Make us your home page


Education news and notes from Tampa Bay and Florida

Federal government releases new rules governing for-profit colleges

Let the battle begin.

This morning - after months of dire warnings and skirmishes - the federal Department of Education released its long-awaited rules governing the sticky question of whether college courses paid for with federal loans should lead to jobs that can actually pay off all of that debt.

The so-called "gainful employment" regulations, aimed at for-profit programs that have been found to promise far more than they deliver, set benchmarks based on average student earnings verus debts. And while they weren't as harsh or immediate as those in the for-profit college industry had feared, they still may prompt a lawsuit.

 "Notwithstanding the changes, the real question is how the regulation will impact students, particularly non-traditional students served by our institutions," said the Association of Private Sector Colleges and Universities, which has already filed a lawsuit over another set of federal rules. "We will not know the answer to that until we have had the opportunity to run an independent analysis of the (Department of Education's) metric.  Our concern is that the regulation will still penalize programs with great outcomes while allowing under-performing programs to continue."

Here's a good roundup from the New America Foundation on today's flurry of news coverage and statements. And more from the Department of Education's news release:

“These new regulations will help ensure that students at these schools are getting what they pay for: solid preparation for a good job,” Secretary of Education Arne Duncan said. “We're giving career colleges every opportunity to reform themselves but we're not letting them off the hook, because too many vulnerable students are being hurt,” Duncan continued.

"To qualify for Federal aid, the law requires that most for-profit programs and certificate programs at nonprofit and public institutions prepare students for gainful employment in a recognized occupation.

"Under the regulations introduced today, a program would be considered to lead to gainful employment if it meets at least one of the following three metrics: at least 35 percent of former students are repaying their loans (defined as reducing the loan balance by at least $1); the estimated annual loan payment of a typical graduate does not exceed 30 percent of his or her discretionary income; or the estimated annual loan payment of a typical graduate does not exceed 12 percent of his or her total earnings. While the regulations apply to occupational training programs at all types of institutions, for-profit programs are most likely to leave their students with unaffordable debts and poor employment prospects."

[Last modified: Thursday, June 2, 2011 2:05pm]


Join the discussion: Click to view comments, add yours