20 U.S.C. § 1099a-1 — State postsecondary review entity agreements

(a) State organization structures

(1) Each agreement under this subpart shall describe a State organizational structure responsible for carrying out the review under section 1099a 3(d) of this title of institutions reported to the State by the Secretary pursuant to section 1099a 3(a) of this title. Each such entity's action in reviewing such institutions shall, for purposes of this subpart, be considered to be the action of the State.

(2) For the purposes of this subpart, the designation of a State postsecondary review entity for the purpose of entering into an agreement with the Secretary shall be in accordance with the State law of each individual State with respect to the authority to make legal agreements between the State and the Federal Government.

(3) Except as provided in paragraph (6), nothing in this subpart shall be construed to authorize the Secretary to require any State to adopt, as a condition for entering into an agreement, a specific State organizational structure.

(4) Except as provided in paragraph (6), nothing in this subpart shall be construed—

(A) as a limitation on the authority of any State to adopt a State organization structure for postsecondary education agencies, or programs, or institutions of higher education as appropriate to the needs, traditions, and circumstances of that State;

(B) as a limitation on the authority of a State entering into an agreement pursuant to this subpart to modify the State organizational structure at any time subsequent to entering into such agreement;

(C) as a limitation on the authority of any State to enter into an agreement for purposes of this subpart as a member of a consortium of States;

(D) as an authorization for the Secretary to withhold funds from any State or postsecondary institution on the basis of compliance with a State's constitution or laws;

(E) as an authorization for any State postsecondary review entity to exercise planning, policy, coordinating, supervisory, budgeting, or administrative powers over any postsecondary institution; or

(F) as a limitation on the use of State audits for the purpose of compliance with applicable standards under section 1099a 3(d) of this title.

(5) Nothing in this subpart shall be construed to limit the authority or activities of any State loan insurance program established under section 1078(b) of this title or of any relevant State licensing authority which grants approval for institutions of higher education to operate within a State or their authority to contact the Secretary directly.

(6) Notwithstanding the provisions of paragraphs (2), (3), and (4) of this subsection, the Secretary may require each State to designate an entity responsible for the conduct or coordination of the review of institutions under this subchapter and part C of subchapter I of chapter 34 of title 42.

(b) Contents of agreements

Agreements between each State and the Secretary shall contain the following elements:

(1) A designation of a single State postsecondary review entity, which represents all entities of that State which are responsible for—

(A) granting State authorization to each institution of higher education in that State for the purposes of this subchapter and part C of subchapter I of chapter 34 of title 42, and

(B) ensuring that each institution of higher education in that State remains in compliance with the standards developed pursuant to section 1099a 3 of this title.

(2) Assurances that the State will review institutions of higher education for the purpose of determining eligibility under this subchapter and part C of subchapter I of chapter 34 of title 42 on a schedule to coincide with the dates set by the Secretary to certify or recertify such institutions of higher education as provided in section 1088 of this title and subpart 3 of this part.

(3) Assurances that the appropriate State postsecondary review entity will perform the functions authorized by this subpart and will keep such records and provide such information to the Secretary as may be requested for financial and compliance audits and program evaluation, consistent with the responsibilities of the Secretary.

(4) A description of the relationship between the State postsecondary review entity designated for the purposes of this subpart and (A) the agency or agencies designated for the purposes of chapter 36 of title 38, (B) the loan insurance program established under section 1078(b) of this title for that State, and (C) the grant agency established under section 1070c 2 of this title.

(5) A plan for performing the functions described in section 1099a 3 of this title.

Notwithstanding any other provision of law, no State shall be required to enter into an agreement with the Secretary under this subpart for performing the review functions required by such agreement unless the Congress appropriates funds for this subpart.