E.O.) 14279, this regulatory
action realigns the Secretary's criteria for recognition of accrediting
agencies to promote high-quality, high value, and affordable education
for students that--
<bullet> Promotes such academic programs and activities at higher
education institutions that are focused on student outcomes and are
free from unlawful discrimination and other violations of Federal law;
<bullet> Reduces barriers that limit competition, innovation, and
new education models that advance credential and degree completion;
<bullet> Holds institutions accountable for discrimination and
other unlawful acts; and
<bullet> Advances academic freedom, intellectual inquiry, and
student learning by ensuring that accreditation requires that
institutions support and prioritize intellectual diversity among
faculty.

III. Background

Section 496 of the Higher Education Act of 1965, as amended (HEA),
requires the Secretary of Education (Secretary) to establish criteria
for determining whether an accrediting agency is a reliable authority,
for purposes of participation in programs authorized under the HEA and
other Federal programs, on the quality of education or training offered
by the institutions and programs that they accredit. Such criteria are
required to include appropriate measures of student achievement.
Consistent with the statute, the Secretary has established
regulations for recognition of accrediting agencies at 34 CFR part 602
and has revised these regulations periodically.
E.O. 14279, titled ``Reforming Accreditation to Strengthen Higher
Education,'' issued on April 23, 2025, by President Trump, directs the
Secretary to take several actions related to the recognition of
accrediting agencies or associations by the Department. Some of these
actions require changes to existing regulations.
These regulatory changes realign the Secretary's criteria for
recognition of accrediting agencies to promote high-quality, high
value, and affordable education for students that--
<bullet> Promotes such academic programs and activities at higher
education institutions that are focused on student outcomes and are
free from unlawful discrimination and other violations of Federal law;
<bullet> Reduces barriers that limit competition, innovation, and
new education models that advance credential and degree completion;
<bullet> Holds institutions accountable for discrimination and
other unlawful acts; and
<bullet> Advances academic freedom, intellectual inquiry, and
student learning by ensuring that accrediting agencies review
institutional policies in these areas.
Specifically, the Executive Order directs the Secretary to--
<bullet> Resume recognition of new accrediting agencies to foster
competition and expand institutional options; and
<bullet> Mandate that accrediting agencies require member
institutions to use data on program-level student outcomes to improve
such outcomes, without reference to race, ethnicity, or sex.
The Department undertook this rulemaking in part to address the
goals contained within the Executive Order, but also to propose
substantive changes that would reform the static and outdated higher
education accountability system. The final rule is intended to increase
competition among accrediting agencies by reducing barriers to entry,
facilitating institutional mobility among recognized agencies, and
reducing regulatory requirements that may unnecessarily discourage the
formation of innovative accrediting organizations and other related
practices. Increased competition is expected to improve institutional
responsiveness, reduce accreditation costs over time, and encourage
greater innovation in the market for quality assurance validation.
Increasing competition among recognized accrediting agencies is
likely to improve the quality, responsiveness, and effectiveness of
accreditation. Accreditation has historically seen very little
competition because it evolved from voluntary membership peer review
groups to set uniform academic standards within those groups.
Institutional accrediting agencies rarely engage in head-to-head
competition; institutions face difficulty in changing accrediting
agencies due to high switching costs and potential risks in maintaining
eligibility for Federal student aid for their students; and there are
regulatory barriers to the recognition of new agencies. During
negotiated rulemaking, the Department explained

[[Page 68629]]

that competition among accrediting agencies is expected to generally
improve quality and expand choices for institutions.
Competition creates incentives for agencies to innovate, respond to
workforce changes, expand choices for institutions among agencies
engaged in various types of innovative activities, and to develop new
measures for assessing student success by institutions.
As explained by a Department economist during negotiated
rulemaking, there is a high concentration of institutions that are
accredited by a handful of institutional accrediting agencies. The
Department recognizes that empirical evidence measuring the causal
effect of institutions changing accrediting agencies is limited.
Because institutions have historically rarely switched agencies, and
those that do may differ systematically from those that do not, it is
difficult to isolate the independent effect of changing agencies on
institutional outcomes. Moreover, previous regulatory barriers have
resulted in too few agency switches to permit rigorous statistical
analysis. The absence of such evidence, however, does not undermine the
broader economic evidence concerning the benefits of competition in
quality assurance markets.
Economic research has consistently found that competition
encourages innovation and improved performance. Joseph Schumpeter
argued that competition produces ``creative destruction'' that drives
innovation by creating new markets that render older ones obsolete, and
more recent empirical work has found that introducing competition into
concentrated markets substantially increases innovation. The Department
believes these findings are relevant because higher education
accreditation has historically exhibited many characteristics of an
uncompetitive market.
Competition is also expected to improve the informational value of
accreditation. During negotiated rulemaking, the Department explained
that institutions seek credible signals of educational quality, and
that in a competitive accreditation market, agencies would compete to
provide those signals. Rather than offering only a binary ``approved/
not approved'' determination, competing accrediting agencies may
distinguish themselves by offering scaled ratings for institutional
quality. On April 14, 2026, during opening remarks for negotiated
rulemaking, the Assistant Secretary for Postsecondary Education stated:
``Competition will include competition for relevance and
universities will signal their quality level through accreditation . .
. Current accrediting agencies give universities and colleges pass-fail
grades which provide very little useful information.'' \2\
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\2\ Opening Remarks--David Barker--Assistant Secretary for the
Office of Postsecondary Education--<a href="https://www.ed.gov/media/document/2026-negotiated-rulemaking-aim-transcripts-day-2-am-113991.pdf">https://www.ed.gov/media/document/2026-negotiated-rulemaking-aim-transcripts-day-2-am-113991.pdf</a>
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This concern was further underscored in a recent decision letter
from the Senior Department Official (SDO) to an accrediting agency,
which cautioned that accreditation can devolve into a bureaucratic,
``check-the-box'' exercise in which meaningful, substantive feedback is
replaced by a binary determination of compliance.\3\ The official
emphasized that accreditation should serve as a process that not only
assesses compliance with minimum standards but also identifies
opportunities for institutions and programs to strengthen their
operations and improve educational quality.
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\3\ Senior Department Official/Secretary's Decision Letter to
the Commission on Massage Therapy Accreditation date October 21,
2026--<a href="https://surveys.ope.ed.gov/erecognition/#/public-documents">https://surveys.ope.ed.gov/erecognition/#/public-documents</a>
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This reasoning is consistent with the economic literature on
certification intermediaries. In ``Information Revelation and
Certification Intermediaries'', Alessandro Lizzeri \4\ demonstrates
that monopolistic certifiers have incentives to reveal only limited
information, whereas competition among certifiers results in more
informative quality signals. Similarly, in ``The Effect of Information
on Product Quality: Evidence from Restaurant Hygiene Grade Cards''
Giner Zhe Jin and Phillip Leslie \[4]\ found that more detailed quality
information improves quality outcomes.
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\4\ Alessandro Lizzeri, Information Revelation and Certification
Intermediaries, The RAND Journal of Economics. Vol. 30, No. 2
(Summer, 1999), pp. 214-231.
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A recent paper provides additional support for the Department's
efforts to promote competition among accrediting agencies. Hatfield and
Lowery \5\ develop a theoretical model of certification markets, with
particular attention to higher education accreditation. They find that
monopoly accrediting agencies have incentives to establish
inefficiently low-quality standards and impose institutional
requirements unrelated to educational quality. Competition can raise
quality standards and reduce such requirements. The authors further
demonstrate that entry by an accrediting agency with preferences
different from those of incumbent agencies can produce substantially
greater improvements in quality and reductions in bias than entry by an
otherwise similar agency.
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\5\ John William Hatfield and Richard Lowery, Quis Custodiet
Ipsos Custodes? Competition, Quality, and Bias in Certification
Markets, Working paper, University of Texas at Austin, October 2,
2026. Available at SSRN: <a href="https://ssrn.com/abstract=7527099">https://ssrn.com/abstract=7527099</a>
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These findings support the Department's efforts to reduce barriers
to entry, facilitate institutions' ability to change accrediting
agencies, and encourage competition among agencies with different
approaches to evaluating educational quality. Although the study is
theoretical, it provides an economic basis for concluding that greater
competition can improve accreditation's effectiveness in protecting
students and taxpayers while preserving institutional autonomy and
encouraging innovation.\6\
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\6\ Ibid.
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Competition can also strengthen, rather than weaken, quality of
institutions and programs. During negotiated rulemaking, the Department
explained that in instances where only one recognized accrediting
agency effectively serves a sector, the withdrawal of recognition may
significantly disrupt institutions and students, making it more
difficult to impose such a penalty. By contrast, when multiple
recognized agencies are available, institutions have viable
alternatives, reducing barriers to enforcement. As the Department
stated during negotiated rulemaking:
``With regional and programmatic monopolies, withdrawal of
recognition can throw industries into chaos . . .'' If the
accreditation market is competitive, institutions can more easily
switch accrediting agencies, which reduces incentives to continue the
recognition of an agency out of fear of potential adverse fallout in
the market.'' While some hesitation to withdraw recognition may always
be present, the Department believes that the more alternative
accrediting agencies are available, the less hesitant the Department
will be to derecognize agencies out of worry over market disruption.\7\
The Department believes competition will increase accountability both
for institutions and for accrediting agencies themselves.
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\7\ Accreditation, Innovation, and Modernization (AIM)
Committee--4/14/26 (page 10)--<a href="https://www.ed.gov/media/document/2026-negotiated-rulemaking-aim-transcripts-day-2-am-113991.pdf">https://www.ed.gov/media/document/2026-negotiated-rulemaking-aim-transcripts-day-2-am-113991.pdf</a>.
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Finally, competition will encourage innovation in accreditation.
Accrediting agencies that face meaningful competition will have
stronger

[[Page 68630]]

incentives to develop new approaches to quality assurance, reduce
unnecessary costs, respond to institutional diversity, and improve
services to institutions and students. As explained in the Department's
written responses during negotiated rulemaking, barriers to switching
generally reduce competition and increase market power through a lock-
in effect. Eliminating or reducing those barriers promotes innovation
and responsiveness.
For these reasons, the Department finds that reducing unnecessary
barriers to competition among qualified accrediting agencies is likely
to improve accreditation over time while preserving the Department's
responsibility to establish minimum standards for Federal recognition.
The Department does not believe competition will cause a ``race to the
bottom'' but rather, the opposite will likely occur. Recognized
accrediting agencies must continue to satisfy all statutory and
regulatory recognition requirements, while competing to provide higher
quality services, with more informative and innovative quality
assurance services. As the Assistant Secretary stated during negotiated
rulemaking, ``We shouldn't fear healthy competition. It is the basis of
a free market economy, and we need more of it in the coddled, protected
business of higher education.'' \8\
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\8\ Accreditation, Innovation, and Modernization (AIM
Committee)--4/14/26 (page 10)--<a href="https://www.ed.gov/media/document/2026-negotiated-rulemaking-aim-transcripts-day-2-am-113991.pdf">https://www.ed.gov/media/document/2026-negotiated-rulemaking-aim-transcripts-day-2-am-113991.pdf</a>.
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IV. Implementation Date of These Regulations

Generally, the regulations included in this document are effective
on July 1, 2027. Section 482(c) of the HEA requires that the Department
publish final regulations affecting programs under title IV of the HEA
in final form by November 1 to be effective for the next award year
(July 1 of the calendar year following November 1).
However, the process for recognition of accrediting agencies is
multi-year and the implementation of the changes to these regulations
in the recognition process will require planning and coordination
between Department staff and agencies who are seeking initial
recognition or renewal of existing recognition prior to the July 1,
2027, effective date.
The Department is providing the following additional clarification
of the implementation timeline:
For recognized agencies that submitted their applications for
renewal of recognition prior to July 1, 2026, Department staff have
been reviewing the applications under the regulations that were in
place prior to the promulgation of these regulations. The agencies will
have an opportunity to respond to the draft staff report when
completed. After receiving a response from the agency on the draft
staff report, the Department will present its final staff report on
each application to the Advisory Committee at the 2027 meetings and
proposed first meeting of 2028, which will be based on compliance with
the regulations that were in effect prior to the promulgation of these
regulations.
For agencies seeking initial recognition that submitted their
application for recognition after July 1, 2026, those agencies must
submit applications for review based on adherence to the requirements
in these revised regulations.
Additionally, Section 482(c)(2) permits the Secretary to designate
any regulatory provision as one that an entity subject to the
regulations may choose to implement earlier and the conditions for
early implementation. To facilitate the implementation of these final
regulations, the Secretary is designating all sections of this
regulation for early implementation beginning on January 1, 2027,
provided that accrediting agencies that decide to adopt any new
provisions prior to July 1, 2027, do not impose new requirements on
institutions or programs resulting from that early implementation that
would take effect prior to July 1, 2027.
Because compliance with these regulations may require accrediting
agencies to make substantive revisions to their policies and
procedures, which may necessitate stakeholder notice and comment
periods and formal adoption by an authorized decision-making body, as
well as training for agency staff and peer reviewers responsible for
implementing the new requirements, accrediting agencies are strongly
encouraged to initiate the necessary revisions and training promptly to
ensure compliance with the new requirements by the applicable effective
dates set forth herein.

V. Authority for the Regulatory Action

The authority for this rulemaking is Section 496 of the HEA.
Section 496(a) of the HEA provides criteria that an accrediting agency
must meet for the Secretary to recognize it as a reliable authority as
to the quality of education or training offered. The same section
states that the Secretary shall, after notice and opportunity for a
hearing, establish criteria for such determinations.
Section 496(o) of the HEA directs the Secretary to establish,
through regulation, procedures governing the recognition of accrediting
agencies and the appeal of recognition decisions. At the same time,
Congress provided that the Secretary shall not promulgate regulations
with respect to the standards of an accrediting agency described in
Section 496(a)(5). The Department interprets these provisions together
to mean that the Secretary may establish recognition criteria governing
whether an accrediting agency functions as a reliable authority under
Section 496, while leaving accrediting agencies the responsibility for
developing and applying their own substantive accreditation standards.
Accordingly, these regulations establish the criteria the Secretary
will use in determining whether an accrediting agency qualifies for
Federal recognition. Except where expressly required by statute, the
regulations do not prescribe the substantive content of accreditation
standards, but instead establish minimum expectations regarding the
processes, consistency, transparency, and lawful administration of
those standards.
The Department has also reviewed existing regulations considering
Section 496(o). Where current regulations prescribe requirements that
extend beyond recognition procedures and instead direct the content or
administration of accrediting standards without a clear statutory
basis, the Department removes or simplifies those requirements to
better align the regulations with Congressional direction and remove
administrative burden.

Severability

``It is axiomatic'' that a regulation may be invalid in part but
not in whole or as applied to one set of facts but not another. Ayotte
v. Planned Parenthood of N. New England, 546 U.S. 320, 329 (2006). If a
court finds one part of a regulation is unlawful, the ``normal rule''
is to enjoin only that part. Id. (quoting Brockett v. Spokane Arcades,
Inc., 472 U.S. 491, 504 (1985).
It is the Department's intent that if any provision of this subpart
or its application to any person, act, or practice is held invalid, the
remainder of the subpart or the application of its provisions to any
person, act, or practice shall not be affected thereby.
Statutes and regulations are severable if the separate provisions
are ``wholly independent of each other'' and can operate independently.
Brockett v. Spokane Arcades, Inc., 472 U.S. 491, 502 (1985). That is
the case here. No part herein will be affected if another

[[Page 68631]]

part is found to be unlawful. Nor does the Department believe courts or
regulated parties would be unable to apply the rule if one part is held
invalid. Cf. Dep't of Educ. v. Louisiana, 603 U.S. 866, 868 (2024) (per
curiam) (denying the government's request to stay a preliminary
injunction against an entire rule where only parts were found to be
invalid because ``schools would face in determining how to apply the
rule for a temporary period with some provisions in effect and some
enjoined'').

VI. Analysis of Public Comments and Changes

On August 20, 2026, the Secretary published a Notice of Proposed
Rulemaking (NPRM) for these regulations in the Federal Register (91 FR
53940). The Department received 7,051 comments on the proposed
regulations. The Department has grouped the comments by functional
topics and by similar themes. We discuss substantive issues under the
sections of the regulations to which they pertain. In instances where
individual submissions appeared to be duplicates or near-duplicates of
comments prepared as part of a write-in campaign, the Department posted
one representative sample comment along with the total comment count
for that campaign to <a href="http://www.Regulations.gov">www.Regulations.gov</a>, which continues to be our
standard practice. We considered these comments along with all the
other comments received. In instances where individual submissions were
bundled together (submitted as a single document or packaged together),
the Department posted all the substantive comments included in the
submissions along with the total comment count for that document or
package to <a href="http://www.Regulations.gov">www.Regulations.gov</a>. Generally, we do not address minor,
non-substantive changes (such as renumbering paragraphs, adding a word,
or typographical errors) within this final rule. Additionally, we
generally do not address changes or comments recommended by commenters
that the statute does not authorize the Secretary to make (such as
forgiving all student loans), or comments pertaining to operational
processes. Analysis of the comments and of any changes in the
regulations since publication of the NPRM (91 FR 53940) follows.

