To: State Board of Education

To: State Board of Education

Fr: Alan Contreras

Date:April 15, 2007

Re:Adverse Impact

This memo is intended to serve as a basic outline of how postsecondary program approval works in Oregon. Oregon has perhaps the most decentralized, and in some respects least formal, postsecondary program approval processes in the United States. However, we also have one of the most unusual notice-and-comment processes, which we call the adverse impact process. Oregon has had this adverse impact process for decades. It was originally part of ODA’s predecessor agencies.

The Office of Degree Authorization (ODA) existed historically as a set of functions within the Oregon Education Coordinating Council, which was reconfigured and renamed the Oregon Educational Coordinating Commission in 1975. That entity eventually morphed into the Office of Educational Policy and Planning in 1987. When that unit was disbanded in 1997 and some of its duties assigned to the governor’s workforce and education advisor, ODA was assigned in its present form to OSAC.

Oregon has five distinct, parallel processes for postsecondary approval.

Schools / Sector / Centralized process for new programs? / Must File Adv. Imp. ?
8 / Oregon University System / Provosts Council, relatively informal, essentially unstaffed since academic affairs unit dissolved. / Yes
17 / Community Colleges / CCWD, some work contracted to Department of Education staff. / Yes
16 / Private, Oregon-based, Northwest accredited degree-granters / None. ODA has a role in problem-solving if Northwest Assn. doesn’t do it. / No
31 * / Non-Oregon based, OR
not regionally accredited, degree-granters / ODA evaluation and approval process (3-year renewal cycle). / No
309 / Nondegree career schools / Office of Career Schools in Department of Education. / No

* not including clinical placement approvals, religious exempt schools or partial programs

Meaning of the words “adverse impact”

The term “adverse impact” is used in two separate, distinct and only slightly overlapping ways in the educational bureaucracy. There has been considerable confusion in recent cases owing to this overlapping use of the same terminology. The two uses are:

1.It is used inside CCWD/ODE to refer to a process set forth in rule that community colleges must use when starting new programs (I am not sure if it applies to courses as well), and refers to conflicts between the proposing college and both private schools and other community colleges. If I understand the process correctly, such disagreements are ultimately resolved by the Superintendent or the Board of Education if staff can’t fix the problems.

2.It is used in ORS 348.603 (as set forth at the end of this memo) to describe ODA’s role in determining whether a publicly funded program or location has had a negative effect on a pre-existing program from another sector. Such disagreements are ultimately resolved by the Student Assistance Commission, which decides whether the publicly funded program can go forward.

These rules and processes are not the same and are not operated by the same agency, but deal in some cases with the same potential conflicts.

Purpose of ODA adverse impact statute

The purpose of the ODA (statutory) adverse impact requirement is quite simple. It is intended to prevent the unnecessary use of public funds. Broadly speaking, such use is defined as starting new programs when there are existing programs in the same geographic area. Programs that serve a similar purpose but are offered without the use of state funds are given a certain level of protection. New publicly funded programs must prove that they are needed and that their establishment will not damage existing programs.

Note that public-sector schools have a right to file ODA adverse impact complaints against schools in other public sectors. For example, if OIT wanted to start a new associate degree program, Klamath Community College could object.

The most important thing to remember about the law is that it is not intended to create the always-illusionary Level Playing Field. It is intended to protect private providers, both non-profit (e.g. Willamette University) and for-profit (e.g. career schools), from public competition.

Role of Board/Department of Education

One issue to keep in mind is that the Board and Department of Education, in its role overseeing some parts of postsecondary education, is not a public-college board. It is responsible for far more private career schools (over 300) than community colleges (17), and the legal authority in the Department of Education is greater over career schools (which it can close) than over community colleges. It is therefore helpful for the Board of Education to think of itself as a neutral problem-solver between these sectors, not simply the board responsible for community colleges. However, the role of the Board vs. the Superintendent is not completely clear in this issue.

