A Notice of Proposed Rule Making was published in the State Register on June 27, 2007. At their June 25–26, 2007 meeting, the Regents substantially revised the proposed rule, and adopted the revised rule as an emergency measure, effective July 1, 2007, in order to permit eligible students who do not hold a diploma from a high school located in the United States, or its recognized equivalent to apply for State student financial aid in a timely manner for the 2007–2008 academic year. A Notice of Emergency Adoption and Revised Rule Making was published in the July 18, 2007 State Register.

Subsequently, further revisions were made to the proposed rule in response to public comment and a second Notice of Revised Rule Making was published in the State Register on September 5, 2007. Pursuant to the State Administrative Procedure Act section 202(4-a), the revised rule cannot be adopted by regular (non-emergency) action until at least 30 days after publication of the revised rule in the State Register. Since the Board of Regents meets at fixed intervals, the earliest the proposed rule can be adopted by regular action, after expiration of the 30-day public comment period for a revised rule making, is the October 22–23, 2007 Regents meeting. However, the June emergency action will expire on September 26, 2007, 90 days after its filing with the Department of State on June 29, 2007. A lapse in the rule's effectiveness would disrupt implementation of the Section 661 of the Education Law, as amended by Chapter 57 of the Laws of 2007; thereby prohibiting eligible students who do not hold a diploma from a high school located in the United States, or its recognized equivalent to apply for State student financial aid in a timely manner for the 2007–2008 academic year.

A second emergency adoption is therefore necessary for the preservation of the general welfare to adopt revisions to the rule in response to public comment and to otherwise ensure that the emergency rule adopted at the June Regents meeting, and revised at the September Regents meeting, remains continuously in effect until the effective date of its adoption as a permanent rule.

It is anticipated that the proposed rule will be presented for adoption as a permanent rule at the October meeting of the Board of Regents, which is the first scheduled meeting after expiration of the 30-day public comment period prescribed by the State Administrative Procedure Act.

The Board of Regents has added section 145-2.15 to the Regulations of the Commissioner of Education, relating to the administration of ability-to-benefit tests for eligibility for awards, as an emergency action effective September 27, 2007. The following is a summary of the emergency rule.

Subdivision (a) of section 145-2 sets forth the applicability of this section, i.e., the identification of certain ability-to-benefit tests approved by the Board of Regents and the passing scores for such tests and the criteria the commissioner shall utilize when determining whether an approved ability-to-benefit test is independently administered.

Subdivision (b) of section 145-2.15 defines the following terms: assessment center; federally approved ability-to-benefit test; school providing secondary education from a state within the United States; and Secretary.

Paragraph (1) of Subdivision (c) of section 145-2.15 provides that for students first receiving aid in the 2007–2008 academic year and each academic year thereafter, students shall have a certificate of graduation from a recognized school providing secondary education from a state within the United States, or the recognized equivalent of such certificate, or receive a passing score on a federally approved ability-to-benefit test identified by the Board of Regents as satisfying the eligibility requirements of this section that has been independently administered and evaluated.

Paragraph (2) of subdivision (c) of section 145-2.15 requires the department to publish a list of ability-to-benefit tests that the Board of Regents has identified as satisfactory in determining eligibility to receive an award. The identification of such tests shall be without term unless the department determines that a test is no longer satisfactory in determining eligibility for awards or the Secretary discontinues federal recognition of such test.

Subdivision (d) of section 145-2.15 provides that an eligible institution shall submit for approval by the Board of Regents, the passing score it proposes to utilize on any ability-to-benefit test approved by the Board of Regents, in a form prescribed by the commissioner. This subdivision states that the score shall not be lower than the score set by the Secretary and he eligible institution shall submit an explanation of its reasons for selecting such passing score. Approval of such score shall be without term unless the department determines that the passing score is no longer satisfactory in determining eligibility for awards or the institution seeks to change such passing score or no longer offers the approved ability-to-benefit test. This subdivision also sets forth the factors that the Commissioner must consider when determining whether to approve an institution's proposed score or scores, including: (1) the level of curricula the institution offers; (2) the admission criteria and procedures the institution utilizes to evaluate the capacity of a student to undertake a course of study and the capacity of the institution to provide instructional and other support services to ensure that the student can complete the course of study; (3) evidence that the admission criteria and procedures that the institution utilizes are effective in admitting only persons who have the capacity to undertake a course of study and the institution provides proper instructional and support services; (4) the adequacy of the academic support services the institution provides; and (5) evidence that the institution evaluates the success of its academic and other support services in providing instructional and other support services that the student needs to complete the program.

