New America’s Higher Education Program's Comments on NC-SARA Policy Proposals
Public Comments

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July 8, 2025
As part of the 2025 NC-SARA Policy Modification Process, New America’s Higher Education Program submitted public comments on a range of proposed changes to the SARA Policy Manual. Our comments reflect our ongoing commitment to promoting student protection, institutional accountability, and strong oversight in distance education. We appreciate the opportunity to contribute to this important process and support efforts to strengthen the reciprocity agreement in ways that prioritize transparency, equity, and consumer protection.
Below are the comments we submitted for consideration.
PMP25-0746: Submitting Teach Out Plans to States
Comment:
New America’s Higher Education Program strongly supports this proposed policy change, which would require SARA-participating institutions to share teach-out plans and related documentation with their State Portal Entity at the time of submission to accrediting agencies or other oversight bodies. This proposal is a critical step toward increasing transparency, strengthening state oversight, and—most importantly—protecting students during institutional closures or major disruptions.
State Portal Entities (SPEs) play a vital role in ensuring institutional accountability within the SARA framework. However, SPEs currently lack consistent and timely access to teach-out information, which limits their ability to respond effectively when institutions are in crisis. By requiring simultaneous submission of teach-out plans to SPEs, this proposal ensures states are not left in the dark when institutions are making significant decisions that affect students’ educational trajectories.
Students deserve to be informed, supported, and protected during moments of institutional instability. Timely access to teach-out plans allows states to coordinate early interventions, ensure that plans are viable and student-centered, and reduce the risk of students being stranded without clear pathways to completion. This is especially important in the context of online education, where students may reside in one state but be enrolled in an institution headquartered in another.
Moreover, this proposal strengthens the broader system of oversight by aligning responsibilities across accreditors, state agencies, and the federal government. It promotes consistency and shared accountability, ensuring that all key oversight entities are working with the same information at the same time.
We urge the NC-SARA Board to adopt PMP25-0746 and continue advancing policies that put students first, promote cross-agency coordination, and uphold the integrity of the SARA framework.
PMP25-0749: Education Specific Consumer Laws in Certain Instances
Comment:
New America’s Higher Education Program strongly supports this proposal, which would allow states to apply education-specific consumer protection laws to SARA-participating institutions under limited but important circumstances.
This policy strikes a thoughtful balance between regulatory consistency and the foundational role of states in protecting students. It recognizes that while reciprocity simplifies oversight for institutions, it should not come at the expense of states’ ability to act in clear and compelling cases where students face harm. While we do not believe that it is necessary to provide institutions the opportunity to have the state’s decision reviewed, if that is allowed, we support the provision that the review of a state’s decision is reviewed by a panel consisting of state regulators representing regions other than the region of the state providing such notice to an institution.
Under current policy, SARA-participating states are prohibited from applying virtually any of their own education-specific consumer protections to out-of-state institutions operating under SARA—even when there is evidence of misconduct or noncompliance. This blanket restriction is both extreme and counter to the original intent of state authorization. States enact authorization laws to ensure that institutions serving their residents meet minimum quality standards and operate in good faith. When those laws are rendered unenforceable—even in the face of student complaints, misrepresentation, or institutional failure—it undermines the legitimacy of state oversight and puts students at risk.
Evidence from recent history underscores this risk. High-profile collapses of institutions like Argosy University, Vatterott College, and the Dream Center network—many of which operated online and across multiple states—left thousands of students with incomplete credentials, untransferable credits, and debt they could not repay. In many of these cases, state regulators were unable to act in time or with sufficient authority because they lacked jurisdiction over out-of-state institutions operating under reciprocity agreements.
This kind of measured oversight is entirely consistent with SARA’s mission and with the longstanding principle that states are the first line of defense in protecting their residents from predatory or negligent educational practices. State regulators often lack real-time insight into out-of-state institutions operating under SARA, and students harmed by such institutions have limited recourse when their home states are preempted from acting. Similarly, New America’s own work has highlighted how student protection mechanisms break down when regulatory coordination fails—particularly for low-income and first-generation students enrolled in online programs where face-to-face support is limited.
PMP25-0749 represents a responsible, student-centered improvement to the SARA policy framework. It restores an essential tool for states to act in their residents’ interest, while maintaining the benefits of reciprocity for institutions that operate in good faith. We urge the NC-SARA Board to adopt this proposal to ensure that states can uphold their consumer protection responsibilities without compromising the integrity of reciprocity.
