Bipartisan Coalition Seeks Freeze on Gainful Employment
A handful of Republicans and Democrats in the U.S. House of Representatives have joined forces to urge the Obama administration to halt further implementation of Gainful Employment regulations after the June 30 ruling by a federal court judge overturning a primary metric of the rule.
In a letter to Education Secretary Arne Duncan, members express a shared desire to work with the Department of Education (ED) during the impending Higher Education Act reauthorization to develop policies for all Title IV schools to provide effective data and resources for students. The letter was signed by House Committee on Education and the Workforce Chairman John Kline (R-MN), Subcommittee on Higher Education and Workforce Training Chairwoman Virginia Foxx (R-NC), and Reps. Robert Andrews (D-NJ), Carolyn McCarthy (D-NY), Robert Scott (D-VA), Alcee Hastings (D-FL), Howard McKeon, (R-CA) and Denny Rehberg (R-MT).
The gainful employment rule includes three metrics to evaluate schools for compliance: debt, earnings and debt repayment of a program's former students -- combined to paint a portrait of borrower success after graduation. Federal District Court Judge Rudolph Contreras on June 30 overturned the loan repayment ratio, on the basis that the 35 percent repayment rate threshold was too arbitrarily contrived by the Department as a performance standard for compliance.
"Because one of the debt measures lacks a reasoned basis, that regulation will be vacated as arbitrary and capricious," Contreras wrote in his ruling. "Because the majority of the related rules cannot stand without the debt measures, they will be vacated as well."
The ruling leaves ED with the choice to appeal the decision or create new metrics, but it does not overturn ED's authority to regulate programs and institutions to ensure they are preparing students for gainful employment.
The bipartisan committee is asking that ED freeze any further implementation of the gainful employment rules and refrain from commencing a new round of negotiated rulemaking.
Members said Congress has the opportunity to work with ED to develop clearer and simpler policies in the reauthorization process that would apply to all Title IV funded schools. The Higher Education Act (HEA) of 1965, as amended, authorizes the major federal student aid programs. Law mandates that Congress review and "reauthorize" these programs every five to seven years; the next reauthorization is scheduled for 2014.
"We believe that in this context we will be able to work with the Department to come up with key data points that can be universally applied and disclosed, to ensure that students and taxpayers receive a good return on their investment in postsecondary education," the coalition's letter to the White House states.