Process for Out-of-Scope Comments

The Department does not typically address comments that are out-of-
scope. For purposes of this final rule, out-of-scope comments are those
that are not addressed in the NPRM (91 FR 53940) altogether. Generally,
comments that are outside of the scope of the NPRM (91 FR 53940) are
comments that do not discuss the content or impact of the proposed
regulations or the Department's evidence or reasons for the proposed
regulations.

Technical Corrections

The Department made no substantive changes to the final rule,
retaining the text agreed upon by the negotiated rulemaking committee
and proposed in the NPRM. The Department made the following minor, non-
substantive technical edits to improve clarity of the regulation.

602.2(b)--How do I know which agencies the Secretary recognizes?

Discussion: The Department is correcting a reference for clarity
and to conform with regulatory drafting standards. The reference
previously read ``published in the Federal Register pursuant to
subsection (a) of this section,'' and we are changing it to refer to
``paragraph (a) of this section.''
Changes: The Department updated paragraph (b) of this section to
read as follows after the words ``Federal Register'': ``. . . pursuant
to paragraph (a) of this section.''

Sec. 602.3--Definition of ``Designated Federal Official''

Discussion: The Department is correcting a reference that appears
in the definition of Designated Federal Official. That definition
previously referenced section 10(f) of the Federal Advisory Committee
Act, which was repealed by Section 7 of Public Law 117-286. This
section, among several others, was moved to a different section of 5
U.S.C. Chapter 10. The correct reference should be 5 U.S.C. 1009(e).
Changes: The Department updated the definition of Designated
Federal Official in Sec. 602.3 to read: ``Designated Federal Official
means the Federal officer designated under 5 U.S.C. 1009(e).''

Sec. 602.3--Definition of ``Related, Associated, or Affiliated Trade
Association''

Discussion: The Department must update the capitalization of the
word that begins each new paragraph under in the definition of Related,
associated, or affiliated trade association with a capital letter to
conform with regulatory drafting standards.
Changes: We updated the definition to read as follows: ``Related,
associated, or affiliated trade association means an organization that:
(i) Is generally a membership organization;
(ii) Is organized to promote a line of commerce, business,
industry, or profession;
(iii) Does not engage in a regular business of a kind ordinarily
carried on for profit, and no part of the net earnings of which inures
to the benefit of any member; and
(iv) Is related to a particular accrediting agency in that the
agency accredits institutions or programs that prepare students to
enter the workforce of the same or substantially the same line of
commerce, business, industry, or profession that organization
promotes.''

Sec. 602.3--Definition of ``Representative of the Public''

Discussion: The Department must update the Arabic numerals to Roman
numerals in the definition of Representative of the public to conform
with regulatory drafting standards.
Changes: We have renumbered the definition to read as follows:
``Representative of the public means a person who is not--
``(i) An employee, member of the governing board, owner, or
shareholder of, or consultant to, an institution or program that either
is accredited or preaccredited by the agency or has applied for
accreditation or preaccreditation;
(ii) A member of any trade association or membership organization
related to, associated with, or affiliated with the agency; or
(iii) A spouse, parent, child, or sibling of an individual
identified in paragraph (i) or (ii) of this definition.''

Sec. 602.15(d)--Administrative and Fiscal Responsibilities

Discussion: The Department clarifies that the requirements of the
paragraph are only in reference to ``recognized'' agencies.
Changes: The Department updated Sec. 602.15(d) to read: ``The
agency will cooperate with other recognized agencies and the Department
in the development of common templates and forms for institutions or
programs to submit when seeking to change accrediting agencies.''

Sec. 602.17(a)(1)(vii)(C), (a)(3) and (a)(3)(i)--Application of
Standards in Reaching Accreditation Decisions

Discussion: The Department must update incorrect cross references
under Sec. 602.17(a)(1)(vii)(C).
Changes: The Department updated Sec. 602.17(a)(1)(vii)(C) to read:
``(C) In the case of a private institution, policies that if
established guarantee the same or similar protections as those
described in subsections (A) and (B) above.''

[[Page 68632]]

Discussion: The Department must update the cross reference in Sec.
602.17(a)(3) from (vi) to (v) because we intended to cross reference
fiscal and administrative capacity instead of student support services.
We also updated Sec. 602.17(a)(3)(i) to add a verb with the stem and
clarify who must complete the cost/benefit analysis.
Changes: The Department updated the provisions under Sec.
602.17(a)(3) and (a)(3)(i) to read:
``(3) When applying its standards according to Sec.
602.16(a)(1)(iv) and (v), conducts:
(i) A review of any cost/benefit analysis performed by an
institution. Cost/benefit analysis means a review by the agency of the
institution's budget, resource utilization and allocation, and, if
existing, its business/strategic plan, continuous improvement strategic
plan, and review of whether the institution considers whether the
expected benefits of the institution's activities justify the
associated financial, administrative, and opportunity costs and the
impact of capital expenditures on future operating expenses;''

Sec. 602.21 Review of Standards

Discussion: The Department must remove the word ``is'' before
``relevant'' because the word ``is'' was inadvertently published in the
NPRM.
Changes: The Department updated Sec. 602.21 to read:
``The agency must maintain a comprehensive systematic program of
review that occurs at regular intervals, involves all relevant
constituencies (including students), and that demonstrates that its
standards are adequate to evaluate the quality of the education or
training provided by the institutions and programs it accredits and
relevant to the educational or training needs of students.''

Sec. 602.22(a)(1)(ii)(H)--Substantive Changes and Other Reporting
Requirements

Discussion: The Department must italicize the Arabic numerals after
paragraph Sec. 602.22(a)(1)(ii)(H) to conform with regulatory drafting
standards.
Changes: The text will now appear as:
``(1) Academic control by the institution.
(2) The institution has adequate faculty, facilities, resources,
and academic and student support systems in place.
(3) The institution is financially stable.
(4) The institution had appropriate planning for the addition.''

Sec. 602.23(l)--Operating Procedures All Agencies Must Have

Discussion: The Department must update Sec. 602.23(l) (1) and (2)
so that the word ``or'' appears after Sec. 602.23(l)(2) because
agencies have the option to choose one of the three structured
mechanisms for individuals to communicate directly with an agency.
Changes: The Department updated the paragraph to read:
``(l) The agency must establish and maintain at least one
structured mechanism through which currently enrolled students,
employed staff, and employed faculty of accredited or preaccredited
institutions or programs may communicate directly with the agency
concerns related to the agency's accreditation standards or the
institution's or program's compliance therewith. Such mechanism(s) must
be designed to ensure that information received is substantive and
manageable in volume. Permissible mechanisms include, but are not
limited to, any one or more of the following:
(1) A registration process through which students, staff, or
faculty may sign up to participate in structured meetings with agency
representatives during scheduled site visits or virtual visits, subject
to reasonable limits on the number of participants and appointment
availability;
(2) Randomized panels of students, staff, or faculty selected by
the accrediting agency or its authorized representatives to participate
in confidential interviews or focus groups during site visits,
conducted in a manner that ensures a representative cross-section of
the institutional community; or
(3) Student, faculty, and staff surveys independently administered
by the agency as part of an initial or renewal of accreditation process
which minimally address the standards areas required by Sec.
602.16(a).''

Sec. 602.24(d)--Additional Procedures Certain Institutional Agencies
Must Have

Discussion: The Department must update the Roman numerals to Arabic
numerals to conform with regulatory drafting standards. We must also
update Sec. 602.24(d)(2) to ensure there are no institutions
identified in any teach-out plan.
Changes: The Department updated (d) to read:
``(d) Closed institution. If an institution the agency accredits or
preaccredits closes without a teach-out plan, the agency must work with
the Department and the appropriate State agency, to the extent
feasible, to assist students in finding reasonable opportunities to
complete their education without additional charges, including by--
(1) Working with institutions to secure teach-out agreements; or
(2) Where a teach-out agreement cannot be arranged, working with
institutions to secure transfer options;
(3) Making teach-out or transfer options, the terms of such
options, and information on obtaining transcripts, loan discharges, and
reimbursement publicly available on the agency's website; and
(4) Sharing such information with appropriate State agencies and,
as applicable, with other recognized accrediting agencies.''

Sec. 602.27 Other Information an Agency Must Provide Department

Discussion: The Department must update the title of this section to
correct a typographical error by adding ``the'' after the word
``provide'' in the amendatory language.
Changes: We updated the title of this section to:
``Sec. 602.27 Other information an agency must provide the
Department.''

Sec. 602.30(a)(3)--Agency Applications and Reports To Be Submitted to
the Department

Discussion: For consistency with Sec. 602.16(d), we must add
``direct assessment education'' to Sec. 602.30(a)(3).
Changes: The Department updated Sec. 602.30(a)(3) to read:
``(3) Documentation of how an agency that includes or seeks to
include distance education, correspondence courses, or direct
assessment education in its scope of recognition applies its standards
in evaluating programs and institutions it accredits that offer
distance education, correspondence courses or direct assessment
education.''

Sec. 602.31(a)(3) and (a)(7)--Procedures for Submitting Applications
for Recognition and Renewal of Recognition

Discussion: We must add ``. . . the Secretary determines that . .
.'' to Sec. 602.31(a)(3) for consistency with the other provisions in
that section. We also must add Sec. 602.31(a)(7) to clearly state the
type of application required for agencies seeking initial recognition.
Changes: We updated Sec. 602.31(a)(3) to read:
``(3) If the Secretary determines that an agency or its officers or
directors have been the subject of legal actions, complaints, or other
compliance issues that individually or in the aggregate raise
substantial concerns regarding the

[[Page 68633]]

agency's compliance with this part, the agency must submit a
comprehensive application that addresses the agency's compliance with
all criteria in subpart B of this part.''
We updated Sec. 602.31(a)(7) to read:
``(7) An agency submitting an application for initial recognition
must submit a comprehensive application that addresses the agency's
compliance with all criteria in subpart B of this part.''

Sec. 602.31(b)(2)--Procedures for Submitting Applications for
Recognition and Renewal of Recognition

Discussion: The proposed text included an unclear reference to
``subparagraph (1).'' We have revised the reference to be more specific
and refer to paragraph (b)(1) of the same section.
Changes: We updated Sec. 602.36(d) to read:
``(2) Within 10 business days after publication of the notice
described in paragraph (b)(1) of this section, the agency must publish
the request for information on the agency's website to include
instructions on how the public can submit information in response to
the request.''

Sec. 602.36(d) Senior Department Official's Decision

Discussion: The Department must amend Sec. 602.36(d) by replacing
``of'' in the current paragraph with ``. . . following the publication
of transcripts of . . .'' to match the change made to Sec. 602.35(a).
Changes: The Department updated Sec. 602.36(d) to read:
``(d) Except with respect to decisions made under paragraph (f) or
(g) of this section and matters referred to the senior Department
official under Sec. 602.37(e) or (f), the senior Department official
notifies the agency in writing of the senior Department official's
decision regarding the agency's recognition within 90 days following
the publication of transcripts of the Advisory Committee meeting or
conclusion of the review under paragraph (b) of this section.''

Directed Question

Sec. 602.15--Administrative and Fiscal Responsibilities

The Department sought feedback about the extent to which the
``conflict of interest'' requirements impact accrediting agencies in
relation to 401K plans, health insurance, and other areas. We
understood that there may be some agencies who utilize the same
resources as their related, associated, or affiliated trade association
in these certain areas, and that there may be some consideration to the
amount of time and resources it would take to unwind the sharing of
resources in such instances.
Comments: Some commenters stated that for a programmatic
accrediting agency, they believed that requiring independent human
resources and benefits administration, IT infrastructure, legal and
finance support, marketing, and standalone facilities within the one-
year timeline would be challenging. Some of these agencies believed
that these changes would result in costs that agencies would pass on to
institutions through higher accreditation fees to programs. Commenters
argued their belief that the proposed regulation directly undercuts the
rule's own goal of reducing regulatory burden and cost under Sec.
602.15(c). The two main suggestions for provisions under Sec. 602.14
and Sec. 602.15 on separate and independent requirements were: (1)
rescind the amendments to the regulations or (2) provide more time to
comply with the requirements. For a full list of recommendations,
please see the discussions under Sec. 602.14 and Sec. 602.15.
Discussion: The Department disagrees with the recommendations. The
Department's phase-in of the final rule for applications for initial
and renewed recognition that were submitted during the transition
period of the final rule will provide agencies approximately 20 months,
through July 1, 2028, to make the necessary changes to comply with the
regulations. If an agency is unable to comply by that date due to
existing lease obligations, it may contact the Department to provide
specific details regarding its circumstances. The Department may
consider an agency's demonstrated, substantive progress toward
achieving full compliance within a reasonable timeframe when
determining whether to maintain its recognition status. Such progress
must be supported by objective, verifiable evidence of concrete actions
taken and measurable progress toward compliance, rather than statements
of intent or unsupported assurances. The Department may require the
agency to submit periodic reports and supporting documentation to
assess its progress and determine whether the agency is on track to
achieve full compliance within the applicable timeframe.
Changes: None.

Regulatory Impact Analysis--Data Constraints

The Department recognizes that there is limited data available to
estimate the proposed regulation's potential impact on accrediting
agencies, institutions, programs, and students. Due to the scarcity of
existing information, the Department invited public feedback on
possible methods and data sources that could further strengthen the
analysis presented in the RIA.
Comments: Several commenters urged the Department to withdraw the
proposal because the commenters believed that the Directed Question in
the NPRM conceded that the Department lacks empirical data on the
effects of these changes.
Discussion: The Department disagrees with commenters' assertion
that its solicitation of public feedback to strengthen the RIA
demonstrates a lack of empirical data to support the proposed changes.
This assertion misconstrues the purpose of the Department's request for
feedback, which is intended to ensure that its analysis is informed by
the best available information and evidence. Seeking public input is a
means of strengthening the analytical basis for informed policymaking,
not an indication that the analysis lacks an adequate evidentiary
foundation. In response to some commenters' feedback, the Department
has supplemented the RIA with additional information to further support
the proposed changes. This includes additional estimates for changes in
title IV student aid disbursements that result from credit transfer
policies and an increase in innovative and flexible educational models.
Changes: None.