PMP25-0750: SPE’s Ability to Review a New Institution Applicant
Comment:
New America’s Higher Education Program supports PMP25-0750, which clarifies that State Portal Entities (SPEs) have the authority to review an institution’s application for SARA participation rather than being required to accept a self-certification without scrutiny.
States must be empowered to verify that institutions meet SARA’s requirements before granting them access to students within and beyond their borders. Removing the current explanatory note and affirming SPEs’ ability to conduct meaningful reviews is a common-sense step that enhances the integrity of the SARA framework and better protects students from potentially low-quality or unstable institutions.
We encourage adoption of this proposal to ensure due diligence in the approval process for new or renewing SARA institutions.
PMP25-0752: Consistent use of “Title IV” in the SARA Policy Manual
Comment:
New America’s Higher Education Program supports PMP25-0752, which clarifies that SARA policies apply equally to Title IV and non–Title IV institutions unless explicitly stated otherwise.
This proposed language improves clarity, ensures consistency throughout the SARA Policy Manual, and reduces ambiguity in future policy development. Clear and consistent language is essential for both oversight entities and institutions to understand and implement SARA policy effectively. We support this straightforward but meaningful update and encourage its adoption.
PMP25-0751: SPE Notification of Changes to FRC Scores
Comment:
New America’s Higher Education Program supports PMP25-0751, which affirms a SARA State Portal Entity’s ability to require institutions on provisional status to disclose that status clearly on their websites.
Transparency is essential to protecting students. When an institution is placed on provisional status—often due to concerns related to financial health, program quality, or consumer protection—students deserve to know. Ensuring that this information is disclosed in a timely and accessible way helps students make informed enrollment decisions and supports accountability across the SARA framework. We urge adoption of this proposal to strengthen consumer awareness and safeguard student interests.
PMP25-0755: Amending Background & Creating a Purpose Statement
Comment:
New America’s Higher Education Program supports PMP25-0755, which would revise the background section and add a clear purpose statement to the SARA Policy Manual. This proposal rightly refocuses the purpose of SARA on what should be its core function: enabling states to provide effective oversight of out-of-state institutions serving their residents through distance education.
While streamlining authorization for institutions is an important benefit of reciprocity, it is not the purpose of state authorization itself. Framing the purpose of SARA as student protection and state oversight, rather than institutional convenience, restores clarity and integrity to the compact and aligns it with the original intent of state authorization laws.
This update provides an essential compass for the development and administration of future SARA policies, ensuring that reciprocity continues to serve the public interest. We urge adoption of this proposal.
PMP25-0756: Changes to Provisional Status
Comment:
New America’s Higher Education Program supports the intent of PMP25-0756, which appropriately seeks to strengthen student protections by requiring SARA State Portal Entities (SPEs) to place institutions on provisional status under certain risk conditions. Clarifying and standardizing these triggers is a meaningful step forward in ensuring consistent oversight and providing early warning signals to protect students from harm.
We commend the proposal’s recognition that financial instability, investigations into consumer protection violations, and institutional closures warrant mandatory action. However, we encourage further refinement of several provisions to ensure the policy fully captures the breadth of institutional risks that can threaten student outcomes.
Recommended Revisions:
1. 3.2(a)(2) – Investigations by Home State: The current language limits this trigger to investigations by the home state. We recommend expanding this provision to include other government entities and enforcement actions that indicate a substantial risk to students. Some examples include: a government agency or court has determined that the institution is in violation of state or federal consumer protection laws; the U.S. Department of Education places the institution on provisional certification status under Title IV; and a third-party servicer or contractor involved in marketing, recruiting, or academic delivery has been the subject of a government enforcement action, judgment, or settlement related to student consumer protection. These enhancements would align SARA policy with federal oversight practices and provide more actionable triggers that reflect the complexities of institutional risk today.
- 3.2(a)(3) – Closure or Cessation of Operations: We recommend clarifying that this trigger includes institutions at risk of closure, not just those in the process of closing. Waiting until an institution formally announces closure may be too late to protect students. Including "risk of closure" would give SPEs a proactive tool to intervene earlier. Indicators could include some of the events identified in the Department of Education’s 2023 rule, such as: failure to meet payroll obligations, notification of intent to withdraw accreditation, involuntary loss of state licensure, significant operating losses, or public announcements of impending closure.
- 3.2(b)(1) – Accreditor Action: We support the inclusion of accreditor probationary or provisional status as a discretionary trigger but recommend explicitly adding show cause orders. A show cause action by an accrediting agency signals serious concerns about institutional compliance and should be considered a sufficient basis for SPE review and potential provisional status.
