ED457762 2001-00-00 The U.S. Department of Education and Student Financial Aid for Distance Education: An Update. ERIC Digest.

ERIC Identifier: ED457762
Publication Date: 2001-00-00
Author: Wood, Patricia A.
Source: ERIC Clearinghouse on Higher Education Washington DC.| BBB32577 _ George Washington Univ. Washington DC. Graduate School of Education and Human Development.

The U.S. Department of Education and Student Financial Aid for Distance Education: An Update. ERIC Digest.

THIS DIGEST WAS CREATED BY ERIC, THE EDUCATIONAL RESOURCES INFORMATION CENTER. FOR MORE INFORMATION ABOUT ERIC, CONTACT ACCESS ERIC 1-800-LET-ERIC

Since the mid-1990s, there has been a boom in the number of U.S. colleges and universities providing courses and degree programs via distance education--education or training courses delivered to off-campus locations via audio, live or prerecorded video, or computer technologies, including both synchronous and asynchronous instruction (Lewis, Snow, Farris, and Levin, 1999, pp. vi, 2). Between 1995 and 1998, enrollments in distance education classes more than doubled, reaching 1,632, 350, and this rapid growth is expected to continue (U.S. Dept. of Education, 2001, June 25).

This virtual explosion in distance education has piqued the interest of parents, students, distance education providers, and federal officials in the rules governing the U.S. Department of Education's distribution of federal student financial aid for distance learning. Under the current federal student aid programs (Title IV of the Higher Education Act of 1965, as amended), the bulk of student aid is awarded to a college or university's resident students; there are a number of statutory and regulatory provisions that limit the eligibility of distance education students to receive financial assistance (U.S. Dept. of Education, 1999, June 25).

The Education Department is now reexamining these provisions, considering how student financial aid regulations are affecting distance education programs, and formulating recommendations for change. This paper offers a brief discussion about the growth of distance education in the postsecondary arena and summarizes the Education Department's progress in evaluating current rules governing financial aid for distance learning.

DISTANCE EDUCATION AT POSTSECONDARY INSTITUTIONS

Distance Education at Postsecondary Institutions: 1997-98, a 1999 Education Department report, found that 1,190 distance learning programs were offered by higher education institutions in 1998, a 72 percent increase from 1995. In 1998, 1,680 institutions offered a total of about 54,000 online-education courses, with 1.6 million students enrolled. Forty-four percent of higher education institutions offered distance education courses in 1998, an 11% increase from 1995 (Carnevale, 2000, January 7).

Other report findings include:

1) The Internet was the medium of choice for most institutions providing distance education. From 1995 to 1998, the proportion of institutions that used two-way interactive video dropped from 57 percent to 56 percent; the proportion that used recorded video courses dropped from 52 percent to 48 percent. The proportion of those offering asynchronous courses on the Internet increased from 22 percent to 60 percent, while the proportion providing synchronous courses on the Internet increased from 14 percent to 19 percent (Carnevale, 2000, January 7).

2) Seventy-seven percent of institutions charged the same tuition for similar online and traditional courses, and 66 percent did not charge additional fees for distance education courses (Carnevale, 2000, January 7).

3) Of the schools offering distance education programs, 70 percent offered courses in English, social and behavioral sciences, and the humanities; 55 percent offered courses in business and management; 36 percent offered courses in health care; 32 percent in mathematics; 29 percent in education; 26 percent in computer science; 17 percent in vocational and technical fields; 12 percent in engineering; 7 percent in agriculture and natural resources; and 6 percent in library and information sciences. Sixteen percent of the colleges offered other distance education courses (Carnevale, 2000, January 7).

