Tennessee Higher Education Commission Division of Postsecondary State Authorization Tennessee Higher Education Commission Initial Authorization Training

Tennessee Higher Education Commission

Division of Postsecondary State AuthorizationTennessee Higher Education Commission

Initial Authorization TrainingJuly 2015


Initial Authorization Training ManualTable of Contents

I. PowerPoint Presentation

• Authorized Institutions Overview

• Tuition Guarantee Fund

• THEC Website

• Website and Advertising Compliance

• Annual Reauthorization

• Record Keeping Requirements and Audits

• Tips to Avoid Reauthorization Audit Findings

• Forms and Applications

• Complaints

II. Rule Chapter 1540-01-02 – Authorization and Regulation of Postsecondary Education Institutions and Their Agents (December 2014)

III. Tennessee Code Annotated Title 49, Chapter 7, Part 20

IV. Tennessee Code Annotated §49-7-144

V. Tennessee Code Annotated §49-7-207


Authorized Institutions Overview


• Pursuant to the Postsecondary Education Authorization Act of 1974 (Tenn. Code Ann. § 49-7-2001, et seq.) the Tennessee Higher Education Commission (THEC) is directly responsible for the oversight and operation of degree and non-degree granting institution that offer a wide variety of academic, career, technical and trade programs. The division within THEC that staffs these functions is the Division of Postsecondary State Authorization (DPSA).

• Currently, THEC authorizes approximately 198 institutions with 358 physical and online locations and approximately 4,700 programs.

Authorized Institutions Overview(Data as of July 8, 2015)

Authorized Institutions Overview(Data as of July 8, 2015)

• Authorized institutions also include state institutions domiciled outside of Tennessee (e.g., Arkansas State University and Troy University)

• Of the 198 Authorized Institutions:

– 134 are for-profit– 64 are not-for-profit

– 44 are regionally accredited– 48 are nationally accredited– 106 are not accredited



Enrollment Distribution By Age Enrollment Distribution By Gender

Authorized Institutions OverviewStudent Population of Authorized Institutions

(Data as of June 2014)


Enrollment Distribution By Race Enrollment Distribution By Accreditation

Authorized Institutions OverviewStudent Population of Authorized Institutions

(Data as of June 2014)


Tuition Guaranty Fund


Tuition Guaranty FundRule Chapter 1710-01-02 & Tenn. Code Ann. § 49-7-2018

• The tuition guaranty fund was created by the Tennessee General Assembly to establish a fund from which reimbursement can be made to students for unearned tuition.

• A Board of Directors administers the fund. The Board is composed of:• the Comptroller of the Treasury;• the Commissioner of Finance and Administration; • the State Treasurer;• the Chair of the Committee on the postsecondary education institutions; • a representative of the private postsecondary education industry named by the

Chair of the Commission; and • the Executive Director of the Tennessee Higher Education Commission.

• The Board is authorized to take any actions necessary to administer the fund, including promulgation of rules, regulations and bylaws.


Tuition Guaranty FundRule Chapter 1710-01-02 & Tenn. Code Ann. § 49-7-2018

Institutions will receive notification concerning the need to contribute to the fund in February of the year following receipt of authorization from THEC. Institutions must pay into the fund for the first six years of authorization as follows:


THEC Website


THEC Website


THEC Website


THEC Website


THEC Website


Website and Advertising Compliance


Website Compliance Putting Together § 49-7-2019 and Rule 1540-01-02-.20(3)(a)

WHAT STATEMENT TO POST?• “[Name of Institution] is authorized for operation as a postsecondary educational

institution by the Tennessee Higher Education Commission. In order to view detailed job placement and graduation information on the programs offered by [Name of Institution], please visit www.tn.gov/thec/ and click on the Authorized Institutions Data button.”

• Within or near this sentence, there must be a hyperlink to www.tn.gov/thec/ through the phrase “Tennessee Higher Education Commission” or by clicking the Commission’s logo.

