Last week, Washington governor Bob Ferguson signed legislation that will require online, out-of-state colleges that enroll Washington residents to obey the state’s consumer protection laws.

State Representative Gerry Pollet, (D-Seattle), sponsor of the legislation, explained in a statement, “Online universities, including many for-profits, who advertise and recruit heavily to entice Washington residents to enroll have sought to avoid any accountability to comply with Washington State’s strong student consumer protections.” He added, “Working students using online programs deserve the same protection and transparency that other Washington students enjoy, regardless of where the college is based.”

The new Washington law challenges the State Authorization Reciprocity Agreement (SARA), a pact among 49 states — all but California — that has shielded online schools from various state regulations and in the process has weakened protections for students against deceptive, predatory, and reckless school practices, such as advertising that makes false statements to students about the costs of attendance and job placement rates.

California, which has relatively strong consumer protections for students, has declined to join SARA.

The SARA agreement, overseen by a group called the National Council for State Authorization Reciprocity Agreements (NC-SARA), prohibits member states from using their own education-focused consumer protection laws — such as disclosure requirements or refund policies — to protect their residents enrolled in online programs at out-of-state schools approved by SARA. Thus under SARA, online colleges can set up their operations in states with weak protections for consumers and avoid some of the risk that more protective states will hold them accountable.

NC-SARA and affiliated groups have rebuffed recent efforts by some member states to introduce more accountability into the system. Meanwhile, the Biden Department of Education conducted extensive meetings to consider proposals for significant reform of online school oversight — steps that could correct key problems with SARA — but Joe Biden’s term ended without the Department ever issuing proposed rules on the topic. With Donald Trump back as president, the Department is now highly unlikely to pursue such pro-student reforms.

Pollet said that the new Washingon law “sends a strong message” that SARA “needs to be reformed to protect the students rather than shielding the for-profit and aggressive online education industry.”

Carolyn Fast, director of higher education policy at The Century Foundation, has written persuasively about the need for reform of SARA and online college oversight. Fast explained that the new law essentially gives NC SARA notice that if it does not, within three years, make changes to allow states to better protect their students, Washington will leave the compact and seek a new reciprocity deal with other reform-minded states, perhaps including California.