General Comments

Comments: Several commenters requested phased implementation to
allow them time to develop systems to implement these changes.
Discussion: Except as otherwise noted, the regulations will not be
effective until July 1, 2027. We believe that the eight months between
November 2026 and July 2027 is sufficient time to update standards,
policies, and procedures to achieve compliance by the established
deadline. Further, the Department has noted implications for specific
provisions of the regulations under the Implementation Date of These
Regulations section.
Changes: None.
Comments: Some commenters requested that the Department publish
subregulatory guidance quickly after the final rule is published. For
example, one commenter requested a prioritized list of items the
Department intends to finalize as guidance, a data-access roadmap that
describes how program-level outcomes, licensure data,

[[Page 68634]]

assessment scores, and unemployment insurance (UI) wage records may be
securely obtained and used, model templates for agency petitions,
confidentiality markings, and remediation/transition plans to reduce
burden and increase consistency, and an interagency/State liaison
process for expedited sharing of restricted outcomes data and
coordinated teach-out/closure responses.
Discussion: The Department recognizes that institutions,
accrediting agencies, States, and other stakeholders may benefit from
additional information regarding implementation of the final rule. The
Department has a long-standing practice of providing technical
assistance, guidance, and other informational resources, as
appropriate, to facilitate compliance with regulatory requirements.
However, the Department declines to commit to issuing specific guidance
documents, model templates, roadmaps, timelines, or interagency
coordination procedures within a prescribed timeframe.
Changes: None.
Comments: Several commenters stated that before finalizing these
amendments, the Department should state, for each regulatory change,
the specific problem it addresses, provide evidence of the problem, and
then state the results it is expected to produce. One commenter also
stated that the final rule should establish a transparent post-
implementation review, using a pre-rule baseline and reporting results
at defined intervals, including an initial review within 24 months and
a fuller review within five years.
Discussion: The Department has explained the reasons for the
regulatory changes in the NPRM and further elaborates on these here. We
also decline to regulate the Secretary in a way that would require the
Secretary to release reports not required under the law.
Changes: None.
Comments: Several commenters argued that the negotiated rulemaking
committee did not reflect a good-faith effort to represent all
significantly affected interests. Some commenters believed that the
committee was overly partisan. Other commenters believe that the
committee lacked faculty members and other negotiators with specialized
expertise needed to fully understand and address the complexities of
the proposal. A few commenters stated that the nine-day negotiated
rulemaking and 30-day comment periods were too short to gather
substantive feedback from stakeholders.
Discussion: The Department firmly disagrees with the assertion that
the negotiated rulemaking process lacked good-faith efforts or the
expertise necessary to adequately consider the issues. Consistent with
the requirements of Section 492 of the HEA, the Department convened a
negotiated rulemaking committee comprising representatives from a broad
range of stakeholder groups reflecting the diverse sectors and
interests within higher education. The Department believes that the
committee benefited from the varied perspectives and expertise of
representatives of institutions of higher education, students,
institutional and programmatic accrediting agencies, State officials,
and other stakeholders with substantial experience in accreditation
policies and practices and related matters. The process was conducted
to facilitate meaningful deliberation among stakeholders with relevant
experience and expertise, and the Department rejects any
characterization that disregards those efforts or the substance of the
committee's work. In addition to information provided during negotiated
rulemaking sessions, the Department considered stakeholder input
received throughout the months-long rulemaking process, including
comments submitted in response to the proposed regulations.
Prior to (public hearings), during (negotiators), and after
rulemaking (public comment period), the Department has heard from
thousands of stakeholders on the proposals. We believe we have afforded
the public a substantial opportunity for meaningful input.
Changes: None.
Comments: One commenter opined that accreditation of local law
schools should be left to the States in which the schools reside, and
their licensing boards of higher education.
Discussion: The Department agrees that this could be an acceptable
alternative. One goal of the final rule is to encourage new, innovative
accrediting agencies to seek recognition from the Department, which
should increase competition and quality of agencies. However, the
Department is unable to independently foster new competition, as it
requires action from new and nascent accrediting agencies.
Changes: None.
Comments: One commenter stated that the final rule should ensure
that nothing in Part 602 leads accrediting agencies to penalize
institutions whose assessment models assume super intelligence (SI)
availability and measure human contribution directly.\9\
---------------------------------------------------------------------------

\9\ Pursuant to Executive Order 14434, 91 FR 63129 (Oct. 2,
2026), this document uses the term ``Super Intelligence'' or ``SI''
instead of ``Artificial Intelligence'' or ``AI.''
---------------------------------------------------------------------------

Discussion: Regulating the use of SI, or any other forms of data
analysis and automation, in educational assessment goes beyond the
scope of this final rule. Agencies are required to establish standards
based on Sec. 602.16 and apply them based on Sec. 602.17. Nothing in
this rule explicitly or implicitly prohibits use of SI or other tools
available to the agency in carrying out these requirements.
Changes: None.
Comments: One commenter recommended that the Department require
accrediting agencies to evaluate whether institutions maintain and
consistently apply:
<bullet> Clear, publicly available academic-appeal procedures;
<bullet> Timely student access to the records and evidence relied
upon before an appeal is decided;
<bullet> Written, evidence-based reasons for final decisions;
<bullet> Conflict-of-interest protections and recusal procedures
for decision-makers;
<bullet> An escalation or independent-review mechanism when the
accuracy, completeness, or reliability of the underlying student record
is disputed; and
<bullet> Public reporting of aggregate appeal outcomes and
corrective actions, while protecting student privacy.
Discussion: While accrediting agencies have significant discretion
to establish requirements for the institutions and programs that they
accredit, the Department believes that the changes proposed by the
commenter are not authorized by the statute.
Changes: None.
Comments: One commenter recommended that the final rule or
accompanying guidance expressly identify Registered Apprenticeship as a
workforce model that programmatic accrediting agencies should be
prepared to evaluate under the proposed rule.
Discussion: While the Department strongly supports Registered
Apprenticeships and has taken steps to remove barriers and otherwise
facilitate the integration of this and other ``learn and earn'' models
with the Federal student aid programs and other Department programs, we
recognize the considerable oversight and evaluation of Registered
Apprenticeships that is already conducted by the Department of Labor
and State apprenticeship agencies. Moreover, Registered Apprenticeships
are just one of many models currently being used for workforce
development and education programs, and the Department does not

[[Page 68635]]

believe it is necessary at this time to reference any particular model
in these regulations.
Changes: None.
Comments: One commenter recommended that the final rule require
ongoing evaluation of unintended consequences. The commenter suggested
the establishment of mechanisms for monitoring whether the reforms
produce ideological sorting, strategic behavior, conflicts of interest,
reduced educational diversity, or other unintended effects are needed.
Discussion: The Department believes the final rule is well-targeted
and likely to achieve their desired objectives. The Department is
constantly monitoring its policies and regulations and the changing
environment in which they are applied. The final rule is the direct
result of evaluating current regulations that amend both long-standing
regulations and more recent changes.
Changes: None.
Comments: One commenter asked the Department to ensure explicit
reference to ``Tribal law'' and ``Tribal governments'' in regulations
and to clarify the final rule to recognize the incorporation of Tribal
languages and culture within Tribal colleges or universities.
Discussion: The major reforms in these regulations--improving
educational quality, protecting students and taxpayers, and ensuring
recognized accrediting agencies support innovation, accountability, and
legal compliance--apply to all accrediting agencies and the
institutions and programs they accredit, including Tribal colleges or
universities. The regulations already address issues of institutional
mission and legal compliance, but the Department reserves the ability
to issue subregulatory guidance as necessary to address specific
matters of legal compliance that may arise.
Changes: None.
Comments: Another commenter stressed that the Department should
require recognized agencies to disclose meaningful information
concerning governance, finances, decision making, institutional
reviews, appeals, peer review practices, conflicts of interest,
accreditation outcomes, and measures of the accrediting agency's own
effectiveness.
Discussion: The Department acknowledges the need for additional
agency transparency and has taken a number of steps in this final rule
to increase disclosure and transparency and address conflicts of
interest. Additionally, these regulations establish a new framework for
improved and more thorough oversight of the recognized accrediting
agencies that serve as the primary gatekeepers for the Federal student
aid programs.
Changes: None.
Comments: One commenter recommended that the Department requires
programmatic accrediting agencies in licensed professions where
practitioners exercise direct professional judgment affecting public
welfare--such as social work, nursing, and counseling--to collect and
publicly report student outcome data, including licensure examination
pass rates by program.
Discussion: The Department acknowledges the value of student
outcome data, particularly licensure pass rates, but notes that such
data is already available through the state licensure process, and many
accrediting agencies have licensure pass rate data and disclose that
data for the programs that they accredit.
Changes: None.
Comments: One commenter stressed that the Department should
evaluate downstream impacts on licensure portability and public
protection.
Discussion: The Department believes we have adequate regulations
regarding licensure under Sec. 602.16(a)(1), Sec. 602.16(g)(3), Sec.
602.17(a)(1), and Sec. 602.20(i)(1).
Changes: None.

General Agreement With the Regulations

Comments: Some commenters offered general support for the proposed
rule. These commenters stated that the rule will increase competition
among accrediting agencies, which will eliminate violations of
antitrust laws, credential inflation, and increased costs for taxpayers
and students alike. Commenters championed the Department's efforts to
focus on student achievement and outcomes, improve credit transfer to
increase educational mobility, and reduce unnecessary administrative
burdens. Commenters' testimonials included:
<bullet> ``The Department's August 20, 2026 proposed rule is a
necessary and potentially transformative correction to an accreditation
system that has too often rewarded institutional conformity instead of
measurable educational value.''
<bullet> ``Accrediting agencies have often played a role in
credential inflation. Programmatic accrediting agencies may add
mandates that make it more expensive to operate a particular program,
the costs of which are passed on to students through higher tuition
prices.''
<bullet> ``Competition among accrediting agencies can preserve a
common safety floor while allowing different educational methods to
prove themselves.''
<bullet> ``Accrediting agencies should focus on whether schools are
providing students with a quality education and helping them succeed.
They should not be requiring schools to follow certain beliefs or
practices that may be discriminatory or unrelated to the quality of
education students receive. I support the Department's proposal to make
sure accreditation decisions are fair, strengthen oversight, and focus
more on student outcomes.''
<bullet> ``Accreditation should provide meaningful assurance of
educational quality without encouraging institutions to become more
alike simply because uniformity is easier to measure. A regulatory
framework that combines rigorous accountability with genuine
institutional differentiation will better serve students, institutions,
and the public.''
<bullet> ``The Problem: The current system focuses on bureaucratic
processes rather than actual student outcomes like learning, graduation
rates, employment, and loan repayment. The Solution: The proposed rule
holds institutions accountable by enforcing state and Federal laws,
setting minimum student performance standards, and measuring real-world
outcomes. This reform is critical to fixing a broken system and
restoring accountability to American higher education.''
<bullet> ``. . . despite their immense power over institutions of
higher education, accreditation agencies fail to ensure academic
quality, operate like a monopoly, lack transparency, and stifle new and
innovative educational models.''
Discussion: The Department thanks commenters for their support. We
agree that the final rule will reduce burden on agencies and their
accredited institutions and programs by eliminating requirements not
required by statute, focus on educational quality with increased
accountability on agencies, and ensure that the standards and policies
of agencies do not violate Federal or State law.
Changes: None.

General Opposition to the Regulations

Comments: Some commenters opposed the proposed rule and urged the
Department to withdraw or substantially revise the proposed rule.
Commenters were concerned that these regulations will shift academic
and financial judgments from institutions and accrediting agencies to
the Federal

[[Page 68636]]

government and argue that educational quality, affordability, and
accountability will suffer as a result. Commenters argued that the
final rule would allow the Department to indirectly withhold Federal
student financial assistance, either by requiring accrediting agencies
to end accreditation or by ending recognition for the institution's
accrediting agency, when institutions are under investigation for a
variety of issues such as interpretations of civil rights laws or
political and ideological disputes.
Discussion: The Department disagrees with these perspectives and
notes that the final rule does not replace institutional or agency
discretion or judgment nor does it politicize the recognition process
for accrediting agencies. Rather, in issuing this final rule, the
Department is strengthening transparency of agencies and the
institutions and programs they accredit and improving consistency and
student protections across institutions and programs. The final rule
preserves the core role of accrediting agencies in setting standards
for and evaluating academic quality. Nothing in the final rule
authorizes the Department to impose Federal viewpoints on agency or
institutional decision-making. The final rule properly sets certain
baseline expectations for recognition of agencies by the Department as
reliable authorities on educational quality, such as protections for
students during disruptions of educational services and consistent
treatment of transfer credits when students change institutions or
advance to higher levels, which are essential to safeguarding the
integrity of the Federal student aid programs and ensuring
accountability to taxpayers.
Changes: None.
Comments: A few commenters expressed concerns for programs serving
students in prison education programs. The commenters stressed the
proposed rules could lead to politically motivated State action against
a prison education or post-incarceration reentry program and could
trigger a fast-tracked accreditation review, giving State actors a new
lever to pressure programs they find objectionable.
Discussion: The Department maintains that all students, including
those who are incarcerated, deserve increased accrediting agency
oversight and will benefit from reinforcement of the existing legal,
constitutional, civil rights, and consumer protection obligations
already required of recognized accrediting agencies and the
institutions and programs that they accredit.
Changes: None

Legal Authority

Comments: Some commenters did not believe the Department has the
statutory authority to regulate in several areas of this final rule,
including the amendments under Sec. 602.13 that add regulations on
antitrust law; Sec. 602.14 and Sec. 602.15 that amend requirements on
conflicts of interest; Sec. 602.17 that amends the application of
standards in reaching accreditation decisions, including student
achievement standards and agency requirements on the application of
civil rights law; Sec. 602.23 that amends regulations on operating
procedures all agencies must have; and Sec. 602.24 that amends
requirements for credit transfers.
Commenters often cited several statutory provisions to support
their claims. Commenters stated Section 496(a)(5) of the HEA prescribes
the specific standards for accreditation. Some commenters believe that
the Department has added new standards that do not currently exist in
statute. Commenters also cited Section 496(g) of the HEA as
Congressional intent on the limitation of the Department's authority to
establish additional standards: ``Nothing in this Act shall be
construed to permit the Secretary to establish criteria for accrediting
agencies or associations that are not required by this section. Nothing
in this Act shall be construed to prohibit or limit any accrediting
agency or association from adopting additional standards not provided
for in this section. Nothing in this section shall be construed to
permit the Secretary to establish any criteria that specifies, defines,
or prescribes the standards that accrediting agencies or associations
shall use to assess any institution's success with respect to student
achievement''. Commenters cited Section 496(o) that states the
Secretary ``shall not promulgate any regulation with respect to the
standards of an accrediting agency or association described in
subsection (a)(5)''.
Finally, commenters cited Section 103 of the Department of
Education Organization Act as evidence of Congressional intent on the
limits of the Department's authority: ``No provision of a program
administered by the Secretary or by any other officer of the Department
shall be construed to authorize the Secretary or any such officer to
exercise any direction, supervision, or control over the curriculum,
program of instruction, administration, or personnel of any educational
institution, school, or school system, over any accrediting agency or
association, or over the selection or content of library resources,
textbooks, or other instructional materials by any educational
institution or school system, except to the extent authorized by law''.
Discussion: The Department disagrees with these commenters. The
Secretary has express authority to ``by regulation provide procedures
for the recognition of accrediting agencies or associations and for the
appeal of the Secretary's decisions,'' 20 U.S.C. 1099b(o), and to
``establish criteria'' through notice-and-comment rulemaking to
determine whether an agency is a ``reliable authority as to the quality
of education or training,'' 20 U.S.C. 1099b(a). Thus, Congress
expressly directed the Secretary to establish criteria for determining
whether an agency is a reliable authority of the quality of education
and training of the institutions and programs that it accredits.
Congress narrowly limited the Secretary's authority in this area is
prohibiting ``promulgat[ing] any regulation with respect to the
standards of an accreditation agency or association described in
subsection (a)(5).'' 20 U.S.C. 1099b(o).
The limitation in this section only means that the Department
cannot add to the standards enumerated in subsection (a)(5). However,
the Secretary is not prohibited from establishing the criteria used by
the Department to determine whether an agency's standards, including
those described in subsection (a)(5), comply with the statute and
regulations.
The Department is not requiring any agency to adopt any
requirements as standards. Instead, these regulations inform how the
Department will assess whether the standards an agency has adopted are
adequate to show that the agency is a reliable authority on
institutional quality.
Changes: None.
Comments: Some commenters questioned the Department's authority to
make many of the changes proposed to Sec. 602.17. These commenters
believe that the Department added new requirements to Sec. 602.17 in
contravention of express statutory prohibitions. Specifically, the
commenters pointed to Section 496(g) of the HEA (20 U.S.C. 1099b(g)),
20 U.S.C. 1099b(o), and Section 103 of the Department of Education
Organization Act . While many of the commenters were skeptical of the
Department's authority to add any of the new requirements in Sec.
602.17, many focused especially on the inclusion of student
achievement, academic freedom, and cost-benefit analysis.
Discussion: The Department disagrees with these commenters. The
Secretary