WHERE SHOULD THE STATEMENT BE POSTED WITHIN THE WEBSITE?• On the first page of the website; or• If the institution is located in more than one state, the first Tennessee-specific web

page or the webpage for each Tennessee authorized site.

http://www.tn.gov/thec/


WHAT ARE INSTITUTIONS REQUIRED TO POST AND WHERE?• Tenn. Code Ann. § 49-7-2019 requires institutions to post the tuition costs

provided to the Commission. • The transferability of credit statement as written in paragraph (b)(2) of Tenn. Code

Ann. § 49-7-144 must be posted. Commission staff recommends posting this statement or a link thereto on the first page of the website, the first Tennessee-specific webpage, or the webpage for each Tennessee authorized site.

Website ComplianceTenn. Code Ann. § § 49-7-2019 and 49-7-144


Advertising ComplianceRule 1540-01-02-.20(6)

• .20(6) states:

“All advertisements placed by an institution or its representatives seeking prospective students must include and clearly indicate the full and correct name of the institution, its address, and the city where the institution is located.” (emphasis added)

• This rule applies to all advertisements, including billboards, radio, television, and newspaper advertisements, and advertisements created and purchased by the institution or its agents.

• If your agent takes out an advertisement and it does not comply with .20(6), your institution may be fined.



• Generally, institutions must obtain approval before using a wage dollar amount in an advertisement. However, institutions can use, without prior approval, specific Tennessee Department of Labor statistics. The statistics are available at: https://www.jobs4tn.gov/vosnet/GSIPub/documentView.aspx?enc=5I4zvxxmS0tmC+HHsx3GHqQU+ZSClAkpglFU8TdIEkY.

• Institutions must use the most recent information. Today, that is the 2015 data.• Note that this same source is preferred by DPSA when completing program

revisions and new program applications. • Institutions may only use the entry wage data without obtaining prior approval.• Institutions may use the data for the state, MSA or BOS in which the institution is

located.

https://www.jobs4tn.gov/vosnet/GSIPub/documentView.aspx?enc=5I4zvxxmS0tmC+HHsx3GHqQU+ZSClAkpglFU8TdIEkY





When you visit https://www.jobs4tn.gov/vosnet/GSIPub/documentView.aspx?enc=5I4zvxxmS0tmC+HHsx3GHqQU+ZSClAkpglFU8TdIEkY you will see:






Clicking on the Johnson City link will take you to information for that Metropolitan Statistical Area.


Advertising ComplianceRule 1540-01-02-.20(16) and (17)

• .20(16) requires that advertising appear under categories such as “Instruction” or “Education.”

• .20(17) has two parts. • Part one provides that an advertisement cannot use the words or phrase

“wanted,” “help wanted,” or “trainee.”• Part two of .20(17) provides that no advertisement shall “indicate in any

manner that the institution has or knows of jobs or employment of any nature available to prospective students; only ‘placement assistance,’ if offered, may be advertised.” (emphasis added)

• Based on this rule, you cannot use phrases such as: “Major Employers Hiring,” “Carriers Prehiring Now,” “Immediate Openings,” or “Job Placement”

• You can say: “Placement Assistance Available”• Institutions that offer a truck driving program should also consult .08(6),

which provides an exceptions to .20(16) and (17) under certain circumstances.



.20(18) prohibits any guarantees of employment or false representations of employment opportunities upon completion of the program.

• Based on these rules, you cannot uses phrases such as:

“Lifetime Job Placement”

“Full Placement”• Based on these rules, you can use:

“Placement Assistance”


Annual Reauthorization


Annual Reauthorization

• Institutions are required to submit an annual reauthorization application.• Application Distribution and Deadline:

– Applications are emailed to the institution’s Director each August. If there is another contact responsible for the application and

follow-up, please notify Teresa Warren.– Please check this email address and spam, junk mail, etc. to ensure

timely receipt of application. It is your responsibility to ensure receipt and timely submission of the application.

– The deadline for submission is October 15th (or the next business day, if October 15th falls on a holiday or weekend).


Annual ReauthorizationCollected Information & Data

The following information will be requested as part of reauthorization so your institution might want to put in place procedures now to ensure the information is readily available when needed.