BATTLING FRAUD AND ABUSE IN THE STUDENT AID PROGRAMS

The rapid expansion of distance education introduces potential risks for fraud and abuse of the Department of Education's student financial assistance programs. Similar risks were present in the 1980s as the numbers of institutions offering postsecondary vocational education increased substantially. A number of student aid program abuses were exposed, including questionable recruiting practices, sudden school closures, participation of low quality schools, and courses expanded in order to obtain more student aid (U.S. Dept. of Education, OPE, PPI, 2001, p.29). To combat such abuses, the Department's oversight authority was expanded by provisions enacted in the late 1980s and early 1990s. The Higher Education Amendments of 1992 were particularly effective in addressing the fraud and abuse in the Title IV student financial aid programs that occurred primarily in schools that delivered instruction by print-based correspondence. The Amendments effectively barred schools offering over half of their courses via correspondence or a combination of correspondence and telecommunications from participating in Title IV, student financial aid programs. One rule limited to less than 50 percent the numbers of students an eligible institution is allowed to enroll in correspondence courses. Another stipulated that correspondence students are allowed to receive Title IV financial assistance only if enrolled in associate's, bachelor's, or graduate degree programs. Congress also imposed a 30-week academic year requirement on eligible institutions in response to abuses such as course stretching and other issues of program length (U.S. Dept. of Education, OPE, PPI, 2001, pp.16, 29).

Though fraud and abuse of the Title IV financial aid programs were greatly remedied by the increased number of provisions set forth in the 1992 HEA amendments, these rules are now hampering distance education students in receiving financial aid (Van der werf, 2000). Until recently, the 1992 Amendments had little effect on the majority of institutions participating in Title IV, student financial assistance programs. Providing distance education via correspondence or telecommunications was a small part of their activity. The postsecondary education landscape has changed dramatically over the last few years, however, as the Internet and other technologies have extended institutions' reach and the demand for online education has grown rapidly. (U.S. Dept. of Education, OPE, PPI, 2001, p. 16).

DISTANCE EDUCATION DEMONSTRATION PROGRAM

By the late 1990s, Congress recognized the importance of the growing trend in distance education as an option to on-campus study and its potential for increasing access to postsecondary education for some groups of students--students living in rural areas, working parents, and students with disabilities that limit their access to the traditional campus setting (U.S. Dept. of Education, 1999, June 25). At the same time, Congress wished to proceed cautiously in amending the rules regulating student financial aid for distance education (U.S. Dept. of Education, OPE, PPI, 2001, p. 29).

Congress acted by authorizing the Distance Education Demonstration Program in the 1998 Higher Education Amendments. The Demonstration Program is designed to provide increased student access to higher education through distance education and to test the quality and viability of expanded distance education programs currently restricted under the Higher Education Act. It is also designed to help determine the most effective means of delivering quality education via distance education, the statutory and regulatory requirements that should be altered to provide greater access to distance education, and the appropriate level of Title IV, student financial assistance for students enrolled in distance education programs (U.S. Dept. of Education, OPE, PPI, 2001, p. 1).

In short, the Demonstration Program will test some of the issues related to student aid for distance learning before Congress considers policy changes that might again result in increases in fraud and abuse (U.S. Dept. of Education, OPE, PPI, 2001, p. 34).

PROGRAM WAIVERS

The Distance Education Demonstration Program allows selected postsecondary schools, systems, and consortia waivers of two rules that currently limit the eligibility of financial aid for distance education:

1) the rule that makes schools ineligible for student aid if they enroll 50 percent or more of their students in distance education programs or offer 50 percent or more of their courses via distance education.

2) the rule that requires that a school's academic year consist of a minimum of 30 weeks for students to receive the maximum federal financial aid.

Waivers are also granted from some Title IV financial aid regulations to facilitate arrangements such as:

1) sharing of distance education courses among consortia members;

2) enrollment tracking to verify status of students taking courses at several institutions simultaneously;

3) collaborations between two- and four-year institutions that will allow a student who has earned an associate degree from a community college to complete a baccalaureate degree via distance education;

4) calculating a student's cost of attendance by limiting costs to tuition, fees, books and supplies, and excluding living expenses, to help determine the appropriate amount of federal aid for distance education students (U.S. Dept. of Education, 1999, June 25).

