Higher Education Law Report
Regional Accreditor Poised to Ban Incentive Compensation to Recruiters of International Students
April 6, 2017
The Middle States Commission on Higher Education has proposed the adoption of a policy that would prohibit Middle States-accredited colleges and universities from providing “incentive payment” (e.g., tuition sharing or per capita payments) to recruiters “based on [their] success in securing student enrollment….” If approved, the policy would apply to the recruitment of prospective students in the United States and internationally. As to prospective applicants in the United States, the policy would not result in significant change as a practical matter, as the United States Department of Education’s Title IV program integrity rules already prohibit payment of such compensation in connection with the recruitment of prospective students eligible for Title IV aid. Historically, however, institutions have been able to pay incentive compensation for the recruitment of foreign students residing outside the United States who are not eligible to participate in Title IV programs. (In 2013 and 2014, the National Association for College Admission Counseling (NACAC) approved an amended Statement of Principles of Good Practice that allows institutions to use commissioned agents to recruit students outside the United States, while encouraging the implementation of protections designed to protect applicants and their families against potential conflicts of interest resulting from the practice.) If adopted, the proposed policy would pose challenges for Middle States-accredited institutions (in Delaware, the District of Columbia, Maryland, New Jersey, New York, Pennsylvania, Puerto Rico and the Virgin Islands) that compete for international enrollments with peer institutions accredited by other regional accreditors, who would not be similarly restricted absent adoption of corresponding prohibitions by their respective regional accreditors. Middle States is accepting public comments on its proposed policy through April 17, 2017. Unless the proposed policy is withdrawn following closure of the comment period, the policy (including any revisions based on comments received) will likely be submitted for approval by vote of the Chief Executive Officers of Middle States’ member institutions sometime this summer.