• Withdrawal, Placement, and Completion Data (Appendix 3)

− Data is collected on enrolled students. “Enrollment” refers to those students who have completed the institution’s application forms, submitted a financial deposit where required, and have actually attended one or more sessions of classes, or, in the case of home study programs, received one or more lessons.

− An official date should be recorded for all student withdrawals, probation, leave of absence, graduation or any other status changes.

• Board/Licensure Passage Rates - Applies to any program leading to employment in a field where licensure/certification is required for employment and there is an examination.


Annual ReauthorizationCollected Information & Data

• Total Gross Tuition Collected and Student Funding Sources - Examples include, federal loans, in-house funding, Workforce Investment Act monies, veterans’ benefits, scholarships

• Proof of a Successful Fire Inspection Conducted by a Governmental Entity Within the Past 12 Months

• Balance Sheet and Income Statement


Annual ReauthorizationAppendix 3 - Withdrawal and Placement Data

• Student ID Number• Race• Gender• Date of Birth• Program Name• Program Code• Delivery Mode• Program Length• Credential• Date Entered

• Date Completed• Date Withdrew• Special Circumstance Withdrew• Placed• Placed In-Field• Special Circumstance Non-

Placement• Name, Address, and Telephone

Number of Employer• Annual Salary or Hourly Wage

Appendix 3 is an Excel spreadsheet and includes the following information for each student:


Annual ReauthorizationAppendix 3 - Withdrawal and Placement Data

Special Circumstances for Withdrawals:

• Health related situation• Family emergency• Death• Incarceration• Full-time military service• Job relocated/transferred• Transferred to a different program at

your institution

Special Circumstances for Non-Placements:

• Health related situation• Family emergency• Death• Incarceration• Full-time military service• Job relocated/transferred• Continuing education at your institution• Continuing education at a different

institution• Pending fulfillment of licensure

requirements• International students - unable by law to

work• Student could not be contacted / Refused

employment


Record Keeping Requirements and

Audits


• Each institution is subject to random audits to verify information submitted in its annual reauthorization application and compliance with THEC’s regulations.

• Selection of Institutions:- Audits conducted on randomly selected authorized institutions each

year; and/or- Institutions with five or more formal student complaints

• Notification:– In-state institutions will be given 3 business days advance notice.– Out-of-state institutions will be given 10 business days to submit the

requested documentation.– The Institutional Director will be the primary contact. An email will be

sent to Institutional Director with a message asking the director to confirm receipt and verify the attachment can be opened.

Reauthorization AuditsProcedures for Student File Review


• Audit Sample:− 30 random files − If less than 30 students, 100% of files− 100% of placement and withdrawal exceptions

• Students’ files must be ready for inspection upon the audit teams arrival.

• If the required records for the 30 random files are kept in multiple files, then all files must be presented at the beginning of the audit.

− Example: If transcripts are in academic files and the enrollment agreements are in the financial aid files, both files must be presented to the audit team at the beginning of the audit.

− Example: If transcripts are stored electronically, then they should be printed off prior to the audit team arrival.

Reauthorization AuditsProcedures for Student File Review


Reauthorization AuditsDocumenting Placement & Withdrawal Exceptions

• All placement and withdrawal exceptions must be documented.

• If documentation is not made available for withdrawals and placements:

- Special Circumstance Withdrawals will be counted as Withdrawals

- Special Circumstance Non-Placements will be counted as Not Placed


Reauthorization AuditsDocumenting Placement & Withdrawal Exceptions

Suggestions for documenting:

• Maintain a call log in the student’s file indicating the name of the person who contacted the student, the date the call was made and the student’s phone number with notes regarding the conversation.

• An email from the student.

• A status form, signed by the student (when possible).

• Proof of incarceration:

(Example) Verification is available at the Montgomery County Sheriffs Department for the day of booking plus three days.

(Example) www.mcgtn.org/sheriff/booking


Reauthorization AuditsWithdrawal Exceptions Sample Form


• There is no documentation for the basis of admission. (Rule 1540-1-2-.15(6)(b)). Most repeated finding that has resulted in adverse action being taken against institutions.

