THE STATE EDUCATION DEPARTMENT / THE UNIVERSITY OF THE STATE OF NEW YORK / ALBANY, NY 12234

 

TO:

The Honorable the Members of the Board of Regents

FROM:

Johanna Duncan-Poitier

 

 

SUBJECT:

Proposed Amendment to the Rules of the Board of Regents Relating to Proprietary College Degree-Conferring Authority

 

DATE:

October 16, 2006

STRATEGIC GOAL:

Goal 2

AUTHORIZATION(S):

 

 

 

SUMMARY

 

Issue for Discussion

 

Should the Board of Regents amend section 3.46 and add section 3.58 of the Rules of the Board of Regents relating to proprietary college degree-conferring authority?

 

Reason(s) for Consideration


            Review of Policy.

 

Proposed Handling

 

The proposed amendment is before the Board of Regents for discussion in October 2006 and will be submitted for action at the December 2006 Regents meeting.

 

Procedural History

 

In January 2006, the Board of Regents Committee on Higher Education and Professional Practice requested that the Department provide the Committee with a comprehensive report on the process by which proprietary colleges are approved and regulated in New York State.  In May 2006, the requested report was presented to the Committee.  The report included five recommendations for actions that would help to ensure that all students enrolled in proprietary colleges can expect to receive a quality education as well as strengthening some admissions policies in all higher education sectors. The proposed amendment implements two of the recommendations, endorsed by the Regents at the May 2006 meeting, designed to strengthen the oversight of proprietary colleges in New York State to ensure high standards of quality.  Notice of Proposed Rule Making concerning the proposed amendment was published in the State Register on September 27, 2006.  Supporting materials for the proposed amendment are available upon request from the Office of the Board of Regents.

 

Background Information

 

            The for-profit sector of higher education has grown significantly in recent years.  Enrollments in proprietary colleges in New York State have tripled over the last 30 years. Although the majority of proprietary colleges provide quality education to students, some instances of poor academic practices and fraud have recently been identified in a number of institutions in New York and other states.  In addition several at risk students were admitted to institutions with out the appropriate academic preparation and or support they needed to be successful.  As a result significant numbers of students are often leaving college after exhausting all of their financial aid benefits, with considerable debt, no degree, and little hope of being successful in the job market.

           

            In response to these serious concerns the Board of Regents received a report from the Department on the process by which proprietary colleges are approved and regulated in New York State. In May 2006, the Regents Higher Education and Professional Practice Committee discussed the approval and regulatory process as well as significant areas of concern with some proprietary colleges identified through the Department’s new Risk Assessment process. This process includes site visits, undercover operations, assessment of graduation and persistence rates, and investigation of student complaints. At high-risk proprietary colleges those concerns included: lack of understanding about the organizational and cultural requirements to be a college, insufficient college-level course content and rigor, insufficient library resources, insufficient academic supports, inadequate admissions standards, etc.  These issues are most often found in cases when there is a change in the ownership or control of an existing proprietary college or when an institution in another State with different standards wants to become established in New York State. Many vocational schools in New York State seek the Board of Regents permission to become degree-granting proprietary colleges.  A successful transition from a vocational school to a college takes time.  In some cases, it may take several years before the new college meets the Regents standards for higher education institutions and is able to truly function independently as a college.  Similarly, proprietary institutions operating in another state seeking to open a college in New York needs a transition period in which to become familiar with New York’s expectations and standards. 

 

            To help address these and other areas of concern, the Board of Regents were presented with five recommendations for actions to improve the oversight of proprietary colleges and ensure high standards of academic quality at all higher education institutions:

           

1.                  Require a transition period before new higher education institutions in New York State are given final authority to award degrees to ensure that standards of quality are upheld and students are appropriately served at proprietary colleges during periods of transition. This recommendation would also limit any expansion during the provisional period.

 

2.                  Require that the sale of degree-granting proprietary institutions in New York State be approved by the Education Department prior to purchase and that the new owners demonstrate capacity to meet the education and fiscal standards to operate the institution before ownership is established. Regents approval of the transfer of degree authority to the new institution and/or owner will still be required.

