Editor’s Picks

Fact Check: Who Benefits From SARA?

By Henry Kronk
March 27, 2018

eLearning Inside News recently reported on the ongoing debate over the State Authorization Reciprocity Agreement (SARA). The piece relied heavily on a figure quoted by Marshall Hill, the Executive Director of the National Council for SARA (NC-SARA): for-profit institutions make up only 6% of the 1,750 that participate in the agreement.

That figure is true, but it also obscures the reality of who benefits from the agreement. While the vast majority of institutions participating in SARA are either public or private non-profits, the number of students studying remotely in these organizations is often just a handful. Going off the students who study in online SARA-authorized institutions, private for-profits make up nearly half. As of 2017, the breakdown stood at 49.7% private for-profit, 33% private non-profit, and 17.3% public non-profit according to SARA institutions’ self-reporting (see page 14, it’s easy to miss).

At SARA’s Outset, Intentions Were Pure

The process to create the agreement commenced in 2011 and it began to take effect in 2013. In its short lifespan, it has made incredible headway. A full 48 states have signed on to it. Massachusetts has passed legislation to join it, but that won’t take effect until later this year. California stands as the only state that has yet to sign on.

“The concept behind SARA is good. But states give away too much when they sign up, without getting any additional consumer protection,” said The Century Foundation Senior Fellow Robert Shireman. As a former education advisor to the Obama Administration, Shireman was instrumental in cracking down on for-profit educators.

Access Isn’t the Full Story

Our previous piece presented arguments for and against the adoption of the agreement. Proponents say that SARA allows for online college programs to more easily reach learners throughout the country without needing to jump through the costly and time-consuming hoops of getting one’s institution authorized state by state.

Opposition to SARA comes almost exclusively from individuals and organizations who stand against lax regulation of for-profit education. It allows online educators to shop around for states with the most favorable regulatory environment. Once established there, they can reach almost any learner throughout the U.S. The Children’s Advocacy Institute (CAI) recently released a report titled “Failing U,” which served largely as an indictment against SARA.

Robert Shireman, right, speaks with Frances Lee and Suzanne Mettler at a New America event. Source: New America, Flickr.

Shireman explained exactly why that matters. “The Department of Education is currently eliminating most of the protections against predatory schools. Secretary DeVos is even considering granting recognition to ACICS, the accreditor that brought us the corrupt Corinthian Colleges.”

“The way that SARA is designed, any school that Secretary DeVos okays, by any accreditor she approves, is virtually assured SARA approval, with no discretion by the state. If Secretary DeVos recognizes ACICS as a valid accreditor, its schools would get automatic approval under SARA and full access to students in SARA states. If California joins SARA it will have no ability to use its state authorization authority to protect its residents.”

“Consider the online Ashford University, which is based in California and has been sued by Attorney General Becerra for deceiving veterans and other students. If California joined SARA and had a passing financial score, California would be required by its commitment to SARA to approve the school’s operation nationwide, even if California imposed restrictions in California or prohibited it from enrolling Californians.”

According to Robert Fellmeth, CAI’s executive director, “Basically, SARA ensures a race-to-the-bottom national regulatory regime that permits on-line for-profits to shop for the most favorable regulatory climate. That does not bode well for students.”

There Is No Hard Bottom Line

In our previous article, we arrived at the following bottom line: “[A]s the debate stands, neither side is participating in the same conversation. SARA proponents want to expand access to education, full stop. Opponents to the agreement, however, remain concerned only over what it spells for predatory, for-profit educators, which make up a small portion of SARA beneficiaries.”

That conclusion still holds some water, but it’s not based on the full picture. Proponents ignore some pretty serious implications of the agreement.

In 2017, 1.17 million learners enrolled in a distance program from a SARA-authorized institution. That figure was up from 857,303 the year before. Assuming that critics have no qualms about the operations of non-profit colleges and universities, about half of these students were worth beneficiaries of the agreement. But then half were unnecessarily exposed to potentially predatory and/or fraudulent for-profit educators.

It’s difficult to reckon with those numbers. It’s a textbook Catch-22. Opposing the agreement means coming down against a large population of learners who benefit from it. And favoring it means opening up the door for for-profit institutions of higher education, a sector in which fraud is practically systemic.

No, for-profits are not fraudsters by definition. But according to Shireman, “Schools operated for profit are inherently more hazardous for students than are public or nonprofit schools, because for-profits are allowed to use tuition revenue for anything they want and are controlled by people who are allowed to take the money for themselves. Many for-profit schools are good, but they can go bad very quickly, and frequently do. That means we need to be careful, especially when for-profit schools are financed with government-backed student loans. Prospective students assume that the government aid is an endorsement of the institution and its price, and the schools use that as a way to overcharge and under-deliver.”