• There is no pre-enrollment checklist or unsigned pre-enrollment checklist. (Rule 1540-1-2-.15(6)(c))

• There is no enrollment agreement or unsigned enrollment agreement. (Rule 1540-1-2-.15(6)(d))

• The transfer of credit disclosure is missing, not compliant or not executed by the student. (T.C.A. § 49-7-144)

• There is no institution transcript or certificate of completion for your institution in the file. (Rule 1540-1-2-.15(6)(e) & (8))

Institutions shall retain student transcripts or certificates of completion permanently.

• No documentation for a special circumstance withdrawal or placement exception.

Reauthorization AuditsMost Common Student File Audit Findings


Tips to Avoid Reauthorization Audit Findings


• Institutional files shall be maintained according to Rule 1540-01-02-.15, and the audit team will be checking for the following items:– Documentation for the basis of admission- Pre-enrollment checklist (required if the checklist items are not in the

enrollment agreement) - Enrollment agreement- Transferability of credits disclosure statement (T.C.A. § 49-7-144) - Copy of student transcript or certificate of completion from your

institution.- Documentation of all special circumstances placement and withdrawal

exceptions - Account Statement/Student Ledger – DPSA recognizes that this

information is often maintained electronically, but should an up-to-date statement should be available to print upon request.

Student Files


As of January 1, 2014 the High School Equivalency Test (HiSET) is available as an alternative option to earn the state-government issued high school equivalency diploma. While the GED is still an option, the State of Tennessee and the State Board of Education will not make a distinction between the two tests when awarding the credential. Successful test takers of either test will be issued a Tennessee High School Equivalency Diploma (HSE).

Student Files


Student Files


• An official high school transcript, high school equivalency transcript or GED score sheet shall be maintained in the student’s file, not a copy of the high school diploma, or GED Certificate or HSE diploma. An official high school transcript, high school equivalency transcript or GED score sheet must be:- Signed by an institutional official or have an official seal.- If a hard copy of the transcript or score sheet is scanned and stored

electronically, then it must be accompanied by documentation that verifies it was received directly from the issuing institution/agency such as the envelope that contained the transcript or score sheet. Please note such is not necessary when the document itself is addressed to the receiving institution.

- If faxed or emailed the transcript or score sheet should include a cover letter, fax cover sheet or envelope from the issuing institution/agency attesting that the copy is an official transcript or score sheet.

• If an official postsecondary transcript is used for admission to an undergraduate program, then the transcript must clearly indicate that the student graduated from high school. If used for admission to a graduate program, then the postsecondary transcript must be official and indicate that the person holds a postsecondary degree.

Student Files


Student Files

Passage of an Ability-to-

Benefit Test

Certificate or Diploma Programs

Ability-to-benefit test results1

High School Equivalency

Diploma

Certificate, Diploma, or Undergraduate Degree

Programs

Official GED Score Sheet Official High School

Equivalency Transcript

High School

Diploma

Certificate, Diploma, or Undergraduate Degree

Programs

Official High School Transcript2

Bachelor’s Degree or

Higher

Graduate Degree Programs

Official Postsecondary Degree Transcript

If the student’s level of education is . . .

then the student is eligible to enroll in . . .

and the student file must contain . . .

1 The test should be approved by DPSA or one previously approved by the U.S. Department of Education., which the institution has informed DPSA of its intention to use.2 Other evidence of receipt of a high school diploma is a postsecondary transcript indicating the student graduated from high school or official military papers such as the Enlisted Record Brief.


Admission Standards

• Each institution is approved with specific admission standards set by the institution, subject to Rule 1540-01-02-.12.

• Admission standards must be applied as approved by THEC.

• Do not admit students that you know or should know are ineligible for licensure unless you get written acknowledgement from the student.


Forms and Applications


Program Revisions• An institution must receive approval to offer a program prior to advertising for or

enrolling any student in the program. Each program approval is specific to the information provided in the application, including curriculum content, tuition, name, etc.