Subdivision (e) of section 145-2.15 requires an institution to independently administer ability-to-benefit tests approved by the Board of Regents.

Paragraph (1) of subdivision (e) of section 145-2.15 provides that an ability-to-benefit test is independently administered if the test is administered at an assessment center that is not located and/or affiliated with the institution for which the student is seeking enrollment and the test administrator is an employee of such center.

Paragraph (2) of subdivision (e) of section 145-2.15 provides that an ability-to-benefit test is independently administered if the test is administered at a degree-granting institution that confers two-year or four-year degrees or an institution that qualifies as an eligible public vocational institution and the chief executive officer of such institution certifies annually, in a form prescribed by the commissioner, that: (1) the test is administered by a unit of the institution that is responsible for other forms of testing or for a provision of academic support services, or both, and such unit does not report to officers responsible for admissions or the administration of student financial aid for such institution; (2) the test is administered in an environment that is separate, secure, closed and continuously monitored during testing; (3) students are required to provide written verification of identity, such as a photo identification, and to sign in prior to taking the test and students are prohibited from bringing into the test area any materials prohibited by the test publisher and are required to leave the test area immediately upon completion of the test; (4) the test is proctored by professional employees who have been trained in test administration and federal guidelines regarding the administration of ability-to-benefit tests and who are not employed through the admissions, student financial aid, or registrar's offices of the institution; (5) the scoring of such test is overseen by institutional employees who are not employed through the admissions, student financial aid, or registrar's offices and such scores are verified by more than one employee; (6) all tests, test results, and test databases, if any, are kept in locked and secured containers; (7) the test administrator has no prior financial or ownership interest in the institution, its affiliates, or its parent corporation, other than the interest obtained through its agreement to administer the test; (8) the test administrator is not a current or former member of the board of directors, a current or former employee or a consultant to a member of the board of directors or a chief executive officer; (9) the test administrator is not a current or former student of the institution and (10) the test administrator is not scoring the test. The annual certification shall include the following information relating to the previous academic year: the number of students examined, the number of re-tests administered, the scores on all ability-to-benefit tests for each student examined, the number of students achieving passing scores on such tests, the number of students tested that are enrolling in such institution and the success of tested students in terms of retention and graduation.

Paragraph (3) of subdivision (e) of section 145-2.15 states that the department will consider an ability-to-benefit test to be independently administered if the test is administered at an eligible institution that does not have degree-conferring authority and the test is given by a test administrator who: (1) has no current or prior financial or ownership interest in the institution, its affiliates, or its parent corporation, other than the interest obtained through its agreement to administer the test, and has no controlling interest in any other educational institution; (2) is not a current or former employee of or consultant to the institution, its affiliates, or its parent corporation, a person in control of another institution, or a member of the family of any of these individuals; (3) is not a current or former member of the board of directors, a current or former employee of or a consultant to a member of the board of directors, chief executive officer, chief financial officer of the institution or its parent corporation or at any other institution, or a member of the family of any of the above individuals; and (4) is not a current or former student of the institution; (5) is certified by the test publisher to give and score the publisher's test; (6) administers the test in accordance with instructions provided by the test publisher and in a manner that insures the integrity and security of the test; (7) makes the test available only to a test-taker, and then only during a regularly scheduled test; (8) secures the test against disclosure or release; (9) submits the completed test to the test publisher within two business days after test administration in accordance with the test publisher's instructions; and (10) upon request, gives the commissioner guaranty agency, accrediting agency, and law enforcement agencies access to test records or other documents related to an examination, audit, investigation, or program review of the institution or test publisher.

Paragraph (4) of subdivision (e) of section 145-2.15 provides that the commissioner will not consider a test to be independently administered if an institution: (1) compromises test security or testing procedures; (2) pays a test administrator a bonus, commission, or other incentive based upon the test scores or pass rates of its students who take the test; or (3) otherwise interferes with the test administrator's independence or test administration.