 

3.                  Endorse the pursuit of a legislative strategy to enhance the capacity to monitor the proprietary sector to ensure high standards of educational quality, protect the public’s investment, and to take action in cases where institutions are out of compliance and students could be at risk.

 

4.      Clearly define and differentiate remedial and developmental coursework from credit-bearing college coursework to ensure that students are appropriately prepared to succeed and to graduate.

 

5.      Strengthen admissions policies. Ensure prospective college students, especially those without a high school diploma or GED, have accurate information on the college, job placement, and/or transfer opportunities necessary to make educated enrollment decisions.

 

            In May, the Regents Committee on Higher Education and Professional Practice endorsed the five recommendations and requested that draft regulatory amendments to implement recommendations 1, 2, 4, and 5 be developed.  (Since Recommendation 3 addresses the need to pursue a legislative strategy to increase the Department’s capacity to monitor at risk institutions in the proprietary sector and take action when students could be at risk, it does not require regulatory amendment to implement.)  The proposed amendment presented in this report is limited to the implementation of the first two recommendations above. Draft regulations to implement recommendations 4 and 5 will be discussed by the Regents in the spring of 2007.

           

            To ensure that the field had multiple opportunities for input on the recommendations and subsequent regulations, in the summer of 2006, the Deputy Commissioner asked all colleges and university presidents in New York for their feedback.  Twenty-five comments were received and helped to inform the draft regulations. The draft amendment has been formally published in the State Register for public comment before the regulations are scheduled to come before the Regents for action in December 2006.  

 

            The purpose of the draft amendments presented for discussion this month is to:

 

 

            The proposed amendment would align the processes for new for-profit institutions with those already in existence for independent institutions.   Education Law section 217 authorizes the Regents to grant provisional charters to new independent colleges.  While under the provisional charter, a new independent college must meet the conditions for an absolute charter, and during this period the Regents confer the degrees to students at the institution.  Upon granting the absolute charter, the Regents authorize the independent college to confer degrees.    

           

            At present, there is no comparable requirement for a provisional period for for-profit (proprietary) colleges.  Instead, when the Board of Regents grants authority to confer degrees to a for-profit institution, it is final.  Under the proposed amendments, initially, the institution would apply for provisional authority to confer degrees for a period of up to five years. During the period of provisional authority, the institution would be authorized to confer degrees, and the proprietary institution, like a private college, must take steps to meet prescribed standards for permanent authority to confer degrees. These institutions may have to make significant changes in governance, personnel, and curricula in order to meet requirements for degree programs prescribed in the Commissioner's regulations and Regents Rules. During this provisional period, the Department would provide technical assistance and conduct periodic peer review visits to the institution.  At least 12 months before the end of the provisional period, the institution must apply for permanent authority to confer degrees.  At that time, the Regents determine whether to grant permanent degree-granting authority, extend the provisional authority, or deny the continuing degree-conferring authority of the institution.  This change will enable the State Education Department and the Regents to monitor and assess the on-going capacity of the new degree-granting proprietary college, before it is granted permanent authority to confer degrees.  

 

            Proprietary colleges may also be bought and sold, unlike public or independent college.  While the transfer of control of an institution can result in very positive changes in an institution, in other instances, the kind of changes that take place after a transfer (i.e., changes in investments, institutional organization and staffing, and academic standards) can have serious and negative results on student learning and success if not done appropriately. 

 

            Education Law section 224(1)(b) prohibits a proprietary college from transferring degree-conferring authority through a change of ownership or control without the consent of the Regents.  However, current Regents Rules provide for the Department and Regents review of the new owner's capacity to operate a degree-granting institution during a transition period after the change of ownership or control of the institution has already taken place.  The proposed amendment would improve this process and student protection by requiring the prospective owner to be reviewed by the Department and Regents prior to the change of ownership or control of the institution.  The review would determine whether the prospective owner meets prescribed standards for the Regents approval of the transfer of degree-conferring authority to the new owner.   This new process would provide the current and prospective owners with critical information that will materially affect the future of the institution as a degree-granting institution before the sale or transfer of the institution’s assets, etc.   The prior approval process will foster a smoother transition between owners and lessen the risk of disruption of educational programs that might be caused if a new owner does not meet the Regents standards for conferral of degrees after the sale has already taken place.  

