DeVos’s latest regulation rollback writes a blank check to scam schools—courtesy of U.S. taxpayers

Wednesday, August 22, 2018

The Department of Education has moved to repeal the gainful employment rule, which seeks to ensure that students who graduate from career education programs earn enough money to repay their student loans, or the schools risk losing their federal funding.

The gainful employment rule sought to address students’ major concern: that predatory career education programs left them without the credentials and training needed to find full-time work, and saddled with insurmountable debt. If a scam school continued to fail to meet the established debt-to-earnings ratios for graduates, the program risked losing access to federal student aid. The Department plans to eliminate this standard.

Instead of making each school publicly disclose debt-to-earnings information, the Department of Education plans to update its College Scorecard website with the data. Underperforming schools will no longer worry about losing their federal funding.

More than 350,000 students graduated from the worst-performing career education programs with nearly $7.5 billion in student loan debt, according to the Department of Education's own data . Those programs, rated as "failing" or "zone" in the Department's existing 2014 gainful employment rule, would have eventually lost access to federal financial aid if they did not improve. Under the Department's new plans, schools will no longer worry about losing their federal funding.

In fact, the Trump Administration’s own estimates show that eliminating the gainful employment rule will cost taxpayers $5.3 billion over the next decade.

Tell the Department of Education that scam for-profit schools should not get a blank check from taxpayers!

To submit your comment to the Department of Education on regulations.gov, follow these steps:

1. Copy the sample letter below.
2. Then click here and paste the letter into the comment box. (Please be aware that your comment and name will become part of the public record.)
3. Edit the comment letter as you see fit, fill in your name and click continue to submit your comment.
4. The deadline to submit comments is Sept. 13.

 

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Docket ID ED-2018-OPE-0042

RIN: 1840-AD31

 

Dear Secretary DeVos,

I am writing to oppose the Department of Education’s proposed gainful employment rule. The proposed rule lacks two critical components: accountability standards and mandatory disclosure. Without these two elements, the gainful employment rule is meaningless and the Department of Education is essentially writing a blank check to failing and low-performing career schools at the expense of taxpayers.

In fact, your own data revealed that the decision to drop the 2014 gainful employment rule would mean the lowest-performing programs keep $5.3 billion over the next decade. This proposal makes no sense.

Since the 2014 gainful employment rule came out, there is more evidence than ever that stronger regulation of the for-profit college industry is necessary. Failing and fraudulent for-profit schools like ITT Tech, Corinthian Colleges and The Art Institutes have received hundreds of millions in federal student aid, while leaving hundreds of thousands of students saddled with insurmountable student loan debt and no viable career path.

In fact, an August 2018 report put out by The Institute of College and Success showed that a single round of Department of Education data showed that more than 350,000 students graduated from the worst-performing career education programs with nearly $7.5 billion in student loan debt. Those programs, rated as "failing" or "zone" in the Department's existing 2014 gainful employment rule, would eventually lose access to federal financial aid if they did not improve.

However, the Department’s proposed rule eliminates the 2014 debt-to-earnings ratio standard for schools’ graduates, removing consequences for schools that have high tuition costs yet provide a low-quality education to their students. This means these failing institutions will continue to receive federal student aid regardless of their continually low-performing programs.

Instead of making each school publicly disclose the debt-to-earnings information for its graduates, your proposal includes plans to update the College Scorecard website with the data. However, unlike the stronger 2014 gainful employment rule, there is no law or regulation that will mandate that the information be published, and underperforming schools will no longer worry about losing their federal funding. Why make students go to another site when they could see the potential risk associated with enrolling in the program on the school’s own website?

It's simple: Schools that fail students shouldn't be subsidized by taxpayer dollars. I urge you to scrap this proposed rule and implement the 2014 gainful employment rule, effective immediately.