One membership replaced fifty approvals
Before a college can enroll a state's residents in an online program, that state has to authorize it. The permission is called state authorization, and for a national online institution it once meant approaching every state separately. The State Authorization Reciprocity Agreement, called SARA, is the arrangement that replaced most of that work: one membership, held through the institution's home state, lets a college enroll online students across state lines instead of holding roughly fifty separate approvals. In 2025, 2,441 institutions participated (NC-SARA Annual Data Report, August 2026).
The savings have been measured. A SARA institution pays $3,700 to $11,175 in fees to become authorized and $2,375 to $9,100 a year to stay authorized. The median institution outside the agreement would pay $268,829 up front and $156,950 every year for the same footprint. On those figures, the average institution would spend 61.1 times as much to authorize and 35.7 times as much to renew without SARA; for institutions of 30,000 or more students, the multiples reach 193.2 and 338.9 (NC-SARA and NCHEMS Cost Savings Study, 2025, built from 537 institutions with complete data).
The estimate excludes staff time, legal costs and insurance. The study rests on 537 institutions with complete data, from a survey of more than 2,400 SARA participants. The 30,000-plus multipliers rest on 12 institutions, and NCHEMS excluded them from its own savings estimates; the study's headline multiples are the all-institution 61.1 and 35.7.
Source: NC-SARA and NCHEMS Cost Savings Study, 2025
The study also reports what it leaves out. The National Center for Higher Education Management Systems (NCHEMS), which built the estimate, states that it excludes staff time, legal costs and insurance.
What the membership costs depends on the home state
NC-SARA, the council that administers the agreement, prices its annual fee on four enrollment bands: $2,200, $4,400, $6,600 and $8,800 a year, with the top band starting at 30,000 full-time-equivalent students (participation fee schedule effective July 1 2024). The institution's home state then adds its own charge for SARA participation, and the agreement leaves that pricing to each state. Fifteen states and one territory charge nothing. West Virginia charges $500. Massachusetts charges $3,000 to $12,000 and Arizona $2,500 to $18,000, both banded on enrollment. New Hampshire prices on out-of-state online headcount, with a top band of $40,000, and Pennsylvania prices on distance-education tuition revenue (NC-SARA state fee table for in-state institutions, 2026).
Combining the two published tables, we compute that the same large online institution pays $8,800 a year if its home state is Texas or Colorado and up to $48,800 if its home state is New Hampshire, for an identical program set. The gap between the least and the most expensive home state for the same programs comes to $40,000 a year.
NC-SARA annual participation fee, $8,800 at the top enrollment band
State fee for in-state institutions at the state's top published band
Modeled on an institution in NC-SARA's top fee band (30,000 or more full-time-equivalent students) at each state's highest published band. New Hampshire's bands run on out-of-state online headcount and Arizona's top band begins at 40,000 enrollments, so each bar assumes enrollment large enough to reach that state's top band.
Source: NC-SARA participation fee schedule (effective July 1 2024) and NC-SARA state fee table for in-state institutions (2026)
The unit of work is programs multiplied by states
A licensure determination is the institution's own finding on whether a specific program satisfies a specific state's requirements for a professional license. NC-SARA's Professional Licensure FAQ, updated June 18 2026, describes the federal disclosure obligation as one that "require[s] an analysis of each state by the institution for each of its applicable programs." The same document says an institution cannot meet the duty by pointing students to NC-SARA's professional licensure directory. The directory covers five program areas: counseling, nursing, psychology, social work and teacher education. It holds contact information for licensing boards rather than determinations, and it updates twice a year. Non-credit programs are in scope where they are designed or advertised as meeting licensure requirements. So are post-licensure programs that could lead to a new or second license.
Each row is one licensure-track program and each column is one state.
One determination: does this program meet this state’s requirements?
After a state board rule change, the institution re-runs that program’s determination in every state.
After a student address change, the institution re-determines that single program-state pair.
Illustrative institution. Program and state counts are chosen for legibility rather than drawn from any real institution.
Source: Obligation as stated in NC-SARA Professional Licensure FAQ, June 18 2026, and 34 CFR 668.43 (eCFR, current). Grid dimensions are illustrative.
| The federal obligation | The NC-SARA directory |
|---|---|
| An analysis of each state by the institution for each of its applicable programs | Five program areas: counseling, nursing, psychology, social work and teacher education |
| Non-credit programs are in scope where they are designed or advertised as meeting licensure requirements | Contact information for licensing boards only |
| Post-licensure programs that could lead to a new or second license are in scope | Updated twice a year |
| Determinations kept current with students notified | Referencing the directory does not fulfill the obligation |
Applies to all SARA-participating institutions offering programs leading to licensure or certification, including programs outside Title IV, the federal student aid system.