Paragraph (5) of subdivision (e) of section 145-2.15 requires any institution administering an ability-to-benefit test to maintain a record for each student who sat for an ability-to-benefit test, including the name of the test taken by the student, the date of the test and the student's scores on such tests.

Paragraph (6) of subdivision (e) provides that, upon request, each eligible institution must provide the commissioner with access to test records or other documents related to an audit, investigation or program review of the institution.

Paragraph (7) of subdivision (e) states that if the commissioner finds that an institution has violated the certification procedures or the ability-to-benefit test procedures under this section, the commissioner shall have the authority to require an eligible institution to employ an assessment center independent of such institution.

1. STATUTORY AUTHORITY:

Education Law section 207 grants general rule making authority to the Board of Regents to carry into effect State laws and policies regarding education.

Education Law section 215 provides that the Regents, or the Commissioner, or their representatives, may visit, examine into and inspect, any institution in the University of the State of New York and any school or institution under the educational supervision of the State, and may require, as often as desired, duly verified reports giving such information and in such form as they shall prescribe.

Education Law section 661(4)(d), as added by Chapter 57 of the Laws of 2007, requires students who first receive State aid in academic year 2006–2007, to have a certificate of graduation from a recognized school providing secondary education within the United States, or the recognized equivalent of such certificate, or have been admitted to such institution after receiving a passing score on a federally approved ability-to-benefit test that has been independently administered and evaluated, as provided by the Commissioner.

Education Law section 661(4)(e), as added by Chapter 57 of the Laws of 2007, requires students seeking State financial aid for the first time in the 2007–2008 academic year or thereafter, to have a certificate of graduation from a school providing secondary education from a state within the U.S. or the recognized equivalent of such certificate, or receive a passing score on a federally approved ability-to-benefit test that has been identified by the Regents as satisfying the eligibility requirements of this section and has been independently administered and evaluated as defined by the Commissioner.

2. LEGISLATIVE OBJECTIVES:

The regulation carries out the legislative objectives of the above-referenced statutes by establishing procedures for the identification of acceptable federally approved ability-to-benefit tests and the passing scores for such tests, and the requirements for the test's independent administration so that students applying for State student financial aid for the first time in academic year 2007–2008, who do not hold a diploma from a high school located in the U.S., or its recognized equivalent, may be found eligible for such aid.

3. NEEDS AND BENEFITS:

Education Law section 661 prescribes eligibility requirements and procedures governing awards under the State student financial aid programs established in Education Law Articles 13 and 14. Education Law section 661(4)(d) and (e) establish new requirements for students who do not hold diplomas from high schools located within the U.S., or its recognized equivalent, seeking State financial aid for the first time in the 2007–2008 academic year.

Currently, under the federal Higher Education Act, students seeking to qualify for Pell grants or other federal Title IV aid who do not have a high school diploma or its recognized equivalent must demonstrate the ability to benefit from the education or training provided by achieving a score set by the Secretary of the U.S. Department of Education (“Secretary”) on a test approved by the Secretary.

Prior to the 2007–2008 academic year, a student applying for State student financial aid who did not have a diploma from a U.S. high school, or its recognized equivalent, was required to achieve a passing score set by the Secretary, on an ability-to-benefit test approved by the Secretary. Education Law section 661(4)(e) modifies this requirement. Students seeking State aid for the first time in the 2007–2008 academic year, without a high school diploma or the recognized equivalent of such, must achieve a passing score on an ability-to-benefit test approved by the Regents and the test must be independently administered as defined by the Commissioner.

The regulation requires the Regents to publish a list of the federally approved ability-to-benefit tests the Regents identify as satisfactory in determining eligibility for State aid for students without a high school diploma from the U.S., or its recognized equivalent. For the 2007–2008 academic year fall semester, all seven federally approved ability-to-benefit tests may be used. For subsequent academic terms, the Department intends to identify and publish a list of federally approved ability-to-benefit tests that the Board of Regents identifies as satisfactory in determining eligibility to receive a State aid award. Once identified, such tests shall be without term unless the Department determines a test is no longer satisfactory in determining eligibility for awards or the Secretary discontinues federal recognition of such test.

