[Federal Register Volume 88, Number 11 (Wednesday, January 18, 2023)]
[Rules and Regulations]
[Pages 2831-2834]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-00556]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 21

RIN 2900-AQ91


Modifications of Approval Requirements for Courses Designed To 
Prepare Individuals for Licensure or Certifications

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: The Department of Veterans Affairs (VA) is amending its 
regulations to implement the provisions of the Jeff Miller and Richard 
Blumenthal Veterans Health Care and Benefits Improvement Act of 2016. 
This final rule adopts without change a proposed rule, which adds new 
approval requirements as specified in the statutory provisions for 
accredited and nonaccredited programs designed to prepare an individual 
for licensure and certification in a State, implements VA's new 
authority to waive the added approval requirements under certain 
circumstances and adjust the authority of a State approving agency to 
add new approval criteria, and adds a circumstance for disapproval of a 
program designed to prepare an individual for licensure and 
certification, as prescribed by the law we are implementing.

DATES: This rule is effective on February 17, 2023.

FOR FURTHER INFORMATION CONTACT: Cheryl Amitay, Chief, Policy and 
Regulation Development Staff, (225C), Education Service, Department of 
Veterans Affairs, 810 Vermont Avenue NW, Washington, DC 20420, (202) 
461-9800. (This is not a toll-free telephone number.)

SUPPLEMENTARY INFORMATION: On January 10, 2022, VA published a proposed 
rule in the Federal Register, 87 FR 1087, to amend its regulations to 
add new approval requirements for accredited and nonaccredited programs 
designed to prepare an individual for licensure and certification in a 
State and to allow VA to waive the added approval requirements under 
certain circumstances. VA provided a 60-day comment period, which ended 
on March 10, 2022. We received two comments on the proposed amendments. 
Both comments supported the rulemaking, but requested clarifying 
information, which we provide below.
    One comment requested that VA clarify the ``undefined terms in 38 
U.S.C. 3676 (approval of nonaccredited courses),'' listing as 
undefined: ``Quality,'' ``Qualifications,'' ``Financially Sound,'' 
``Substantial Misrepresentation,'' ``Good Reputation and Character,'' 
``Licensure and Certification,'' ``Such Additional Criteria. . . ,'' 
and ``Administrative Support.'' The commenter stated that the standards 
to protect student veterans and GI Bill funds in 38 U.S.C. 3676 have 
been undefined and rarely enforced resulting in the abuse of veteran 
benefits and taxpayer funds.
    VA shares the concern for the protection of student veterans and 
their VA education benefits and wants to provide assurances that the 
standards in sec. 3676 are clearly defined and upheld. The regulatory 
amendments

[[Page 2832]]

