October 27, 2021

Gainful Employment being rescinded by Education Secretary!

Education Secretary Betsy DeVos is rescinding an Obama-era rule that was created to protect students from abusive for-profit colleges.  She ruled that all colleges should be held to the same rules.  Clearly makes sense to us, but other dont agree…

The rule, known as Gainful Employment, required for-profit colleges and career certificate programs to post debt-to-earnings ratios, proving that their students could find good-paying jobs upon graduating. If the average ratio did not meet government standards, the school’s federal funding would be revoked.

The Department of Education outlined a number of reasons the regulation was flawed in a notice posted Friday. It said the rule failed to account for factors other than program quality that could affect a graduate’s earnings.

DeVos has also criticized the rule for not requiring all nonprofit colleges to also publish the data. In May, the department released new student loan data at the program level from nonprofit colleges, as well as certificate-granting programs.

Link to CNN article: https://www.msn.com/en-us/news/us/betsy-devos-scraps-obama-era-rule-on-for-profit-colleges/ar-AADzKvw?ocid=spartandhp


A judge ruling vacated a core element of the “gainful employment” rule!

A federal judge’s weekend ruling vacating a core element of the “gainful employment” rule was welcomed Monday by the for-profit college industry.  Many see this as vindication of their challenge to the controversial rule.

The decision however, affirmed the Department of Education’s authority to issue the rule, and advocates for tougher regulation including calling on the government to respond with new guidelines that would not be rejected for lack of a “reasoned basis.”

In striking down the regulations the court stated the following,
“The debt repayment standard was not based upon any facts at all. No expert study or industry standard suggested that the rate selected by the Department would appropriately measure whether a particular program adequately prepared its students. Instead, the Department simply explained that the chosen rate would identify the worst-performing quarter of programs…That this explanation could be used to justify any rate at all demonstrates its arbitrariness…This is not reasoned decision making. (“[I]n the absence of any reasonable justification,” the court “must conclude that this aspect of the [rule] is arbitrary and capricious.”
APSCU v. Duncan, pg. 31, 11-1314 (RC) (6/30/12)

Weighing Next Steps

A spokesman for the Education Department said Monday that officials there would decide “very shortly” whether to appeal the ruling, develop new regulations, or “do both.”

the courts decision can be found here: https://ecf.dcd.uscourts.gov/cgi-bin/show_public_doc?2011cv1314-25 

chronicle article here: http://chronicle.com/article/Ruling-on-Gainful-Employment/132737/

APSCU letter to Arne Duncan in response to the ruling here: http://apscu.informz.net/apscu/data/images/documents/lettertosecretaryduncan07012012.pdf