[[Page 68637]]

has express authority to ``by regulation provide procedures for the
recognition of accrediting agencies or associations and for the appeal
of the Secretary's decisions,''
20 U.S.C. 1099b(o), and to ``establish criteria'' through notice-
and-comment rulemaking to determine whether an agency is a ``reliable
authority as to the quality of education or training,'' 20 U.S.C.
1099b(a). Thereby, Congress has commanded the Secretary to establish
criteria by which the Secretary will determine whether an agency is a
reliable authority of institutional quality. Congress limited the
Secretary's authority in this area by prohibiting the Secretary from
``promulgat[ing] any regulation with respect to the standards of an
accreditation agency or association described in subsection (a)(5).''
20 U.S.C. 1099b(o).
The Department believes the best reading of this section is that
the Department cannot add to the standards listed in subsection (a)(5).
But, given the express command to establish criteria by which the
Secretary will determine whether an agency is a reliable authority of
institutional quality, the Secretary is not prohibited from explaining
the criteria that the Secretary will use to determine whether an
agency's subsection (a)(5) standards are effectively applied and
enforced.
This is what the Department has done in Section 602.17. Section
602.17 does not add to the standards an agency must consider when
assessing an institution's faculty, for example. Rather, these are the
criteria the Department will use to determine whether an agency has
effective subsection (a)(5) standards.
This interpretation is further supported by Section 496(a)(4)(A) of
the HEA, which expressly requires accrediting agencies to consistently
apply and enforce their standards, and section 496(n), which requires
the Secretary to conduct a comprehensive and independent evaluation of
accrediting agencies. These provisions authorize the Department to
evaluate not only whether agencies have adopted standards, but also how
those standards are applied and enforced. The requirements in Sec.
602.17 implement these statutory responsibilities without prescribing
the substantive content of accreditation standards. This distinction
rests on the substance of the requirements, not merely their placement
in the regulations.
To the extent the commenters believe that the Department is adding
standards to Section 602.16, they are mistaken. While the Department's
initial discussion draft prior to negotiated rulemaking included
proposed changes to 602.16, the Department heard from several
negotiators that the changes being sought were focused on the
application of standards rather than changing the content of the
standards themselves. Instead, these amendments inform how the
Department will assess whether the standards an agency has adopted are
adequate to show that the agency is a reliable authority on
institutional quality. The negotiated rulemaking committee extensively
discussed and ultimately reached consensus on changes to Section 602.17
to address how the Department determines whether agencies have
effective mechanisms for evaluating compliance with its standards. The
changes that were agreed upon by the negotiated rulemaking committee
were proposed by the Department in the NPRM. These changes make only
clarifying and technical changes to the requirements for standards in
602.16 and amend the evaluative criteria in 602.17 for the agency's
application of standards in reaching accreditation decisions, which are
designed for the Department to determine whether an agency is a
reliable authority of educational quality for purposes of the HEA and
other Federal purposes.
Changes: None.
Comments: Other commenters stated that the Department lacks
authority to promulgate Section 602.14. In particular, the commenters
argued that the Department could not apply the separate and independent
requirement to programmatic accrediting agencies who do not serve as
title IV gatekeepers. One commenter stated that the HEA was amended
more than 30 years ago (Public Law 103-208) to make clear that
``separation was not required for accrediting bodies with no title IV
purpose.'' The commenter stated that contemporaneous legislative
history reinforces this point, because a US Representative, in
introducing the Higher Education Technical Amendments of 1993, stated
that: ``. . . membership organizations requested clarification of the
requirement for accrediting bodies to be separate and independent from
their accrediting associations. Statements made on the House floor
during consideration of the Higher Education Amendments of 1992
clarified that this separation was not required for accrediting bodies
with no title IV purpose. However, the Department of Education informed
us that a technical amendment is necessary to achieve congressional
intent. Without this clarification these organizations will be required
to undergo costly restructuring to meet the separate and independent
requirements.''
Discussion: The Department disagrees with the commenters. We first
note that accrediting agencies will be required to demonstrate a
Federal link in order to be recognized by the Department. Programmatic
agencies who do not demonstrate such a link will not be considered for
recognition and therefore need not comply with the separate and
independent requirements. In any case, purely programmatic accrediting
agencies recognized under 602.14(a)(3) are not required to comply with
the separate and independent requirements in 602.14(b).
All accrediting agencies, including programmatic ones, are required
to comply with 602.15, including by demonstrating clear and effective
controls to avoid or resolve conflicts of interest. The commenters do
not dispute the Department's authority to regulate under this section.
To the extent commenters argue that the Department is effectively
imposing the separate and independent requirements through 602.15(e),
they are mistaken. Section 602.14(b) requires structural separation,
meaning an agency must be independent of any related, associated, or
affiliated trade association in its governance, budget, and personnel.
In contrast, Section 602.15(e) does not require that separation. It
requires only that the agencies identify and disclose relationships
with trade associations and maintain clear and effective controls to
prevent those relationships from improperly influencing accreditation
decisions. An agency may maintain such relationships and comply with
602.15(e), so long as appropriate safeguards are in place.
The Department discussed at length its concerns with the influence
that related, associated, or affiliated trade associations exert over
accrediting agencies, leading the agencies to adopt standards and
practices that do not always advance students' interests. The
commenters fail to explain why the Department is incorrect to call this
influence a conflict of interest or why the Department should not take
steps to rein it in. The longstanding nature of the relationship
between an accrediting agency and a related, associated, or affiliated
trade association does not negate the existence of a conflict of
interest, nor does it justify permitting such a conflict to persist.
Finally, the Department takes note of the legislative history cited
in a comment but also notes that legislative history cannot change the
plain language of the statute. See State Farm Fire and Cas. Co. v. U.S
ex rel. Rigsby, 580 U.S. 26, 36-37 (2016).

[[Page 68638]]

Here, the relevant statutes grant the Secretary authority to
promulgate regulations and do not limit the Secretary's authority to
specify what is considered a conflict of interest.
Changes: None.

Sec. 600.11 Special Rules Regarding Institutional Accreditation or
Preaccreditation

Comments: Some commenters strongly supported the amendments to
Sec. 600.11. They believed that competition among accrediting agencies
will strengthen accountability, provide quality assurance, encourage
innovation, and make accrediting agencies more responsive. Other
commenters stated that the proposed regulations would lower barriers to
entry while retaining statutory quality controls for agency
recognition. Commenters stated that agencies should have incentives to
demonstrate their value through effective quality assurance, reasonable
processes, responsive service, appropriate standards, and efficient
oversight. These commenters believed that allowing institutions to more
easily change accrediting agencies creates those incentives and reduces
the risk that accreditation relationships become permanent regardless
of an agency's performance.
Discussion: We agree and thank the commenters for their support.
The final rule reduces regulatory burden on agencies in several areas
but enhance accountability and direct focus on agencies' application of
their standards and policies during the Department's recognition
process.
Changes: None.
Comments: Some commenters stated that loosening requirements for
institutions to change accrediting agencies will result in institutions
seeking out agencies with the lowest standards. Common themes in the
comments opposing the amendments were (1) the regulations would weaken
accreditation and result in a ``race to the bottom'' in terms of
academic quality, (2) relaxed requirements for changing agencies and
fewer barriers to Federal recognition would result in institutions
shopping for the agencies with the weakest standards, (3) institutions
would be able to easily evade accountability, (4) the rule ignores the
negative consequences of policies that create competition for
competition's sake, and (5) this change, combined with changes under
Sec. 602.11 and Sec. 602.12, will drastically lower the requirements
of accrediting agencies to be more easily recognized by the Department,
with the probability of predatory institutions gaining accreditation
increasing.
Discussion: The Department has not reduced statutorily required
oversight of accrediting agencies nor encouraged them to have lower
standards. The commenters will note that all the statutorily required
standards under Section 496(a)(5) remain unchanged. The Department has
also added additional safeguards in the form of application of the
required standards under Sec. 602.17 to ensure agencies are accounting
in their policies for things like post-completion and graduation
outcomes, the educational and economic returns of programs, academic
freedom protections, cost-benefit analysis of institutional activities,
and optimization of students' time to credential to reduce the amount
of borrowing for students.
The regulations will not result in a race to the bottom. In fact,
the Department has raised the bar for outcomes of students receiving
title IV, HEA assistance at eligible institutions. An agency will still
apply to the Department for recognition and be evaluated by both
Department staff and NACIQI, receive approval from the senior
Department official, and continue to be re-recognized by the Secretary
through Departmental periodic review of the agency's compliance with
the rigorous standards contained in the regulations.
Changes: None.
Comments: A few commenters provided specific recommendations that
they believe would strengthen protections in the rule. One commenter
stated that the Department should require an institution to submit its
complete accreditation and compliance record, including all adverse and
interim actions, unresolved findings, complaints, financial risk
indicators, program review materials, teach-out obligations, corrective
action plans, and relevant State or Federal actions. The receiving
agency should be required to review that record and provide the
Secretary with a written certification that it has considered the
institution's prior history and determined that the change is not
intended to evade oversight or obtain a less rigorous review. The
commenter made additional requests regarding public disclosure of the
change in agency and clear timelines to be published about the process
for changing agencies. The Department should also require an
institution to publicly disclose its reason for changing accrediting
agency and any pending or recent adverse actions.
A different commenter stated that agencies should submit the most
recent accreditation determination letter; visiting-team reports and
other agency feedback from the prior three years; information on
pending consumer complaints and investigations by State and local
licensing and law-enforcement agencies; and a status confirmation from
the institution's current accrediting agency stating whether it has
opened inquiries, engaged in substantive dialogue about compliance, or
taken any action.
Another commenter stated that the NPRM assurance that institutions
``subject to an adverse action cannot switch'' is not reflected in the
regulatory text itself, which requires a Secretarial finding of evasive
intent. The commenter recommended restoring the current 24-month look-
back, and providing that an institution under probation, show cause,
suspension, or adverse action may not designate a new accrediting
agency as its gatekeeper for the Federal student aid programs until the
action is resolved or the receiving agency has independently reviewed
and adopted findings on each deficiency identified by the prior agency.
Discussion: The Department declines the commenters' suggestions
because they are not based in statute. We believe the new regulations
under Sec. 600.11(a)(1)(ii) are sufficiently rigorous to ensure that
the Department is able to ascertain that an institution is trying to
evade, avoid, misrepresent, or undermine the integrity of any title IV,
HEA programs, which includes if an institution was subject to an
adverse action by an agency.
Changes: None.
Comments: One commenter requested that the Department consider
language that would protect institutions from penalizing actions by a
current accrediting agency when exercising their right to choose
another agency under Sec. 600.11.
Discussion: If an institution believes that its current accrediting
agency has taken adverse or punitive action against it in response to
its efforts to change accrediting agencies, the institution may
document those concerns in the materials it submits to the Department
pursuant to Sec. 600.11(a)(1). The institution may also submit a
complaint directly to Department staff for review.
Changes: None.
Comments: One commenter stated that the Secretary should not be the
sole arbiter of whether an institution's cause for switching
accrediting agencies is ``reasonable.'' The commenter stated that the
determination would rest entirely with one political appointee, with no
independent review, no defined evidentiary standard, and no public

[[Page 68639]]

rationale requirement. The commenter recommended that the Department
vest this determination in NACIQI or a comparable independent body.
Discussion: The discretion to approve or deny a change in
accrediting agencies even prior to this proposal rested with the
Secretary. The Department maintains the proper protocols, ethical
practices, and staff to ensure consistency, transparency, and fairness
in all decision-making.
Changes: None.
Comments: One commenter stated that the final rule and accompanying
guidance should specify how eligibility for title IV, HEA program funds
is affected when an institution holds more than one institutional
accreditation, how the institution designates a primary agency and
changes that designation, and what disclosure to students is required.
Discussion: The current process for reviewing multiple
accreditations addresses these issues, and the Department does not
expect the process related to those issues to change. Under the
regulations, Department evaluates whether an institution has
demonstrated reasonable cause for adding an additional accrediting
agency based on information provided by the institution and other
information available to the Department. As a reminder, under 34 CFR
668.43(a)(6), institutions are responsible for providing information
that is readily available to enrolled and prospective students about
the names of associations, agencies, or governmental bodies that
accredit, approve, or license the institution and its programs and the
procedures by which documents describing that activity may be reviewed
under 34 CFR 668.43(b). If a new agency begins to accredit an
institution, the Department expects the institution to disclose the
appropriate information to enrolled and prospective students as soon as
possible.
Changes: None.
Comments: A few commenters stated that institutions should be able
to protect their students by avoiding a gap in title IV aid between the
previous accreditation and the new accreditation, especially in the
health care and veterinary professions. The commenter also stated that
although the rule states that new agencies should avoid unnecessary
costs to institutions in the accreditation process, institutions that
change agencies may have to account for increased accreditation costs,
and those costs may be passed along to taxpayers or students.
Discussion: While there may be an outlier, the Department does not
envision a circumstance in which an institution voluntarily chooses to
switch accrediting agencies and causes a gap in title IV funds access.
The institution would retain title IV eligibility under its original
agency until the change in accrediting agency was complete.
With respect to concerns about increased costs associated with
changing accrediting agencies, the Department notes that these
regulations do not require an institution or program to change
accrediting agencies. Rather, the regulations are intended to
facilitate such changes when an institution or program determines that
doing so is appropriate. Accordingly, an institution or program
anticipating increased costs that could necessitate ongoing increases
in students' cost of attendance should carefully evaluate whether
changing accrediting agencies is in the best interests of its students.
The Department recognizes, however, that the potential benefits of
changing accrediting agencies may outweigh the associated costs,
depending on the institution's or program's circumstances and the
interests of its students.
Changes: None.
Comments: Several commenters supported the amendments to the
provision on an institution having accreditation from multiple entities
under Sec. 600.11(b). One commenter stated that the regulations
correctly read HEA Sections 496(h) and (i) as requiring disclosure and
reasonable cause, not as granting the Department a general veto over an
institution's choice of quality assurance partner. The enumerated
grounds for finding cause unreasonable are the right guardrails and are
narrowly drawn. Another commenter stated that allowing an institution
to have accreditation from multiple agencies will encourage more
agencies to apply to the Department for recognition, thus leading to
increased oversight of agencies and better quality assurance of
institutions and programs.
Discussion: We agree and thank the commenters for their support.
Changes: None.
Comments: Several commenters opposed the changes under Sec.
600.11(b) because they believe institutions will be incentivized to
seek dual accreditation, likely from a new accrediting agency with less
rigorous standards, as a safety net if they fail to meet the standards
of one of the more established accrediting agencies.
Discussion: We believe a guardrail exists in the regulation for
this situation. One of the provisions under Sec. 600.11(b) is that an
agency cannot carry accreditation from multiple agencies to ``avoid or
delay enforcement or oversight by the Department or an accrediting
agency.'' Accordingly, the Department has adequately addressed the
commenters' concerns.
Changes: None.
Comments: One commenter was concerned that the wording of Sec.
600.11(b)(2) could be interpreted in a way that would prevent the
Secretary from acting against poorly performing institutions. The
commenter recommended that, since revoking accreditation is often a
yearslong process, the Department revise Sec. 600.11(b)(2) to read
``The Secretary will not solely determine the cause of having multiple
accrediting agencies to be unreasonable due to a probation or
equivalent, show cause order, or suspension order.''
Discussion: If the Secretary determines that an accrediting agency
is not compliant with statue or regulations, there are many mechanisms
to review, sanction, or revoke recognition of the agency. This
provision alone does not prohibit the Secretary from taking action in
response to violations of statute or regulations.
Changes: None.
Comments: One commenter requested that the Department identify, as
examples of ``reasonable cause,'' an institution's decision to add an
agency whose scope covers workforce, certificate, apprenticeship-
aligned, or eligible workforce programs.
Discussion: We decline to create a list of reasons why an
institution can have accreditation by multiple agencies. If the
Department develops a list, we must have a rationale for why one reason
is included and another is not. We have provided in the regulation that
as long as none of the criteria are violated under Sec.
600.11(b)(1)(ii), then the institution can have accreditation from
multiple agencies.
Changes: None.
Comments: One commenter recommended that future accreditation-
reform initiatives expressly support technology and shared
infrastructure designed to reduce the administrative burden associated
with seeking, maintaining, and changing accreditation.
Discussion: The Department supports the use of technology and
shared infrastructure (so long as it does not violate Sec. 602.13) to
reduce the burden of an institution seeking, maintaining, and changing
agencies.
Changes: None.
Comments: One commenter stated that the Secretary should consider
when a change of agency follows an unresolved compliance concern raised
by the current agency, regardless of whether the institution's stated
reason is

[[Page 68640]]

compliance with State law, and require the institution to disclose any
outstanding findings.
Discussion: We believe the commenter's suggestion is accounted for
under Sec. 600.11(a)(1)(ii).
Changes: None.

Sec. 602.2 How do I know which agencies the Secretary recognizes?

Comments: One commenter agreed with the changes under Sec. 602.2
stating that the amendments increase transparency and more timely
access to information regarding accreditation actions.
Discussion: We thank the commenter for their support.
Changes: None.
Comments: One commenter recommended that the Department include the
history of accreditation actions rather than only the current status
and flag any institution operating under a continuation of eligibility
granted under Sec. 602.26, so a student can see that a college is
drawing Federal aid despite an adverse accreditation action.
Discussion: We decline the commenter's recommendation. We believe
this would be redundant to requirements under 602.26(f) that require an
agency to maintain on its website a clear record of all actions taken
for each institution or program it accredits or preaccredits for a
period of at least five years.
Changes: None.

Sec. 602.3 What definitions apply to this part?