implementing the provisions of the Jeff Miller and Richard Blumenthal 
Veterans Healthcare and Benefits Improvement Act of 2016 will provide 
safeguards against abuse of veterans and their VA educational benefits 
with regard to programs that are designed to prepare an individual for 
licensure or certification. The new approval requirements will ensure 
that courses designed to prepare an individual for licensure or 
certification meet all instructional curriculum licensure and 
certification requirements, and courses designed to prepare an 
individual for employment meet the standards developed by a board or 
agency. Likewise, for courses designed to prepare an individual for 
licensure to practice law, the new approval requirements will ensure 
that the courses are accredited by a specialized accrediting agency for 
programs of legal education, or an association recognized by the 
Department of Education. We believe our implementation in this 
rulemaking of the legal standards will ensure the protection of student 
Veterans and GI Bill funds, and further clarification is not necessary. 
Thus, we will not make any changes based on this comment.
    Also, the State Approving Agency's (SAA) authority in new 38 CFR 
21.4253(d) and 21.4254(c)(15) to impose additional approval criteria 
and the requirement in these provisions that SAAs consult with VA 
before imposing the new criteria to ensure that the criteria are 
necessary and equitable with regard to public, private, and proprietary 
educational institutions will provide protection against abuse of 
veterans benefits and taxpayer funds. In addition, the requirement in 
new 38 CFR 21.4259(e) to publicly disclose the conditions or 
requirements for obtaining the license, certification, or approval or 
face disapproval will protect veterans from being deceived about the 
skills they need for licensure or certification. Therefore, we do not 
think it is necessary to further define terms in sec. 3676 and will not 
make any additional changes based on these comments.
    A second comment requested that VA collaborate with the Department 
of Education to determine common language and direction, where 
possible, when addressing institution responsibilities to manage 
student aid for postsecondary programs leading to a license or 
certification. VA is happy to consider the request to collaborate with 
the Department of Education when necessary to address an institution's 
responsibilities concerning managing student aid for programs that lead 
to licensure or certification to make any processes less confusing for 
students; however, we will not make any changes to the rule based on 
this comment as it is beyond the scope of this rulemaking.
    This comment also requested clarification on implementation of 
proposed 38 CFR 21.4253(d)(9)(i) with regard to how VA will advise the 
SAA and the institution seeking State program approval to address 
interstate programs provided by distance education that lead to a 
license or certification. For SAA approval, Sec.  21.4253(d)(9)(i) 
requires that a course designed to prepare an individual for licensure 
or certification in a State meet all instructional curriculum licensure 
or certification requirements of such State. Such courses are required 
to meet the same instructional curriculum licensure or certification 
requirements established by their State whether the program is 
conducted via distance learning or in person. The comment referenced 
confusion with regard to jurisdiction for obtaining SAA approval of 
``interstate distance education.'' Section 21.4253(d)(9)(i) does not 
address SAA jurisdiction for purposes of approval of licensure or 
certifications courses, and therefore, we will not address the 
jurisdictional issue in this rulemaking. However, the general 
provisions in 38 CFR 21.4250, governing licensing and certification 
test approval and jurisdiction, remain applicable.
    Additionally, this comment requested clarification concerning the 
specific additional requirements that must be part of the notifications 
that are intended by the requirement in proposed 38 CFR 21.4259(e) 
directing an SAA to disapprove a course leading to a license or 
certification when an institution fails to publicly disclose ``any 
conditions or additional requirements, including training, experience, 
or examinations, required to obtain the license, certification, or 
approval for which the course of education is designed to provide 
preparation.'' The additional requirements that must be part of the 
notifications refer to any requirements set by a state licensing or 
certifying agency, such as training required for licensure, 
certification, or approval, any prior experience that is a prerequisite 
for obtaining the license, certification, or approval, or any 
examinations that must be taken before a student can obtain a license, 
certification, or approval. Because each state licensing or certifying 
agency establishes their own distinct requirements, we are unable to be 
more specific about the requirements in this rulemaking. If there are 
any requirements beyond training, prior experience, or examinations 
that a student must meet to obtain a particular license, certification, 
or approval, an institution or training facility must disclose those 
requirements. Thus, we will not make any changes based on this comment.
    For the reasons stated above, VA will adopt the proposed rule as 
final, without change.

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess the 
costs and benefits of available regulatory alternatives and, when 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, and other advantages; distributive impacts; 
and equity). Executive Order 13563 (Improving Regulation and Regulatory 
Review) emphasizes the importance of quantifying both costs and 
benefits, reducing costs, harmonizing rules, and promoting flexibility. 
The Office of Information and Regulatory Affairs has determined that 
this rule is not a significant regulatory action under Executive Order 
12866. The Regulatory Impact Analysis associated with this rulemaking 
can be found as a supporting document at www.regulations.gov.

