The Institute for Creation Research is a well known young-earth creationist outfit in California, which describes itself as a "Christ-Focused Creation Ministry." But it also operates a graduate school which awards advanced degrees in biology, geology, and geophysics. That's not a shocker--anyone who wants to can legally set up a "school" and award "degrees" (although some states do prohibit schools from using words like "degree" without state authorization). What's troublesome is the ICR's school is actually accredited by a nationally recognized accreditation agency.
That's important because while anyone can award "degrees," a college degree is only respected if it is from an accredited college. But the government is not in the business of accrediting schools. Instead, accreditation is handled by private accreditation agencies. Some of these agencies, like the Middle States Commission on Higher Education, accredit all colleges and universities within a certain geographical area. Other agencies focus on schools within a particular trade or profession--the American Bar Association, for instance, accredits law schools throughout the nation.
Now, accreditation is important not only because it makes a degree respectable, but because government scholarships and grants, like the GI Bill, are only redeemable at schools that are accredited by an accreditation agency that the government recognizes. The lists of federally-approved accreditation agencies are here (for regional accreditors) and here (for national accreditors). The Secretary of Education has the sole and unlimited authority to extend federal recognition to an accreditor. 20 U.S.C.A. §1099b. Although he has advisors who give him recommendations, they don't get a vote--only the Secretary gets to choose what accreditation agencies to recognize.
Most accreditors establish rather broad criteria for accrediting schools--things like whether the schools are safe and clean, and whether a certain percentage of the graduates get jobs in their fields of study. This is important because it would be easy for an accreditation agency to interfere with a school's educational freedom. In 1991, Middle States tried to require racial "diversity" among the faculty of colleges applying for accreditation, which was highly controversial. It finally backed down when several schools complained. Likewise, if an accreditation agency were to take sides in an academic dispute, this could seriously harm the freedom of inquiry in the academic world itself. See further Sherman College of Straight Chiropractic v. U.S. Commissioner of Education, 493 F. Supp. 976 (D.D.C. 1980). For similar reasons, it's important that accreditation not be done by the government, but by independent agencies. Otherwise, government could "cast a pall of orthodoxy over the classroom." Keyishian v. Board of Regents, 385 U.S. 589, 603 (1967). If the government were to accredit schools--or if accreditors were to become agents of the government--the result would be a chilling effect on colleges, discouraging them or their students from challenging government-approved ideas.
Now, back in the late 1970s, an accreditation agency called the Transnational Association of Christian Colleges and Schools, or TRACS, was formed. It adopted a list of accreditation criteria that is far more specific than those employed by most accreditors. For instance, to qualify for TRACS accreditation, a school must adhere to a list of eleven "Biblical standards," including:
1. The unique divine inspiration of all the canonical books of the Old and New Testaments as originally given, so that they are infallible and uniquely authoritative and free from error of any sort, in all matters with which they deal, scientific and historical as well as moral and theological.
2. Special creation of the existing space-time universe and all its basic systems and kinds of organisms in the six literal days of the creation week.
3. The full historicity and perspicuity of the biblical record of primeval history, including the literal existence of Adam and Eve as the progenitors of all people, the literal fall and resultant divine curse of the creation, and worldwide cataclysmic deluge and the origin of nations and languages at the Tower of Babel. . ..
In 1991, Secretary of Education Lamar Alexander overruled the recommendations of his advisors and extended recognition to TRACS. This brought some serious criticism (including an entire book called When The TRACS Stop Short, by degree-mill gadfly Steven Levicoff, author of Name It And Frame It; unfortunately, Levicoff's books, which were on-line for a long time, are no longer available.)
Immediately after its recognition, TRACS did some highly questionable things, among which was its accreditation of ICR's graduate school, despite the fact that the chairman of TRACS' board of directors was none other than Henry Morris, founder of ICR.
Today, TRACS remains a federally recognized accreditation agency for Christian education. Specifically, it is federally approved for "the accreditation and preaccreditation (‘Candidate' status) of postsecondary institutions that offer certificates, diplomas, and associate, baccalaureate, and graduate degrees, including institutions that offer distance education."
What are the implications of ICR's accreditation? Students receiving federal educational grants or loans can spend these at ICR and receive degrees in creationist-influenced "science" fields. Under Zelman v. Simmons-Harris, 536 U.S. 639 (2002), the Establishment Clause is not violated when a student freely chooses to spend a government educational grant at a religious school. Nor do I believe it would be wise to pursue a rule of law by which the actions of accreditors would be considered acts of the state. This would have a deleterious effect on colleges' independence from government. However, the Secretary of Education's recognition of TRACS might be a violation of the Establishment Clause under the test of Lemon v. Kurtzman, 403 U.S. 602 (1971). Although the Secretary has no statutory limits in deciding what accreditors to recognize, he is certainly constrained by the Constitution. His action in recognizing TRACS might violate the Establishment Clause if it did not have a secular legislative purpose, if its principal or primary effect either advances or inhibits religion, and if it fosters "an excessive government entanglement with religion." 403 U.S. at 612-613.
The problem with this approach is that it, too, threatens academic freedom. In Sherman College, a chiropractic college sought to prevent the Secretary (then the Commissioner) of education from recognizing an accreditor which took a particular side in a dispute within the field of chiropractic. The court threw the case out because "[t]he Commissioner's recognition action is not unreviewable agency action." 493 F. Supp. at 978. To hold otherwise, the court said, would "ultimately require the Commissioner to become ‘a specialist on the matter of educational philosophy' in every field, and would make him a ‘referee in. . .intra-professional combat.'" Id. While I would find it gratifying if the Secretary of Education took a hard line against creationism and other pseudosciences, this would risk establishing a dangerous precedent--when a more conservative administration (such as the present one) might bend to religious pressures and use its referee power to force such things as "equal time" on colleges. Indeed, I suspect that is exactly what happed in the case of Secretary Alexander.
An easier solution to this problem would be to clarify that when a school is accredited, it is only accredited to award degrees in the field for which the accreditation agency is itself recognized. It would be absurd for the American Bar Association to accredit a school, and then for that school to go about awarding degrees in dentistry. The ABA is only an expert on legal education, and its accreditation can only speak to that field of study. Likewise, TRACS may be a specialist in a narrow range of fundamentalist, Protestant Christianity, but it is not an expert on geology, and its accreditation of ICR ought therefore to confer no official recognition on ICR's degrees in that field.
(This is all adapted from an article I wrote during my first year of law school, which you can read on line here. It has its flaws, but it at least provides much more detail on TRACS' history.)