Accrediting Agency or Agency

Comments: A few commenters supported the amended definition. One
commenter stated that the revisions are an important shift from
process-based compliance toward substantive quality assurance. The
commenter stated that peer review should remain available, but the
Federal government should not dictate unnecessary details for those
processes. The commenter believed that reducing Federal micromanagement
can allow accrediting agencies to devote more attention to student
achievement, institutional performance, educational quality, and
meaningful improvement while simultaneously reducing unnecessary
administrative costs for institutions. Another commenter who supported
the rule stated that accrediting agencies may wish to include
professionals and experts on site visit teams who do not directly fit
within the strictest meanings implied by ``peer'' or ``peer
reviewers.''
Discussion: We agree and thank the commenters for their support.
Changes: None.
Comments: Some commenters opposed the Department's definition of
accrediting agency or agency. Commenters opposed the removal of the
requirement that an agency conduct activities through peer review.
Commenters urged the Department to maintain the requirement for peer
review for the following reasons:
<bullet> Peer review is central to credibility independence and
essential to the evaluation process, and peers are the most competent
individuals capable of assessing quality of instruction.
<bullet> Experts such as engineers, doctors, writers, physicists,
and veterinarians know their subjects but have no understanding of
education, teaching, or students.
<bullet> The peer review process avoids the injection of political
ideologies, political appointees, and overreach of outside Federal
agencies into the accreditation process.
<bullet> With no guardrails, agencies may contract individual
reviewers with little to no expertise in the areas they are reviewing.
<bullet> Current regulations already require agencies to include
practitioners and employers as a part of their evaluation teams.
<bullet> The Department itself encourages peer review in the
preamble explanation to changes to site visits under Sec. 602.24(b).
Discussion: The regulatory requirement that an agency conduct
activities through peer review is not prescribed in statute under the
HEA. Where current regulations prescribe requirements that extend
beyond recognition procedures and instead direct the content or
administration of accrediting standards without a clear statutory
basis, the Department removes or simplifies those requirements to
better align the regulations with Congressional direction.
The regulations allow for an accrediting agency to continue
utilizing the peer review model. There is no prohibition on peer review
if that is the best option for the agency; however, the regulations do
acknowledge that peer review is not the only appropriate model for the
review of an institution or program. For example, an agency may
determine that a practicing veterinarian or group of practicing
veterinarians may be better suited for the review of a program than a
professor(s) of veterinary sciences.
Under Sec. 602.15(a)(2), any agency must have competent and
knowledgeable individuals, qualified by education or experience as
appropriate for their roles. This provision continues to include the
agency's decision-making body and site reviewers. With this final rule
the Department declines to apply a ``one size fits all'' approach to
how an agency reviews its accredited institutions and programs;
however, we still maintain high standards under Sec. 602.16 and
application of those standards under Sec. 602.17 for the reviews.
Note that the preamble language for Sec. 602.24 states ``peer'' or
``independent'' review: ``For example, having a peer or independent
reviewer alongside accrediting agency staff would help the evaluation
reflect professional expertise and perspectives that extend beyond
accrediting agency staff alone. Peer reviewers bring field specific
knowledge that allows them to assess academic standards, administrative
capacity, and institutional practices with appropriate depth.
Independent reviewers, likewise, help the accreditation process not be
unduly influenced by an agency's internal perspectives or by
longstanding relationships with institutions.''
Changes: None.
Comments: One commenter asked, what is the Department's expectation
for who conducts a review of a professional program?
Discussion: The Department will not mandate who conducts the review
of any program, including professional programs. By removing the
requirement for peer review, agencies have flexibility to innovate and
create a unique review process for institutions and programs. Note that
while the final rule provides for flexibility and innovation, the
language under Sec. 602.15(a)(2) still requires that an agency has
competent and knowledgeable individuals, qualified by education or
experience in their own right, as appropriate for their roles.
Changes: None.
Comments: One commenter asked the Department to clarify that
regardless of whether reviewers are peers, agency staff, or other
qualified experts, the review must apply rigorous standards through a
competent, independent, and well-trained team.
Discussion: The commenter's statement is correct. Under Sec.
602.15(a)(2), any agency must have competent and knowledgeable
individuals, qualified by education or experience in their own right,
as appropriate for their roles.
Changes: None.

Institution

Comments: A few commenters recommended that the Department use the
term ``postsecondary institution'' rather than simply ``institution''
because it would preserve the Department's

[[Page 68641]]

objective of avoiding the narrower statutory term ``institution of
higher education'' while more clearly identifying the category of
institutions governed by the accreditation regulations. Another
commenter was concerned that replacing language traditionally tied to
educational entities as ``Institutions of Higher Education'' with the
broader term ``institution'' may unintentionally expand eligibility too
far beyond organizations whose primary mission is education and
learning.
Discussion: The Department sought to simplify the term in an effort
to not repeat the phrase throughout 34 CFR part 602. We believe the
definition of ``institution'' is clear and simple. We specifically
state that the term means an educational institution that meets the
requirements of paragraph (1) of the definition of eligible institution
found in 34 CFR 600.2; therefore, there is no possibility that the
eligibility could expand beyond (1) an institution of higher education,
as defined in Sec. 600.4, (2) a proprietary institution of higher
education, as defined in Sec. 600.5; or (3) a postsecondary vocational
institution, as defined in Sec. 600.6.
Changes: None.

Related, Associated, or Affiliated Trade Association

Comments: One commenter stated that the definition is overly
expansive and will capture trade associations that do not have a direct
relationship with agencies and negatively impact the ability of those
organizations to work effectively with accrediting agencies, especially
if accrediting agencies are member organizations of such trade
associations.
Discussion: The Department disagrees with the commenter because the
definition does require a direct relationship. One of the components of
this definition is that the organization ``. . . is related to a
particular accrediting agency in that the agency accredits institutions
or programs that prepare students to enter the workforce of the same or
substantially the same line of commerce, business, industry, or
profession that organization promotes.''
Changes: None.

Sec. 602.10 Link to Federal Programs

Comments: One commenter supported the amendments to Sec. 602.10.
The commenter stated that Congress has assigned recognized accrediting
agencies an important responsibility to serve as reliable authorities
regarding educational quality. That responsibility should remain at the
center of the recognition framework. Where Congress has expressly
required agencies to perform Federal functions, those requirements must
be honored. But Federal recognition should not unnecessarily expand the
agency's role beyond those statutory responsibilities or encourage
agencies to regulate matters disconnected from educational quality.
Discussion: We agree and thank the commenter for their support.
Changes: None.
Comments: Several commenters stated that the changes to 602.10 will
result in programmatic accrediting agencies no longer seeking
recognition from the Department. The commenters believe that agencies
that accredit ``professional programs'' should be regulated by the
Secretary to ensure quality. The commenter recommended that the Federal
link should include a designated ``professional program,'' and those
agencies should be required to seek Department recognition. Another
commenter stated that agencies that oversee law, medical, dental,
veterinary, pharmacy, and nursing schools should be required to be
recognized by the Department due to their role in the U.S. social
system.
Discussion: The Department disagrees with the recommendation.
Section 496(a) requires a link to Federal programs in order for the
Secretary to grant recognition. Institutional accrediting agencies
primarily act as title IV gatekeepers for an institution to be eligible
to participate in the title IV student financial aid programs. State
licensure of professions does not establish a Federal link and law,
medical, dental, veterinary, pharmacy, or nursing schools fall within
an institutional accrediting agency's grant of accreditation to the
institution. For programmatic accrediting agencies, the Federal link is
usually through a non-HEA Federal program, and the Department will
continue to recognize or review for recognition any agency with a non-
HEA Federal link actively utilized by its accredited programs as well.
The Department will not recognize any agency that does not have a
direct Federal link with either the Department or another Federal
agency. As noted earlier, the Federal link is a statutory requirement
for the Department's recognition and it is not intended to be a signal
to State governments or licensure agencies to rely on those agencies
for licensure or other State requirements.
Changes: None.
Comments: One commenter opposed permitting an agency to satisfy the
Federal link requirement on the basis of institutions that have
designated another agency. The provision exists to enable stand-by
accreditation. The commenter recommended that the Federal link be
satisfied only by institutions that designate the agency.
Discussion: As stated in the final rule in 2019 when added, this
provision is designed to decrease barriers to entry and enable new
agencies to more easily enter the marketplace. Until a new agency is
recognized, it is highly unlikely that an accredited institution would
relinquish its current accreditation that enables it to meet title IV
institutional eligibility requirements to attain accreditation from
that new agency, even though the new agency may be better suited to the
institution's mission. Therefore, we decline the commenter's suggestion
to remove the provision.
Changes: None.
Comments: One commenter stated that the regulations do not address
what happens to an agency that loses recognition if after two years
there are no institutions or programs that rely on the agency's
accreditation to establish or continue eligibility to participate in
Federal programs. The commenter stated that the Department should add
provision for a notice period, teach-out, and title IV consequences.
Discussion: If an agency has no institutions that participate in
the title IV programs, then there would be no reason for a teach-out or
notice period because no entity associated with the agency would be
disbursing title IV aid to students. In the case of non-HEA Federal
programs, we cannot account for all nuances of each program but would
again state that there would be limited impact to students if no
Federal link is established. The two-year window is to ensure only
accrediting agencies that have institutions and programs that utilize
Federal programs are seeking recognition to avoid wasting Department
and taxpayer resources.
Changes: None.
Comments: One commenter asked the Department to confirm that an
agency's Federal link under Sec. 602.10 may be established through
Workforce Pell participation alone, without requiring a longer-format
credential.
Discussion: The Department confirms that an eligible institution is
permitted to offer only eligible workforce programs qualifying for Pell
Grants (colloquially referred to as ``Workforce Pell''). And, to that
extent as such an institution participating in the Pell Grant program
would be eligible for at least one title IV, HEA program, accreditation
of such an institution would satisfy the Department's requirements for
a Federal link even if

[[Page 68642]]

the institution did not offer eligible programs other than eligible
workforce programs.
Changes: None.
Comments: One commenter asked the Department to state in
implementing guidance that where a Federal agency conditions employment
on programmatic accreditation, the qualifying condition should be
accreditation by an agency recognized by the Secretary, rather than
accreditation by a single named organization.
Discussion: The Department declines the commenter's request.
Section 496 (m) of the HEA states that ``the Secretary may only
recognize accrediting agencies or associations which accredit
institutions of higher education for the purpose of enabling such
institutions to establish eligibility to participate in the programs
under this Act or which accredit institutions of higher education or
higher education programs for the purpose of enabling them to establish
eligibility to participate in other programs administered by the
Department of Education or other Federal agencies.''
The Department does not have authority over another Federal
agency's policies. A separate Federal agency may condition employment
on a specific programmatic accrediting agency that is not recognized by
the Department, but the statute is clear that the Federal link that
agencies need to establish for Department recognition is related to a
program administered by a Federal agency, not conditions of employment
by a Federal agency.
Changes: None.
Comments: One commenter asked the Department to state in the
preamble to the final rule that the test in Sec. 602.10(a) governs
reliance under Sec. 602.10(c): an institution that is accredited by
two accrediting agencies and participates in the title IV, HEA programs
could designate either agency as its primary agency for title IV
purposes and could therefore be used by either agency to demonstrate
its Federal link. The commenter also suggests that the Department
conforms the text by adding to Sec. 602.10(c) a sentence to that
effect so that the two paragraphs apply one test.
Discussion: We confirm that if an institution is dually accredited,
even if the institution designates another institutional accrediting
agency as its Federal link, that would satisfy the requirements for
initial recognition under Sec. 602.10(c). Additional conforming
regulatory text is not necessary.
Changes: None.
Comments: One commenter stated that proposed Sec. 602.10(c) would
establish a two-year post-recognition condition under which a newly
recognized agency loses recognition if no institution relies on its
accreditation within that period. The commenter stated that the final
rule should explain how the Department expects the provision to operate
in professional sectors where institutional switching may occur slowly
for reasons unrelated to accrediting agency quality.
Discussion: All accrediting agencies must demonstrate a Federal
link for Federal recognition. If an agency that accredits an
institution loses the Department's recognition after two years under
Sec. 602.10(c), then the institution it accredits never participated
in an HEA or non-HEA Federal program; therefore, there would be no
Federal consequence to the institution due to the loss of the agency's
recognition.
Changes: None.
Comments: One commenter requested that the Department clarify the
requirements for new agency recognition by (1) stating objective
recognition criteria with defined review timelines; (2) providing a
provisional or developmental recognition status through which a new
agency can demonstrate performance on a defined cohort before full
recognition; and (3) ensuring that experience requirements can be
satisfied by demonstrated competence of an agency's standards,
processes, and personnel, so that specialized quality-assurance bodies
are not excluded by criteria only incumbents can meet.
Discussion: While we decline to regulate the Secretary in a way
that would place arbitrary deadlines on the Department, we believe that
several of the commenters' suggestions are already accounted for in the
final rule at Sec. 602.12 Accrediting Experience, Sec. 602.16
Accreditation and preaccreditation standards, Sec. 602.17 Application
of standards in reaching accreditation decisions, Sec. 602.30 Agency
applications and reports to be submitted to the Department, and Sec.
602.31 Procedures for submitting applications for recognition and
renewal of recognition.
Changes: None.

Sec. 602.11 Extent of Accrediting Activities

Comments: Several commenters offered general support for the
elimination of references to geographic scope under Sec. 602.11. The
commenters believe that differentiating between regional and national
accrediting agencies implies that an institution accredited by a
regional accrediting agency may be superior or represent a different
level of quality.
Discussion: We thank the commenters for their support. These final
rules make clear that the Department recognizes institutional or
programmatic accrediting agencies only. We hold all agencies to the
same rigorous standards.
Changes: None.
Comments: One commenter questioned the need for further regulation
on regional and national accreditation. The commenter stated that this
amendment is not necessary as the Department published a final rule on
November 1, 2019, noting that ``the terms ``regionally accredited'' and
``nationally accredited'' will no longer be used or recognized by the
Department. The commenter stated that the Department taking additional
action after six years is unnecessary as recognized institutional
accrediting agencies have been considered national agencies following
this rule.
Discussion: We proposed to fully eradicate the terminology because
regulations under Sec. 602.11(b) still refer to a region. The
Department seeks to continue to break down the notion that there is a
difference between institutional accrediting agencies. We believe these
amendments will encourage States and other Federal agencies to continue
to remove policies that favor institutions--and therefore their
students--accredited by former ``regional'' agencies over institutions
accredited by ``national'' agencies.
Changes: None.
Comments: A few commenters disagreed with the Department's removal
of geographic restrictions from recognized agencies. One commenter
stated that accrediting agencies will be making decisions on programs
with which they have little experience or knowledge. Another commenter
stated that regional and national accrediting agencies held
institutions to different standards and produced different outcomes.
The commenter pointed to the Department's regulatory impact analysis,
Figures 3.1 to 3.3, plots of graduation rates, completer earnings, and
loan delinquency by accrediting agency. The commenter argued that the
solution would be to organize agencies by tiers of demonstrated rigor
defined at the outset, which the prior regional versus national
approach approximated.
Discussion: Since 2019, the Department has viewed institutional
accrediting agencies with no distinction for geographic regions, unless
noted within their scope of recognition. We have been careful not to
make any distinction as all agencies are required

[[Page 68643]]

to meet the same standardized requirements in the regulations. This is
a floor not a ceiling; agencies have the flexibility and autonomy to
create additional standards so long as they do not conflict with
Federal or State law. The Department will discontinue the practice of
stratification of agencies based on incomplete data or assumptions and
instead hold all agencies to the same rigorous thresholds and
standards.
Lastly, regarding the commenter's statement that an agency may not
have the necessary experience to accredit institutions outside of a
specific region, the commenter will note that the very next section of
the regulations, Sec. 602.12, contains extensive requirements
regarding the required experience of an agency for recognition. For
example, Sec. 602.12(b) states that ``An agency seeking initial
recognition must undergo the Secretary's recognition process, defined
in Sec. 602.31, and an evaluation of the agency's compliance with the
Secretary's recognition criteria, defined in 34 CFR part 602, for the
purpose of determining if the agency is a reliable authority as to the
quality of education or training provided by the institutions or
programs it accredits before its application for recognition may be
considered by the Advisory Committee.''
Changes: None.
Comments: One commenter stated that the Department should clarify
what constitutes an adequate description of the ``extent'' of
accrediting activities and, more importantly, what evidence an agency
must provide to demonstrate that it has the capacity, policies, and
procedures necessary to operate within that extent. For example, if an
agency expands from accrediting institutions in a limited number of
States to truly operating nationally, should the Department evaluate
staffing capacity, reviewer availability, institutional volume, travel
and monitoring capacity, financial resources, governance
infrastructure, or other operational factors?
Discussion: The factors noted by the commenter are evaluated during
a renewal of recognition review.
Changes: None.