Regulatory Flexibility Act

    The Secretary hereby certifies that this final rule will not have a 
significant economic impact on a substantial number of small entities 
as they are defined in the Regulatory Flexibility Act (5 U.S.C. 601-
612). VA has determined that, although there may be a number of 
educational training facilities and SAAs considered small entities 
which may be affected by this rule, they will not be significantly 
impacted by this rule.
    Allowing waiver of the added approval requirements under certain 
circumstances, as well as requiring SAAs to present a written proposal 
to VA justifying the need for adding additional approval criteria for 
approving either accredited or nonaccredited programs, will likely have 
some impact on both educational training institutions and SAAs. 
However, the impact will be minimal. VA estimates that five educational 
facilities will request a waiver per year and that the estimated cost 
for any educational institution seeking a waiver will be less than 
$300. Also, VA estimates that approximately eleven requests per year 
from SAAs will be received to add additional approval criteria and the 
estimated cost for SAAs making these requests will also be less

[[Page 2833]]

than $300. Accordingly, the number of schools and SAAs affected will 
not be substantial and the impact on each will not be significant. 
Therefore, under 5 U.S.C. 605(b), the initial and final regulatory 
flexibility analysis requirements of 5 U.S.C. 603 and 604 do not apply.
    The provisions requiring institutions to meet certain criteria to 
maintain eligibility for receipt of VA educational benefits could also 
entail costs to these institutions, such as the cost of making program 
changes to meet the new requirements or the loss of funding derived 
from VA benefit payments because of an inability to meet the new 
requirements or obtain a waiver. However, such provisions merely 
restate existing provisions of statute and thus will have no additional 
impact on such small entities. Therefore, under 5 U.S.C. 605(b), these 
provisions are exempt from the initial and final regulatory flexibility 
analysis requirements of 5 U.S.C. 603 and 604.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in the expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any one year. This final rule will have no such effect on 
State, local, and tribal governments, or on the private sector.

Paperwork Reduction Act

    This final rule includes provisions constituting two new 
collections of information under the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501-3521) that require approval by the Office of Management 
and Budget (OMB). Accordingly, under 44 U.S.C. 3507(d), VA has 
submitted a copy of this rulemaking action to OMB for review and 
approval. OMB has reviewed and approved these new collections of 
information and assigned OMB Control Numbers 2900-0907, 2900-0908.

Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), 
the Office of Information and Regulatory Affairs designated this rule 
as not a major rule, as defined by 5 U.S.C. 804(2).

List of Subjects in 38 CFR Part 21

    Administrative practice and procedure, Armed forces, Claims, 
Colleges and universities, Education, Employment, Schools, Veteran 
readiness, Veterans, Vocational education.

Signing Authority:

    Denis McDonough, Secretary of Veterans Affairs, approved this 
document on December 30, 2022, and authorized the undersigned to sign 
and submit the document to the Office of the Federal Register for 
publication electronically as an official document of the Department of 
Veterans Affairs.

Jeffrey M. Martin,
Assistant Director, Office of Regulation Policy & Management, Office of 
General Counsel, Department of Veterans Affairs.

    For the reasons stated in the preamble, the Department of Veterans 
Affairs amends 38 CFR part 21 as set forth below:

PART 21--VETERAN READINESS AND EMPLOYMENT AND EDUCATION

Subpart D--Administration of Educational Assistance Programs

0
1. The authority citation for part 21, subpart D, continues to read as 
follows:

    Authority:  10 U.S.C. 2141 note, ch. 1606; 38 U.S.C. 501(a), 
chs. 30, 32, 33, 34, 35, 36, and as noted in specific sections.


0
2. Amend Sec.  21.4253 by revising the last sentence of the 
introductory text of paragraph (d) and adding paragraphs (d)(9) and 
(10) to read as follows:


Sec.  21.4253  Accredited courses.

