July 2026

July 7, 2026

Introduction
 

The Council for Higher Education Accreditation (CHEA) Policy Watch publication provides accreditation stakeholders and CHEA-eligible institutions with updates on developments affecting accreditation from the White House, the U.S. Department of Education (USDE), the United States Senate, the United States House of Representatives, and the federal courts.

Department of Education

Department Issues Final Accountability Regulations

Last week, the U.S. Department of Education published final regulations establishing a new earnings-based accountability framework that applies to all Title IV programs. The regulations implement changes passed under the One Big Beautiful Bill Act (OBBBA) and negotiated through the Accountability in Higher Education and Access through Demand-driven Workforce Pell (AHEAD) Committee negotiated rulemaking. The rule addresses the new “Do No Harm” standard, revisions to Gainful Employment, and the new Student Transparency System (STATS) framework following consideration of public comments.  Changes to the final rule include several delays in implementation and exemptions. These include:

  • Most changes are effective July 1, 2027 with several provisions effective August 31, 2026. Amendments to Direct Loan Program regulations at 34 CFR Part 685 become effective August 31. This includes revisions to the Program Participation Agreement that support implementation of the new accountability framework. Institutions also have the opportunity to early implement certain provisions. All institutions must submit either GE/FVT or STATS reporting by October 1, 2026. The Department will treat institutions that report under the new framework as having elected early implementation, while institutions that continue reporting under the 2023 Gainful Employment regulations remain subject to those regulations and program eligibility consequences until July 1, 2027. The Department will calculate the first rates in early 2027, applicable to the 2027-2028 award year. Programs that fail the earnings test in both 2027 and 2028 may be designated as low-earning outcome programs beginning in the 2028-29 award year.   
     
  • Delayed accountability for tipped occupations. The final rule delays application of the earnings accountability consequences for programs that prepare students in occupations in which a substantial portion of wages comes from tips. Because the “No Tax on Tips” provision enacted under OBBBA changes the tax treatment of tipped income and presumably makes it less likely that workers will underreport tipped income, the Department will not apply accountability consequences based on earnings data from 2025 or earlier for these programs. Institutions must still report the required data, but the delay postpones consequences for these programs until earnings data reflect the new policy, beginning with earnings reported in 2026 or later. The delay applies to 20 program fields including cosmetology, massage therapy, skin care specialists, and bartending.
     
  • Exemptions for programs that do not, or elect not to, participate in the Direct Loan program. The Department provided several exemptions from loss of full Title IV eligibility for programs that do not and have not participated in the Direct Loan Program in the last five years and for programs at risk of failing the measure who elect not to allow their students to borrow Direct Loans for at least five years. The Department notes these changes will particularly benefit religious programs, resulting in 600 religious programs that will now be exempt from the accountability consequences and that the final rule will reduce the consequences by roughly half on students and Title IV program funds disbursed to religious programs relative to the current regulations.
     
  • Exemption for programs that exclusively serve students with documented disabilities. The final rule exempts programs that only enroll students with documented disabilities from accountability consequences.

Department Updates Professional Degree Guidance Following Court Order.

Following a federal district court’s action temporarily blocking the Department of Education’s regulatory definition of “professional degree,” the Department issued updated guidance with revised Classification of Instructional Programs (CIP) codes that will temporarily qualify as professional degree programs for purposes of federal student loan limits. The court’s order affects the Department’s regulatory definition but does not change the statutory borrowing limits passed by Congress. The guidance includes a broader range of graduate programs, temporarily expanding the list from seven to 29 programs, including advanced nursing, various health, and psychology programs as professional degree programs while the litigation remains ongoing.

Federal Student Aid Updates Institutional Nonpayment Data.

The Office of Federal Student Aid (FSA) has updated its institutional nonpayment rate data through the FSA Data Center, reflecting borrower repayment activity through March 31, 2026. The updated data provide institutions with updated information on the percentage of federal student loan borrowers who are not making payments on their loans and offer an additional resource for monitoring borrower repayment trends.

Since the Department first published institutional nonpayment rates in July 2025, the number of institutions with nonpayment rates of at least 25 percent has grown from just over 1,100 to approximately 2,000 institutions in the latest update. Although these rates are not currently used for accreditation or title IV eligibility, the Department continues to emphasize them as an early indicator of future cohort default rates and has encouraged institutions with elevated rates to strengthen default prevention efforts, suggesting they will continue to receive greater policy attention.

Accreditation

What to Watch for at the July NACIQI Meeting

The National Advisory Committee on Institutional Quality and Integrity (NACIQI) will meet to consider renewal of recognition for seven accrediting agencies and a compliance report of one state approval agency at its meeting on July 22-23. The Department’s Accreditation Group released its final analyses of each agency under review. Staff analyses raise several themes likely to receive significant discussion. These themes include:These themes include:These themes include:
Rigor of student achievement standards: Four agencies were cited for concerns regarding the rigor or implementation of student achievement standards.

  • Student earnings data: Three staff reports reference publicly available lower earnings data of a college’s graduates even though earnings are not yet included in regulations or the criteria for recognition.
  • Governance: Several agencies received compliance findings related to board composition, public members, independence, and relationships with affiliated trade associations.
  • Arbitration: Five agencies were cited for deficiencies related to arbitration procedures following the Department’s December 2023 guidance.

Institutions or members of the public may sign up to provide public comment regarding a specific agency up for review or other issues within the scope of NACIQI’s authority. Instructions on how to register to watch the meeting or provide public comment can be found in the Federal Register notice.

Senior Department Official Issues Recognition Decisions Following March NACIQI Meeting

The U.S. Department of Education Senior Department Official (SDO) released decisions regarding the recognition status of 10 accrediting agencies reviewed during the March 2026 meeting of the National Advisory Committee on Institutional Quality and Integrity (NACIQI). These decisions largely adopted recommendations from Department staff and NACIQI with one notable exception. Rather than deny recognition to the Council for Naturopathic Medical Education as recommended by NACIQI, the SDO required enhanced monitoring and limited the agency’s ability to accredit new programs while it works to demonstrate compliance. While diversity, equity, and inclusion standards and policies were discussed extensively during the March NACIQI meeting, they did not appear in any final decision.

New Accreditor Seeks Initial Recognition

Competition among institutional accreditors moved closer to becoming reality this month as the Department of Education formally began reviewing the Postsecondary Commission (PSC) for initial recognition. If recognized, PSC would represent the Administration's first successful effort to expand the number of federally recognized institutional accreditors and could introduce additional competition within the accreditation system. PSC, an aspiring accreditor established in 2023, seeks to accredit institutions offering degree and non-degree-granting institutions across the country. It currently accredits one institution and has announced two additional institutions seeking initial recognition. The Department’s review is expected to follow an expedited timeline, following interpretive guidance released earlier this year. According to that guidance, the Department will complete its review within 6 to 12 months. Public comment on PSC is open until July 15.

CHEA Updates

CHEA Welcomes Vice President for Federal Policy and Government Relations

CHEA recently welcomed Antoinette Flores as Vice President for Federal Policy and Government Relations. In this leadership role, she will lead CHEA's federal policy strategy, strengthen engagement with policymakers and higher education stakeholders, and expand CHEA's thought leadership on accreditation, institutional quality, and accountability. Antoinette can be reached at [email protected].

CHEA Convenes New Leadership Forums

CHEA launched two new initiatives this month: the Council of Experts on Quality Assurance and Accreditation and the Accreditor Leadership Roundtable, a new forum for accrediting agency presidents. The groups will provide forums for expert discussion, collaboration among accrediting agencies, and development of CHEA’s policy agenda.