 

            The amendment provides expedited time frames for this review in cases of intra-family transfers of ownership or control, when there is evidence that the management of the institution will not be materially affected and the Department is satisfied that such an expedited review is in the best interests of the students.    In addition, the amendment provides for Regents consent to a temporary transfer of degree-conferring authority after the change of ownership or control already has taken place in limited cases, upon a showing of good cause.

           

            The proposed amendment also establishes circumstances and procedures for the revocation or limitation of the degree-conferring authority of a proprietary college and procedures for the surrender of such degree-conferring authority.  Finally, the proposed amendment establishes the responsibilities of for-profit institutions whose degree-granting authority has expired or has been surrendered, denied or revoked.     

 

Recommendation

 

N/A

 

Timetable for Implementation

 

The effective date of the proposed amendment is December 28, 2006.

 

 

 

 

 

 

 

Attachment

AMENDMENT TO THE RULES OF THE BOARD OF REGENTS

            Pursuant to sections 207, 210, 215, 216, 218, and 224 of the Education Law and Chapter 82 of the Laws of 1995.

            1.  Section 3.46 of the Rules of the Board of Regents is amended, effective December 28, 2006, as follows:

            3.46 Degree-conferring power.

            [(a)] No institution in this State shall confer any honorary or other degree unless so authorized by its charter or by authorization of the Regents.  No charter shall authorize an institution to confer any degree on requirements lower than those fixed by the department as the minimum for that degree.  The commissioner shall make regulations for the conferring of degrees, and no institution shall confer a degree except in accordance with such regulations.  Degrees shall be limited to those approved by the Regents in section 3.50 of this Part.

            [(b) . . .]

            2.  Section 3.58 of the Rules of the Board of Regents is added, effective December 28, 2006, as follows:

            3.58 Proprietary college degree-conferring authority.

            (a) Definitions.   As used in this section:

            (1) Change of ownership or control means merger or consolidation with any corporation; sale, lease, exchange or other disposition of all or substantially all of the assets of the institution; and the transfer of a controlling interest (at least 51 percent) of the stock of a corporation.

            (2) Deputy Commissioner means the Deputy Commissioner for the Office of Higher Education.

            (3) Proprietary college means an institution that is operated on a for-profit basis, offers postsecondary educational programs, and has be granted by the Board of Regents authority to confer degrees.

            (4) Prospective owner means an individual or individuals seeking ownership or control of a proprietary college and requesting the consent of the Board of Regents for the transfer of degree-conferring authority of the institution upon the change of ownership or control.  

            (b) General requirements.

            (1)  A for-profit institution may be granted degree-conferring authority by the Board of Regents in accordance with the procedures of this section.  Such an institution that has no degree-conferring authority must first obtain provisional authority to confer degrees for a period of up to five years, in accordance with the requirements of subdivision (c) of this section.    At least 12 months prior to the end of the provisional authority period, such institution must apply to the department for permanent authority to confer degrees, in accordance with the requirements of subdivision (d) of this section. The Board of Regents shall determine whether to grant such permanent authority, or extend the provisional authority to confer degrees for an additional period of up to five years, or deny continuing degree-conferring authority past the term of the previously granted provisional authority.

            (2) During the period of provisional authority, the institution shall take steps to meet the requirements for permanent authority to confer degrees, as prescribed in subdivision (d) of this section.  At the department's request, the institution shall provide the department with information and reports concerning its progress in meeting the requirements for permanent authority to confer degrees. 

            (c) Provisional authority to confer degrees.