Each eligible institution must submit for Regents approval, the passing score it proposes to utilize on any approved ability-to-benefit test, which passing score may not be lower than the federally approved score for such test. For the 2007–2008 academic year fall semester, eligible institutions may utilize any passing score that is not lower than the federally approved score. For subsequent academic terms, in determining whether to approve an institution's proposed passing score, the regulation requires the Regents to consider certain specified factors. Once approved, an institution's passing score(s) will remain approved unless the institution proposes to change such score(s) or the Regents determine that such passing score is no longer satisfactory in determining eligibility for awards under Education Law section 661.

The regulation also establishes factors the Department will consider to determine if an ability-to-benefit is independently administered and evaluated. For the 2007–2008 academic year fall semester, the test will be deemed independently administered if its administration meets the criteria set forth in federal regulations. For subsequent academic terms, the regulation provides that an ability-to-benefit test is independently administered if the test is administered by an assessment center not located at, or affiliated with, the institution for which the student is seeking enrollment and the test administrator is an employee of such center. If the ability-to-benefit test is administered at an eligible degree-granting institution, the institution's chief executive officer shall provide the Department an annual certification that it independently administers such tests according to the factors in the regulation. If the ability-to-benefit test is administered by an eligible institution that does not grant degrees, the ability-to-benefit test must be administered pursuant to the federal regulations' criteria. If the Department finds an institution has violated the certification procedure or the federal ability-to-benefit procedures, it may require the institution to use an assessment center external to the institution.

4. COSTS:

(a) Costs to State government. The regulation will not impose any additional costs on State government beyond those resulting from the enactment of Chapter 57 of the Laws of 2007.

(b) Costs to local government. The regulation will result in minimal costs beyond those resulting from enactment of Chapter 57 of the Laws of 2007.

The regulation may impose negligible costs on institutions eligible to participate in State student financial aid programs that admit students without a diploma from a U.S. high school and seek to qualify such students for State student financial aid. Each such institution would be required to submit an application for approval of the passing score it proposes to utilize. However, once the institution's passing score(s) is approved by the Regents, an institution's passing score(s) will remain approved unless the institution proposes to change them or the Department revokes the approval for cause.

To administer an ability-to-benefit test on campus, each eligible degree-granting institution would be required to submit to the Department an annual certification by their chief executive officer that its administration of these tests meets the regulation's requirements. The majority of the regulation's requirements for the independent administration of such tests duplicate requirements set forth in the federal Higher Education Act and its corresponding federal regulations. Therefore, eligible degree-granting institutions should already be administering ability-to-benefit tests in a similar manner and any additional costs imposed should be minimal.

Since the regulation proposes minimal reporting and recordkeeping requirements, the Department expects existing staff at eligible institutions will have the necessary expertise to satisfy the regulation's requirements as part of their ongoing responsibilities.

Minimal costs may arise in the sponsor contributions to the budgets of community colleges that are subject to approval by the sponsoring local government(s).

(c) Costs to private regulated parties. As stated above under “Costs to local government”, private regulated parties may incur minimal costs to submit an application for approval of the passing score it proposes to utilize and to complete the annual certification required of institutions that wish to administer ability-to-benefit tests on campus.

(d) Costs to the regulatory agency. The regulation may add one time negligible additional responsibilities for the Department to develop a basic application and an annual certification form. The Department will administer the program using existing staff and resources.

5. LOCAL GOVERNMENT MANDATES:

The regulation establishes procedures for identifying acceptable federally approved ability-to-benefit tests, the passing scores for such tests and the requirements for the independent administration of such tests, for students applying for State student financial aid for the first time in academic year 2007–2008, who do not hold a diploma from a high school located in the U.S., or its recognized equivalent. It will affect all institutions eligible to participate in State student financial aid programs, including locally-sponsored community colleges that admit such students and seek to qualify them for State student financial aid. The Department estimates at least 21 community colleges may be affected.

6. PAPERWORK:

The regulation requires additional paperwork only for institutions eligible to participate in State student aid programs that admit students without a diploma from a U.S. high school and seek to qualify such students for State student financial aid. Each such eligible institution would be required to submit an application for approval of the passing score it proposes to use, including information to assist the Department, in determining whether to approve a score, about the curricula the institution offers, admission criteria and procedures the institution uses in its evaluation of the capacity of a student to undertake a course of study and the capacity of the institution to provide instructional and other support that the student needs to complete the program, and adequacy of the academic support services the institution provides. Once approved, an institution's passing score(s) will remain approved unless the institution proposes to change them or the Department revokes the approval for cause.