* * * * *
    (d) * * *The State approving agency may approve the application of 
the school when the school and its accredited courses are found to have 
met the following criteria and additional reasonable criteria 
established by the State approving agency if the Secretary or designee, 
in consultation with the State approving agency, approves the 
additional criteria as necessary and equitable in its treatment of 
public, private, and proprietary for-profit educational institutions:
* * * * *
    (9)(i) For a course designed to prepare an individual for licensure 
or certification in a State, the course meets all instructional 
curriculum licensure or certification requirements of such State.
    (ii) For a course designed to prepare an individual for licensure 
to practice law in a State, the course is accredited by a specialized 
accrediting agency for programs of legal education or association 
recognized by the Secretary of Education under subpart 2 of part H of 
title IV of the Higher Education Act of 1965 (20 U.S.C. 1099b), from 
which recipients of law degrees from such accredited programs are 
eligible to sit for a bar examination in any State.
    (iii) For a course designed to prepare an individual for employment 
pursuant to standards developed by a board or agency of a State in an 
occupation that requires approval, licensure, or certification, the 
course meets such standards.
    (iv) An educational institution may apply, through their State 
approving agency of jurisdiction, to the Secretary or designee for a 
waiver of the requirements of this paragraph (d)(9). The State 
approving agency will forward an application for waiver, together with 
its recommendation for granting or denying the application, to the 
Secretary or designee. The Secretary or designee may grant a waiver 
upon a finding that all of the following criteria have been met:
    (A) The educational institution is not accredited by an agency or 
association recognized by the Department of Education.
    (B) The course did not meet the requirements of this paragraph 
(d)(9) at any time during the 2-year period preceding the date of the 
waiver.
    (C) The waiver furthers the purposes of the educational assistance 
programs administered by VA or would further the education interests of 
individuals eligible for assistance under such programs.
    (D) The educational institution does not provide any commission, 
bonus, or other incentive payment based directly or indirectly on 
success in securing enrollments or financial aid to any persons or 
entities engaged in any student recruiting or admission activities or 
in making decisions regarding the award of student financial 
assistance, except for the recruitment of foreign students residing in 
foreign countries who are not eligible to receive Federal student 
assistance.
    (10) Before requiring a school and its accredited courses to meet 
any additional criteria, the State approving agency must present a 
written proposal to the Secretary or designee justifying the need for 
the additional criteria and containing an attestation that the criteria 
will treat all schools equitably, regardless of whether they are 
public, private, or for-profit institutions. The Secretary or designee 
will determine whether the additional criteria are necessary and treat 
schools equitably based on the proposal and any additional information 
submitted. The Secretary or designee may change the determination at 
any time if, after implementation, it becomes apparent that the 
criteria are unnecessary or

[[Page 2834]]

schools are treated inequitably under the criteria.
    (i) The written proposal must contain a description of the need for 
the additional criteria and an explanation of how the imposition of the 
additional criteria would remedy the problem. The proposal must also 
contain a statement concerning whether State or Federal laws, 
regulations, or policies require the imposition of the additional 
criteria and an explanation of the consideration of any alternative 
means to achieve the same goal as the additional criteria.
    (ii) The Secretary or designee may request such additional 
information from the State approving agency as the Secretary or 
designee deems appropriate before determining whether the criteria are 
necessary and treat schools equitably.

(Authority: 38 U.S.C. 3675(b)(3), 3676(c), (f))

* * * * *

0
3. Amend Sec.  21.4254 by revising paragraph (c)(14) and adding 
paragraph (c)(15) to read as follows:


Sec.  21.4254  Nonaccredited courses.

