The rise of MOOCS lead Ed Central’s Top Ten Higher Ed Stories of 2013. “The massive open online courses have huge potential to bring learning to more people, and to do it cheaper.”
Also on the list is U.S. Department of Education approval for Southern New Hampshire University’s College for America, “the first school to award federal aid based on direct assessment of students’ learning.”
President Obama sent higher education stakeholders into a tizzy with his August announcement that the administration would implement a wide-ranging plan to get college costs under control. The centerpiece of the plan would rate colleges on a variety of metrics, and with Congressional approval, tie the ratings to financial aid eligibility.
Congress lowered interest rates on federal student loans and tied the rates to the market.
“Merit aid madness” benefits the wealthiest students.
(Colleges) “increasingly using their institutional financial aid as a competitive tool to reel in the top students, as well as the most affluent, to help them climb up the U.S. News & World Report rankings and maximize their revenue.
Other top stories are questions about the fairness of income-baseded repayment, policy changes for Parent PLUS loans, the rewrite of gainful employment regulations, data transparency and a OECD report “identifying one in six Americans as lacking basic skills necessary for the workforce.”
Ed Central proposes a college scoreboard design.
The federal income-based repayment needs to change, write Jason Delisle and Alex Holt on EdCentral.
Under IBR (in its current form), the government will provide more in loan forgiveness to someone with a high income and a master’s degree than it will provide in Pell Grants to a student from a low-income family attending a four-year college. . . . those who borrow and spend more get larger government benefits than those who make more prudent choices or use their own money to finance a graduate degree.
Those large subsidies for graduate students should be redirected to struggling undergrads, they write. Once that’s done, IBR should be the universal repayment plan, not just an option for the savvy borrower.
Borrowers who take “public service” jobs receive loan forgiveness after 10 years instead of 20, no matter how much they earn, Delisle and Holt write. One out of four jobs count as “public service.”
A public service job is one with a federal, state, or local government agency, entity, or a non-profit organization with a 501(c)(3) designation, or a non-profit that provides: emergency management, military service, public safety, or law enforcement services; health services; education or library services; school-based services; public interest law services; early childhood education; public service for individuals with disabilities and the elderly. . . . PSLF applies to almost any job so long as it is not at a for-profit business.
Income-based repayment plans won’t ruin repayment rates for career programs, writes Ben Miller, who’s been tracking gainful employment negotiations.
Keep the “public service loophole” out of gainful employment regulations, Delisle advises.
The Education Department doesn’t want the public to know how much it pays its debt collectors, adds Persis Yu.
New America Foundation’s Ben Miller is liveblogging the gainful employment negotiations at the U.S. Education Department. Sessions are expected to run through Wednesday.
Miller has more reporting on the proposed regulations, which will affect career programs at for-profit and community colleges.
Gainful employment regulations aim to ensure that career programs don’t leave students jobless and in debt, writes the New America Foundation’s Ben Miller in Improving Gainful Employment. The Obama administration’s new proposal is simpler and stronger than the one invalidated by a judge in 2012, he writes. But it still has loopholes.
In addition to measuring students’ debt-to-earnings ratio, Miller suggests three performance tests. Students would have to pay down their loans, no more than a third of students could withdraw in a year and the average graduate would have to earn at least as much as a full-time minimum-wage worker.
Career programs that can’t meet these standards — or have graduates with too much debt compared to their incomes — would risk losing eligibility for federal student aid.
Career programs need to focus on all their students — dropouts as well as graduates — Miller argues.
Furthermore, it’s not enough for programs to show low student debt if students also have low earnings, he writes: “Students are also spending billions in federal grant aid and arguably an even more precious resource, their time. They should expect better than living in or near poverty after completing a postsecondary program.”
Community college students typically don’t borrow — or don’t borrow very much — to pursue a vocational credential. But some don’t earn much either. Community colleges also have high dropout rates.
Gainful employment rules will hit high-cost for-profit colleges the hardest, but they also apply to nonprofit colleges that provide job training.