• Your institution must notify DPSA of the following changes:

– Tuition/Other Costs

– Program Name

– Credit/Contact Hours

– Curriculum Content

– Program Length

– Credential Offered

• Institutions should use the Program Revision Form available on THEC’s website.

• Please keep track of your revisions as the form asks for the last revision date.

• Keep a copy of the completed form and the acknowledgement letter from DPSA.

• Changes to delivery mode (residential, online or blended) will likely require a new program application.


Program Revisions

• Generally, forms should be submitted 30 days prior to implementation of the revision.

• PROGRAM CHANGES EXCEEDING 25%• Rule 1540-01-02-.07(13)(e) provides: “Ongoing institutions that make

changes to an existing program(s) previously approved by the Commission must file a New Program Application if program changes exceed 25% in one calendar year, or if in the opinion of staff a significant change has occurred.”

– The percentage change is calculated using the past 12 months.• Rule 1540-01-02-.07(13)(f) provides: “Institutions shall not arbitrarily add a

course or courses to an existing program in which a student would incur additional time and expense beyond the catalog requirements at the time of enrollment, unless the addition is in response to: demonstrated educational necessity; a reasonable program completion period had elapsed; state approval agencies; recognized accrediting agencies or for requirements of professional certifications or licenses.” (emphasis added)


Tuition Charges

• Institutions must charge the approved tuition amount.

• Institutions may request a review of any offering that results in a reduced tuition amount (such as scholarships, waivers or grants) to ensure that the offering is not prohibited.

• Commission staff evaluates proposed offerings to determine whether:1. the criteria for receiving the award is clearly defined in writing;2. the institution has a form and procedure to verify eligibility; and 3. the amount of the award is a flat dollar amount or subject to calculation

using a defined formula or scale.

WHAT IS AN AGENT?

AGENT REQUIREMENTS

• All agents must:1. receive approval and an agent permit; and 2. If the institution is out-of-state, secure an appropriate bond prior to any

solicitation. • Agent permits must be renewed annually and the renewal application is available

on THEC’s website.• Institutional Directors and the Institution are responsible for an Agent’s actions.• Agent whose permit has expired must submit a New Agent Application if

submitted more that 60 days following the expiration date.Tennessee Higher Education Commission

AgentsT.C.A. § 49-7-2003 and Rule 1540-01-02-.16(15)

Tenn. Code Ann. § 49-7-2003(1) (1) Agent means any person owning any interest in, employed by or representing for

remuneration a postsecondary educational institution, who, by solicitation in any form, enrolls or seeks to enroll a student for education offered by an authorized institution, or offers to award educational credentials, for remuneration, on behalf of any such institution for any such purpose . . . .


ANSWERS TO COMMON AGENT QUESTIONS

• An institution must obtain approval for an agent prior to the individual engaging in any agent activity.

• If the institution is compensating the person for enrolling or seeking to enroll students, then he/she is an agent.

• An employee of the institution working at the instructional site is not an agent; however, a person working from a remote location ,who enrolls students or make cold calls, or as part of a recruiting firm is an agent.

Agents Rule 1540-01-02-.16(15)

WHY IS THIS IMPORTANT?• Any student solicited or enrolled by a non-licensed agent may be entitled to a refund

of all moneys paid and a release of all obligations by the institution.• Any contract signed by a prospective student as a result of solicitation or enrollment

by a non-licensed agent may be unenforceable. • The institution could be fined or the institution’s authorization status changed to

conditional or revoked.


• Directors shall notify DPSA of staff changes. − Unaccredited institutions must submit applications for all instructors

and administrative personnel. − Accredited institutions must submit applications for administrative

personnel only.

• Administrative personnel generally encompasses individuals that oversee areas as outlined in operational and administrative standards. This includes by function, but is not limited to titles of an institutional director; financial aid administrator; director of admissions; director of education; business officer or manager; director of student services (including counseling and placement) and the registrar.

• Support and clerical staff are not considered administrative personnel; therefore, School Personnel Applications are not necessary for these positions.

School Personnel Applications


School Personnel Applications

• All instructors must meet the minimum instructor qualifications as outlined in Rule 1540-01-02-.16(11).