            (1) The Board of Regents may grant a for-profit institution provisional authority to confer degrees for a period of up to five years, which may be extended by the Regents.  At least 12 months prior to end of the provisional authority period, such institution holding provisional authority to confer degrees shall apply for permanent authority to confer degrees, pursuant to the procedures of subdivision (d) of this section, at which time the Board of Regents shall determine whether to grant the institution with permanent authority to confer degrees, or extend the provisional authority to confer degrees for an additional period of up to five years, or deny continuing degree-conferring authority past the term of the previously granted provisional authority.  If the institution does not apply for a permanent authority to confer degrees, the provisional authority to confer degrees shall expire at the end of the term of the provisional authority.

            (2) Procedures for determining whether to grant provisional authority to confer degrees. 

            (i) The institution shall apply to the department for provisional authority to confer degrees.  The institution shall submit to the department the following documentation which substantiates the institution's capacity to operate as a degree-granting institution:

            (a) evidence confirming the owner's capacity to operate the institution in compliance with the Education Law, program registration standards set forth in Part 52 of this Title, other Rules of the Board of Regents and Regulations of the Commissioner of Education, other State statutes and regulations, and Federal statutes and regulations, relevant to the operation of degree-granting institutions;    

            (b) evidence confirming that the institution has sufficient financial resources to ensure satisfactory conduct of its degree programs and achievement of its stated educational goals;

            (c) evidence that the individuals having ownership or control of the institution have experience operating an educational institution or other business or enterprise in an effective manner which demonstrates their capacity to operate a degree-granting institution; and

            (d) evidence that the individuals having ownership or control of the institution have not engaged in fraudulent or deceptive practices.

            (ii) The institution shall submit to the department documentation which substantiates the need for the degree programs it plans to offer based upon demand by students and/or employers and/or need of society for such programs, in accordance with section 137 of Chapter 82 of the Laws of 1995.

            (iii) The department may cause the institution to undergo site visits and may require the institution to provide additional reports and information in support of its application for provisional degree-conferring authority.

            (iv) The Deputy Commissioner shall review the information submitted by the institution, information obtained during the department's site visits, and other information obtained during the department's review of the institution for provisional degree-conferring authority, and make a recommendation on the matter.  This recommendation shall include the factual basis for the recommendation and shall be sent to the institution. 

            (v) Within 30 days of receipt of the Deputy Commissioner's recommendation, the institution may request the Deputy Commissioner to reconsider that recommendation, and may submit with the application for reconsideration additional written information in support of its position.  If the institution does not request reconsideration during this time frame, the Deputy Commissioner's recommendation shall be the final recommendation on provisional authority to confer degrees, transmitted to the Board of Regents.

            (vi) If the institution timely requests reconsideration, the Deputy Commissioner shall consider the additional written information submitted by the institution and make a final recommendation on provisional authority to confer degrees to the Board of Regents.  Such final recommendation shall include the factual basis for the recommendation and shall be sent to the institution, and transmitted to the Board of Regents.

            (vii) Regents decision.  At a regularly scheduled public meeting, the Board of Regents shall consider the findings and recommendations of the Deputy Commissioner and make the final determination on provisional authority to confer degrees.

            (d) Permanent authority to confer degrees.

            (1) Pursuant to the procedures of this subdivision, the Board of Regents may grant a proprietary college having provisional authority to confer degrees with permanent authority to confer degrees, or extend the provisional authority to confer degrees for an additional period of up to five years, or deny continuing degree-conferring authority past the term of the previously granted provisional authority.

            (2) Procedures for determining whether to grant permanent authority to confer degrees.