These additions would provide SPEs with the clarity and authority they need to act consistently and decisively to protect students—particularly those enrolled in online programs who may be more vulnerable to disruptions caused by institutional instability. We appreciate the work of the Provisional Status Working Group in bringing this proposal forward and urge the NC-SARA Board to adopt it with the enhancements outlined above.
PMP25-0759: 4.5(c) - Where to Submit Student Complaints
Comment:
New America’s Higher Education Program supports PMP25-0759, which clarifies the collaborative role of SARA State Portal Entities (SPEs) in processing and resolving student complaints. Codifying a strong practice of inter-state cooperation will promote greater transparency, consistency, and accountability across the SARA framework. We appreciate the effort to make the complaint process more accessible to students by explicitly allowing them to submit appeals to either the SPE of the institution’s home state or the state where the student is located. This flexibility acknowledges the realities of distance education and helps ensure students do not fall through the cracks.
Suggested Clarifications to Strengthen the Proposal:
Clarify SPE Coordination in 4.5(c): Since the first paragraph of the proposed 4.5(c) allows students to submit complaints to either the SPE of the institution’s home state or the state where the student resides, the second paragraph should require whichever SPE receives the complaint to inform the other. This small addition would ensure both entities are kept in the loop, prevent duplicative or conflicting actions, and reinforce the collaborative spirit of the policy.
Retain the First Sentence of the Previous 4.5(d): We recommend preserving the original language from the beginning of 4.5(d): "The SARA State Portal Entity of the state in which the student is located may assist as needed in the complaint resolution process." Even though the home state retains final authority, enabling the student’s state SPE to support resolution efforts improves communication, reinforces student trust, and can improve oversight.
With these modest clarifications, the proposed update to Section 4.5(c) and (d) will more accurately reflect and strengthen the cooperative framework that underpins the SARA complaint process.
PMP25-0760: 2.6 State renewal: Optional Lengthening Renewal Periods
Comment:
New America’s Higher Education Program opposes PMP25-0760, which would allow for discretionary extensions of SARA state membership renewal periods beyond the current two-year timeline. While we understand the desire to reduce administrative burden, the two-year renewal cycle plays a critical role in maintaining the integrity, accountability, and consistency of the SARA framework. Regular renewals provide essential checkpoints to ensure that states continue to uphold their responsibilities under SARA, including oversight of participating institutions and student complaint resolution.
A four-year renewal period could allow serious issues—such as lapses in state enforcement, personnel turnover, or systemic failures in handling complaints—to go unaddressed for far too long. In the fast-evolving landscape of higher education, especially in distance learning, two years is already a significant interval. Extending that timeline would weaken the feedback loop and oversight necessary to protect students and ensure compliance.
Moreover, the existing two-year process provides opportunities for regional compacts to assess whether states are fulfilling their obligations and to make timely improvements. A longer interval increases the risk that emerging concerns are missed or delayed, potentially allowing problems to fester and students to suffer the consequences.
We urge the NC-SARA Board to retain the current two-year renewal period for states as a reasonable, responsible standard that balances administrative efficiency with the need for continued vigilance and accountability.
PMP25-0764: Accepting Consumer Complaints
Comment:
New America’s Higher Education Program supports PMP25-0764, which would give states the flexibility to accept student complaints directly—without requiring that they first be submitted to the institution—when permitted by state law. This proposal rightly recognizes that SARA policy should not create unnecessary barriers that weaken oversight or delay action to protect students. In states where regulators are authorized to accept complaints directly, this change would allow for faster identification and resolution of potential problems, particularly in urgent or sensitive situations. We support this common-sense update to align SARA policy with state law and improve the responsiveness of student protections.
PMP25-0766: Provisional Status - Accreditor Sanction
Comment:
New America’s Higher Education Program supports PMP25-0766, which would allow states to place institutions on provisional status when they are subject to a sanction or show cause order by an institutional accreditor. This is a necessary and important addition to SARA’s policy framework to ensure timely action can be taken when serious concerns arise about an institution’s quality or stability.
This addition aligns with the recommendation we made during the comment period for PMP25-056, recognizing that a show cause order is among the most serious actions an accreditor can take prior to withdrawing recognition. It signals significant noncompliance and, in many cases, precedes institutional closure or loss of Title IV eligibility. Students deserve added protections during such moments of heightened institutional risk.
However, while we support the proposed language, we note that it still leaves action to state discretion. Given the gravity of a show cause order, we encourage NC-SARA to consider whether a mandatory provisional status designation might be more appropriate in these circumstances. Discretion may be too lenient when early intervention is critical to safeguarding students and preventing further harm.