PROGRAM ADMINISTRATION

The Distance Education Demonstration Program began to be implemented on July 1, 1999 with the selection of 15 postsecondary schools, systems and consortia to participate in the first year of the program. Additional participants were selected to join the program in its third year, beginning July 1, 2001 (U.S. Dept. of Education, OPE, 2001, October 26). The projects are expected to continue through the 2003-2004 academic year at which time Congress is expected to consider amendments to the Higher Education Act (U.S. Dept. of Education, 2001, June 25). There are currently 24 participants, including over 100 institutions from 20 states and the District of Columbia (U.S. Dept. of Education, OPE, 2001, October 26)

* American InterContinental University http://www.aiu-online.com

* Brevard Community College http://www.brevard.cc.fl.us

* Capella University http://www.capellauniversity.edu

* Community Colleges of Colorado (system schools) http://www.cccoes.edu

* Connecticut Distance Learning Consortium (consortium members) http://www.ctdlc.org

* Eastern Oregon University http://www.eou.edu

* Florida State University http://www.fsu.edu

* Franklin University (consortium members) http://www.franklin.edu

* JesuitNET Consortium http://www.ajcunet.edu

* LDS Church Education System (system schools) http://www.byu.edu

* Marlboro College http://www.gradcenter.marlboro.edu

* New York University http://www.scps.nyu.edu

* North Dakota University System (system schools) http://www.ndus.nodak.edu

* Quest Education Corp - Kaplan College http://www.kaplancollege.com

* Regis University http://www.regis.edu/distance.asp

*Southern Christian University http://www.southernchristian.edu

* Texas Tech University http://www.dce.ttu.edu

* United States Sports Academy http://www.ussa.edu

* University of Maryland University http://www.umuc.edu

* University of Phoenix http://www.phoenix.edu

* Walden University http://www.waldenu.edu

* Washington Community and Technical College System Online Consortium (consortium members) http://www.sbctc.ctc.edu/dl/default.htm

* Washington State University http://www.wsu.edu

* Western Governors University http://www.wgu.edu

(U.S. Dept. of Education, OPE, Distance Education Demonstration Program. Participating Institutions).

Staff from the Education Department's Office of Postsecondary Education and Office of Student Financial Assistance administer the Demonstration Program. The Office of Postsecondary Education, as the office responsible for the development of Title IV Student Financial Assistance policy, provides the Program leadership (U.S. Dept. of Education, OPE, 2001, October 26).

PROGRAM RESULTS

Congress required that Program findings be reported after 18 months with subsequent reports submitted annually (Carnevale, 2001, Feb. 9). The Report to Congress on the Distance Education Demonstration Program, issued January 2001, responds to some of the concerns that institutions have about the federal financial aid rules and statutes, but does not make specific recommendations about what actions Congress should take (Carnevale, 2001, Feb. 9).

According to the report, inflexibility in financial aid regulations hurts the advancement of distance education. Current rules that restrict which colleges and universities can provide federal financial aid to distance education students are complex and inhibiting and should be updated to reflect the growth of alternative education (Carnevale, 2001, Feb. 9). One of these rules--the "50 percent rule"-- disallows schools offering more than half of their courses via distance learning from providing federal student aid. A second rule targeted as inhibiting is the +12-hour rule" -- a rule created to exclude diploma mills -- that requires that students enroll in at least 12 hours of course work a week to qualify for full-time status and the maximum amount of student aid (Carnevale, 2001, Jan. 19, Feb. 9). Proponents of distance education assert that distance education and other alternative teaching methods do not rely on classroom hours to gauge students' learning and call the 12-hour rule an antiquated measure; distance education allows students to be in class for as long as they need to, they argue, rather than for a prescribed period (Carnevale, 2000, Sept. 15). The report also suggests the possibility of experimenting with a student-based delivery system --disbursing financial aid to students directly, instead of the current practice of giving it to postsecondary institutions to distribute (U.S. Dept. of Education, OPE, PPI, 2001, p.vi).