            (i) A proprietary college shall apply to the department for permanent authority to confer degrees at least 12 months prior to the expiration of the term of its provisional authority to confer degrees.  The institution shall submit to the department the following documentation which substantiates the institution's on-going capacity to operate as a degree-granting institution:

            (a) evidence confirming that the institution is in compliance with the Education Law, program registration standards set forth in Part 52 of this Title, other Rules of the Board of Regents and Regulations of the Commissioner of Education, other State statutes and regulations, and Federal statutes and regulations, relevant to the operation of degree-granting institutions;     

            (b) evidence confirming that the institution has sufficient financial resources to ensure satisfactory conduct of its degree programs and achievement of its stated educational goals;

            (c) evidence that the individuals having ownership or control of the institution are operating the proprietary college in an effective manner and that the degree programs meet their educational objectives;

            (d) evidence that the individuals having ownership or control of the institution have not engaged in fraudulent or deceptive practices; and

            (e) evidence that substantiates the institution's beneficial contributions to the community or communities it serves.

            (ii)  The department may cause the institution to undergo site visits and provide additional reports in support of its application for permanent degree-conferring.

            (iii) The Deputy Commissioner shall review the information submitted by the institution and information obtained during the department's site visits, and other information obtained during the department's review of the institution for permanent degree-conferring authority, and make a recommendation on the matter.  This recommendation shall include the factual basis for the recommendation and shall be sent to the institution. 

            (iv) Within 30 days of receipt of the Deputy Commissioner's recommendation, the institution may request the Deputy Commissioner to reconsider that recommendation, and may submit with the application for reconsideration additional written information in support of its position.  If the institution does not request reconsideration during this time frame, the Deputy Commissioner's recommendation shall be the final recommendation to the Board of Regents on whether to grant permanent authority to confer degrees, or whether to extend provisional authority for an additional period of up to five years, or whether to deny continuing degree-conferring authority past the term of the previously granted provisional authority, and such recommendation shall be transmitted to the Board of Regents.

            (v) If the institution timely requests reconsideration, the Deputy Commissioner shall consider the additional written information submitted by the institution and make a final recommendation to the Board of Regents on whether to grant permanent authority to confer degrees, or whether to extend provisional authority to confer degrees for an additional period of up to five years, or whether to deny continuing degree-conferring authority past the term of the previously granted provisional authority.  Such final recommendation shall include the factual basis for the recommendation and shall be sent to the institution, and transmitted to the Board of Regents.

            (vi) Regents decision.  At a regularly scheduled public meeting, the Board of Regents shall consider the findings and recommendations of the Deputy Commissioner and make the final determination on whether to grant permanent authority to confer degrees, or whether to extend provisional authority for an additional period of up to five years, or whether to deny continuing degree-conferring authority past the term of the previously granted provisional authority.

            (e) Transfer of degree-conferring authority.

            (1) In accordance with Education Law section 224(1)(b), no proprietary college holding degree-conferring authority granted by the Board of Regents shall convey, assign or transfer such degree-conferring authority through a change of ownership or control of the institution, without the consent of the Board of Regents to transfer such degree-conferring authority prior to the change of ownership or control of the institution, except that consent to a temporary transfer of degree-conferring authority may be obtained after a change of ownership or control of the institution already has been made where the Board of Regents determine there is an adequate showing of good cause as prescribed in paragraph (7) of this subdivision.  The determination concerning whether to consent to the transfer of degree-conferring authority shall be made in accordance with the requirements and procedures of this subdivision  

            (2) The department shall determine if a proposed transaction is a change of ownership or control of a proprietary college, as defined in subdivision (a) of this section.

            (3) The department may expedite in terms of time the department's review for the transfer of degree-conferring authority in instances where the change of ownership or control of the institution is between family members, upon an adequate showing of good cause by the institution.  For purposes of this paragraph, good cause shall include but not be limited to, evidence satisfactory to the department that the change of ownership or control will not materially affect the management of the institution, provided that an expedited review is in the best interests of students at the institution.

            (4) The Board of Regents may limit or condition the degree-conferring authority of the proprietary college under the prospective owner based upon a review of the prospective owner's capacity to meet the standards prescribed in paragraph (6) of this subdivision.