We appreciate the inclusion of this provision and urge continued refinement of SARA policy to ensure that warning signs like show cause receive the serious response they warrant.
PMP25-0771: 2.5, 3.2, 3.3- Options for financial responsibility
Comment:
New America’s Higher Education Program opposes PMP25-0771, which would allow institutions with federal financial responsibility composite scores below 1.0 to participate in SARA, provided they meet certain alternative criteria. While we agree there is room to clarify and improve how additional evidence of financial stability is evaluated, the proposed changes go too far in weakening baseline protections—potentially putting students at greater risk.
We agree with the observation that SARA policy provides insufficient guidance on how states should evaluate "additional information" for institutions with composite scores between 1.0 and 1.5. More clarity—such as examples of acceptable evidence or documentation—would improve consistency across states and reduce uncertainty for institutions and regulators alike.
However, we strongly oppose allowing institutions with composite scores below 1.0 to participate in SARA, even with additional documentation or a letter of credit. The current cutoff at 1.0 is an important safeguard. While it is true that the U.S. Department of Education (ED) may continue Title IV eligibility for institutions scoring below 1.0 under provisional certification, this is not a justification for relaxing standards in SARA.
SARA participation reduces state-level oversight by replacing individual state review with reciprocity. That’s why it is both appropriate and necessary for NC-SARA to apply a higher threshold of financial stability. Institutions with composite scores below 1.0 have been flagged by the federal government as financially unstable—granting them interstate operating privileges with reduced scrutiny runs counter to the goals of consumer protection. Moreover, the letter of credit process used by ED is not a student-facing safeguard—it is designed to protect the federal government’s financial interest, not students'. Institutions that pose a financial risk to taxpayers should not be granted regulatory relief through SARA, especially when that relief results in weaker student protections across state lines.
This proposal would fundamentally alter SARA’s commitment to protecting students by allowing high-risk institutions to expand their reach under a lighter regulatory framework. We appreciate concerns about the limitations of the composite score methodology, especially in the context of online institutions or parent company accounting. But the solution is not to lower the bar—it is to improve transparency and establish clear, rigorous standards for additional evidence within the existing composite score range.
We urge the NC-SARA Board to reject this proposal and instead focus on strengthening—rather than weakening—the standards that protect students and maintain public trust in interstate reciprocity.
PMP25-0772: Provisional Status - Court finding of violation
Comment:
New America’s Higher Education Program supports PMP25-0772, which would allow states to place an institution on provisional status if a court has determined the institution violated a law related to student consumer protection. A judicial finding of this nature is a serious indicator of risk and should be treated accordingly.
This proposal aligns with a recommendation we made during the comment period for PMP25-056, recognizing the importance of empowering states to respond to legal findings that signal harm to students. However, we note that the proposed language still leaves this action to state discretion. Given the gravity of a court’s determination, we encourage NC-SARA to consider whether mandatory provisional status may be more appropriate in these circumstances. Nonetheless, we support this step toward stronger oversight and appreciate the inclusion of legal accountability as a factor in SARA eligibility.
PMP25-0773: Provisional Status - Illegal Conduct
Comment:
New America’s Higher Education Program supports PMP25-0773, which would allow states to place an institution on provisional status if a court or government agency has determined that the institution violated a state or federal law or regulation related to student consumer protection.
This proposal aligns with recommendations we made in response to PMP25-0756, where we emphasized the need to treat legal findings of misconduct as serious indicators of risk to students. Empowering states to respond to such determinations is a critical step toward safeguarding students from institutions with a documented history of harmful or illegal behavior.
However, we note that the proposed language makes this action discretionary. Given the gravity of a legal finding of consumer protection violations, we encourage NC-SARA to consider whether such circumstances should result in mandatory provisional status to ensure consistency and student protection across states.
PMP25-0774: Provisional Status - Contractor Government Action
Comment:
New America’s Higher Education Program supports PMP25-0774, which would allow states to place an institution on provisional status if a court or government agency has determined that the institution’s third-party contract violated a state or federal law or regulation related to student consumer protection.
This proposal aligns with recommendations we made in response to PMP25-0756, where we emphasized the need to treat legal findings of misconduct as serious indicators of risk to students. Empowering states to respond to such determinations is a critical step toward safeguarding students from institutions with a documented history of harmful or illegal behavior.
