WASHINGTON — The Department of Education on Thursday issued regulations governing for-profit colleges, a rapidly expanding education sector that has been criticized in Congress for allegedly providing students with a poor education and excessive debt.
The department delayed releasing one of the more controversial proposals concerning "gainful employment," which would eliminate federal aid to programs that create high student debt and low loan-repayment rates.
Issued after a year of negotiations, the new regulations are intended to improve the Education Department's ability to monitor the institutions, including compensation for recruiters, and its ability to take action against schools engaging in deceptive advertising and marketing.
The regulations will take effect in July 2011.
While the Education Department postponed finalizing "gainful employment" regulations, Thursday's announcement did include a provision that requires for-profit colleges to provide prospective students with program graduation and employment rates, provide the department with reports on student debt and incomes, and provide notice when introducing a new program.
"These new rules will help ensure that students are getting from schools what they pay for: solid preparation for a good job," Secretary of Education Arne Duncan said in a statement.
Students enrolled in for-profit colleges account for 26 percent of all student loans and 43 percent of loan defaulters, according to the department.