To administer an ability-to-benefit test on campus, each eligible degree-granting institution would be required to have its chief executive officer annually certify to the Department that its administration of the tests meets the regulation's requirements.

Since the regulation proposes minimal reporting and recordkeeping requirements, the Department expects existing staff at eligible institutions will have the necessary expertise to satisfy the regulation's requirements as part of their ongoing responsibilities.

7. DUPLICATION:

The regulation is necessary to implement Education Law section 661(4)(e). The criteria the Department will utilize in reviewing applications by eligible institutions to set passing scores on acceptable ability-to-benefit tests are already required of those institutions in the standards for the registration of undergraduate and graduate curricula set forth in Commissioner's Regulations Part 52. The definition for assessment center is similar to the federal definition set forth in 34 CFR section 668.142 and the criteria set forth in the proposed amendment for independent administration builds upon the federal requirements set forth in 34 CFR section 668-151.

8. ALTERNATIVES:

In developing the regulation, the Department consulted with a working group that represented The City University of New York Central Administration, the State University of New York System Administration, Clarkson University, The College of New Rochelle, Touro College, the Commission on Independent Colleges and Universities, Monroe College, Plaza College, the Association of Proprietary Colleges, and the New York State Higher Education Services Corporation. The regulation represents the result of that consultation. There are no viable alternatives to the regulation.

9. FEDERAL STANDARDS:

The regulation builds on federal standards for the administration of federal student financial aid programs established under Title IV of the Higher Education Act and its corresponding regulations. Specifically, the definition for assessment center is similar to the federal definition in 34 CFR section 668.142 and the criteria set forth in the regulation for independent administration builds upon the federal requirements in 34 CFR section 668-151.

10. COMPLIANCE SCHEDULE:

The regulation would be effective on its stated effective date.

1. EFFECT OF RULE:

(a) Small Businesses:

To implement Education Law section 661, as added by Chapter 57 of the Laws of 2007, the regulation establishes procedures for the identification of federally approved ability-to-benefit tests and passing scores the Regents will deem approved as an alternative for students applying for State financial aid, and requirements for the independent administration of such tests. The Department estimates 21 of the eligible 42 proprietary colleges in the State are small businesses with 100 or fewer employees.

(b) Local Governments:

The State Education Department estimates that at least 21 community colleges may be affected by the regulation.

2. COMPLIANCE REQUIREMENTS:

Prior to the 2007–2008 academic year, a student applying for State student financial aid who did not have a diploma from a U.S. high school, or its recognized equivalent, was required to achieve a passing score set by the Secretary of the U.S. Department of Education (“Secretary”), on an ability-to-benefit test approved by the Secretary. Education Law section 661(4)(e) modifies this requirement. Students seeking State financial aid for the first time in the 2007–2008 academic year, without a high school diploma or the recognized equivalent of such, must achieve a passing score on a federally approved ability-to-benefit test identified by the Regents as satisfactory in determining eligibility for awards and the test must be independently administered as defined by the Commissioner.

The regulation requires the Regents to publish a list of the federally approved ability-to-benefit tests that the Regents identify as satisfactory in determining eligibility for State aid for students without a high school diploma from the U.S., or its recognized equivalent. For the fall semester of the 2007–2008 academic year, all seven federally approved ability-to-benefit tests may be used. For subsequent academic terms, the Department intends to identify and publish a list of federally approved ability-to-benefit tests that the Regents identify as satisfactory in determining eligibility to receive a State aid award. Once identified, such tests shall be without term unless the Department determines that a test is no longer satisfactory in determining eligibility for awards or the Secretary discontinues federal recognition of such test.

