Twenty-two policy and advocacy organizations urge college accrediting agencies to improve their financial monitoring of institutions of higher learning, protect students enrolled at colleges facing the risk of closure, and conduct additional oversight of colleges that have transitioned to online operations—all in the wake of the coronavirus crisis. The letter can be found on this link.
The coronavirus pandemic continues to create unprecedented uncertainty for higher education. In a sector where many private colleges were already under pressure, COVID-19 is causing increased financial strain on institutional budgets. Colleges have been forced to switch operations to online learning, issue large sums of money in refunds to students for housing and other fees, and now face uncertain fall enrollment. In addition to the damaging losses in revenue and unpredictable fall enrollment, public colleges face looming state budget cuts that will lead to additional challenges.
The risk of financial fallout is increasing. According to Education Dive, earlier this year, “Moody’s Investors Service downgraded its outlook for the higher education sector from stable to negative,” pointing to more than 30 percent of public colleges and almost 30 percent of private colleges already experiencing operating deficits. According to Moody’s, only about 5 percent of private colleges have at least 90 days of cash available to help them withstand the losses. Other projections in light of the pandemic estimate that college tuition revenue will decrease by 10 percent in the year ahead and the number of institutions at high risk of closure will increase by 40 percent. As COVID-19 wears on, an increasing number of colleges will be forced to shut their doors permanently.
Financial constraints may also affect institutions’ ability to offer quality online learning opportunities. For students enrolled at institutions that have had to suddenly switch their operations online and the colleges serving them, online education already presents additional challenges. Some students have reported limited student and faculty interaction and negative effects on the quality and rigor of their courses. Meanwhile, institutions that have made the switch report that one of the biggest challenges for many students is that online education is not their preferred way to learn. Many lack access to proper equipment or internet service, undermining their ability to engage meaningfully in virtual coursework. This raises the risk that students—particularly low-income students—will see the promise of their program diminished and, ultimately, not complete their courses or decide to defer enrollment and not return. For students, the quality of education received is an important factor in completion.
Tasked with ensuring educational quality, accrediting agencies play a critical role in monitoring the colleges they oversee. The pandemic provides accrediting agencies with the opportunity and responsibility to proactively monitor institutions as the first line of defense and protect students as they navigate crisis and uncertainty. As accreditors help institutions address this crisis and provide additional flexibility that allows colleges to operate seamlessly online, they should also prepare for the inevitable outcome that many institutions will close in the months and years ahead, and they should make efforts to mitigate the harm this could have on countless students. The following three policy changes will help protect students and minimize harm.
Increase monitoring and oversight of institutional finances and enrollment. As institutions of higher learning face mounting financial uncertainty, accreditors should increase monitoring and identify those at greatest risk of closure. This includes collecting data more regularly to monitor institutional finances and enrollment, using new data to identify colleges at greatest risk of closure, conducting regular and frequent data collection on finances and enrollment for institutions at high risk of closure, and monitoring enrollment changes for lower-risk institutions. For example, accreditors could collect new indicators that include a current assessment of cash flow and an institution’s expected or actual change in enrollment, which represents one of the most important indicators of an institution’s financial health. For high-risk institutions, data collection on projected enrollment could occur on a biweekly basis.
Implement student safeguards for potential closures. Agencies should require teach-out plans and agreements from colleges at high risk of closure. This means putting plans in place to ensure students have high-quality transfer options to continue their studies at financially secure colleges and that include guarantees for students that they will not be charged excessive additional tuition and fees. However, teach-out plans are not adequate to ensure students have high-quality transfer options to continue their studies; for the highest-risk schools, teach-out agreements must be required at signs of significant trouble, prior to an announcement of closure. The new accreditation regulations, which go into effect in July, provide a road map that ensures that receiving institutions are of high quality, the minimum expectations for what students should expect, and that these provisions should be implemented as soon as possible. Accreditors should also give ample thought to ensuring plans and agreements include a thorough records management plan. The plan must ensure students have access to their financial and academic records in the event of a closure without facing additional charges or limits based on fees owed.
Monitor institutions’ use of online educational delivery. It is important that accreditors monitor which institutions have fully switched to online distance learning while their campuses are closed to ensure they are meeting regulatory requirements and to be able to determine which institutions need additional approval when the national emergency ends. As an increasing number of institutions make decisions about online operations continuing into the fall, accreditors should require minimum reporting and documentation on how institutions are ensuring quality in their online programs and how programs are meeting federal requirements to ensure regular and substantive interactions between students and their instructors. While many programs have temporarily transitioned online, programs requiring hands-on instruction should not be permitted to transition without sufficient evidence that students’ needs can be met with online classes, and the transition should not be continued for longer than necessary. This should include basic reporting on the description of programs affected, the initial data of change in delivery, enrollment, and periodic updates on when the school expects to return to normal operations.
Agencies should also pay attention to nearsighted marketing and recruitment strategies that could prove problematic in the long run. The last recession fueled a boom in enrollment growth across higher education as more Americans sought additional education. This enrollment growth was particularly troublesome at for-profit colleges and for online programs using aggressive recruiting and marketing practices and resulted in deception and abuse at many institutions, leaving students with high debt and low job prospects. Accreditors should avoid mistakes of the past by tracking spikes in enrollment, monitoring marketing and recruitment practices, and aggressively enforcing protections from misrepresentations and fraud in advertising. This could include audits of institutional recruiting practices, reports on any new marketing spending, audits of any new materials used for marketing and recruiting, and any new or changing agreements with online program managers to evaluate marketing and recruiting materials and outreach.
Accrediting agencies must take an active role in ensuring college students receive a quality educational experience and are protected as they navigate the impact of the coronavirus crisis, while also looking out for the well-being of institutions. It is critical that agencies conduct increased financial monitoring, particularly for institutions at high risk of closure, and put plans in place to ensure that students are not left in the lurch in the months ahead. Accreditors can also help ensure quality and stability for students by monitoring institutions switching to online education, sudden changes in enrollment, and marketing and recruitment practices. Additional oversight will help avoid the worst practices from the past so that harms are not repeated in efforts to address the current emergency.
Antoinette Flores is the director for Postsecondary Education at the Center for American Progress.