WASHINGTON -- The U.S. Department of Education will allow at least 40 colleges to experiment with competency-based education and prior learning assessment, granting them a waiver from certain rules that govern federal financial aid.

The department last week notified colleges that had successfully applied to participate in the latest round of “experimental sites,” which observers said is more expansive than previous ones.

“This is much more complicated than any experiment they have done,” said Amy Laitinen, deputy director of the New America Foundation's higher education program and a former official at the department and White House.

It’s still unclear how many institutions are part of the federal project, as the department will not post its public notice for a few weeks. But a group of colleges, dubbed the Competency-Based Education Network (C-BEN), collected a list of 40 institutions that have received approval. Some are not part of the Lumina-funded network, which includes colleges that either offer competency-based degrees or are working to offer them (see box for a smattering of participants).

The feds began considering this version of experimental sites about 16 months ago. As with previous efforts, the idea was to give colleges space to try new things so policy makers, accreditors and academics can learn more about the emerging form of higher education.

Competency-based education and prior learning assessment have been around for a long time. But the college completion push and growing concerns about workforce development have helped shine a spotlight on the adult students who are most likely to be attracted to academic programs that use the two approaches. Ideally they allow students to more quickly demonstrate what they know and can do, and to spend more time focused on the “competencies” they have yet to master.

Partial List of Participating Institutions Antioch University Brandman University Capella University Charter Oak State College Kentucky Community & Technical College System Lipscomb University Northern Arizona University Salt Lake Community College Southern New Hampshire University University Of Maryland University College University Of Wisconsin-Extension

A new breed of competency-based degrees is designed explicitly around self-pacing for students. So-called “direct assessment” programs do not rely on the credit-hour standard. The department has granted federal-aid eligibility to four institutions for direct-assessment degrees.

Last July the department announced this round of experimental sites. Three types of programs could qualify: ones with prior learning assessment, hybrid competency-based programs with some direct assessment, and competency-based degrees that are fully direct assessment.

Capella University, which is one of the first to offer direct-assessment degrees, received approval for three experimental sites applications in all three areas, said officials with the for-profit, online university.

The department will allow participating colleges to use different aid disbursements for direct and indirect student expenditures, Laitinen said. Students will be able to qualify for aid to cover direct costs, such as tuition, as they progress. Aid for indirect costs, including living expenses, will be paid out in a more regular way. Laitinen called it an innovative approach to "dealing with some of the stickiness of paying for competencies."

Proponents of competency-based education welcomed the department’s willingness to experiment. While the Obama administration’s Education Department publicly has been supportive of competency-based education, the feds have sometimes expressed mixed messages about the approach, which has led to confusion at colleges that want to give it a try.

For example, an audit by the department’s Office of Inspector General criticized aspects of the federal approval process for direct-assessment programs. Results of the audit, which were released in October, also cited the potential for abuse with poor-performing versions of competency-based education and raised questions about the faculty role in direct assessment.

Congress could clear up some of the confusion, said several experts.

In July the U.S. House of Representatives unanimously passed a bill to create a “demonstration project,” which would allow up to 20 institutions to offer competency-based degrees without meeting all current federal requirements. The U.S. Senate, however, has yet to take up the bill.

“It’s great that this is happening,” Laitinen said of the experimental-sites project. But “there are limits to what the department can do.”