The regulation requires each eligible institution to submit for approval by the Board of Regents, the passing score it proposes to utilize on any approved ability-to-benefit test, however, the passing score may not be lower than the federally approved score for such test. For the fall semester of the 2007–2008 academic term, eligible institutions may utilize any passing score that is not lower than the federally approved score. For subsequent academic terms, in determining whether to approve an institution's proposed passing score, the regulation requires the Regents take into consideration the following factors: (1) the curricula the institution offers; (2) the admission criteria and procedures the institution uses to evaluate the capacity of a student to undertake a course of study and the capacity of the institution to provide instructional and other support services that the student needs to complete the program; (3) evidence that the admission criteria and procedures that the institution utilizes are effective in admitting only persons who have the capacity to undertake a course of study; (4) the adequacy of the academic support services the institution provides; and (5) evidence that the institution evaluates the success of its academic and other support services in providing instructional and other support that the student needs to complete the program. Once approved, an institution's passing score(s) will remain approved unless the institution proposes to change such score(s) or the Regents determines that such passing score is no longer satisfactory in determining eligibility for awards under Education Law section 661.

The regulation also establishes factors the Department will consider to determine if an ability-to-benefit is independently administered and evaluated. For the fall semester of the 2007–2008 academic year, the test will be deemed independently administered if its administration meets the criteria set forth in federal regulations. For subsequent academic terms, the regulation provides an ability-to-benefit test is independently administered if the test is administered by an assessment center not located at, or affiliated with, the institution at which the student is seeking enrollment and the test administrator is an employee of such center. If the ability-to-benefit test is administered at an eligible degree-granting institution, the chief executive officer of such institution shall provide an annual certification to the Department that it independently administers such tests according to the factors delineated in the regulation. If the ability-to-benefit test is administered by an eligible institution that does not grant degrees, the ability-to-benefit test must be administered pursuant to the criteria set forth in the federal regulations. If the Department finds that an institution has violated the certification procedure or the federal ability-to-benefit procedures, it may require the institution to use an assessment center external to the institution.

3. PROFESSIONAL SERVICES:

(a) Small Businesses:

The regulation will not require eligible institutions that are classified as small businesses to hire professional services to comply. The Department expects that existing staff at eligible institutions will have the necessary expertise to satisfy the regulation's requirements as part of their ongoing responsibilities.

(b) Local Governments:

The regulation amendment will not require eligible community colleges to hire professional services to comply. The Department expects that existing staff at eligible institutions will have the necessary expertise to satisfy the regulation's requirements as part of their ongoing responsibilities.

4. COMPLIANCE COSTS:

The regulation may impose negligible costs on institutions eligible to participate in State student aid programs that admit students without a diploma from a U.S. high school and seek to qualify such students for State student financial aid. Each such institution would be required to submit an application for approval of the passing score it proposes to use, including information to assist the Department in determining whether to approve a score, about the curricula the institution offers, admission criteria and procedures the institution uses in its evaluation of the capacity of a student to undertake a course of study and the capacity of the institution to provide instructional and other support that the student needs to complete the program, and adequacy of the academic support services the institution provides. However, once approved, an institution's passing score(s) will remain approved unless the institution proposes to change them or the Department revokes the approval for cause.

To administer an ability-to-benefit test on campus, eligible degree-granting institutions would be required to submit to the Department an annual certification by their chief executive officer that its administration of these tests meets the requirements set forth in the text of the regulation. The majority of the regulation's requirements for the independent administration of such tests duplicate requirements set forth in the federal Higher Education Act and its corresponding federal regulations. Therefore, eligible institutions should already be administering ability-to-benefit tests in a similar manner and any additional costs imposed by this regulation should be minimal.

Since the regulation proposes minimal reporting and recordkeeping requirements, the Department expects existing staff at eligible institutions will have the necessary expertise to satisfy the regulation's requirements as part of their ongoing responsibilities.

Minimal costs may arise in the sponsor contributions to the budgets of community colleges that are subject to approval by the sponsoring local government(s).

5. ECONOMIC AND TECHNOLOGICAL FEASIBILITY:

(a) Small Businesses:

The regulation will not impose any technological requirements on eligible institutions that are classified as small businesses, and is economically feasible. See above “Compliance Costs” for the economic impact of the amendment.

(b) Local Governments:

The regulation will not impose any technological requirements on eligible community colleges, and is economically feasible. See above “Compliance Costs” for the economic impact of the amendment.