            (5) (i)  Where the Board of Regents did not consent to the transfer of degree-conferring authority prior to the change of ownership or control of a proprietary college, and where there is no temporary transfer of degree-conferring authority based upon good cause, as prescribed in paragraph (7) of this subdivision, the institution shall cease all instruction creditable towards a degree until such time as the Board of Regents shall have consented to the transfer of degree-conferring authority, except as provided in subparagraph (ii) of this paragraph.  The new owner shall meet the responsibilities prescribed in subdivision (h) of this section applicable when there is a cessation of degree-conferring authority.   The new owner shall apply under the procedures of paragraph (6) of this subdivision to request the consent of the Board of Regents for the transfer of degree-conferring authority.

            (ii) Cessation of instruction as prescribed in subparagraph (i) of this paragraph shall be held in abeyance during the time period that the department and the Board of Regents are reviewing an institution's properly submitted application for a temporary transfer of degree-conferring authority in accordance with the requirements of paragraph (7) of this subdivision.    During this period of review, the Board of Regents shall confer degrees upon students of the institution who, in the judgment of the Regents, have duly earned such degrees. 

            (6) Procedures for determining whether to consent to the transfer of degree-conferring authority.

            (i) At least 180 days prior to the proposed date for consummation of the change of ownership or control of a proprietary college, the proprietary college holding degree-conferring authority shall inform the department in writing of the proposed change of ownership or control, and shall inform the prospective owner in writing that the Board of Regents must approve the transfer of degree-conferring authority of the proprietary college prior to the change of ownership or control of the institution, that such degree-conferring authority is not transferred when a proprietary college is purchased or other change of ownership or control takes place, and that the prospective owner must apply to the department for consent to the transfer of degree-conferring authority at least 150 days prior to the proposed date for the change of ownership or control of the proprietary college. 

            (ii) At least 150 days prior to the proposed date for the change of ownership or control of a proprietary college, the prospective owner shall apply to the department for the transfer of degree-conferring authority.  The prospective owner shall submit to the department the following documentation which substantiates the prospective owner's capacity to operate the college:

            (a) evidence confirming the prospective owner's capacity to operate the institution in compliance with the Education Law, program registration standards set forth in Part 52 of this Title, other Rules of the Board of Regents and Regulations of the Commissioner of Education, other State statutes and regulations, and Federal statutes and regulations, relevant to the operation of degree-granting institutions;   

            (b) evidence confirming that the prospective owner has sufficient financial resources to ensure satisfactory conduct of degree programs and achievement of the institution's stated educational goals;

            (c) evidence of the prospective owner's experience operating an educational institution or other business or enterprise in an effective manner which demonstrates the prospective owner's capacity to operate a degree-granting institution;

            (d) evidence that postsecondary education institutions that the prospective owner operates in New York State or elsewhere, if any, are in compliance with Federal and state statutes and regulations and accreditation requirements relevant to the operation of such institutions; and

            (e) evidence that the prospective owner has not engaged in fraudulent or deceptive practices.       

            (iii) The department may make site visits to the proprietary college for which transfer of degree-conferring authority is being requested and institutions operated by the prospective owner, and require the prospective owner to provide additional reports and documentation in support of its application.

            (iv) The Deputy Commissioner shall review the information submitted by the prospective owner and information obtained during the department's site visits, and other information obtained by the department during the department's review for transfer of degree-conferring authority, and make a recommendation on the matter within 60 days of receipt of a complete application, as determined by the department.  This recommendation shall include the factual basis for the recommendation and shall be sent to the prospective owner and the proprietary college.

            (v) Within 15 days of receipt of the Deputy Commissioner's recommendation, the prospective owner may request the Deputy Commissioner to reconsider that recommendation, and may submit with the application for reconsideration additional written information in support of its position.  If the prospective owner does not request reconsideration during this time frame, the Deputy Commissioner's recommendation shall be the final recommendation on the transfer of degree-conferring authority, transmitted to the Board of Regents.

            (vi) If the prospective owner timely requests reconsideration, the Deputy Commissioner shall consider the additional written information submitted by the prospective owner and make a final recommendation on the transfer of degree-conferring authority within 30 days of receipt of the request for reconsideration.  Such final recommendation shall include the factual basis for the recommendation and shall be sent to the prospective owner and the proprietary college, and transmitted to the Board of Regents.