Source: NC-SARA Professional Licensure FAQ, June 18 2026 (the obligation), and NC-SARA Professional Licensure Directory page (directory coverage and update cycle)
An institution with 20 licensure-track programs facing 50 states holds 1,000 program-state pairs, and each pair needs its own current answer (illustrative arithmetic, computed; the per-state, per-program obligation is NC-SARA's own wording, June 18 2026).
The federal rule runs on a clock
The duty is federal, and the text is specific. 34 CFR 668.43(a)(5)(v) requires the institution to publish, for every program that leads to a license, the list of all states where it has determined the program meets the state's requirements and all states where it has determined it does not. The next two provisions attach to individual students. Section 668.43(c)(1) requires notice before enrollment when the program falls short in the student's state or when no determination has been made at all. Section 668.43(c)(2) sets the clock: once the institution determines a program no longer meets a state's requirements, each enrolled student in that state must receive direct written notice within 14 calendar days. Section 668.43(c)(3)(ii) requires written documentation of how each student's state was identified, produced to the Secretary of Education on request, with a fresh determination when the institution formally learns the student has moved. All of it has been in force since July 1 2020 (84 FR 58834, 2019). Since July 1 2024, 34 CFR 668.14(b)(32) adds one more state to the determination: the one a distance student attests they intend to seek employment in.
A compliance officer at an institution with a large online nursing portfolio starts her morning with a memo: a state board has raised its clinical-hour minimum. The state changed its requirement, so every determination for that program is due for a fresh look. She re-runs the determination for that program in every state where an enrolled student sits, because the answer may have flipped somewhere. Wherever it flipped, the 14-day clock is already running for every enrolled student in that state. That afternoon, a student in the same program submits a change of address, so she re-determines that student's state under 668.43(c)(3)(ii) and records how she knew. The directory cannot tell her whether the program still qualifies, so she calls the board. The regulation gives her 14 days.
Publish
Lists of all states where each licensure program does and does not meet requirements. 34 CFR 668.43(a)(5)(v).
Before enrollment
Individual notice where the program does not meet requirements in the student's state or where no determination has been made. 34 CFR 668.43(c)(1).
Within 14 calendar days
Direct written notice to each enrolled student after a determination that a program no longer meets a state's requirements. 34 CFR 668.43(c)(2).
Ongoing
Documented basis for each student's state, produced to the Secretary of Education on request, with re-determination when the institution formally learns of a move. 34 CFR 668.43(c)(3)(ii).
In force since July 1 2020. Since July 1 2024 the determination extends to the state a distance student attests they intend to seek employment in (34 CFR 668.14(b)(32)).
Applies to institutions participating in Title IV, the federal student aid system; SARA policy extends the disclosure expectations to non-Title IV institutions and programs.
Source: eCFR, 34 CFR 668.43 and 668.14; 84 FR 58834 (2019)
The rules did not change in 2024 or 2025
A version of this story circulates in which the state authorization rules changed recently. They did not. The Department of Education terminated its negotiated rulemaking on state authorization on December 26 2024 (89 FR 104937), which left the 2019 rule governing exactly as written. What did arrive is separate: the distance education final rule published January 3 2025 (90 FR 470), effective July 1 2026, adds 34 CFR 668.41(h) and requires institutions to report distance-education enrollment to the Department. The Department's own impact analysis prices the full rule that carries the requirement at $27.3 million over ten years, about $3.04 million annualized plus $9.42 million of annualized paperwork burden (90 FR 470, 2025). The determination framework a compliance office runs today is the one that took effect on July 1 2020.
$27.3 million
net present value over ten years
$3.04 million
annualized cost
$9.42 million
annualized paperwork burden
Sector-wide totals across all affected institutions rather than a per-institution figure.