Sec. 602.12 Accrediting Experience

Comments: Several commenters supported removing the requirement
under current Sec. 602.12(a)(2) that an agency conduct accrediting
activities, including deciding whether to grant or deny accreditation
or preaccreditation, for at least two years prior to seeking
recognition (two-year rule). Commenters stated that the two-year rule
provided no practical path to an agency's recognition due to expense
and time it would take to obtain agency recognition from the
Department. One commenter stated the two-year rule represented a
categorical barrier rather than a quality check.
Another commenter stated that opening the system to qualified new
agencies will permit accreditation to evolve alongside higher education
and the American workforce. New educational delivery models, rapidly
changing technologies, artificial intelligence, shorter-term
credentials, competency-based education, and changing employer needs
present challenges that the accreditation system must be capable of
addressing. Emerging agencies may develop different methods of
evaluating outcomes, using data and technology, measuring competencies,
and assessing whether programs are preparing students for employment
and further education. Competition does not guarantee innovation, but
eliminating unnecessary barriers gives innovation an opportunity to
occur.
Discussion: We agree and thank the commenters for their support.
Changes: None.
Comments: Some commenters opposed removing the two-year rule under
current Sec. 602.12(a)(2). They stated that accreditation exists to
protect students and taxpayers by ensuring that a reliable, experienced
authority is vouching for institutional and program quality, and a
faster path to recognition should not come at the expense of that
assurance. Several commenters stated that such a change would allow
organizations with no record of responsible conduct to be created at
will, which removes the value of accreditation entirely. Other
commenters believed that the amendments of Sec. 602.12 enable the
creation of accrediting agencies with arbitrary standards and will
increase accreditation of predatory institutions that saddle students
with debt.
One commenter stated that the Department did not provide sufficient
data to support the rescission of the two-year rule, and instead the
Department merely speculates that its lower bar will entice new
agencies to seek recognition and further speculates that developing the
accrediting agency market will lead to competition and better
educational outcomes. The commenter contended that the changes would
fall short of enabling the Department to meet its statutory obligation
to conduct a ``comprehensive review and evaluation'' prior to
recognition, as required by 20 U.S.C. 1099b(n). In addition, the
commenter stated that the proposal is contrary to law as the Secretary
can ``only recognize'' accrediting agencies which ``accredit'' (present
tense) institutions or programs for the purpose of enabling
participation in Federal funding, per 20 U.S.C. 1099b(m).
Discussion: As stated in the NPRM, a two-year requirement is not
statutory and represents undue and unnecessary burden for accrediting
agencies seeking recognition. Note that the new provisions create
guardrails and high standards for agencies by requiring that the agency
be legally established to operate in the relevant jurisdiction and that
the agency has standards and operating procedures consistent with
applicable regulations. Additionally, all agencies are reviewed for
compliance with the Secretary's Criteria for Recognition and are
subject to the recognition process, which ensures a comprehensive
evaluation.
The Department disagrees with the commenter's argument that the
Secretary can ``only recognize'' accreditors which ``accredit''
(present tense) institutions or programs. Section 496(m) describes the
purpose of recognition, not a requirement that an agency already have
accredited institutions or programs. This interpretation is consistent
with Section 496(a)(2)(A), which defines qualifying agencies by their
principal purpose of accreditation. The Secretary must still conduct a
comprehensive review and determine that an applicant satisfies all
applicable statutory requirements, including demonstrated ability and
experience, but the statute does not require two years of prior
operations.
Changes: None.
Comments: One commenter stated that the rescission of the two-year
rule creates a situation in which an unrecognized agency will conduct a
full evaluation of an institution that already holds recognized
accreditation, and the quality of that single decision will carry the
petition. The commenter asks the Department to confirm that an
institution in this position satisfies Sec. 600.11(b) if it makes the
submission and designation within a reasonable period after the
agency's recognition and that its eligibility is not interrupted in the
interval.
Discussion: The Department will address specific operational and
implementation questions in subregulatory guidance. The Department
agrees that an institution should not experience an interruption in
title IV eligibility solely because it obtains accreditation from an
agency that subsequently receives recognition. An institution that
maintains

[[Page 68644]]

accreditation from an already recognized agency retains its eligibility
on that basis, provided it continues to satisfy all applicable
requirements.
Changes: None.
Comments: Several commenters suggested that before recognizing a
new accrediting agency the Department should:
<bullet> Require credible evidence that the agency has experienced
and properly trained peer reviewers; transparent and consistently
applied standards; effective conflict-of-interest protections; a
demonstrated ability to evaluate institutional quality and student
outcomes; and adequate procedures for complaints, appeals, monitoring,
teach-outs, and institutional closures.
<bullet> Establish a formal public-comment opportunity as part of
the initial recognition process for newly established accrediting
agencies, particularly where recognition may affect regulated
professions.
<bullet> Ensure that State licensing authorities, educational
institutions, professional organizations, students, employers, existing
accrediting agencies, and other affected stakeholders have a meaningful
opportunity to identify potential implications for educational quality,
licensure eligibility and portability, workforce mobility, and public
protection, especially if scope of practice and license portability
could be impacted.
<bullet> Require that an agency's accrediting experience covers the
range of degrees, certificates, institutions, and programs for which it
seeks recognition. An agency that has reviewed a single certificate
program should not be recognized to accredit doctoral institutions.
<bullet> Adopt a three-year initial recognition period with a
required monitoring report, rather than five years, and confirm that
first-time applicants receive the most rigorous review track rather
than the lightest.
<bullet> Establish explicit risk-based triggers for enhanced
monitoring of newly recognized agencies, including rapid growth in
portfolio size, an elevated rate of adverse actions or closures among
accredited institutions, and accreditation of institutions that
recently changed agencies.
Discussion: The Department believes that many of the suggestions
are accounted for in the regulations under Sec. 602.3 (see that
section for a discussion on reviewers), Sec. 602.14, Sec. 602.15,
Sec. 602.16, Sec. 602.17, and Sec. 602.24. The Department declines
recommendations that are not expressly stated in the HEA.
Changes: None.

Sec. 602.13 Effect of Recognition

Comments: A few commenters offered general support for the
provision stating that the Secretary's recognition of an agency confers
no antitrust immunity. One commenter stated that some agencies have
operated like anticompetitive gatekeepers. Another commenter stated
that the regulations make clear that accreditation should not be used
to impose unnecessary educational requirements that restrict entry into
a profession.
Discussion: We thank these commenters for their support.
Changes: None.
Comments: One commenter stated that the regulations repeat
requirements that already exist in Federal law and are enforced through
the Department of Justice. The commenter stated that inclusion of Sec.
602.13 in the regulations suggests that the Department seeks to enforce
provisions within the purview of other Federal agencies. The commenter
recommended eliminating Sec. 602.13.
Discussion: The Department noted in the NPRM--and repeats here--
that it is not the enforcer of antitrust law, but accrediting agencies
are expected to comply with Federal law, including avoiding anti-
competitive practices. The purpose of this provision is to make it
clear that agencies cannot affirmatively claim that they enjoy any
antitrust immunity flowing from their recognition. ``Repeals of the
antitrust laws by implication from a regulatory statute are strongly
disfavored.'' Norfolk & W. Ry. Co. v. Am. Train Dispatchers Ass'n, 499
U.S. 117, 129 (1991) (quoting United States v. Phila. Nat. Bank, 374
U.S. 321, 350 (1963). There is nothing in this regulation or the HEA
that suggests that the antitrust laws are displaced explicitly or
implicitly, and the amendments in Sec. 602.13 make that explicitly
clear.
Furthermore, the Department would not enforce the antitrust laws
under Sec. 602.32(3) either. When enforcing Sec. 602.32(3), the
Department would rely on, as evidence of an antitrust violation, a
final judgment in state of Federal court, an admission by an
accrediting agency, or a settlement where the agency admitted to have
engaged in anticompetitive conduct. Only in these circumstances would
the Department view the conduct as a negative factor when reviewing for
compliance under Sec. 602.32(3). Mere allegations of anticompetitive
conduct would not be a sufficient basis for the Department to view that
conduct as a negative factor when adjudicating an agency's recognition.
Changes: None.
Comments: One commenter stated that the final rule should make
clear that Sec. 602.13 neither creates antitrust immunity nor
constitutes a finding concerning the legality of any particular
agency's conduct.
Discussion: We believe the regulation is clear as it is currently
written. Nothing in the regulation suggests or should be taken to mean
that the regulations under Sec. 602.13 confer antitrust immunity, nor
that the Department has made any findings concerning any particular
agency.
Changes: None.
Comments: One commenter stated that the Department should clarify
that legitimate quality assurance activities undertaken pursuant to
Federal recognition are not themselves evidence of anticompetitive
conduct and that new agencies do not undermine scope of practice and
patient protections enacted by State licensure boards.
Discussion: The Department declines to prescribe specific
activities by accrediting agencies that may or may not be evidence of
anticompetitive conduct. Each recognized accrediting agency is
responsible for ensuring that its activities comply with all applicable
Federal and State laws, including antitrust laws, and may wish to
consult with legal counsel regarding its compliance obligations.
Changes: None
Comments: A commenter stated that there is no specific exemption
for accrediting agencies in the antitrust laws, and case law has long
supported the view that accrediting agencies are subject to such laws,
but at the same time Sec. 602.17(a)(1)(ii)(E) requires accrediting
agencies, in setting and applying student achievement standards, to
assess the reasonableness of institutional and programmatic earnings
relative to cost of attendance.
The commenter also stated that the Department seeks to have
accrediting agencies conduct a ``cost-benefit'' analysis under proposed
Sec. 602.17(a)(3) of an institution's ``budget, resource utilization,
and allocation.'' The commenter believes that these provisions are
fundamentally irreconcilable with the statement that accrediting
agencies are subject to antitrust laws.
The commenter further expressed that by compelling accrediting
agencies to engage in cost-based assessments while simultaneously
denying them any antitrust protection for doing so, the proposed rule
creates a trap: an agency that complies with the Department's mandate
exposes itself to an antitrust claim or enforcement action, while an

[[Page 68645]]

agency that declines to comply in order to mitigate antitrust risk
faces loss of recognition. The commenter stated that the Department
cannot lawfully impose regulatory obligations that force accrediting
agencies to violate antitrust laws while simultaneously stating that
such agencies are not immune from those laws.
Discussion: The Department does not believe the regulations are
irreconcilable with antitrust laws. Nothing in the regulation requires
an agency to set tuition and fees, assess an institution's tuition and
fees with respect to other institutions, otherwise pressure or compel
institutions to set tuition and fees at a certain level, or act against
an institution because of the institution's tuition and fees. The
standard requires an agency to assess whether the institution has done
a reasonable analysis to determine whether its own tuition and fees are
reasonable in light of its own costs. Beyond that, agencies and
institutions may wish to consult with counsel to effectively implement
these regulations within Federal antitrust law. This does not, contrary
to the commenter's suggestion, require any institution to engage in
concerted action with other institutions. In particular, institutions
can make their own decisions about how to conduct the cost-benefit
analysis, which requires institutions to engage in reasoned decision
making and to avoid arbitrary requirements, including those that may be
unduly costly. The Department certainly does not want accrediting
agencies to engage in any conduct that would violate the antitrust
laws, which may include accrediting agencies developing uniform
standards for making decisions in institutions' cost benefit analysis
that could, directly or indirectly, fix prices. To the degree that an
accrediting agency has a good faith belief that a specific action would
violate the antitrust laws and abstains from taking that action on
those grounds, the Department will credit those concerns when
evaluating the compliance with the recognition criteria.
The commenter is also mistaken with regard to the regulation
requiring agencies to perform cost/benefit analysis. Agencies are only
required to review cost/benefit analysis performed by institutions.
Changes: None.

Sec. 602.14 Purpose and Organization

Comments: One commenter requested that the Department provide a
clear statement in the preamble to the final rule that programmatic
accrediting agencies, which do not act as gatekeepers of Title IV funds
and are recognized under Sec. 602.14(a)(3), are not subject to Sec.
602.14(b).
Discussion: The commenter is correct; accrediting agencies that are
recognized under Sec. 602.14(a)(3) are not subject to the ``separate
and independent'' requirements under Sec. 602.14(b).
Changes: None.
Comments: One commenter recommended that under Sec. 602.14(b)(2)
the Department should adopt a defined cooling-off period for public
members and should bar owners and shareholders of accredited
institutions from voting on accreditation decisions.
Discussion: We decline the commenter's recommendation. We believe
that the regulations are sufficiently rigorous to ensure that
recognized agencies are separate and independent without additional
requirements.
Changes: None.
Comments: One commenter asked for clarification of the requirements
under Sec. 602.14(b)(6) regarding
``. . . any complaints received during the current recognition
period that are material.''
Discussion: The Department understands that stakeholders will have
questions regarding implementation of the final rule. We cannot address
every situation within the regulations because the regulations are
meant to be the general framework. We believe that the commenter's
request is subregulatory in nature, and we may offer subregulatory
guidance as necessary to inform implementation.
Changes: None.
Comments: One commenter stated that the Department should revise
Sec. 602.14(b)(6) to read ``The authorized representative of the
agency submits a signed statement certifying that it has met the
requirements to be `separate and independent' within each petition for
recognition submitted to the Department, and includes in that statement
information regarding any complaints received during the current
recognition period that are material to the agency's adherence to the
`separate and independent' requirements in this section.'' The
commenter stated that as written, the requirement is not clearly linked
to Sec. 602.14(b)(6).
Discussion: As noted by the commenter, the provision appears in
Section 602.14(b). We believe that it is clear the complaints
referenced regard complaints related to ``separate and independent.''
Changes: None.
Comments: Some commenters supported the rescission of the joint use
provisions under Sec. 602.14(c) for the following reasons:
<bullet> The rescission gets rid of conflicts of interest, and
accreditation should be an independent check to make sure an
institution or program is actually qualified, not a gatekeeping tool
used by industry groups to protect their own interests.
<bullet> Accrediting agencies should not be utilized to support or
prop up membership organizations. They should be independent of
influence and focus completely on accrediting institutions and/or
programs.
<bullet> Affiliated trade or membership organizations should have
no role in the accreditation process, specifically the appointment of
accreditation members, approval of standards or policies, setting of
fees, approval or oversight of budgets, oversight of the accrediting
body, management of staff leaders, and oversight of legal
representation.
<bullet> The provision will block programmatic accrediting agencies
from unduly raising costs for students or contributing to degree
inflation.
<bullet> The provision, in combination with amendments under Sec.
602.15, will prohibit agencies from being run as a division of a
lobbying group.
Discussion: We agree and thank the commenters for their support.
Changes: None.
Comments: A few commenters supported the changes under Sec. 602.14
and stated that they should be strengthened to include further
delineation between setting standards and auditing compliance. One
commenter stated that the Department should also make clear how often
the relevant Department staff will be checking to ensure that
accrediting agencies and associations are not sharing resources.
Another commenter stated that separate and independent should also
refer to the independence of the Board from the chief executive officer
of the accrediting agency itself.
A different commenter stated that the Department should require a
materially independent public/consumer presence and prohibit any single
related professional or educational organization from appointing,
nominating, ratifying, or effectively controlling a majority coalition.
The same commenter also recommended to define separate and independent
to require separate legal incorporation, employer identification number
(EIN), bank accounts, financial statements, audited books, governing
body, employees, HR function, IT environment, document repositories,
physical offices, insurance, legal counsel, lobbying/public-policy
function, communications staff, and

