measurable and mandatory performance standards and not rely on the Department or the accrediting agencies to do so.

We believe that the Department's regulations are not what the 1992 HEA Amendments contemplated; nor will they enable the Department to attain clear, measurable and binding performance standards to help meet the requirements of the Government Performance and Results Act of 1993 (GPRA). The GPRA mandates federal program accountability by requiring federal agencies to establish performance goals that are objective, quantifiable and measurable by fiscal year 1999. The Department currently must rely on accrediting agencies to establish and enforce such performance goals. However, without assessing the institutional performance data collected by the agencies from member schools, the Department's ability to comply with the GPRA may be significantly jeopardized.

Post-1992 HEA Amendments OIG Audit Work

To assess whether the accrediting agencies were in fact developing performance standards for student achievement, as contemplated by the law and the Department's regulations, the OIG in 1994 conducted on-site reviews of five agencies that accredit institutions providing vocational training programs which receive SFA funds. Our May 1995 audit report concluded that the five accrediting agencies generally were not using performance measures to assess and improve the

quality of education offered by member schools. Since our report, on-going, followup work reflects that some accrediting agencies have adopted or are now

developing performance standards. However, the accrediting agencies expressed their reluctance to do so and said that they want and need more direction in the law itself as to what the appropriate standards for schools should be for purposes of participation in the SFA programs.

The accrediting agencies we reviewed treated the standards only as "goals" that the schools should try to meet rather than as enforceable standards that serve as a basis for withdrawing accreditation of substandard schools. For example, the National Accrediting Commission of Cosmetology Arts and Sciences (NACCAS) offered what it called "outcome guidelines" as fulfillment of the requirement for performance standards during the re-recognition process. To its credit, the Department staff criticized NACCAS for not having enforceable standards and directed NACCAS to call its guidelines "standards" and enforce them. While this is encouraging, the Department's regulations give accrediting agencies considerable leeway in enforcing their standards. Without enforceable standards, schools that fall short of their own accrediting agency standards -- even in such basic areas as graduation and job placement -- may continue to be accredited and continue to participate in the SFA programs. Since what you measure you get, without measurement and enforcement of even these basic standards for student

achievement, we cannot assure that vocational trade schools in the SFA program

will consistently graduate and place the bulk of their students in jobs for which they were trained.

For example, our 1993 Management Improvement Report entitled "Title IV Funding for Vocational Training Should Consider Labor Market Needs and Performance Standards" reported that in one instance, a cosmetology school in Louisiana received over $2.8 million in SFA program funds for the 673 students enrolled over a period of approximately 3.5 years. Of the 673 students, only 19 students actually received state cosmetology licenses, at a cost to the taxpayers of almost $148,000 per license. While we do not mean to suggest that this is the norm, our investigations and other studies have revealed similar or even more egregious examples. I submit that had there been performance standards for vocational trade schools that included licensing exam pass rates and job placement, this shocking waste of federal funds may not have occurred.

In our 1995 audit report on accrediting agency performance standards, we recommended that the Department evaluate accrediting agency standards and procedures for measuring the quality of member schools and the success of their programs, particularly with respect to job placement. We also recommended that the Department require the agencies to verify the accuracy of performance outcomes reported by schools and hold schools accountable for unsuccessful training programs. We recommended further that the Department develop a

process to collect and compile reported performance data from accrediting agencies. The data could not only be used to monitor the success of accrediting agencies on an ongoing basis, but it is essential in order for the Department to assess program success in accordance with the GPRA.

The Department's program office did not completely agree with our audit report, and we have elevated the matter within the Department to the Office of the Chief Financial Officer for resolution. The fundamental disagreement concerns the requirements of the 1992 HEA Amendments regarding performance standards for student achievement. We believe the performance standard for student achievement must be numerical and absolute to be both meaningful and enforceable. We also believe that accrediting agencies must enforce their standards so that substandard schools do not remain accredited. The Department has taken the position, on the other hand, that the performance standards do not have to be absolute or numerical; that the standards could be goals that schools should work to, but may never achieve; and that agencies could develop subjective standards to be applied on a case-by-case basis to assess schools that do not meet the standards within specified time frames.

The Department also did not agree with our recommendation that it develop

a process to collect and compile performance data from accrediting agencies. The Department expressed concern that it did not have the resources to develop and

operate a system to collect and compile the performance data. We continue to believe that it is not enough to simply require accrediting agencies to measure

performance. The Department needs to know how well its Title IV funded

vocational training programs are doing so that it can better manage the programs and demonstrate compliance with the GPRA.

Legislative Standards Needed

There has been a statutory requirement for accreditation standards for student achievement since July 1992, and a regulatory requirement effective since July 1994. Yet, we are only now beginning to see a handful of accrediting agencies establish performance standards, and accrediting agencies are not using their standards to terminate the accreditation of poor quality schools. In light of this reluctance on the part of accrediting agencies to engage in objective, quantitative evaluation of student achievement at their member schools, and the Department's reluctance to require that the performance standards be absolute, we recommend that Congress incorporate performance standards directly into the law, at a minimum for non-degree-granting, vocational trade schools. Since what you measure you get, these legislative standards should measure what Congress

believes students and taxpayers should get from vocational training being financed

with federal dollars.