New Accreditation Rules Tie College Quality to 'Value-Added Earnings,' Require Financial Separation from Trade Groups

The newly proposed Accreditation Choice and Innovation Act is a major shakeup for higher education, specifically targeting the gatekeepers of college quality: accrediting agencies. At its core, the bill overhauls how these agencies get recognized by the federal government, shifting the focus from general “training” to specific “skills development” and introducing new, tough standards for measuring whether a degree is worth the price tag.

The New Bottom Line: Earnings vs. Cost

For anyone currently paying tuition or thinking about going back to school, this is the biggest change. The bill mandates that accrediting agencies must now judge schools based on student success metrics that go beyond simple graduation rates. They have to compare the Total Price a student pays for a program against their Value-Added Earnings after they graduate. Total Price is defined as tuition minus non-federal grants and scholarships. Value-Added Earnings is basically what the student earns above a baseline poverty level (150% for undergraduate degrees, 300% for graduate degrees), adjusted for location. This means if you’re looking at a $50,000 degree, the school’s accreditation will now depend on whether its graduates are actually earning enough to justify that cost four years later. This is a huge win for consumer transparency and accountability, forcing schools to prove their programs lead to real labor market outcomes.

Cutting the Cord: Independence for Accreditors

If you work in a field regulated by a trade association—say, construction or healthcare—you know those groups often have associated accrediting bodies. This bill introduces a strict firewall. Accrediting agencies linked to trade associations must now be completely separate—financially and administratively (Sec. 2). This means the trade association can’t choose the agency’s leadership, and the agency must set its own budget without the trade group’s approval. Furthermore, the agency’s board must include business representatives not affiliated with the trade association, and all board members must be free of conflicts of interest with the schools being reviewed. This change aims to ensure that accreditation decisions are based purely on educational quality, not industry politics or financial ties.

Easier Transfers, Clearer Status

Two provisions aim to make life simpler for students and institutions. First, the bill requires accrediting agencies to assure the Secretary of Education that their schools won’t deny transfer credit simply because the credit came from a school accredited by a different agency. This could finally reduce the headache of losing credits when moving from a community college to a four-year university. Second, the bill streamlines the process for a school to switch accreditors, provided they aren't trying to dodge a negative review. A school can notify the Secretary 10 days before the switch, giving institutions more flexibility to find an agency that better suits their mission.

Navigating the Religious Mission Clause

The bill introduces specific language requiring accrediting agencies to respect the stated religious mission of an institution when making accreditation decisions. Agencies cannot use a school’s religious policies as a negative factor, provided those policies fall within certain areas, like curriculum. For religious institutions facing adverse action, there’s a new process: they can file a complaint with the Secretary, and the adverse action is paused while the complaint is investigated. The burden of proof is on the accrediting agency to show their action wasn't based on the school's religious mission. This provision is designed to protect religious schools but introduces a potential friction point, as agencies must now carefully navigate the line between legitimate academic standards and institutional religious freedom.

Boosting Transparency and Oversight

Finally, the bill significantly increases public transparency. Accrediting agencies must now publicly post a list of every accredited institution, including the dates of their initial and last reviews. If an agency takes action against a school (like putting it on probation), they must post a summary explaining exactly why that action was taken. This sunlight on the process is critical. Furthermore, the bill extends the life of the National Advisory Committee on Institutional Quality and Integrity (NACIQI)—the committee that advises the Secretary on accreditation—until September 30, 2028, ensuring continued federal oversight of these new rules.