Negotiations are underway on “gainful employment” regulations proposed by the U.S. Education Department, reports Community College Times.
While the regulations are expected to hit hardest at for-profit career colleges, vocational programs at community colleges also will be affected. Colleges must gain federal approval for some new programs or students won’t be able to get federal aid.
“Whatever the regs are, you’ve got to keep them simple, you’ve got to keep them affordable,” said negotiator Richard Heath, financial aid director at Anne Arundel Community College (Maryland).
“Any time I add a new program, it is vetted to death,” Heath said.
Unnecessary layers drag out the time to create new programs that local businesses need, and they are expensive, Heath said. They can add months to the approval process and tens of thousands of dollars in costs.
Negotiators will meet again Oct. 21 to 23. If they don’t reach a unanimous consensus on the rules, the department can propose its own final version.
Kevin Jensen, financial aid director at the College of Western Idaho, also was one of the 14 negotiators. Three alternates from community colleges are: Rhonda Mohr, student financial aid specialist at the California Community Colleges Chancellor’s Office; Glen Gabert, president of Hudson County Community College (New Jersey); and Sandra Kinney, vice president of institutional research and planning at the Louisiana Community and Technical College System.
Gainful employment regulation is back, reports the Washington Post. Once again, the Obama administration has a new proposal to regulate career-training programs — primarily at for-profit colleges — to see whether graduates earn enough to pay off their loans.
From 2009 to 2011, the administration engaged in a sharp debate with the for-profit education sector and its allies over proposals to crack down on programs that leave graduates with heavy debts that they are unable to repay.
The Education Department issued a rule in 2011 that defined standards for loan repayment rates and the ratio of a graduate’s debt to income. Programs that failed the standards were in jeopardy of being disqualified from participation in the federal student aid, which would essentially shut them down.
A federal judge in 2012 blocked major provisions of that rule. The department will begin negotiating the new proposal next with representatives of for-profit colleges and others.
The new version of gainful employment “undoes many of the concessions” made to for-profit colleges in the first round, writes Ben Miller on Higher Ed Watch. The standards are higher and more colleges are likely to fail.
The biggest change in the proposed regulatory language from the 2011 final rule is that it would only rely on two measures: annual and discretionary debt-to-earnings ratios. Missing from this setup is the repayment rate, the metric that proved to be the weak link the last go around, as the judge ruled that the Department had not engaged in reasoned decisionmaking for the 35 percent repayment rate threshold.
Stronger disclosure requirements will break out information for completers and dropouts. “Repayment rates would be based on borrowers, not loan dollars, which makes them much more intuitive for a consumer,” writes Miller, who has much more on the details of the new proposal.
Federal aid is subsidizing colleges with low graduation, loan repayment and employment rates, writes Judah Bellon on Minding the Campus. Instead of singling out for-profit higher education, regulators should scrutinize the outcomes of all colleges and universities that rely on federal loans and grants.
For-profit colleges enroll more black, Hispanic, low-income and older students than public and nonprofit institutions. Their no-frills programs attract working students who need a flexible schedule, writes Bellon. Technical training is the strong suit of for-profit colleges, which adjust quickly to employer demand. For-profit students are more likely to complete certificates and associate degrees than community college students.
However, for-profit students are much less likely to complete four-year degrees and much more likely to default on student loans. That inspired the U.S. Department of Education’s attempt to enforce “gainful employment” rules limiting aid to programs whose graduates don’t earn enough to pay back their loans.
Regulate the bad applies, writes Bellon. But don’t single out for-profit higher education. If students are failing to graduate for jobs or unable to pay back their loans, it doesn’t matter if they attended a for-profit, private nonprofit or public institution.
The U.S. Education Department will rewrite “gainful employment” regulations fought bitterly by for-profit colleges, according to a notice published in the Federal Register. The department plans to use “negotiated rule-making” to move forward its agenda on college aid and affordability, substituting regulation for legislation, notes Inside Higher Ed.