6. MINIMIZING ADVERSE IMPACT:

Education Law section 661(4)(d) and (e), as added by Chapter 57 of the Laws of 2007, applies equally to all institutions eligible to participate in State student financial aid programs that admit students without a diploma from a U.S. high school and seek to qualify such students for State student financial aid, including those classified as small businesses. Consequently, the State Education Department believes that the proposed amendment, which sets forth the procedures for identification of federally approved ability-to-benefit tests and the passing scores for such tests, and the requirements for the independent administration of such tests must be uniformly applied to all such institutions.

7. SMALL BUSINESS AND LOCAL GOVERNMENT PARTICIPATION:

Before drafting the regulation, the Department convened a working group comprised of persons knowledgeable about student financial aid and academic affairs, from all four sectors of higher education, including the Vice Chancellor for Community Colleges and other staff of the State University of New York System Administration and comparable staff of The City University of New York central administration, proprietary colleges that are classified as small businesses, as well as the president of the association of proprietary colleges, many of which are classified as small businesses. The comments they provided were taken into consideration when drafting the proposed amendment.

1. TYPES AND ESTIMATED NUMBER OF RURAL AREAS:

The proposed regulation establishes the procedures for the identification of acceptable federally approved ability-to-benefit tests and the passing scores for such tests, and the requirements for the independent administration of such tests, so that students applying for State student financial aid for the first time in the 2007–2008 academic year who do not hold a diploma from a high school located in the United States, or its recognized equivalent, may be found eligible for such aid. The proposed regulation only applies to institutions eligible to participate in State student financial aid programs that admit students without a diploma from a U.S. high school and seek to qualify such students for State student financial aid. The Department estimates that approximately 54 degree-granting institutions would be affected by the proposed regulation. Of these, the Department estimates that approximately 13 to 15 are located in the State's 44 rural counties with fewer than 200,000 inhabitants and 71 towns in urban counties with a population density of 150 per square mile or less.

2. REPORTING, RECORDKEEPING AND OTHER COMPLIANCE REQUIREMENTS AND PROFESSIONAL SERVICES:

Prior to the 2007–2008 academic year, a student applying for State student financial aid who did not have a diploma from a U.S. high school, or its recognized equivalent, was required to achieve a passing score set by the Secretary of the U.S. Department of Education (“Secretary”), on an ability-to-benefit test approved by the Secretary. Education Law section 661(4)(e) modifies this requirement. Students seeking State financial aid for the first time in the 2007–2008 academic year, without a high school diploma or the recognized equivalent of such, must achieve a passing score on a federally approved ability-to-benefit test identified by the Regents as satisfactory in determining eligibility for awards and the test must be independently administered, as defined by the Commissioner.

The regulation requires the Regents to publish a list of the federally approved ability-to-benefit tests that the Regents identify as satisfactory in determining eligibility for State aid for students without a high school diploma from the U.S., or its recognized equivalent. For the fall semester of the 2007–2008 academic year, all seven federally approved ability-to-benefit tests may be utilized. For subsequent academic terms, the Department intends to identify and publish a list of federally approved ability-to-benefit tests that the Regents identify as satisfactory in determining eligibility to receive a State aid award. Once identified, such tests shall be without term unless the Department determines that a test is no longer satisfactory in determining eligibility for awards or the Secretary discontinues federal recognition of such test.

The regulation requires each eligible institution to submit for approval by the Board of Regents, the passing score it proposes to utilize on any approved ability-to-benefit test, however, the passing score may not be lower than the federally approved score for such test. However, for the fall semester of the 2007–2008 academic term, eligible institutions may utilize any passing score that is not lower than the federally approved score. For subsequent academic terms, in determining whether to approve an institution's proposed passing score, the regulation requires the Regents take into consideration the following factors; (1) the curricula the institution offers; (2) the admission criteria and procedures the institution uses to evaluate the capacity of a student to undertake a course of study and the capacity of the institution to provide instructional and other support services that the student needs to complete the program; (3) evidence that the admission criteria and procedures that the institution utilizes are effective in admitting only persons who have the capacity to undertake a course of study; (4) the adequacy of the academic support services the institution provides and (5) evidence that the institution evaluates the success of its academic and other support services in providing instructional and other support that the student needs to complete the program. Once approved, an institution's passing score(s) will remain approved unless the institution proposes to change such score(s) or the Board of Regents determines that such passing score is no longer satisfactory in determining eligibility for awards under Education Law section 661.

