Online learning got a huge boost when Congress recently passed legislation removing the so-called “50-percent rule,” which required colleges to deliver at least half of their courses face to face to qualify for federal student aid.

The move is a boon for fully online degree-granting institutions such as the University of Phoenix, as well as schools with a strong mix of campus-based and online programs. Now, these schools will be able to attract students who otherwise might not be able to afford a higher education.

The change, which was attached to a $39.5 billion budget-cutting package that President Bush signed on Feb. 8, reflects the growing importance of virtual instruction as a means of reaching today’s students, especially busy professionals who don’t have time for–or easy access to–campus-based instruction. But some observers fear the move also opens the door for for-profit online ventures to thrive at the expense of taxpayers.

Congress enacted the 50-percent rule in 1992 after investigations showed that some for-profit institutions were merely diploma mills reaping the benefits of federal student loans. Although both traditional and for-profit colleges have expanded their internet courses in the last few years, most fully online degree-granting institutions are for-profit schools.

Still, online instruction has grown substantially in recent years. Nearly two-thirds of all colleges and universities that deliver face-to-face instruction now also offer online courses, and last year’s enrollment in these online courses was up nearly 20 percent over the 2003-04 academic year, according to a recent survey of online instruction at the nation’s higher-education institutions.

While only 19 percent of colleges offer both face-to-face and online undergraduate degree programs, that figure is 34 percent for master’s programs and 38 percent for doctorate programs, the survey found.

Nebraska’s Bellevue University, a private, nonprofit institution that reportedly was one of the first universities in the nation to offer degree programs online, applauded Congress’s action. Bellevue University Provost Mary Hawkins said Congress has now recognized what some colleges and universities already know–that students increasingly prefer to take classes online instead of in a traditional classroom setting.

“We are getting to the point where more of our students are choosing online [instruction],” Hawkins said. “It’s the direction [in which] higher education is moving.” Currently, more than 38 percent of Bellevue’s enrollment is online, but officials expect that number to reach 50 percent within the next two years.

Yet some critics say the nation is rushing to expand virtual instruction because it’s profitable, without any study of its effectiveness.

A story in the New York Times noted that lobbyists for the interests of for-profit schools have a sympathetic ear in Congress and the Bush administration.

According to the story, Sally L. Stroup, the assistant secretary of education who is the top administration official overseeing higher education, is a former lobbyist for the University of Phoenix, the nation’s largest for-profit college with some 300,000 students. A. Bradford Card, the brother of White House Chief of Staff Andrew Card, also is a lobbyist for the for-profit education industry, the Times reported.

“This is a growth industry, and you get rich not by being skeptical, but by being enthusiastic,” Henry M. Levin, director of Columbia University’s National Center for the Study of Privatization in Education, told the Times. “… We have not found a single rigorous study comparing online with conventional forms of instruction.”

In an interview with eSchool News, Barmack Nassarian, associate executive director of the American Association of Collegiate Registrars and Admissions Officers (AACRAO), said the impact of the rule change on legitimate colleges and universities “is likely to be quite positive.”

His concern, however, is that the elimination of the 50-percent rule also might make it possible for “a lot of fly-by-night institutions,” including illegitimate diploma mills, to qualify for federal aid.

Though Nassarian’s organization supports the use of the internet to improve education and provide more opportunities for students, he believes Congress acted too hastily, failing to put in place safeguards that would protect people from being defrauded.