[[Page 68646]]

contracting authority. A related organization should be permitted to
submit input to the accrediting agency only through the same publicly
documented process available to unrelated stakeholders.
Discussion: We decline the recommendations as the Department
believes that the regulations are sufficiently rigorous to ensure that
recognized agencies are separate and independent.
The Department recognizes that separating standard-setting from
compliance evaluation may offer advantages, including reducing
potential conflicts of interest and promoting more consistent
enforcement of standards. Such an approach could also introduce
additional costs and operational complexities. We believe this proposal
warrants further consideration, including examination of quality
assurance practices in other industries. Accordingly, we are not
adopting additional requirements in this area in the present
rulemaking, but may consider this approach in future regulatory
actions.
Changes: None.
Comments: Some commenters opposed the changes to Sec. 602.14. They
believed the revised Sec. 602.14 will discourage programmatic
accrediting agencies from seeking recognition from the Department and
dramatically increase operating costs for programmatic agencies that
continue to seek Department recognition. Commenters believe that the
regulations do not explicitly recognize that programmatic accreditation
in regulated professions serve a different purpose from institutional
accreditation. Several commenters stated that the amendments will
severely disrupt professional preparation by forcing specialized,
programmatic agencies to sever formal organizational ties with related
professional associations. The commenters claimed that for fields such
as education, veterinary sciences, and speech-language-hearing, this
separation degrades the connection between academic training and real-
world professional standards. Other commenters stated that the
Department's rulemaking did not demonstrate that complete
organizational separation is necessary especially because HEA Section
496(a)(3)(C) allows for the Secretary to waive the separate and
independent requirement.
Finally, one commenter stated that the additions to Sec. 602.14
impose additional requirements on accrediting agencies not present in
statute. By adding additional criteria to the statutory definition of
separate and independent, the commenters believe that the Department is
violating the prohibition on establishing additional criteria for
accrediting agencies in Sec. 496(g) and is impermissibly changing
Congress's definition of ``separate and independent.''
Discussion: The statute does not differentiate the purposes of
recognized accrediting agencies--other than whether they are
institutional or programmatic and whether their Federal link is an HEA
or non-HEA program. Therefore, there is no statutory basis for treating
specialized, programmatic agencies differently, as the commenters
suggest. The Department has been clear that we seek to eliminate
conflicts of interest between accrediting agencies and related,
associated, or affiliated trade associations, and the separation
required by the regulations achieves that necessary goal to protect
students.
We have addressed our statutory authority under the Legal Authority
section of this final rule.
Changes: None.
Comments: Some commenters requested an exemption to the rescission
of paragraph Sec. 602.14(c) (about the joint use of personnel,
services, equipment, or facilities) including:
<bullet> Agencies with 501(c)(3) status. The commenter stated that
legal arrangements and contracts could be completed to allow for some
shared services with partnering agencies to keep costs within range.
<bullet> Agencies that accredit institutions that offer programs
like specialized health, podiatric medicine, and veterinary services.
The commenter stated that for a relatively small health profession,
requiring duplication of personnel, office space, technology,
administrative services, and other infrastructure could impose
substantial new costs.
<bullet> Agencies that accredit institutions that offer counselor
education.
<bullet> All recognized programmatic agencies.
<bullet> Agencies that distinguish between resource-sharing that
creates that risk and administrative resource-sharing.
Discussion: From the onset of this rulemaking effort, the
Department has made clear that we seek to ensure independence between
accrediting agencies and related, associated, or affiliated trade
associations. We believe that continuing to allow organizations to
jointly use space increases the risk of inappropriate collaboration
between entities that may result in credential inflation that burdens
students with additional unnecessary costs, increases the risk of
explicit or tacit collusion, and encourages the outsized influence of
related, associated, or affiliated trade association that results in
the postsecondary institution itself having less control over the
curriculum and coursework.
Changes: None.
Comments: Some commenters offered alternatives to the amendments,
including:
<bullet> Allow specific services to be excepted from the rescission
of Sec. 602.14(c), including joint use of legal services, IT services,
accounting firms, evaluator training, technical assistance, and
professional development.
<bullet> Give the Secretary the authority to grant a waiver to the
joint-use prohibition for good cause.
<bullet> Specify that employment by a professional organization
serving the same field as an accrediting agency's programs does not, by
itself, indicate a lack of independence.
<bullet> Adopt a functional independence standard.
<bullet> Strengthen safeguards as opposed to institute a categorial
exclusion.
<bullet> Clarify the scope of communication restrictions.
<bullet> Allow States sufficient time to amend their statutes and
regulations.
<bullet> Provide a multi-year transition period for recognized
agencies.
Discussion: We decline the commenters' suggestions; for the
rationale, please see the immediate previous discussion to this
section. The Department understands that agencies will have questions
regarding implementation of the final rule. We cannot address every
situation within the regulations because the regulations are meant to
be the general framework. We believe that the commenters' requests are
subregulatory in nature, and we may offer subregulatory guidance as
necessary to inform implementation.
Changes: None.
Comments: One commenter suggested edits to the waiver provisions
under the Sec. 602.14(d) waiver.
Discussion: We decline suggestions to the waiver provisions because
the final rule removes the waiver provisions.
Changes: None.

Sec. 602.15 Administrative and Fiscal Responsibilities

Comments: Several commenters offered general support for the
amendments to Sec. 602.15.
Discussion: We thank the commenters for their support.
Changes: None.
Comments: A few commenters supported the repeal of the prescriptive

[[Page 68647]]

body-composition mandates at Sec. 602.15(a)(3) and Sec. 602.15(a)(4).
Discussion: We agree and thank the commenters for their support.
Changes: None.
Comments: A few commenters were concerned that Sec. 602.15(a)(3)
would allow individuals who have never worked in a specific field to
participate in the educational evaluation processes. Additionally,
another commenter was concerned that the removal of Sec. 602.15(a)(4)
would remove the requirement for programmatic accrediting agencies to
include educators, practitioners, and/or employers on their evaluation,
policy, and decision-making bodies. The commenter questioned whether
evaluation bodies would be made up of individuals whose experience
might not be relevant.
Discussion: The Department disagrees with the commenters'
assertions. The regulations under Sec. 602.15(a)(2) require that
``Competent and knowledgeable individuals, qualified by education or
experience in their own right, as appropriate for their roles''.
Changes: None.
Comments: One commenter stated that Sec. 602.15(a)(6) is not
waivable, and the Department should say so expressly. The final rule
should provide that where a majority of an agency's decision-making
body consists of current or former senior leadership of, or fiduciaries
to, institutions the agency accredits, case-by-case recusal does not
satisfy Sec. 602.15(a)(6).
Discussion: Provisions under current Sec. 602.15(a)(6) have been
removed in this final rule.
Changes: None.
Comments: Several commenters offered general support for the
provisions under Sec. 602.15(c) stating that it will help reduce costs
to institutions as a result of the Paperwork Reduction Act (PRA).
Discussion: We thank the commenters for their support and agree
that these changes should help reduce costs overall for institutions
once implemented.
Changes: None.
Comments: One commenter stated that the Department should clarify
that accrediting agencies should minimize unnecessary compliance costs
and avoid duplicative demands when the same evidence is already
available through other sources.
Discussion: We believe there is already language under Sec.
602.15(c) that speaks to the commenter's request and that states ``The
agency conducts its accreditation activities in a manner that seeks to
avoid unnecessary financial, compliance, and administrative burdens,
including by avoiding duplicative reporting, excessive documentation
requirements, and unwarranted prescriptive processes.''
Changes: None.
Comments: A few commenters stated that the Department has not
adequately explained how it would determine whether an accreditation
activity or requirement creates an ``unnecessary'' burden or how this
provision would be applied through the recognition process. Commenters
recommended that the Department should clarify those items in Sec.
602.15(c).
Discussion: The Department declines this recommendation because
adding such factors to the regulations would result in requirements
that are too prescriptive and narrow. The Department may provide
additional subregulatory guidance on this issue in the future if we
determine that there is sufficient lack of understanding among
accrediting agencies.
Changes: None.
Comments: One commenter encouraged the Department to examine
functional relationships among accrediting agencies, professional
associations, testing organizations, certification bodies, and other
organizations.
Discussion: We believe we have struck a fair and nuanced balance
under the regulations in Sec. 602.14 and Sec. 602.15 to reduce
conflicts of interest between recognized agencies and their
stakeholders. The Department recognizes that professional associations,
testing organizations, certification bodies, and other organizations
can provide valuable expertise, information, and services that
contribute to effective accreditation. Such cooperation can improve the
development of accreditation standards, facilitate the evaluation of
educational quality, and reduce unnecessary duplication of effort.
At the same time, these organizations may have interests that
differ from those of students and the public. The Department's
regulations are intended to prevent relationships that create conflicts
of interest or give outside organizations inappropriate influence over
accreditation standards or other decisions, without unnecessarily
restricting legitimate collaboration or the exchange of expertise. The
Department believes this approach preserves the benefits of cooperation
while ensuring that accrediting agencies remain accountable for
independently carrying out their responsibilities to protect
educational quality and the public interest.
Changes: None.
Comments: Under Sec. 602.15(d), the Department requires that an
accrediting agency will cooperate with other accrediting agencies and
the Department in the development of common templates and forms for
institutions or programs to submit when seeking to change accrediting
agencies. One commenter suggested that the Department add language
clarifying that an agency is not required to modify its standards or
process for seeking accreditation as a part of the collaboration. The
same commenter suggests that language be added to Sec. 602.15(d) to
clarify what is meant by ``will cooperate with other agencies and the
Department in the development of common templates and forms for
institutions or programs to submit when seeking to change accrediting
agencies.'' Lastly, the commenter suggests that language should be
added to the regulations indicating that participating in the
collaboration required by Sec. 602.15(d) does not violate antitrust
laws.
Discussion: We decline to accept the commenter's suggestions. The
Department does not dictate an agency's standards. Per Sec. 602.16 and
Sec. 602.17, we only note which areas an agency must have standards
for and how those standards are applied. Additionally, this provision
does not require an agency to modify its accreditation process because
of any cooperation with another recognized agency.
All forms that the Department requires an accrediting agency to use
must complete a process called an information collection request (ICR).
ICRs have public comment periods; therefore, all agencies will be able
to weigh in on forms or templates related to institutions or programs
seeking to change agencies. The Department would not publish a form
that violated antitrust laws. In addition, we do not enforce the
antitrust laws, so it would not be appropriate to create an exhaustive
list of regulatory provisions that do not violate antitrust laws.
Changes: None.
Comments: One commenter recommended extending the cooperative-
format principle to academic records by amending Sec. 602.15(d) to
read, ``The agency will cooperate with other agencies and the
Department in the development of common templates and forms, and common
data formats for the exchange of academic records and transfer of
credit information, for institutions or programs to submit when seeking
to change accrediting agencies or when

[[Page 68648]]

evaluating credit earned at another institution.''
Discussion: We decline to accept the commenter's suggestion. The
Department does not seek to standardize the entire accreditation
process. Institutions and programs still need the flexibility to
develop forms and output documents that best meet the needs of their
specific student populations.
Changes: None.
Comments: Some commenters suggested removing Sec. 602.15(e)(2).
Commenters believe that the new requirements dictate the governance
structures of private entities. Commenters interpreted the provision as
beyond the narrow items delineated in Section 496(b)(2) of the HEA
regarding public members and stated that an agency must be free to
determine how it organizes its governance.
Other commenters stated that the regulation would require that an
accrediting agency's decision-making body not have the authority to set
standards or policy if its members are also representatives of impacted
institutions or programs. Commenters believe that the provision
effectively prohibits peer review. Due to changes under Sec. 602.3
that eliminate the requirement for peer review, commenters questioned
who the Department expects to be a part of an agency's review process
of an institution.
Discussion: The commenters concerns are unfounded because these
regulations are fully within the Department's authority and are simply
common-sense steps to prevent conflicts of interest by individuals who
set an agency's standards. The regulations prevent such individuals
from setting standards that directly benefit their institution or
program(s). The provision continues to allow anyone the agency chooses
to be a member of the standards-setting body, which may include members
of the agency's decision-making body. However, the members of the
standards-setting body cannot vote to adopt or revise standards or
policies if they are an officer, director, or employee of an accredited
institution or program because of the conflict of interest that this
poses.
There is nothing to restrict an agency from including in its
decision-making body employers, students, practitioners,
administrators, academics, and/or educators from institutions or
programs not accredited by the agency. This provision also does not
limit members regarding other responsibilities of the decision-making
body, which can include fiduciary, accreditation decisions, procedures
for implementing standards and policies, and other administrative
procedures.
Changes: None.
Comments: Some commenters opposed the requirements for operational
separation from related, associated, or affiliated trade association or
professional organization under Sec. 602.15(e)(4). The commenters
stated that the provisions will substantially increase the cost of
accreditation while also limiting the clinical, surgical, and
educational expertise available to inform standards that directly
affect the preparation of future podiatric physicians and surgeons.
Several commenters were concerned that the requirements would go
significantly beyond ensuring independent accreditation decision-making
by prohibiting the sharing of personnel, services, facilities,
equipment, information technology infrastructure, and office space with
an affiliated professional organization. One commenter requested that
the Department allow specialized and professional accrediting agencies
to demonstrate independence through effective, enforceable safeguards
rather than requiring complete physical and operational separation in
all circumstances.
Discussion: Similar to responses under Sec. 602.10 and Sec.
602.14, the Department strongly believes that the shared use of
resources, personnel, services, equipment, facilities, information
technology, and office space, has led to the outsized and direct
influence of related, associated, or affiliated trade association over
accreditation standards and decisions.
These arrangements can give trade associations influence over the
selection, supervision, and compensation of personnel, control over
budgets and access to essential services, and access to confidential
accreditation information. Even in the absence of direct interference
in individual accreditation decisions, an accrediting agency's
dependence on a trade association for essential operational resources
can compromise its ability to establish standards, conduct evaluations,
and make accreditation decisions independently, particularly when those
decisions conflict with the interests of the trade association or its
members.
Such influence can harm students and the public in several ways. A
trade association may have an interest in protecting its members from
adverse accreditation decisions, even when those decisions are
necessary to protect students. It may also seek to weaken standards
that impose costs on its members or, conversely, support unnecessarily
restrictive standards that protect established institutions from
competition and innovation. These conflicts of interest can result in
students receiving an inadequate education, incurring debt for
credentials of limited value, or being denied access to lower-cost or
innovative educational opportunities. They can also expose taxpayers to
losses when institutions that fail to provide adequate educational
quality continue to participate in the Federal student aid programs.
Changes: None.
Comments: One commenter recommended that the Department should
expressly state that ``services'' include legal, compliance, insurance,
indemnification, government-relations, lobbying, communications and
risk-management services.
Discussion: The Department declines to define ``services'' further.
We believe the term used here is intentional and is widely understood
within the community at-large. The regulations prevent accrediting
agencies from sharing resources with any related, associated, or
affiliated trade association or professional organization, including,
but not limited to, services. All of the items cited by the commenter
would be included in the umbrella concept of ``shared resources,'' and
this term should be interpreted broadly.
Changes: None.
Comments: A few commenters opposed Sec. 602.15(e)(5) entirely. One
commenter stated that professional affiliation within the broader field
does not necessarily create a conflict. The commenter recommended that
the rule focus on whether an individual's relationship creates a
conflict that could compromise the specific decision. The commenter
also recommended that the Department consider clarifying that recusal
applies to decisions affecting an institution or program with which an
individual has an officer, director, or employee relationship. This
approach could avoid extending recusal requirements to circumstances in
which an individual's professional expertise or employment within the
broader field does not create a conflict with the specific matter under
consideration.
Discussion: We believe that the provision is clear and does not
require additional clarification. Again, the Department strongly
believes that close relationships between accrediting agencies and
related, associated, or affiliated trade associations has led to the
outsized and direct influence of accreditation standards and decisions.
This provision ensures that the conflict

[[Page 68649]]

of interest is removed from the agency and the aforementioned entities.
Changes: None.
Comments: One commenter supported Sec. 602.15(e)(7), which would
require an agency that acts to restrict access to a profession to show
by clear and convincing evidence that, among other things, the
restriction is necessary to protect the public interest and which
allows such restriction to include raising the cost or level of
required education or training. Placing the burden on the agency is the
appropriate allocation where the agency is the only path into the
profession.
Discussion: We thank the commenter for their support.
Changes: None.
Comments: Several commenters opposed Sec. 602.15(e)(7). One
commenter believed that the provision permits the Department to second
guess substantive programmatic accreditation standards whenever those
standards may increase credentialing expectations, educational cost, or
the level of required education or training. The commenters stated that
a ``clear and convincing evidence'' standard, applied without regard to
the professional consensus underlying a standard, could place the
Department in the position of second-guessing peer-developed, patient
safety-driven professional judgments--such as minimum competency
thresholds tied to a licensing examination--using an evidentiary
standard that is difficult to satisfy for any qualitative professional
judgment, however well-founded.
Discussion: The Department will not second-guess an agency's
standard as long as it can provide clear and convincing evidence that
the rationale for the restriction meets the requirements of Sec.
602.15(e)(7).
Changes: None.
Comments: One commenter requested that the Department confirm in
the preamble that the public interest provision under Sec.
602.15(e)(7) accommodates educational standards adopted to meet
independent national certification and State licensure requirements and
to protect patient safety in relevant fields.
Discussion: The Department agrees with the commenter in that Sec.
602.15(e)(7)(i) requires an accrediting agency to provide clear and
convincing evidence that the independent national certification
requirements are necessary to protect the public interest, the expected
public benefits outweigh the cost the public, and no less restrictive
alternative would protect the public interest when restricting access
to employment in a profession, occupation, or vocation. As noted in
Sec. 602.23(h) of the final rule, an agency must not have policies
that require institutions or programs to violate any State law.
Changes: None.
Comments: Commenters made multiple suggestions for Sec.
602.15(e)(7) including: (1) stating that faculty and practitioner
shortages must be part of the credential inflation analysis under Sec.
602.15(e)(7), (2) requiring a less-restrictive alternative analysis,
not merely requiring quality rationale (3) requiring an occupational
entry impact assessment before every material impact change, and (4)
having a recognized programmatic accrediting agency require Department
approval before creating a bridge, equivalency, prerequisite-approval,
or academic-clearance mechanism that determines whether education
completed outside the accredited program satisfies requirements for
individual occupational eligibility.
Discussion: It appears the same commenter submitted multiple
individual comments to Sec. 602.15(e) with the most being to (e)(7).
We decline the suggestions because we believe the commenter's
suggestions are outside of the scope of Sec. 602.15(e)(7).
Changes: None.
Comments: One commenter recommended that the Department
<bullet> Add Sec. 602.15(e)(7)(ii)(D): ``obtaining or acting to
maintain any provision of Federal or State law, regulation, or program
requirement that conditions employment, appointment, licensure,
certification, or reimbursement on accreditation by that agency
specifically, or that excludes graduates of programs accredited by
another agency.''
<bullet> Add Sec. 602.15(e)(7)(iv): ``An agency named in any
Federal or State law, regulation, or program requirement described in
paragraph (e)(7)(ii)(D) must disclose, in each petition for
recognition, each such provision known to the agency and any
communication by the agency or by any related, associated, or
affiliated trade association or professional organization with the
issuing authority concerning its adoption, retention, or amendment.''
Discussion: We decline the additions. As noted in Sec. 602.23(h)
of the final rule, an agency must not have policies that require
institutions or programs to violate any Federal or State law. We
believe the suggested amendments would be overly burdensome for
agencies and produce no substantially more beneficial impact than the
new final rule.
Changes: None.
Comments: One commenter recommended that the Department
<bullet> Add Sec. 602.15(e)(8): ``Publicly disclose each
requirement in the agency's own standards that obligates a student or
trainee to purchase or obtain any product, service, insurance,
credential, examination, or membership, together with the identity of
any related, associated, or affiliated trade association or
professional organization that provides, sponsors, or receives any
payment or other consideration in connection with it.''
<bullet> Add Sec. 602.15(e)(9): ``Where the agency's standards
require a student or trainee to obtain any product, service, insurance,
credential, or examination, the agency must require as a condition of
accreditation that the institution or program . . .''
Discussion: We decline the additions. We believe they would be too
prescriptive. However, accrediting agencies may voluntarily adopt the
commenter's suggestions, and the Department would encourage such
transparency.
Change: None.
Comments: Some commenters suggested removing Sec. 602.15(f)
because the language is unnecessary as agencies do not and, under the
law, cannot restrict an institution's legal obligations, including
regarding the First Amendment. The commenter stated that public
institutions already follow Federal law to implement the First
Amendment's freedoms of religion, speech, press, assembly, and
petition. Another commenter stated that agencies do not have the
expertise to interpret complex constitutional law issues.
One commenter suggested alternative language: ``The agency's
accreditation standards, policies must not restrict public institutions
from fulfilling their obligations under the First Amendment to the
Constitution of the United States. These standards similarly also must
not restrict any private institutions that, through their institutional
policies, guarantee the same or similar protections for students or
faculty, unless the institution has a religious mission.'' Finally, the
commenter asked the Department to clarify ``. . . unless the
institution has a religious mission.''
Discussion: The Department declines the commenters' suggestion to
remove the provision. The Department seeks to remind agencies of the
obligations under the Constitution as required under E.O. 14279 to
ensure that ``accreditors are not using their role under Federal law to
encourage or force institutions to violate State laws, unless such
State laws violate the Constitution or Federal law.'' The Department
will

