September 27, 2021

U.S. Department of Education held the first gainful employment negotiated rulemaking session

dept of educationYesterday, the U.S. Department of Education held the first gainful employment negotiated rule-making session.  Here are some highlights from the proceedings.

  • The morning portion was filled with procedural discussions and yada yada…  The panel rejected three additional representatives to the committee, including:  Florida Coastal School of Law,  U.S. Chamber of Commerce,  Bridgepoint Education.
  • Barmak Nassirian, representing public four-year institutions on behalf of AASCU raised the idea of gainful employment being an upfront requirement giving the Department the ultimate authority to decide what programs should exist at what institutions based on a review of factors, such as market needs, pay sufficiently above the minimum wage to justify the cost, etc.
  • Brian Jones, the general counsel at Strayer University and negotiator on behalf of publicly-held institutions explained the new program approval process and the role of accreditors in response to Nassirian’s proposal.
  • Ray Testa, from Empire Education Group, questioned whether there is a need to define gainful employment since it has been around for a long period of time.
  • Belle Wheelan, the president of the Southern Association of Colleges and Schools Commission on Colleges, raised a similiar issue when talking about being unable to control the economy or availability of jobs.
  • Testa raised concern on an institution’s inability to limit borrowing by students. In the previous GE regulation, the Department recognized this problem and allowed for amounts to be limited to tuition and fees in the calculation. That cap was deleted in the new proposal put forward by the Department.
  • The community college negotiator also raised concerns with students over borrowing for living expenses and not for education expenses – a common theme.
  • Marc Jerome from Monroe College explained why the debt-to-earnings ratios don’t work, in part, because of the retroactive nature of the calculation. Changes an institution makes today to reduce debt won’t help the student who has already completed; since debt is all that matters, programs may fail the calculation even though institutions have reduced debt for current students.
  • Nassirian suggested that when institutions have programs in the zone (not passing but not failing) institutions should be required to take action such as, post a letter of credit, not pay dividends or freeze executive compensation.
  • Nassirian turned the discussion to marketing and advertising and suggested targeting institutions that spend more on those activities than on education/instruction.

Testa raised several issues directed at the retrenching of the Department in this version of the regulation as compared to the previous one. He challenged the use of the eight percent standard for the annual debt-to-earnings ratio; the exclusion of non-Title IV students and the reduction in cohort size from 30 to 10, among other things.

Media coverage
The Chronicle of Higher Education, Inside Higher Ed and Politico were all in attendance for various portions of the session, we will circulate their coverage tomorrow in the APSCU morning media clips, as well as tomorrow’s update. Bloomberg, PoliticoNPR and Inside Higher Ed all published preview stories this morning.

APSCU content
APSCU continues to push messages and content that supports the press statements we made on September 5 and August 30. In advance of today’s session, we provided a list of questions to the negotiators for our institutions. Many of the issues were raised in this afternoon’s opening discussions.


California Bill Seeks Campus Credit for Online Study


ny times

Legislation will be introduced in the California Senate on Wednesday that could reshape higher education by requiring the state’s public colleges and universities to give credit for faculty-approved online courses taken by students unable to register for oversubscribed classes on campus.

If it passes, as seems likely, it would be the first time that state legislators have instructed public universities to grant credit for courses that were not their own — including those taught by a private vendor, not by a college or university.

Click link for article below

Graduate students no longer qualify for IN-school interest subsidy, how will effect your schools?

grad students interestAs the nation’s student-loan debt surpasses the $1-trillion mark, alarming students, parents, and politicians, few are thinking about the effects it is having on people

Beginning July 1. After that date, students pursuing advanced degrees will no longer qualify for the in-school interest subsidy on Stafford loans.  meaning they will now have to begin paying interest while in school.

The total debt borne by graduate students is expected to increase as about $125-billion in graduate-student borrowing is shifted from the subsidized to the unsubsidized program, costing students $18.1-billion over the next decade, according to estimates by the Congressional Budget Office.

Click Here for Chronicle Article 

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Interesting change in view from Motley Fool

Brian Stoffel from the Motley Fool recently wrote an article indicating he may have been totally wrong in his opinions relating to the for profit education industry.

I spent the better part of my first year at the Fool raging against the for-profit education community. And it was for good reason: Enrollment is dropping, they get too much money from the government, and students are defaulting on their loans at alarming rates.

But after watching a recent speech by innovation guru Clayton Christensen, I’m starting to wonder if I am reading the situation completely wrong.

1. Competing against non-consumption
Christensen says that most innovation comes from companies that are able to bring products to people that otherwise would have no access to them…

2. Using different metrics
A typical college or university focuses on the quality of the research being conducted by faculty as a preeminent metric for value and worth that a college has. While that might seem great, it doesn’t do much to ensure that students are actually being taught…

3. New customers will be enticed into the system
With the cost of sending a child to college sky-rocketing, more and more students may look at online schools as a viable alternative…

Link to complete article