Friday Follow Up
Some needed sanity in state-level regulations around online education
Phil Hill
August 29, 2025
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One of our long-running themes is how the regulatory actions taking aim at online education in general and rev share OPMs in particular were moving from the federal level to the state level. The two centerpieces of the activist (aka The Coalition™ in these pages) arguments have been:
Ban tuition revenue-sharing agreements for OPMs, creating a de facto reversal of the 2011 bundled services exception federal guidance; and
Gut the State Authorization Reciprocity Agreement (SARA), attempting to roce SARA to redefine its rules by allowing separate consumer protection compliance from each state where students reside.
There have been some good transparency suggestions in both areas, but the core of the arguments is that online is predatory by nature and must be throttled.
With the change from the Biden to the Trump Administration, there have been two changes to note:
The move to state action has accelerated, with virtually all federal regulatory initiatives stopped. I say virtually here because the Do No Harm / Earnings Premium accountability metric in OBBB was created by The Coalition and is partially aimed at online education.
Arnold Ventures, which funded and coordinated much of this work from 2018 - 2024, appears to have left the coalition and is instead pushing CUNY ASAP expansion as its core education initiative.
The news out of California is that we now know the status of both initiatives that could have restricted rev share OPM contracts or further attempted to gut SARA. Neither is happening, at least anytime soon. University of California interim policy keeps rev share OPM options, and the state legislature effectively killed SB 790.
Before getting to those details, some historical context is in order.