[[Page 68650]]

maintain the reference to ``enforcement practices'' in the regulation
to ensure that agencies understand that they cannot enforce any agency
provision, standard, or policy on an institution or program that
violates the First Amendment. E.O. 14279 provided examples that the
administration believes were violations of the First Amendment.
Finally, regarding the phrase ``unless the institution has a
religious mission,'' the final rule is consistent with existing law for
a religious-mission institution because the institution would not be
required to adopt viewpoint-range, intellectual-diversity policies, or
academic-freedom protections that would conflict with that mission. The
substitute duty is inquiry and student learning consistent with the
mission. This is not a general exemption from 602.16 standards,
eligibility for title IV, HEA funds, student-achievement standards,
fiscal capacity, or the core curriculum requirement in 602.18(b)(3).
Separately, the final rule also says nothing in the viewpoint-
neutrality paragraph for agencies that require an accrediting agency
that itself has a religious mission to be neutral with respect to
viewpoints. This is an agency-level clause, not an institutional one.
Changes: None.
Comments: Several commenters sought guidance or clarifications
about various provisions under this section.
Discussion: The Department may issue subregulatory guidance or
clarifications regarding specific issues addressed in these regulations
if, following publication of the final rule, the Department determines
that further clarification is necessary to support the regulated
community's understanding and implementation of the rule.
Changes: None.

Sec. 602.16 Accreditation and Preaccreditation Standards

Comments: A few commenters supported the amendments to Sec.
602.16. One commenter stated that the changes to Sec. 602.16 would
strengthen the requirements for agencies to evaluate student outcomes,
which is an important improvement that would benefit students and
taxpayers. Agencies would be required to set standards for student
achievement at the institutional and program levels, and the proposal
allows agencies to tailor those standards for each institution.
Discussion: We agree and thank the commenters for their support.
Changes: None.
Comments: Several commenters expressed concern with the amendments
to Sec. 602.16. One commenter stated that the changes undermine
longstanding professional accreditation standards and put students'
eligibility for licensure at risk. Another commenter stated that
defining success solely in relation to an institution's mission, and
thereby allowing different standards for different programs, could
endanger the public because veterinary licensure authorizes practice
across the full scope of the profession.
Discussion: We disagree with commenters. Except for the cross
reference to Sec. 602.17(a)(1) under Sec. 602.16(a)(1)(i), the
changes to this section are technical in nature and do not reference
licensure. The regulations under Sec. 602.16(a)(1)(i) currently allow
for ``. . . different standards for different institutions or programs
. . .''. This is not a new policy; the statute has expressly permitted
different standards for different institutions and programs since 2008
and the Department's implementing regulations since 2009.
Changes: None.
Comments: One commenter stated that the Department provided
insufficient explanation for the change under Sec. 602.16(a)(1)(i)
that adds ``. . . at the institutional and program level . . .'' The
commenter believes that the Department cannot use the regulations to
impose an additional accreditation requirement that Congress did not
authorize or to dictate the level at which an accrediting agency must
evaluate student achievement.
Discussion: The Department has not added additional requirements or
standards to the regulations. The accrediting agency is responsible for
reviewing and confirming academic quality at an institution, and that
includes the programs that the institution offers. That an agency would
have standards for student success at both institutional and
programmatic levels is consistent with the best reading of the statute.
The commenter should recognize that review at both the institutional
and programmatic levels is necessary to account for variations in
quality and outcomes across programs within the same institution.
Changes: None.
Comments: One commenter supported the addition of ``at the
institutional and program level'' in Sec. 602.16(a)(1)(i).
Institution-level averages conceal program-level failure, and making
the program level explicit is worthwhile even though the Department
characterizes the accompanying change from ``set forth clear
expectations'' to ``establish requirements'' as not altering the
regulation's effect. The commenter requested that the Department
confirm in the preamble that agencies retain discretion to apply
program-level review proportionately--an institution offering more than
120 programs and one offering six programs should not face identical
documentation volume requirements for the same regulatory purpose.
Discussion: We thank the commenter for their support. Yes, agencies
retain discretion to apply program-level review proportionately. We
thank the commenter for their support.
Changes: None.
Comments: One commenter recommended that the Department clarify
that agencies in Sec. 602.16(a)(1) should assess whether undergraduate
students have access to some form of review that is structurally
independent of the original decision-maker for academic and
administrative grievances that do not involve discrimination.
Discussion: We decline the commenter's recommendation because we
believe the new process outlined under Sec. 602.23(l) is sufficient.
Changes: None.
Comments: One commenter recommended that Sec. 602.16(a)(1)(i)
should include time-to-declaration and major-transition metrics for
undeclared, pre-major or exploratory students.
Discussion: The Department declines to add the metrics proposed by
the commenter. Such requirements would be too prescriptive, and we
prefer to allow accrediting agencies to make their own decisions about
exactly what to measure within the parameters of 602.16(a)(1)(i).
Changes: None.
Comments: One commenter recommended updating Sec. 602.16(a)(1)(i)
to read:
``(i) Success with respect to student achievement at the
institutional and program level in relation to the institution's
mission, which may include different standards for different
institutions or programs and may recognize multiple pathways to
academic progress and achievement, as established by the institution,
including, as appropriate, consideration of State licensing
examinations, course completion, job placement rates, and credit for
prior learning, as described in Sec. 602.17(a)(1).''
Discussion: The Department declines the recommendation of the
commenter as we believe that the suggestion is technical in nature. The
regulation says ``. . . including, as appropriate'', which gives
agencies and institutions flexibility to recognize multiple pathways to
academic progress and achievement.
Changes: None.

[[Page 68651]]

Comments: One commenter supported the proposed provision under
Sec. 602.16(f) that would permit agencies to adopt additional
standards beyond Section 496 of the HEA only where those standards are
lawful and consistent with ensuring institutional or programmatic
quality and integrity. The commenter stated that standards that are
neither required by statute nor connected to quality or integrity
impose cost without producing educational value, and students pay for
that cost in tuition.
Discussion: We agree and thank the commenter for their support.
Changes: None.
Comments: Several commenters opposed Sec. 602.16(f) that states an
agency may establish any additional lawful accreditation standards that
are consistent with ensuring institutional or programmatic quality and
integrity as it deems appropriate. One commenter stated that this
provision is an open door for the current administration to use
partisan influence to promote a conservative agenda. Several other
commenters stated that the amendment exceeded the Department's
authority and had concerns that the Department would have too much
discretion to determine what ``lawful'' means.
Discussion: We believe the commenters misinterpreted the provision.
The provision allows an accrediting agency to establish additional
lawful standards, not the Department. The commenters should note that
the Department has not added additional standards under Sec. 602.16.
Changes: None.
Comments: One commenter stated that the NPRM repeatedly references
that the Department will clarify the regulations in the Accreditation
Handbook, including under part Sec. 602.16. The commenter stated that
because guidance is not legally binding like regulation, leaving core
implementation details to future guidance creates legal and operational
uncertainty for accrediting agencies and institutions.
Discussion: The Department routinely issues subregulatory guidance
to clarify regulatory requirements and facilitate implementation.
Consistent with this longstanding practice, the Department uses the
Accreditation Handbook to provide policy and operational guidance to
accrediting agencies regarding implementation of 34 CFR part 602. To
the extent the commenter's requests concern matters appropriately
addressed through subregulatory guidance, the Department may provide
further clarification, including through the Accreditation Handbook, as
necessary to support implementation.
Changes: None.
Comments: One commenter expressed strong support for the
regulations under Sec. 602.16(g)(3) and (g)(4).
Discussion: We appreciate the commenter's support. Please note that
there are no proposed changes to these provisions.
Changes: None.
Comments: One commenter requested that the Department add Sec.
602.16(g): ``The agency's requirements must be stated in its own
published standards. The agency may not require institutions or
programs to conform to, or evaluate them against, the standards, the
code of ethics, code of conduct, guidelines, policies, or positions of
any other organization, whether by incorporation by reference or
otherwise, except as required by applicable Federal or State law.''
Discussion: We decline to accept the commenter's recommendation. We
believe that the suggestion is already covered under Sec.
602.18(a)(3).
Changes: None.
Comments: One commenter stated that proposed Sec. 602.16(f)
permits an agency to establish ``any additional lawful accreditation
standards.'' The commenter requested that the Department confirm in the
final rule that a standard requiring an institution, its faculty, or
its students to affirm a contested viewpoint as a condition of
accreditation is not a ``lawful'' standard within the meaning of Sec.
602.16(f).
Discussion: If faculty or a student believes that an agency is
inappropriately or illegally requiring them to affirm a contested
viewpoint, they can file a formal complaint with the agency itself. If
the resolution is not satisfactory to the faculty or student, they can
submit formal complaints about an agency to the Department at
<a href="/cdn-cgi/l/email-protection#ddbcaeb1afb8beb2afb9aeb0bcb3bcbab8af9db8b9f3bab2ab">[email&#160;protected]</a> or call 202-453-7615. The commenter may also
attend a NACIQI meeting and provide public comment regarding an
accrediting agency. The Department encourages the commenter to consult
the Federal Register and the NACIQI website for announcements and
information regarding upcoming meetings and opportunities for public
comment.
Changes: None.
Comments: One commenter made multiple individual recommendations
for Sec. 602.16, including:
<bullet> Require accreditation standards to distinguish objective
competency requirements from global discretionary judgments.
<bullet> Require that if a program director signs or transmits a
verification document, the recipient should know what exactly is being
attested.
<bullet> Direct agencies to prefer licensure outcomes, completion,
validated competency performance, employment outcomes.
<bullet> Prohibit program completion documents from becoming
private occupational licenses.
<bullet> Be aware that accreditation should set outcomes, not
create a national ladder from associate through graduate education.
<bullet> State that Federally recognized accrediting agencies may
define minimum educational outcomes but may not prescribe subordinate
curricular architecture, competency taxonomies, assessment methods or
progression systems unless those prescriptions satisfy a documented
necessity and least restrictive-alternative test.
Discussion: We thank the commenter for submitting multiple
thoughtful recommendations to this section of the rule; however, we
decline to accept them because they go beyond the statutory framework,
and we believe that they are more aspirational requests than specific
regulatory proposals.
Changes: None.

Sec. 602.17 Application of Standards in Reaching Accreditation
Decisions

Comments: Several commenters offered support for the amendments
under Sec. 602.17(a)(1). One commenter stated that agencies have not
always done a good job upholding high standards of student achievement.
The commenter stated that agencies also rarely sanction their member
institutions for poor student outcomes. The Department's language does
not specify a single numerical cutoff where agencies need to set their
minimum expectations, but they must have minimum expectations
documented. The commenters stated that one of the most critical minimum
standards for agencies to enforce is the minimum expectations for
retention, completion, and graduation rates.
Discussion: We agree and thank the commenters for their support. We
believe that these amendments provide reasonable parameters that
accrediting agencies can use to ensure educational quality without
imposing specific mechanisms that agencies must use in their evaluation
of institutions or programs.
Changes: None.
Comments: The largest percentage of comments focused on the
proposed changes in Sec. 602.17. Commenters raised

[[Page 68652]]

concerns about: (1) the Department's focus on economic returns in the
assessment of student achievement, which they believed did not properly
take into account institutional type or mission; (2) the inclusion of
cost/benefit analysis when agencies are evaluating compliance with
standards for facilities, equipment, and supplies and student support
services; (3) the lack of availability of reliable data to assess
student success outcomes with respect to student achievement under
Sec. 602.17(a)(1)(ii); (4) infringement into institutional autonomy,
governance, and management, especially in regards to faculty; (5)
minimal guidance or explanation of the new provisions; (6)
administrative burden and cost implications; (7) the Department's lack
of authority to add standards; and (8) how the Department will enforce
provisions containing the phrases ``academic freedom'' and
``intellectual diversity.''
Commenters offered language suggestions, revisions, clarifications,
and many asked for complete rescission of the proposal. Several
institutions requested that the agencies that accredit their
institutions receive special considerations with the final rule based
on the populations they serve, including but not limited to religious
institutions/programs, minority-serving institutions, tribal colleges
and universities, small institutions, liberal arts institutions, and
specialized institutions. If no changes are made in the final rule,
some commenters requested that the Department release extensive
subregulatory guidance explaining each of the provisions.
Discussion: For more information regarding the Department's legal
authority to establish these requirements, please see the Legal
Authority section of this final rule.
The changes to this section do not prescribe thresholds. An agency
retains the authority to establish a threshold for compliance with the
standards. The Department believes these changes will strengthen
educational quality by prioritizing positive student outcomes over
procedural compliance requirements that lack a demonstrated connection
to those outcomes. These changes will result in lower costs for
taxpayers and an increase in benefits for students. The Department
declines to offer exceptions or carve-outs to these provisions because
we seek to standardize application of the standards.
Following publication of the final rule in the Federal Register,
the Department may issue nonbinding subregulatory guidance if it
determines that additional clarification is necessary to facilitate
implementation.
Changes: None.
Comments: Some commenters opposed the amendments under Sec.
602.17(a)(1). Opposition included, but was not limited to, legality,
cost to agencies and institutions, lack of necessary data, and too much
focus on the return-on-investment metrics.
Commenters stated that the proposal exceeds the Department's
authority and constitutes Federal overreach. 496(a)(5) of the HEA
prescribes the specific standards for accreditation. Some commenters
believe that the Department has added new standards that do not
currently exist in statute. The commenters often cited Section 496(g)
of the HEA as expressing Congressional intent on the limitation of the
Department's authority to establish additional standards: ``Nothing in
this Act shall be construed to permit the Secretary to establish
criteria for accrediting agencies or associations that are not required
by this section. Nothing in this Act shall be construed to prohibit or
limit any accrediting agency or association from adopting additional
standards not provided for in this section. Nothing in this section
shall be construed to permit the Secretary to establish any criteria
that specifies, defines, or prescribes the standards that accrediting
agencies or associations shall use to assess any institution's success
with respect to student achievement.'' Commenters cited Section 496(o)
that states the Secretary ``shall not promulgate any regulation with
respect to the standards of an accrediting agency or association
described in subsection (a)(5).'' Commenters also cited Section 103 of
the Department of Education Organization Act as evidence of
Congressional intent on the limits of the Department's authority: ``No
provision of a program administered by the Secretary or by any other
officer of the Department shall be construed t

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