* * * * *
    (c) * * *
    (14)(i) For a course designed to prepare an individual for 
licensure or certification in a State, the course meets all 
instructional curriculum licensure or certification requirements of 
such State.
    (ii) For a course designed to prepare an individual for licensure 
to practice law in a State, the course is accredited by a specialized 
accrediting agency for programs of legal education or association 
recognized by the Secretary of Education under subpart 2 of part H of 
title IV of the Higher Education Act of 1965 (20 U.S.C. 1099b), from 
which recipients of law degrees from such accredited programs are 
eligible to sit for a bar examination in any State.
    (iii) For a course designed to prepare an individual for employment 
pursuant to standards developed by a board or agency of a State in an 
occupation that requires approval, licensure, or certification, the 
course meets such standards.
    (iv) An educational institution may apply, through their State 
approving agency of jurisdiction, to the Secretary or designee for a 
waiver of the requirements of this paragraph (c)(14). The State 
approving agency will forward an application for waiver, together with 
its recommendation for granting or denying the application, to the 
Secretary or designee. The Secretary or designee may grant a waiver 
upon a finding that all of the following criteria have been met:
    (A) The educational institution is not accredited by an agency or 
association recognized by the Department of Education.
    (B) The course did not meet the requirements of this paragraph 
(c)(14) at any time during the 2-year period preceding the date of the 
waiver.
    (C) The waiver furthers the purposes of the educational assistance 
programs administered by VA or would further the education interests of 
individuals eligible for assistance under such programs.
    (D) The educational institution does not provide any commission, 
bonus, or other incentive payment based directly or indirectly on 
success in securing enrollments or financial aid to any persons or 
entities engaged in any student recruiting or admission activities or 
in making decisions regarding the award of student financial 
assistance, except for the recruitment of foreign students residing in 
foreign countries who are not eligible to receive Federal student 
assistance.
    (15) Such additional reasonable criteria as may be deemed necessary 
by the State approving agency if the Secretary or designee, in 
consultation with the State approving agency, approves the additional 
criteria as necessary and equitable in its treatment of public, 
private, and proprietary for-profit educational institutions. The 
Secretary or designee will determine whether the additional criteria 
are necessary and treat schools equitably based on a proposal and any 
additional information submitted.
    (i) Before requiring a school and its nonaccredited courses to meet 
any additional criteria, the State approving agency must present a 
written proposal to the Secretary or designee justifying the need for 
the additional criteria and containing an attestation that the criteria 
will treat all schools equitably, regardless of whether they are 
public, private or for-profit institutions. The written proposal must 
contain a description of the need for the additional criteria and an 
explanation of how the imposition of the additional criteria would 
remedy the problem. The proposal must also contain a statement 
concerning whether State or Federal laws, regulations, or policies 
require the imposition of the additional criteria and an explanation of 
the consideration of any alternative means to achieve the same goal as 
the additional criteria.
    (ii) The Secretary or designee may request such additional 
information from the State approving agency as the Secretary or 
designee deems appropriate before determining whether the criteria are 
necessary and treat schools equitably.
    (iii) The Secretary or designee may change the determination at any 
time if, after implementation, it becomes apparent that the criteria 
are unnecessary or schools are treated inequitably under the criteria.

(Authority: 38 U.S.C. 3676(c), (f))

* * * * *

0
4. Amend Sec.  21.4259 by adding paragraph (e) to read as follows:


Sec.  21.4259  Suspension or disapproval.

* * * * *
    (e) The Secretary or the appropriate State approving agency will 
disapprove a licensing and certification program of education if the 
educational institution providing the program of education fails to 
publicly disclose in a prominent manner any conditions or additional 
requirements, including training, experience, or examinations required 
to obtain the license, certification, or approval for which the program 
of education is designed to provide preparation.
    (1) The Secretary will determine whether a disclosure is 
sufficiently prominent; however, at a minimum, the educational 
institution must publish the conditions or requirements on a publicly 
facing website and in their catalog, and include them in any 
publication (regardless of medium) which explicitly mentions 
``educational assistance benefits for servicemembers (and their 
dependents) or veterans (and their dependents)'' or which, in the view 
of the Secretary, is intended for VA educational assistance 
beneficiaries.
    (2) Individuals continuously enrolled at the same educational 
institution pursuing a program of education subject to disapproval 
under paragraph (e) of this section may complete the program of 
education.

(Authority: 38 U.S.C. 3679(d))
* * * * *
[FR Doc. 2023-00556 Filed 1-17-23; 8:45 am]
BILLING CODE 8320-01-P