How the Adverse Impact process works

An excellent overview of the process is contained in CCWD’s Community College Handbook, pages 11-16. I have asked board staff to provide you with appropriate material from that handbook.

In essence, any new program (degree or certificate) must go through a formal notice-and-comment period, in which potentially affected schools offering programs in the same region are notified of the proposal. The region is defined as 50 miles from the proposed offer site, or state-wide if proposed for state-wide offer. See enclosed map for an example based on Chemeketa Community College.

What can go wrong

The principal problems are listed on page 16 of the Community College Handbook. Most relate to communication errors or to an imbalance between zeal to serve a community and the need to play by the rules. Active wickedness is rare.

In practice, there is only limited “enforcement” conducted by CCWD or the OUS chancellor’s office upon their respective public colleges. The main reasons for this are lack of staffing, mutuality of interest and the nature of the relationship: neither the Commissioner of Community Colleges nor the Chancellor can remain in their position if actively opposed by most of the sector presidents. The state positions and offices exist, at least formally, largely as support and service functions for their sectors.

That is a different role than prevails between the state (ODA) and the ODA-approved degree-granting schools or between the state and the private career schools overseen by Ray Lindley’s office in the Department of Education. In both of those situations, the state agency’s primary role is enforcement, not support or problem-solving. Although my office provides more problem-solving for private colleges than is generally known, we are mainly a standards enforcement agency, and every program we approve must return for a complete re-evaluation every three years.

Because the relationships are different, private schools often feel that they get “enforced upon” while the public colleges don’t. There is an element of truth to that view. That situation has been a significant factor in recent disagreements over adverse impact processes and legislative proposals.

In fact, neither the chancellor’s office nor Cam Braly’s office has the staff or the current regulatory structure to engage in enforcement beyond a fairly minimal level, except during the process of formal program approval at CCWD, which is highly detailed and structured. However, that process only works when programs that should be submitted are actually submitted. Recent problems came about mainly because that didn’t happen.

Please do not hesitate to contact my office with any questions.

Statutory basis for ODA adverse impact process

(key portions shown in bold)

348.603 Duties of commission relating to degree authorization and nondegree programs; approval of new post-secondary program or location; rules; fees. (1) The Oregon Student Assistance Commission, through the Office of Degree Authorization, shall:

(a) Authorize approved schools to offer academic degree programs;

(b) Authorize approved degree-granting schools to offer nondegree programs leading to a certificate or diploma;

(c) Validate claims of degree possession;

(d) Terminate substandard or fraudulent degree activities; and

(e) Review proposed new publicly funded post-secondary programs and locations.

(2)(a) Following review of a proposed new publicly funded post-secondary program or location, the commission shall recommend resolution to the appropriate governing boards and mediate between the boards to seek a negotiated resolution if:

(A) There is a detrimental duplication of programs; or

(B) The program or location would have a significantly adverse impact on one or more other segments of education.

(b) If the boards do not resolve the issue raised under paragraph (a) of this subsection within 90 days of the date when the issue was recommended to the boards for mediation, the commission shall have final authority for approval or disapproval of the program or location. If the boards do not resolve the issue, the commission shall approve or disapprove the program or location within 180 days of the date when the review began.

(c) If the boards do not resolve the issue, the commission shall approve the program or location if the commission finds that the program or location meets an unmet workforce need in the state.

(d) The commission shall establish by rule a fair and neutral decision-making process in consultation with representatives designated by the State Board of Education, the State Board of Higher Education, associations representing Oregon independent colleges, associations representing Oregon career colleges, and the governing boards of otherwise unrepresented post-secondary schools.

(3) The commission, by rule, may impose a fee on any school or person requesting information from the commission. The amount of the fee shall be established to recover designated expenses incurred by the commission in carrying out the administration of ORS 348.594 to 348.615. Any fees collected under this subsection shall be deposited in the Office of Degree Authorization Account established under ORS 348.601. [1997 c.652 §10; 2001 c.454 §2; 2003 c.674 §1]