Source: Department of Education regulatory impact analysis, 90 FR 470 (2025)
Membership renews every year on fixed deadlines
NC-SARA emails the institution a renewal notice at least 90 days before its end date, with further notices at 60, 30 and 7 days if needed. The chief executive or chief academic officer signs and submits within 30 days. Payment is due within 30 calendar days of approval and before the participation end date. After that comes an automatic 30-day grace period and a 5% late fee. An institution still out of compliance five business days after the grace period ends is removed from the SARA participant list and may not reapply for 180 calendar days (SARA Policy Manual 26.1, effective July 1 2026, section 3.7). Annual data reporting has its own fixed window, May 15 to June 15, and a missed report may be grounds for provisional status or disapproval of continued participation (section 6.1). For the median institution, the alternative waiting on the far side of a 180-day lockout is the state-by-state route the cost study priced at $268,829 (NC-SARA and NCHEMS, 2025).
Renewal notices arrive 90, 60, 30 and 7 days before the participation end date, and the chief executive or chief academic officer signs and submits within 30 days.
- Participation end date. Payment is due within 30 calendar days of approval and before this date.
- An automatic 30-day grace period carries a 5% late fee.
- Removal from the SARA participant list five business days after the grace period ends.
- Reapplication is blocked for 180 calendar days, drawn compressed here.
Applies to every SARA-participating institution; institutional participation renews every year.
Source: SARA Policy Manual, Version 26.1, sections 3.7 and 6.1 (effective July 1 2026)
The work sits with 2,441 institutions
A compliance office does this work at every participating institution, and in 2025 there were 2,441 of them (NC-SARA Annual Data Report, August 2026).
2,441
SARA-participating institutions in 2025
1,722,640
students attending out-of-state institutions entirely by distance education in fall 2025, up 4% from the year before
546,869
out-of-state learning placements in 2025, meaning supervised field experiences completed in another state
64%
of the 2025 placements were in health professions
SARA-participating institutions across member states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands.
Source: NC-SARA Annual Data Report, August 2026
In fall 2025, 1,722,640 students attended an out-of-state institution entirely through distance education under the agreement, up 4% from the year before. Institutions also reported 546,869 out-of-state learning placements, meaning supervised field experiences such as clinical rotations or student teaching completed in another state, and 64% of those were in health professions (NC-SARA Annual Data Report, August 2026).
Methodology
Every computed figure in this piece and its arithmetic:
- $8,800 (floor of the fee stack), computed. NC-SARA's top annual participation band is $8,800 for institutions of 30,000 or more full-time-equivalent students (fee schedule effective July 1 2024). Texas and Colorado charge $0 as the state fee for in-state institutions (NC-SARA state fee table, 2026). $8,800 + $0 = $8,800.
- $48,800 (ceiling of the fee stack), computed. $8,800 (NC-SARA top band) + $40,000 (New Hampshire's top published band, charged to institutions with 20,001 or more out-of-state online students) = $48,800.
- Other bars in Figure 2, computed. West Virginia: $8,800 + $500 = $9,300. Massachusetts: $8,800 + $12,000 (top band) = $20,800. Arizona: $8,800 + $18,000 (top band, 40,000 or more enrollments) = $26,800.
- $40,000 annual gap, computed. $48,800 - $8,800 = $40,000.
- 1,000 program-state pairs, illustrative and computed. 20 licensure-track programs x 50 states = 1,000. The dimensions are illustrative; the per-state, per-program structure of the obligation is NC-SARA's own description (Professional Licensure FAQ, June 18 2026).
- Not recomputed. The medians ($268,829 initial; $156,950 annual), the SARA fee ranges ($3,700-$11,175 initial; $2,375-$9,100 annual) and the multipliers (61.1x, 35.7x, 193.2x, 338.9x) are reported as published by the NC-SARA and NCHEMS Cost Savings Study (2025). The 30,000-plus multipliers rest on 12 institutions, and NCHEMS excluded them from its own savings estimates; the study's headline multiples are the all-institution 61.1 and 35.7. The scale figures (2,441 institutions; 1,722,640 students; 546,869 placements; 64% health professions; 4% growth) are reported as published in the NC-SARA Annual Data Report (August 2026). The costs of the full rule containing the reporting requirement ($27.3 million net present value; $3.04 million annualized; $9.42 million annualized paperwork burden) are the Department of Education's own estimates in 90 FR 470 (2025).
Population notes: the cost study rests on 537 institutions with complete data from a survey of more than 2,400 SARA participants. The fee-stack institution is a model, sized to reach each state's top published band, and no bar describes a named institution. State fees are set by each state; SARA does not set them, and the spread is reported as a structural fact.