Rule-making notices
Notice of Hearing
NOTICE IS HEREBY GIVEN that pursuant to ss.
45.54 (2) and
(3), and
227.11 (2), Stats., and interpreting s.
45.54 (2),
(3),
(7) and
(10), Stats., the Wisconsin Educational Approval Board will hold a public hearing at the time and place indicated below to consider an order relating to the regulation of for-profit postsecondary schools; out-of-state, non-profit colleges and universities; and in-state, non-profit institutions incorporated after 1991.
Hearing Information
The public hearing will be held:
Tuesday, December 17, 2002 at 1:30 p.m.
8th Floor Board Conference Room
Department of Veterans Affairs
30 W. Mifflin Street
Madison, Wisconsin
Interested persons are invited to present information at the hearing. Persons appearing may provide oral testimony but are urged to submit facts, opinions and argument in writing. Written commentary may also be submitted without making a personal appearance by mail addressed to the Educational Approval Board, 30 W. Mifflin Street, P.O. Box 8696, Madison, WI 53708. Written comments must be received by December 19, 2002 to be included in the official record of rule-making proceedings.
Any person who has a qualifying disability as defined by the Americans with Disabilities Act that requires the meeting or materials at the meeting to be in an accessible location or format must contact the EAB at 608/266-1996 at least ten days prior to the hearing so that necessary arrangements can be made.
Analysis prepared by the Educational Approval Board
• Create a definition of a “recognized accrediting body".
Accreditation is a formal status granted to an institution meeting or exceeding state educational criteria. The purposes of accreditation are to assess and enhance consistency in institutional operations, promote improvement, and provide for public accountability. There are presently hundreds of different accrediting agencies. However, the U.S. Department of Education (ED) recognizes only certain regional, national, and specialized accrediting agencies to serve as reliable authorities as to the quality of educational institutions. The proposed rule defines an accrediting body as those recognized by the ED.
• Amend the definition of a “school" so that it is consistent with its statutory usage.
• Amend the definition of a “sponsor" to include a government agency.
Many EAB-approved schools enroll individuals who received funding from government agencies, such as the state Department of Workforce Development and the U.S. Department of Education. These sponsors provide assistance through worker retraining grants, vocational rehabilitation funding, and federal student financial aid, among others. The proposed rule amends the current definition of a sponsor to include a government agency.
• Create a definition of a “teach-out".The proposed rule defines a teach-out, a term that refers to the completion of an EAB-approved program in which a student enrolled. Typically, a teach-out is used to fulfill the promises made to students when a school closes or does not fulfill its contractual obligations to provide certain education or training services.
• Amend board-operating procedures.
The procedures for conducting board meetings are presently identified in rule. In the absence of a specific rule provision, Roberts Rules of Order apply. This proposed rule would give the board the authority to adopt by resolution alternative procedures regarding the manner in which business is conducted, so long as they do not conflict with the rules of Roberts Rules of Order. In addition, the proposed rule would allow board members to participate in board meetings via teleconference or videoconference.
• Clarify the delegation of board responsibilities to staff.
The Educational Approval Board is a seven-member policy-making body whose purpose is to protect the general public by inspecting and approving certain schools doing business within the state. Under current law, the board employs an executive secretary that is charged with performing the administrative functions of the board. This provision is intended to clarify that the board has delegated the executive secretary to perform the board's administrative functions.
• Create a set of intermediate sanctions that the EAB can place upon a school for regulatory violations.
Under current administrative rule, the EAB's authority is restricted to granting, denying, or revoking the approval of a school. While these actions are appropriate for serious school violations, the EAB lacks the ability to address school violations that do not necessarily warrant denying or revoking the school's approval. By creating intermediate sanctions, the EAB would have additional options for dealing with schools that are non-compliant. The proposed rule would allow the board to: [1] require the submission and implementation of a school improvement plan to address or correct problems identified by the board; [2] suspend the enrollment of students for one or more of the approved programs offered by the school; and, [3] impose a fine on the school, not to exceed $500 per day. The board would also be able to issue a cease and desist order to any school that operates without proper approval.
• Create a provision allowing the board to waive second payment renewal fees in certain instances.
As a cost efficiency measure, the proposed rule will allow the EAB to waive annual renewal fees that are less than $50.
• Clarify that a hearing requested by a school regarding a board action would pertain to either a denial or revocation of approval and would be before an administrative law judge.
The proposed rule makes it explicit that the board has the ability to deny an initial request for school approval, clarifies that a school may request a hearing before the board to contest a decision to deny or revoke school approval, and that any appeal of a board decision would be before an administrative law judge. In addition, the rule specifies the manner in which the board is required to provide notice of such actions.
