In a stunning turnabout, City College of San Francisco will not be forced to close and is expected to retain accreditation under new rules proposed Wednesday by the Accrediting Commission for Community and Junior Colleges.

The 19-member commission expects to change its rules, let City College request more time to comply with accrediting standards, and avoid what are widely viewed as the catastrophic consequences of shutting down a college of nearly 80,000 students who would have few other educational options.

"This is not a free pass, but a careful process of holding the college accountable for implementing new and sustained practices that meet standards of quality within two years," said Barbara Beno, commission president. "There's been progress, but since the college leadership has asked for up to 24 months to meet basic standards, there's clearly much work still to be done."

The new policy, not yet final, would let any college threatened with loss of accreditation to apply for its restoration before the revocation deadline. The commission is inviting public comment until 5 p.m. June 25 and will finalize the policy shortly afterward if the U.S. Department of Education approves the plan.

Policy already vetted

That is expected because the department has already vetted the policy language.

City College Chancellor Art Tyler said "absolutely" he will apply for "restoration status" before July 31, the date revocation had been expected. "This is what we've asked for," he said.

At the same time, he and state education officials said they must review the full policy before celebrating.

Under the policy, once the college has applied for the new status, the commission would re-evaluate the college within four months. The college then would have two years to come into full compliance with accrediting standards.

Rep. Jackie Speier, D-Hillsborough, called the new policy "a welcome relief for the students, the faculty and the alumni."

The commission's move is expected to end two years of uncertainty at City College that has resulted in the loss of thousands of students - and the state funding that followed them - because many feared enrolling at a school on the brink of closure. The decision is likely to send waves of relief not only across the campus but throughout the Bay Area, where employers - including hospitals, restaurants, police and fire departments - depend on skilled workers from City College, and where thousands of residents depend on the school for classes.

The college has worked to repair extensive problems in governance, fiscal oversight and academic planning identified by the accrediting commission and independent fiscal evaluators. Last summer, state education officials replaced City College's elected Board of Trustees with a state trustee who has hired new administrators.

Lee, Pelosi weigh in

California Community College Chancellor Brice Harris and state and local politicians, including San Francisco Mayor Ed Lee and House Minority Leader Nancy Pelosi, D-San Francisco, had urged Beno and other commission leaders to grant more time to City College, where administrators say they need about 18 months to come into full compliance.

Last month, Beno and commission Chairwoman Sherrill Amador and Vice Chairman Steven Kinsella refused to extend the revocation deadline despite public assurances from Lynn Mahaffie, a senior accrediting director with the Department of Education, that federal regulations permitted doing so.

Nevertheless, the full commission, which meets just twice a year, changed its policy during its meeting June 4-6 in Sacramento. The agency is private and details about its internal decision-making aren't known.

The Chronicle reported Friday that the commission had changed its revocation policy, but staff members would not say how until Wednesday.

Despite the looming July 31 deadline, however, revocation had already been blocked by a judge, pending the outcome of a trial in October to decide if the commission broke rules in its 2012 evaluation of City College. San Francisco City Attorney Dennis Herrera, who brought the lawsuit, said Wednesday that it will go forward.

"This policy change has absolutely no impact whatsoever on our lawsuit," he said. Herrera also filed a motion Wednesday saying evidence of commission misconduct was so overwhelming that San Francisco Superior Court Judge Curtis Karnow should immediately invalidate its sanction against CCSF and require the commission to evaluate the college anew.

Commission's motion

Commission lawyers also were expected to file a similar motion Wednesday, asking the judge to immediately affirm that it acted appropriately in its evaluation. The commission did not provide a copy of its motion, despite repeated requests.

Herrera's motion alleges missteps by the commission, including:

-- Conflict of interest. In 2011, the Department of Education found the commission lacked "effective controls against conflicts of interest" when choosing commissioners. The commission agreed to change its process, but 14 of the 19 commissioners appointed under the old rules participated in the City College decision.

-- President's husband. Peter Crabtree, Beno's husband, served on the team that evaluated City College in 2012. The U.S. Department of Education later said that including Crabtree has the appearance of a conflict of interest.

-- Too few professors. Large teams evaluating City College in 2012 and 2013 each had just one professor. The Department of Education said that was "not reasonable representation" of academics.

The motion also claims the commission unfairly singled out City College for a harsher sanction than it imposed on other colleges with accrediting problems.

In court papers, Beno has denied that decisions about City College were made unfairly and said she was not involved in selecting her husband to help evaluate City College.

Nanette Asimov is a San Francisco Chronicle staff writer. E-mail: nasimov@sfchronicle.com Twitter: @NanetteAsimov