Perspectives on an American Institutes for Research (AIR) study of state oversight in postsecondary education, conducted for the U.S. Office of Education (USOE), are offered by researcher Steven M. Jung. In addition, a list of recommendations by the General Accounting Office concerning USOE's eligibility process and responses by John Proffitt, on behalf of USOE and the Department of Health, Education, and Welfare are presented. The historical antecedents of the AIR study are reviewed. Several policy discussions at the federal level revealed the lack of knowledge about the effectiveness of state licensing in providing consumer protection. The study was based on a detailed analysis of about 95 percent of the total number of state laws and regulations passed before January 1, 1977, that dealt with institutional licensing and approval. Detailed tables were developed that indicate the consumer protection provisions of state laws and regulations in 14 categories. Additionally, state comparisons were included on such topics as: location of licensing function with the state bureaucracy, authorized enforcement strategies, and treatment of out-of-state institutions. It was found that only 38 states have legal provisions for authorization and oversight of private degree-granting institutions, and, of these, three-quarters contain provisions that make most established institutions exempt from the consumer protection standards of the laws and regulations. Suggested roles for the government and licensing agencies are described. Recommendations by the General Accounting Office and the federal responses pertain to: the respective roles of the federal and state governments and accrediting associations; dissemination of revised criteria for eligibility; evaluation processes; actions against schools that are guilty of educational malpractice; and guidelines for establishing minimum standards for such matters as advertising, refund policies, and information disclosure. (SW)