Definitions

Section 103 of the Higher Education Act of 1965 (20 U.S.C. 1003) is amended by adding at the end the following:

(25)

Competency-based education; competency-based education program

(A)

Competency-based education

Except as otherwise provided, the term competency-based education means education that—(i)measures academic progress and attainment—(I)by direct assessment of a student’s level of mastery of competencies;(II)by expressing a student’s level of mastery of competencies in terms of equivalent credit or clock hours; or(III)by a combination of the methods described in subclauses (I) or (II) and credit or clock hours; and(ii)provides the educational content, activities, and resources, including substantive instructional interaction, including by faculty, and regular support by the institution, necessary to enable students to learn or develop what is required to demonstrate and attain mastery of such competencies, as assessed by the accrediting agency or association of the institution of higher education.(B)

Competency-based education program

Except as otherwise provided, the term competency-based education program means a postsecondary program offered by an institution of higher education that—(i)provides competency-based education, which upon a student’s demonstration or mastery of a set of competencies identified and required by the institution, leads to or results in the award of a certificate, degree, or other recognized educational credential;(ii)ensures title IV funds may be used only for learning that results from instruction provided, or overseen, by the institution, not for the portion of the program of which the student has demonstrated mastery prior to enrollment in the program or tests of learning that are not associated with educational activities overseen by the institution; and(iii)is organized in such a manner that an institution can determine, based on the method of measurement selected by the institution under subparagraph (A)(i), what constitutes a full-time, three-quarter time, half-time, and less than half-time workload for the purposes of awarding and administering assistance under title IV of this Act, or assistance provided under another provision of Federal law to attend an institution of higher education.(C)

Competency defined

In this paragraph, the term competency means the knowledge, skill, or ability demonstrated by a student in a subject area.

General provisions relating to student assistance

(a)

Definitions of academic year and eligible program

Section 481 of the Higher Education Act of 1965 (20 U.S.C. 1088) is amended—(1)in subsection (a), by adding at the end the following:

(3)(A)For the purpose of a competency-based education program the term academic year shall be the published measured period established by the institution of higher education that is necessary for a student with a normal full-time workload for the course of study the student is pursuing (as measured using the value of competencies or sets of competencies required by such institution and approved by such institution’s accrediting agency or association) to earn—(i)one-quarter of a bachelor’s degree;(ii)one-half of an associate’s degree; or(iii)with respect to a non-degree or graduate program, the equivalent of a period described in clause (i) or (ii).(B)(i)A competency-based education program that is not a term-based program may be treated as a term-based program for purposes of establishing payment periods for disbursement of loans and grants under this title if—(I)the institution of higher education that offers such program charges a flat subscription fee for access to instruction during a period determined by the institution; and(II)the institution is able to determine the competencies a student is expected to demonstrate for such subscription period.(ii)Clause (i) shall apply even in a case in which instruction or other work with respect to a competency that is expected to be attributable to a subscription period begins prior to such subscription period.(iii)In a case in which a competency-based education program offered by an institution of higher education is treated as a term-based program under clause (i), the institution shall review the academic progress of each student enrolled in such program in accordance with section 484(c), except that such review shall occur at the end of each payment period.

; and

(2)in subsection (b), by striking paragraph (4) and inserting the following:

(4)For purposes of this title, the term eligible program includes a competency-based program that—(A)has been evaluated and approved by an accrediting agency or association that—(i)is recognized by the Secretary under subpart 2 of part H; and(ii)has evaluation of competency-based education programs within the scope of its recognition in accordance with section 496(a)(4)(C); or(B)as of the day before the date of enactment of the CBE Act of 2022, met the requirements of a direct assessment program under section 481(b)(4) (as such section was in effect on the day before such date of enactment).