The regulation also establishes factors the Department will consider to determine if an ability-to-benefit is independently administered and evaluated. For the fall semester of the 2007–2008 academic year, the test will be deemed independently administered if its administration meets the criteria set forth in federal regulations. For subsequent academic terms, the regulation provides an ability-to-benefit test is independently administered if the test is administered by an assessment center not located at, or affiliated with, the institution for which the student is seeking enrollment and the test administrator is an employee of such center. If the ability-to-benefit test is administered at an eligible degree-granting institution, the chief executive officer of such institution shall provide an annual certification to the Department that it independently administers such tests according to the factors delineated in the regulation. If the ability-to-benefit test is administered by an eligible institution that does not grant degrees, the ability-to-benefit test must be administered pursuant to the criteria set forth in the federal regulations. If the Department finds that an institution has violated the certification procedure or the federal ability-to-benefit procedures, it may require the institution to use an assessment center external to the institution.

The regulation will not require eligible institutions, including those located in rural areas, to hire professional services to comply.

3. COSTS:

The regulation may impose negligible costs on institutions eligible to participate in State student aid programs that admit students without a diploma from a U.S. high school and seek to qualify such students for State student financial aid, including those located in rural areas. Each such institution would be required to submit an application for approval of the passing score it proposes to use, including information to assist the Department in determining whether to approve a score, about the curricula the institution offers, admission criteria and procedures the institution uses in its evaluation of the capacity of a student to undertake a course of study and the capacity of the institution to provide instructional and other support that the student needs to complete the program, and adequacy of the academic support services the institution provides. However, once approved, an institution's passing score(s) will remain approved unless the institution proposes to change them or the Department revokes the approval for cause.

To administer an ability-to-benefit test on campus, each eligible degree-granting institution would be required to submit to the Department an annual certification by their chief executive officer that its administration of these tests meets the requirements set forth in the text of the regulation. The majority of the regulation's requirements for the independent administration of such tests duplicate the requirements set forth in the federal Higher Education Act and its corresponding regulations. Therefore, eligible degree-granting institutions should already be administering ability-to-benefit tests in a similar manner and any additional costs imposed by this regulation should be minimal.

Since the regulation proposes minimal reporting and recordkeeping requirements, the Department expects that existing staff at eligible institutions will have the necessary expertise to satisfy the regulation's requirements as part of their ongoing responsibilities.

Minimal costs may arise in the sponsor contributions to the budgets of community colleges that are subject to approval by the sponsoring local government(s).

4. MINIMIZING ADVERSE IMPACT:

The proposed regulation makes no exception for eligible institutions that are located in rural areas. Paragraph (e) of subdivision (4) of section 661 of the Education Law, as added by Chapter 57 of the Laws of 2007, applies equally to all institutions eligible to participate in State student aid programs that admit students without a diploma from a U.S. high school and seek to qualify such students for State student financial aid, including those located in rural areas. Consequently, the State Education Department believes that the proposed regulation, which sets forth the procedures for the identification of acceptable federally approved ability-to-benefit tests and scores on such tests, and the requirements for the independent administration of such tests, required by paragraph (e) of subdivision (4) of section 661, also must apply uniformly to all such institutions, including those located in rural areas and that it would be inappropriate to establish different standards for eligible institutions located in rural areas.

5. RURAL AREA PARTICIPATION:

Before drafting the proposed regulation, the State Education Department convened a work group comprised of persons knowledgeable about student financial aid and academic affairs from all four sectors of higher education. The group included representatives of eligible institutions located in rural areas, as well as of the Association of Proprietary Colleges, the Commission on Independent Colleges and Universities, and the State University of New York system administration, many of whose institutions or campuses are located in rural areas. The comments they provided were taken into consideration when drafting the proposed regulation.

The purpose of the proposed regulation is to identify certain ability-to-benefit tests and the passing scores for such tests that the Board of Regents approves for purposes of eligibility for awards under Section 661 of the Education Law. The proposed regulation also establishes criteria that the Department will utilize to determine if an approved ability-to-benefit test is independently administered; in order to implement the requirements of Chapter 57 of the Laws of 2007.

Because it is evident from the nature of the proposed regulation that it will not affect jobs or employment opportunities, no affirmative steps were needed to ascertain that fact and none were taken. Accordingly, a job impact statement is not required and one has not been prepared.