            (vii) Regents decision.  At a regularly scheduled public meeting, the Board of Regents shall consider the findings and recommendations of the Deputy Commissioner and make the final determination on the transfer of degree-conferring authority.

            (7) Temporary transfer of degree-conferring authority. 

            (i) The Board of Regents may consent to a temporary transfer of degree-conferring authority after the change of ownership or control of the institution already has been made, upon an adequate showing of good cause by the institution.  For purposes of this paragraph, good cause shall include but not be limited to, evidence satisfactory to the Board of Regents that conditions outside of the new owner's control caused the transfer of ownership or control of the institution prior to the institution obtaining the consent of the Board of Regents for the transfer of degree-conferring authority, provided that it  is in the best interests of students at the institution to permit the institution to continue to offer degree programs.

            (ii) The department shall review the institution's application for a temporary transfer of degree-conferring authority and may request other information from the institution during its review.  The department shall make a recommendation to the Board of Regents concerning whether to grant consent to the temporary transfer of degree-conferring authority based upon good cause.  

            (iii) When the department determines that it is in the best interests of students of the institution, the department may require the institution to have a  teach-out agreement with other institution(s) that is acceptable to the department, before making a positive recommendation to the Board of Regents that it grant consent to the temporary transfer of degree-conferring authority.  The teach-out agreement shall be a written agreement between the institution requesting consent to the temporary transfer of degree-conferring authority and one or more degree-granting institutions.  The agreement shall provide for the continuity of educational services to students enrolled in registered programs at the institution in the event that the Board of Regents does not consent to the transfer of degree-conferring authority after a review pursuant to paragraph (6) of this subdivision.  To be acceptable to the department, the teach-out agreement shall ensure that the teach-out institution(s):

            (a) has the necessary experience, resources, and support services to provide educational programs that are of acceptable quality and reasonably similar in content, structure, and scheduling to that provided by the institution requesting consent to the transfer of degree-conferring authority; and

            (b)  can provide students access to the programs and services without requiring them to move or travel substantial distances.

            (iv) The Board of Regents consent to such temporary transfer may limit or condition the degree-conferring authority of the institution.  Such temporary transfer shall be for an initial period not to exceed 180 days, but may be extended for such additional periods as determined by the Board of Regents. 

            (v) Before consent to a temporary transfer of degree-conferring authority may be granted, the new owner must also apply under the regular procedures of paragraph (6) of this subdivision for the review required for the transfer of degree-conferring authority.   

            (f) Revocation of or limitation on degree-conferring authority.

            (1) The Board of Regents may revoke in whole or part or limit the degree-conferring authority of a proprietary college for sufficient cause.  As a prerequisite for the revocation in whole or part of degree-conferring authority in accordance with the requirements of this subdivision, all registered programs at the institution leading to the degree(s) covered by the revocation must first be denied re-registration by the department pursuant to the requirements and procedures prescribed in Part 52 of this Title.  Such prerequisite shall not apply when the proceeding under this subdivision does not concern revocation of an institution's authority to confer a degree or degrees and only concerns limitations on degree-conferring authority, such as enrollment caps.  

            (2) Procedures for determining whether to revoke or limit degree-conferring authority.

            (i) The department may review the capacity of a proprietary college to continue to have degree-conferring authority and may cause the institution to undergo site visits and require the institution to provide reports and written information in support of the continuation of degree-conferring authority.    The department's review shall determine whether the institution violated substantive requirements of Part 52 of this Title that demonstrate that the institution does not have the ability to offer quality programs leading to the degree(s) covered by the revocation or that demonstrate that the institution must have limitations on degree-conferring authority to ensure the quality of the degree programs offered by the institution.