(b)

Student eligibility

Section 484 of the Higher Education Act of 1965 (20 U.S.C. 1091) is amended—(1)in subsection (b), by adding at the end the following:

(6)For purposes of competency-based education, in order to be eligible to receive any loan under this title for an award year, a student may be enrolled in coursework attributable only to 2 academic years within the award year.

; and

(2)in subsection (c)—(A)in paragraph (1)—(i)in subparagraph (B)—(I)by striking the student has a cumulative and inserting the following: the student has—

(i)a cumulative;

;

(II)by striking the second and inserting each;(III)by striking the period at the end and inserting ; or; and(IV)by adding at the end the following:

(ii)for the purposes of competency-based programs, a non-grade equivalent demonstration of academic standing consistent with the requirements for graduation, as determined by the institution, at the end of each such academic year; and

; and

(ii)by adding at the end the following:

(C)the student maintains a pace in his or her educational program that—(i)ensures that the student completes the program within the maximum timeframe; and(ii)is measured by a method determined by the institution which may be based on credit hours, clock hours, or competencies completed.

;

(B)in paragraph (2), by striking grading period and inserting evaluation period; and(C)by adding at the end the following:

(4)For purposes of this subsection, the term maximum timeframe means—(A)with respect to an undergraduate program measured in credit hours, a period that is no longer than 150 percent of the published length of the educational program, as measured in credit hours;(B)with respect to an undergraduate program measured in competencies, a period that is no longer than 150 percent of the published length of the educational program, as measured in competencies;(C)with respect to an undergraduate program measured in clock hours, a period that is no longer than 150 percent of the published length of the educational program, as measured by the cumulative number of clock hours the student is required to complete and expressed in calendar time; and(D)with respect to a graduate program, a period defined by the institution that is based on the length of the educational program.

(c)

Recognition of accrediting agency or association

Section 496 of the Higher Education Act of 1965 (20 U.S.C. 1099b) is amended—(1)in subsection (a)(4)—(A)in subparagraph (A), by striking and at the end; and(B)by striking subparagraph (B) and inserting the following:

(B)such agency or association demonstrates the ability to review, evaluate, and assess the quality of any instruction delivery model or method such agency or association has or seeks to include within its scope of recognition, without giving preference to or differentially treating a particular instruction delivery model or method offered by an institution of higher education or program except that, in a case in which the instruction delivery model allows for the separation of the student from the instructor—(i)the agency or association requires the institution to have processes through which the institution establishes that the student who registers in a course or program is the same student who participates in, including, to the extent practicable, testing or other assessment, and completes the program and receives the academic credit; and(ii)the agency or association requires that any process used by an institution to comply with the requirement under clause (i) does not infringe upon student privacy and is implemented in a manner that is minimally burdensome to the student; and(C)if such an agency or association evaluates or assesses the quality of competency-based education programs, the agency’s or association’s evaluation or assessment—(i)shall address effectively the quality of an institution’s competency-based education programs as set forth in paragraph (5), except that the agency or association is not required to have separate standards, procedures, or policies for the evaluation of competency-based education;(ii)shall establish whether an institution has demonstrated that its program satisfies the definitions in section 103(25); and(iii)shall establish whether an institution has demonstrated that it has defined an academic year for a competency-based program in accordance with section 481(a)(3).

;

(2)in subsection (c)(1), by inserting or competency-based education after distance education;(3)in subsection (n)(3), by inserting , or competency-based education programs, after each occurrence of distance education courses or programs; and(4)by adding at the end the following:

(r)

Waiver

The Secretary shall establish a process through which an agency or association may seek to have a requirement of this subpart waived, if such agency or association—(1)demonstrates that such waiver is necessary to enable an institution of higher education or program accredited by the agency or association to implement innovative practices intended to—(A)reduce administrative burdens to the institution or program without creating costs for the taxpayer; or(B)improve the delivery of services to students, improve instruction or learning outcomes, or otherwise benefit students; and(2)describes the terms and conditions that will be placed upon the program or institution to ensure academic integrity and quality.