THE FUTURE

Though the Distance Education Demonstration Program was begun during the last Administration, the matters involved are bipartisan. The new Administration has stated it will work with Congress throughout the coming months to explore the myriad issues that must be carefully considered before crafting new student financial aid regulations (Carnevale, 2001, Jan. 19). Interested parties may stay abreast of developments by visiting the Distance Education Demonstration Program web site at http://www.ed.gov/offices/OPE/PPI/DistEd/

BIBLIOGRAPHY

American Council on Education. (March 2000). Developing a distance education policy for 21st century learning. Retrieved June 8, 2001, from the American Council on Education, Division of Government and Public Affairs Web site: http://www.acenet.edu/washington/distance_ed/2000/03march/distance_e d.html

Carnevale, D. (2000, January 7). Survey finds 72% rise in number of distance education programs [Electronic version]. The Chronicle of Higher Education, p. A57.

Carnevale, D. (2000, September 15). U.S. mulls aid changes for distance courses [Electronic version]. The Chronicle of Higher Education, p. A28.

Carnevale, D. (2000, November 3). Colleges receive tips on joining federal effort on aid for online-education students [Electronic version]. The Chronicle of Higher Education, p. A43.

Carnevale, D. (2001, January 19). Education Dept. told that aid rules impede distance education [Electronic version]. The Chronicle of Higher Education, p. A33

Carnevale, D. (2001, February 9). Report to Congress says financial-aid rules are hurting distance programs [Electronic version]. The Chronicle of Higher Education, p. A34.

Lewis, L., Snow, K., Farris, E., Levin, D. (1999). Distance education at postsecondary education institutions: 1997-98. (National Center for Education Statistics Report No. 2000-013). Washington, DC: U.S. Department of Education. Retrieved June 8, 2001 from the Department of Education web site: http://nces.ed.gov/pubs2000/2000013.pdf

U.S. Department of Education. (1999, June 25). New ED projects promote distance learning for college. Press Release. Retrieved June 8, 2001 from the Department of Education web site: http://www.ed.gov/PressReleases/06-1999/distep.html

U.S. Department of Education (2001, June 25). Ten new distance ED projects expand higher ED access. Press Release. Retrieved October 26, 2001 from the Department of Education web site: http://www.ed.gov/PressReleases/06-2001/06252001.html

U.S. Department of Education, Office of Postsecondary Education. (2001, July). Student Financial Assistance and Nontraditional Educational Programs (Including the "12-Hour Rule"). A Report to Congress. Retrieved October 15, 2001 from the Department of Education web site: http://www.ed.gov/offices/OPE/News/12HourRuleReport.html

U.S. Dept. of Education, Office of Postsecondary Education. Distance Education Demonstration Program. Retrieved October 26, 2001 from the Department of Education web site: http://www.ed.gov/offices/OPE/PPI/DistEd/

U.S. Dept. of Education, Office of Postsecondary Education. Distance Education Demonstration Program. Participating Institutions. Retrieved October 26, 2001 from the Department of Education web site: http://www.ed.gov/offices/OPE/PPI/DistEd/participants.html

U.S. Department of Education, Office of Postsecondary Education, Policy, Planning and Innovation. (2001). Report to Congress on the Distance Education Demonstration Programs. Retrieved June 8, 2001 from the Department of Education web site: http://www.ed.gov/offices/OPE/PPI/distEd.html

Van der werf, M. (2000, July 9). Colleges picked for project on aid to distance learning students [Electronic version]. The Chronicle of Higher Education, p. A34.

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Title: The U.S. Department of Education and Student Financial Aid for Distance Education: An Update. ERIC Digest.
Note: Contains small print.
Document Type: Information Analyses---ERIC Information Analysis Products (IAPs) (071); Information Analyses---ERIC Digests (Selected) in Full Text (073);
Available From: ERIC Clearinghouse on Higher Education, One Dupont Circle, Suite 630, Washington, DC 20036-1183. Tel: 800-956-7739 (Toll Free). For full text: http://www.eriche.org.
Descriptors: Distance Education, Educational Finance, Federal Government, Fraud, Higher Education, Institutional Characteristics, Student Financial Aid
Identifiers: ERIC Digests

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