However, we note that the proposed language makes this action discretionary. Given the gravity of a legal finding of consumer protection violations, we encourage NC-SARA to consider whether such circumstances should result in mandatory provisional status to ensure consistency and student protection across states.
PMP25-0775: Provisional Status - Title IV Provisional Status
Comment:
New America’s Higher Education Program supports PMP25-0775, which would permit states to place an institution on provisional status under SARA when the U.S. Department of Education has placed that institution on provisional certification status for Title IV eligibility.
This is a sensible and necessary alignment of oversight mechanisms. When the Department identifies concerns serious enough to warrant provisional certification—whether related to financial responsibility, administrative capability, or compliance with federal law—states should be empowered to respond accordingly. Such actions signal heightened risk to students, and SARA policy should ensure that state regulators can take protective measures without delay.
This proposal helps close a gap between federal and state oversight and reinforces the role of states in safeguarding students enrolled in distance education. We urge adoption of this common-sense policy improvement.
PMP25-0776: Provisional Status - Additional Oversight Measures
Comment:
New America’s Higher Education Program supports PMP25-0776, which provides helpful clarification on the types of additional oversight measures that states may impose on institutions placed on provisional status.
States must have the flexibility to tailor oversight based on the nature and severity of the risks posed by an institution. By explicitly listing examples—such as limits on distance learning enrollments or requirements to post a bond—this proposal gives states clear, practical tools to help ensure institutions meet SARA standards related to program quality, financial stability, and consumer protection.
We also support the annual reporting requirement to regional steering committees and NC-SARA, which will help increase transparency and accountability around how provisional status is used. We urge adoption of this proposal as a commonsense improvement that reinforces SARA’s student protection goals.
PMP25-0777: State Control of Decision-making
Comment:
New America’s Higher Education Program supports PMP25-0777, which would ensure that authority over policy modifications to the SARA Policy Manual rests with the regional compacts and their member states—not with the NC-SARA Board, which currently holds veto power.
This proposal addresses a long-standing concern about the lack of accountability in the current governance structure. While the NC-SARA Board plays an important role in coordination, its authority to override decisions made collectively by the four regional compacts—particularly when its membership includes non-state actors, such as institutional representatives—undermines state sovereignty and the core purpose of SARA: to serve students through state-led consumer protection and oversight.
We also strongly support the inclusion of a required impact analysis on the fiscal and legal implications of each proposal before the regional compacts vote. This is a smart and transparent way to ensure that all decision-makers are fully informed, and it provides NC-SARA an appropriate avenue to raise concerns without overriding state-led consensus.
This proposal also promotes transparency and public participation, clearly outlining how policy proposals move through the process and how stakeholders are engaged. These steps are consistent with our recommendations to improve stakeholder trust and ensure the integrity of SARA policymaking. We urge the NC-SARA Board and regional compacts to adopt this proposal to restore appropriate authority to the states and improve transparency, accountability, and responsiveness in SARA governance.
PMP25-0778: State Renewal Options
Comment:
New America’s Higher Education Program supports PMP25-0778, which would allow regional compacts to grant states Provisional Approval status during the renewal process when a state has demonstrated deficiencies in fulfilling its responsibilities under the SARA Policy Manual.
This proposal fills a critical gap in current SARA policy. As it stands, compacts are often faced with a binary choice—approve or deny a state’s renewal—with no middle ground for states that are working toward compliance but not yet fully meeting expectations. Provisional status offers a flexible and pragmatic tool for encouraging continuous improvement without immediately disrupting student access to educational opportunities.
However, we recommend adding reasonable limitations on states under Provisional Approval to ensure continued accountability and consistency. For example, states in provisional status could be temporarily restricted from approving new SARA-participating institutions or from expanding existing institutions’ activities across state lines. Such guardrails would minimize risk to students and help maintain the integrity of reciprocity while the state addresses its deficiencies.
This proposal is a positive step forward in reinforcing the collaborative and accountable structure of SARA. We urge adoption with the additional consideration of safeguards tied to provisional status.
PMP25-0779: Adjusting Timing of Public Comment Period
Comment:
New America’s Higher Education Program supports PMP25-0779, which would adjust the timing of the public comment period in the SARA policy modification process so that comments are invited before the deadline to amend proposals.
This change is both practical and meaningful. Public comments are most valuable when they can inform revisions and improvements to proposals. Ensuring that feedback is received while there is still time for submitters to act on it will enhance the quality, clarity, and consensus around proposed policy changes.
We appreciate NC-SARA’s decision to offer an early public comment period this year and support this proposal to make that practice permanent.