• Create a provision that requires schools to have a minimum surety bond.
The proposed rule will require schools to have a $10,000 minimum surety bond. Several years ago, the need for a minimum bond of $25,000 was eliminated and the current provision to set a bond based on a school's unearned tuition was substituted. The current provision works well for established schools which have unearned tuition. However, in the case of a new school seeking board approval, the current method of determining an appropriate bond level does not work well. Because there is no “history" of unearned tuition, staff must rely on enrollment and revenue projections. It can be a year or more before reliable data is available to know if the bond is set at an appropriate level.
• Allow the board to use a surety bond on which it collects for a teach-out.
The proposed rule would allow the board to use bond proceeds to contract with a provider to teach-out students affected by a school that cannot fulfill its obligations to provide certain education or training services. This authority would help to ensure that a student completes the education or training that they had initially intended to attain.
• Amend the retention of records by schools.
Under current rule, a school only needs to retain student records for 6 years after graduation or the last date of enrollment. This provision clarifies that a school must keep student transcripts indefinitely.
• Create a provision for the retention of closed school records by the board.
In certain situations, the board has become the custodian of student records (e.g., when a school closes and the board secures them to ensure their safekeeping). This provision specifies that the student records in the possession of the board are to be maintained in accordance with retention and disposition authorization procedures established by the state records board and the federal family educational rights and privacy act (FERPA) of 1974.
• Amend the refund provisions pertaining to partial refunds.
Under current rules, there are no provisions that address refunds to students who withdraw or are dismissed prior to beginning classes. This rule clarifies that students who have not started classes are entitled to a partial refund, as determined by rule. In addition, to facilitate refund determinations involving students who stop attending classes but fail to inform the school, the proposed rule will require all schools to have a constructive notice of an intention to withdraw policy. This provision was (inadvertently) eliminated when the rule was last revised.
• Create specific provisions regarding the regulation of distance learning.
Section
45.54 (2), Stats., states that the purpose of the educational approval board is to protect the general public by “approving schools
…doing business within the state whether located within or outside this state
…" Further, s.
EAB 4.01 (1) states, “[a] school shall not operate, conduct business, offer any programs, advertise or enroll students unless it has been approved or determined to be exempt." Clearly, out-of-state, on-line schools offering programs via distance learning to Wisconsin residents are subject to EAB oversight and regulation.
The educational approval board's current regulatory framework and fee structure for initial school approval was based on an assumption that out-of-state schools delivered programs to classes of students at specific Wisconsin locations. With distance learning via the Internet, delivery is no longer place specific and a new fee structure must reflect this new reality.
Through distance learning, schools can now offer programs in all 50 states and have no physical presence. As in the traditional school model, online schools make money by enrolling classes of students, but those classes are no longer tied to a location. For example, an online class can literally consist of 20 students in 20 different states. Based on the EAB's current fee structure, it can be cost prohibitive for schools to be approved to offer online courses in Wisconsin.
Confronted with this reality, an online school will choose to either not operate in the state or ignore the approval requirements. While a school that chooses not to operate in the state ultimately limits the educational opportunities available to Wisconsin residents, a school that ignores the need for approval sets in motion an enforcement effort that is legally complex, expensive, and time consuming.
Under current rule, a school meeting certain conditions may be granted a fee reduction. While this fee reduction might provide some relief, it is not an effective way to deal with the issue presented by distance learning providers. Moreover, the fee reduction was intended to address larger, traditional institutions.
The EAB seeks to address the reality of distance learning by more fairly regulating online schools, while maintaining adequate oversight. An initial school approval fee that recognizes the unique characteristics associated with online instruction will help encourage providers to have their online programs approved in Wisconsin. As required under s.
45.54 (10) (c), Stats., the new fee structure would need to be sufficient to cover the costs incurred by the EAB to approve the school.
• The rule makes changes to correct erroneous technical information and inconsistent references to other provisions.
During the last rule update, a number of references were inadvertently amended to reference erroneous provisions. The proposed rule amends those provisions to correct these errors.
Fiscal Estimate
This rule has no fiscal effect.
Initial Regulatory Flexibility Analysis
The proposed rule relates to small businesses that operate as private postsecondary schools. In general, the rule clarifies and updates existing rule provisions. Therefore, it has been determined that this rule will not significantly affect the administrative functions or the professional skills required in order to comply with the rule.
Copies of the Rule and Contact Person
Copies of this proposed rule are available without cost upon request to:
Blanca James
Educational Approval Board
30 W. Mifflin Street, 9th Floor
P.O. Box 8696
Madison, Wisconsin 53708
Questions regarding the rule should be directed to David Dies at 608/267-7733.
Notice of Hearing
