Arne Duncan's Plan To Fix College Accreditation

The Education Department pledges to do better at policing the "watchdogs that don't bite" after the failure of Corinthian Colleges Inc.

When it comes to accreditors, the private organizations paid by colleges to help them maintain access to nearly $150 billion annually in federal student aid, the U.S. Department of Education seems to think sunlight is the best disinfectant.

The Obama administration on Friday made public its long-awaited recommendations to reform what many experts contend is the broken system of college accreditation -- the self-regulatory collection of private groups paid by schools to evaluate whether the institutions meet the necessary standards to continue receiving a nearly free flow of taxpayer money.

Education Secretary Arne Duncan on Thursday described accreditors as "watchdogs that don't bite" -- though he has the power to correct that by stripping them of their authority. His package of reforms largely amounts to injecting much-needed transparency into a historically opaque system, directing his staff to do a better job, and asking Congress for more power.

"We have been clear and direct when we have said that it's everybody's responsibility to improve in thinking about ensuring high student outcomes, and so we want to do our work better too," said Education Undersecretary Ted Mitchell. "And you'll see in the recommendations that much of this is aimed at helping us get insight into student outcomes in a way that will be the basis for our actions."

Duncan's staff compiled data on students' graduation and loan repayment rates by accreditor, and the standards they use to grade schools, and publicly released the findings on a new website. The education secretary also told his staff to gather more information and share it when judging schools and accreditors. Additional reports on suspect schools that could lose accreditation will be made public, Duncan said, and department employees will tell accreditors how to do their job better.

Congress could help, too, by granting the department more authority and flexibility to judge accreditors. Lawmakers also could require more of accreditors and direct previously confidential information to be made public on a government website.

In interviews, three experts -- a former Education Department official, a former college president who now advises the Education Department, and an official at a Washington association representing state colleges -- praised the moves as common-sense measures. They said they had hoped the department would be more aggressive in reforming a system in which the for-profit Corinthian Colleges schools could fail amid allegations of systemic fraud while maintaining full accreditation.

The accreditor that oversees Corinthian, the Accrediting Council for Independent Colleges and Schools, had been criticized by the Education Department in 2011 for setting low standards and for shoddy oversight, yet maintained its authority two years later. In 2014, the federal Consumer Financial Protection Bureau sued Corinthian in federal court, alleging it systematically misled students into taking out unaffordable loans with false job placement rates.

"This is not dramatic change. This is tweaking the existing system," Arthur Rothkopf, a former president of Lafayette College in Pennsylvania, said of the Education Department's reform package.

Rothkopf is a member of the National Advisory Committee on Institutional Quality and Integrity, which advises Duncan on accreditation issues. He said accreditors don't consider themselves to be effective oversight agencies. "The accreditors don't believe they're cops on the beat. They believe they're there to help institutions improve."

But far too often accreditors end up rubber-stamping seals of approval on dodgy schools that shouldn't have access to federal student aid funds, said Barmak Nassirian, director of federal relations and policy analysis at the American Association of State Colleges and Universities.

"That's how accreditation is failing today," Nassirian said. "These are things a competent agency would've been working on since Day 1, not at this late hour."

Instead, Duncan asked his senior deputies to take the next 75 days, or roughly the amount of time until President Barack Obama delivers his last State of the Union address, to come up with additional ways to improve accreditation.

Rothkopf and Nassirian said Duncan has broad authority to yank the federal government's recognition of an accreditor if it's failing students or taxpayers. Rothkopf said his advisory committee has previously recommended that the department revoke its stamp of approval on some accreditors.

Accreditation is a "back-scratching system with a lot of conflicts of interest," Rothkopf said.

The Education Department under Arne Duncan has never withdrawn its recognition of an accreditor, according to department spokeswoman Denise Horn.

Department data released Friday show that Accrediting Council for Independent Colleges and Schools has the highest proportion of schools -- 76 percent -- among accreditors ranked in the bottom third nationally in terms of the share of former student borrowers who are repaying their loans after three years. The CFPB sent the accreditor a civil investigative demand in August as part of an ongoing probe.

In response to a September report that students at ACICS-accredited schools defaulted on their federal student loans at much higher rates than the national average, Albert Gray, ACICS president, defended his organization by arguing that the schools it accredits typically enroll poor students who are the first in their families to attend college.

Judith Eaton, president of the Council for Higher Education Accreditation, didn't respond to a message seeking comment left after normal business hours.

Nassirian said it's the Education Department's responsibility to aggressively police colleges that saddle students with worthless credentials and mountains of debt. That includes going after accreditors failing in their oversight role.

Instead, the department's lesson on oversight from the failure of Corinthian Colleges was, "Boy, wouldn't it be nice if someone else could do that for us?" Nassirian said.

The Education Department already has the authority to require financially troubled schools to stump up letters of credit to protect taxpayers from shouldering the costs of a potential failure. But the Education Department on Friday asked Congress to give it explicit authority to judge accreditors in part on whether they require high-risk schools to pre-fund a potential failure.

"You're the cop on the beat. You can't be praying that someone else shows up in a uniform with the proper armaments," Nassirian said.

Ben Miller, a former Education Department official who now is senior director for postsecondary education at the Center for American Progress, said department officials have long been critical of the accreditation system, but Corinthian's failure -- and the bipartisan backlash against accreditation it helped spark -- could be part of the reason why the department waited until now to broadly address it.

"The big question I have is what will this ultimately mean in terms of action?" Miller said. "Transparency alone is good, but it needs to be followed by action."