− All unaccredited institutions must maintain on-site a School Personnel Application for every instructor and administrative personnel.

− Accredited institutions must maintain on-site documentation supporting instructors meeting the minimum qualifications and complete an application upon request from Commission staff.

• Verification of qualifications may be required at any time or as part of a Commission site visit. Often, DPSA requests confirmation of qualifications when investigating a complaint.


School Personnel ApplicationsWhen completing the school personnel application, make sure to include the following:• The certification or license held• Experience

– List each position held within the last seven years

– Add rows to the form or list on a separate sheet of paper if more space is needed

• List program/subject to be taught• Qualifications

– Place a check mark by applicable qualifications

– Only mark qualifications for level to be taught (i.e., instructors for certificate level programs need only to mark certificate level qualifications)

• Signatures of require persons• All information placed on applications is subject to verification by

Commission staff.


Other Required Forms• Change of Address – Rule 1540-01-02-.07(14)

− Your institution may not conduct instruction at an unauthorized site. Submit application at least 30 day prior to the scheduled relocation.

− DPSA must inspect the facilities and equipment.

• Program Deletion

• Change of Institutional Name

• Change of Ownership – Rule 1540-01-02-.07(12)

• New Program Application – Rule 1540-01-02-.07(13)

− An institution must receive approval to offer a program prior to advertising for or soliciting enrollment.

− For equipment heavy programs, DPSA will inspect the equipment prior to approving the program.

• Surety Bonds for Agents and Institutions – Rule 1540-01-02-.07(6) thru (10)


Complaints


Complaints• The investigation of complaints against institutions is one of the

most important functions performed by this agency.

• Sources of complaints:• Students• Parents• Employees• Elected Officials• Better Business Bureau• Other State Agencies

• Types of complaints:• Informal (non-written)• Formal (written)


When an informal complaint is received, DPSA explains the complaint process to the complainant, discusses any applicable statutes and rules, and suggests that the complainant contact the Institutional Director. DPSA sends a follow-up email to the complainant with instructions for initiating a formal complaint. The Institutional Director is copied on this email.

If the complainant does not submit a written complaint within 30 days of the informal complaint, the complaint is closed.

If DPSA receives a written complaint, the following process is initiated.

Informal Complaints


Formal Complaint Process

DPSA sends a copy of the complaint to the institution

along with a letter requesting a response to specific

allegations and documents to assist with the investigation.

The institution’s response to DPSA should fully address

the allegations and include all documentation requested by

DPSA.



DPSA may request additional information/documentation

or complete a site visit as part of the investigation process.

DPSA will review all information to determine if there were any violations of

statutes, rules, or the institution’s internal policies.



Every attempt is made to resolve the dispute between the

parties. If no resolution is reached, DPSA will issue its

written findings.

If DPSA determines that a violation has occurred, the

institution is given an opportunity to provide

substantial reasons as to why adverse action should not be

taken.



DPSA will evaluate the institution’s response and take appropriate action, including

recommending that the Executive Director assess a fine, change authorization status, or require

the institution to issue a refund or take some other action.

In the event that either party is not satisfied with the

determination made by DPSA, the party may seek further review

by the Executive Director or through the Uniform

Administrative Procedures Act.


Complaints

Adhere to your own policies

Document communications

Educate your staff to resolve issues internally

How can my institution reduce or eliminate complaints filed with DPSA?


Conclusion

Thank you for your attendance today. Before you leave, please pick up a Director Affirmation Statement.

THIS STATEMENT MUST BE COMPLETED AND RETURNED TO THE COMMISSION WITHIN TWO WEEKS. RETURN TO:

Tennessee Higher Education CommissionAttn: Rosie Padgett

Parkway Towers, Suite 1900404 James Robertson Parkway

Nashville, TN 37243-0830

Questions for the Commission should be directed as follows:• Statutes and Rules: [email protected]• Applications: [email protected]• Complaints: [email protected]

mailto:[email protected]



Documents

Tennessee Higher Education Commission Division of Postsecondary State Authorization Tennessee Higher Education Commission Initial Authorization Training