The traditional venue for enacting long-term changes to help students afford, attend and graduate from college would be the Higher Education Act, the massive law governing federal financial aid programs that is periodically rewritten to account for changing times or to pursue new policy goals.
Usually, negotiated rule-making comes after the revised act is signed into law, to wrangle with details and write more precise regulations to put a legislative vision into practice. The Education Department convenes a panel of stakeholders — representing different sectors of higher education as well as some advocacy groups — to hammer out new regulations for colleges to follow.
The Obama administration has proposed expanding Perkins Loans and federal work-study to reward colleges that offer “good value” by keeping cost-per-degree numbers down. However, spending more will require legislation.
The department used “negotiated rule-making” to write the “gainful employment” rule, which was partially overturned in court last year.
Congress members are pushing back. House Committee on Education and the Workforce Chairman John Kline, R-Minn., Rep. Virginia Fox, R-N.C., and several Democratic representatives sent a letter urging Secretary of Education Arne Duncan to “abandon these harmful regulations and instead work with Congress to strengthen the nation’s higher education system through reauthorization of the Higher Education Act.“
Parts of the Education Department’s “gainful employment” rule are invalid, a federal judge ruled Saturday. The for-profit colleges’ trade association had challenged the rule, which could cut off student loan eligibility to vocational programs whose graduates don’t earn enough to pay off their loans. The department has authority to regulate career programs based on graduates’ earnings and debt levels, ruled Judge Rudolph Contreras of the U.S. District Court for the District of Columbia. However, the rule requiring at least 35 percent of graduates to be repaying their student loans was “arbitrary and capricious.”
. . . Judge Contreras says the department failed to provide a factual basis for why a repayment rate of 35-percent would be a “meaningful performance standard.” Instead, he wrote, it has said it chose that figure “because approximately one quarter of gainful employment programs would fail a test set at that level.” But the department could have chosen a percentage under which only one-tenth of the programs would have failed and justified it by the same rationale, he said.
The rule’s other provisions, which compare graduates’ debt to earnings, “were based upon expert studies and industry practice—objective criteria,” the judge ruled.
But because the debt-to-income measures were intertwined with the debt-repayment measure, he said, he had to vacate them too.
By the same reasoning, he also vacated two other provisions that rely in part on the debt-repayment measure: one that requires institutions seeking to offer a new vocational program to get prior approval from the Education Department, and one that requires institutions to provide data to the department for calculating the debt measures.
The Education Department also ordered institutions to disclose a vocational program’s costs, on-time graduation rate, job placement rate and median loan debt to potential students. That part of the rule will stand.
A 35 percent repayment rate is embarassingly low, writes Ed Sector’s Kevin Carey. Can the industry really make an argument for a lower rate?
The for-profit industry’s trade group is standing up in front of the world and saying it can’t live with a rule that excludes programs from federal financial aid only if two-thirds of students are failing to pay loans back and–emphasis, and–the program also fails both debt-to-income measures, for three out of four years.
The Education Department is likely to appeal the ruling. The judge wants more justification for the repayment rate. That ought to be doable.
Five percent of college career programs — all at for-profit colleges — have failed all three “gainful employment” rules, the U.S. Education Department announced Tuesday. The rule covers non-degree programs. Here’s a chart showing the programs.
The Education Department’s data is inaccurate, some for-profit colleges charged. “The Department of Education’s so-called ‘gainful employment’ regulation has always been and remains today a faulty metric,” said Steve Gunderson, president of the Association of Private Sector Colleges and Universities. The APSCU is challenging the regulations in court.
Some career fields showed more problems, notes Inside Higher Ed.
More than half of all programs in criminal justice, as well as those that prepare secretaries, medical assistants, and pharmacy and medical records technicians, failed to meet any of the department’s standards. Other programs — including photography, interior design and certificate programs for licensed professional nurses — fared relatively better, with more than 70 percent meeting at least minimum standards.
. . . About one in 10 programs at the for-profit Art Institutes, owned by the Education Management Corporation, also fell short.
Several community college programs failed two of the three tests, including programs at McLennan Community College and Trinity Valley Community College, in Texas.