## Facts

- Beth Rochel Seminary, a nonprofit Jewish women’s seminary in New York, sought eligibility for federal student aid under Title IV of the Higher Education Act of 1965 despite lacking accreditation.
- The Higher Education Act allowed certain nonaccredited institutions to qualify through the “three institutional certification” (3-IC) provision if their credits “are accepted, on transfer,” by at least three accredited institutions “on the same basis” as credits from accredited schools.
- Beth Rochel applied for 3-IC status and identified three accredited institutions as transfer recipients; each indicated it had offered transfer admission with academic credit to Beth Rochel students.
- The Department of Education granted Beth Rochel 3-IC certification for a three-year period, permitting participation in federal student aid programs.
- In a later review, the Department determined that Beth Rochel could not show that students had actually transferred and enrolled at one of the three schools with credits accepted in practice.
- Applying its interpretation that the statute requires actual acceptance of credits “upon transfer and enrollment” by at least three accredited institutions, the Department terminated Beth Rochel’s eligibility, demanded repayment of previously received federal funds, and did so without an evidentiary hearing.
- Beth Rochel challenged the agency’s statutory interpretation and argued that termination and recoupment without a hearing violated Fifth Amendment due process.
- The district court entered summary judgment for the Department; Beth Rochel appealed.

## Issues

1. Whether the Department of Education permissibly interpreted the 3-IC provision to require actual acceptance of credits upon transfer and enrollment by at least three accredited institutions.
2. Whether due process required an evidentiary hearing before the Department terminated Beth Rochel’s Title IV eligibility and sought repayment of funds.

## Decision

- The court affirmed summary judgment for the Department of Education.
- The court held the Department’s interpretation of the 3-IC provision was reasonable and consistent with the statute’s language and purpose.
- The court held Beth Rochel had no due process right to an evidentiary hearing before disqualification and recoupment under the circumstances presented.

## Legal Principles

- When statutory terms are ambiguous as to implementation, an agency may adopt a reasonable construction that advances the statute’s purpose, and courts will uphold that construction under established administrative-law deference principles.
- Under the 3-IC alternative to accreditation, the Department may require evidence that credits are accepted in practice—i.e., accepted upon transfer and enrollment—rather than relying solely on written assurances.
- Participation in federal student aid programs is conditioned on compliance with statutory and regulatory eligibility criteria; loss of eligibility and related recoupment may proceed without a trial-type evidentiary hearing where the institution receives notice of the grounds and has access to meaningful judicial review.

## Conclusion

The D.C. Circuit upheld the Department of Education’s requirement that a nonaccredited institution prove actual transfer-and-enrollment credit acceptance by three accredited institutions to qualify under the 3-IC provision, and it rejected the claim that due process mandated a pre-termination evidentiary hearing.


Beth Rochel Seminary v. Bennett, 825 F.2d 478 (D.C. Cir. 1987)