            (ii) The Deputy Commissioner shall review the record relating to the denial of re-registration of programs leading to the degree(s) covered by the revocation, information submitted by the institution and information obtained during the department's site visits, and other information obtained during the department's review of the institution for continuing degree-conferring authority.  Based upon such review, the Deputy Commissioner may recommend that the  Board of Regents revoke in whole or in part or otherwise limit the authority of a proprietary college to confer degrees upon sufficient cause, meaning the institution violated substantive requirements of Part 52 of this Title that demonstrate that the institution does not have the ability to offer quality programs leading to the degree(s) covered by the revocation or that demonstrate that the institution must have limitations on degree-conferring authority to ensure the quality of the degree programs.   This recommendation shall include the factual basis for the recommendation and shall be sent to the institution. 

            (iii) Within 30 days of receipt of the Deputy Commissioner's recommendation to revoke or limit degree-conferring authority, the institution may request the Deputy Commissioner to reconsider that recommendation, and may submit with the application for reconsideration additional written information in support of its position.  If the institution does not request reconsideration during this time frame, the Deputy Commissioner's recommendation shall be the final recommendation on whether the degree-conferring authority shall be revoked in whole or part or limited, and such recommendation shall be transmitted to the Board of Regents.

            (iv) If the institution timely requests reconsideration, the Deputy Commissioner shall consider the additional written information submitted by the institution and make a final recommendation to the Board of Regents on whether to revoke in whole or part or limit degree-conferring authority of the institution.  Such final recommendation shall include the factual basis for the recommendation and shall be sent to the institution and transmitted to the Board of Regents.

            (v) Within 30 days of receiving the final recommendation of the Deputy Commissioner, the proprietary college may submit to the Board of  Regents a written response to the Deputy Commissioner's final recommendation, which  may include supporting affidavits, exhibits, and documentary evidence and may present legal argument.  In such written response, the proprietary college may at its discretion request an opportunity for oral argument.

            (vi) The matter shall be reviewed by a panel of the Board of Regents consisting of at least three Regents designated by the Chancellor of the Board of Regents.  This panel shall hear oral argument, if requested by the proprietary college in its written response as prescribed in subparagraph (v) of this paragraph.   At this oral argument, representatives of the proprietary college and the Deputy Commissioner may speak and present additional documentary evidence and written submissions.  After its consideration of the Deputy Commissioner's recommendation, the written response of the proprietary college, if any, and oral argument and documentary evidence and written submissions taken at oral argument, if any, the designated Regents panel shall make a recommendation to the full Board of Regents as to whether the degree-conferring authority shall be revoked in whole or part or limited.  Such recommendation shall include the factual basis for the recommendation.

            (vii) Regents decision.  At a regularly scheduled public meeting, the Board of Regents shall consider the findings and recommendations of the designated Regents panel and make the final determination on whether the degree-conferring authority of the institution shall be revoked in whole or part or limited.

            (g) Surrender of degree-conferring authority. 

            (1) A proprietary college may make application to surrender in whole or in part its degree-conferring authority.   Such application shall be in writing and submitted to the department.   The institution shall describe in such application how it will meet the institutional responsibilities prescribed in subdivision (h) of this section applicable when there is a cessation of degree-conferring authority at a proprietary college.

            (2) At a regularly scheduled public meeting, the Board of Regents shall determine whether to accept the proprietary college's request to surrender in whole or part its degree-conferring authority.

            (h) Institutional responsibilities upon cessation of degree-conferring authority.  A proprietary college whose degree-conferring authority has expired or has been surrendered, denied, or revoked shall:

            (1) cease recruitment for enrollment of new students in each program registered pursuant to Part 52 of this Title creditable towards the degree or degrees covered by the expiration, surrender, denial, or revocation of degree-conferring authority;

            (2) cease operation of each program registered pursuant to Part 52 of this Title creditable towards the degree or degrees that are covered by the expiration, surrender, denial, or revocation of degree-conferring authority by the effective date of such expiration, surrender, denial or revocation; and

            (3) cooperate with the department to ensure that students already enrolled in programs creditable towards the degree or degrees covered by the expiration, surrender, denial or revocation of degree-conferring authority are able to find avenues for completion of their studies with a minimum of disruption.