Negotiators Conclude Final Gainful Employment Session With No Consensus

By Joelle Fredman, NASFAA Staff Reporter

After spending four days debating the details of the Department of Education's (ED) proposal to rewrite gainful employment (GE) regulations, negotiators ended the last day of this final session with no consensus, concluding by reiterating their most pressing concerns for ED to keep in mind as it begins to draft the regulations.

While no agreement was reached on the overall package of issue papers, negotiators did kick off Thursday with agreement to revive language that ED had initially proposed to strike regarding conducting consumer testing of disclosures, which was discussed at length yesterday. Federal negotiator Greg Martin confirmed that ED was willing to reinstitute that language.    

Following that discussion, negotiators delved into the intricacies of programmatic accreditation, focusing on issues related to licensure requirements differing from state-to-state and disclosing whether a program meets those requirements in either or both the state in which the institution is located and the state(s) in which the students it is enrolling reside.

Todd Jones, representing private, nonprofit institutions, argued requiring disclosures such as this one highlights the challenges inherent in expanding the GE regulations to all undergraduate programs, and that this kind of disclosure would have little value because students attending nationally-ranked institutions are not often attempting to obtain a licensure to work in that state. Jones also took issue with ED's proposal to require that those programs disclose information about state licensure to students before they enroll in a program when many undergraduate institutions don't require students to declare a major until later on in their college careers, when such disclosures would be unlikely to influence their enrollment.

While other negotiators argued that informing students of the state licensure implications of enrolling in certain programs outweighs the administrative burden of disclosing this information, Jones maintained that this disclosure does not benefit students attending many institutions in his constituency.

"There are hundreds of institutions that don't need this for the good of their students... another piece of paper isn't going to solve any sort of problem at the institutions I represent," Jones said.

Negotiators also debated certain disclosure requirements such as whether to add the word "estimate" when disclosing tuition, fees, books, and supplies when an institution does not have the actual information for the duration of the program's length available, for instance, because of their own timetable or their dependence on another entity like a state legislature for establishing tuition and fees. They also discussed proposed disclaimer language for disclosures stating that income data may be impacted by factors such as tip income, self-employment income, and geographical variations in earnings. Maryland Assistant Attorney General Chris Madaio argued that these disclaimers may confuse students and water down the power of the disclosure, while representatives of institutions with programs that lead to professions in which practitioners commonly have unreported earnings were supportive of the disclaimers as a way to address an issue that the current regulations address through the cumbersome alternate earnings appeal process.

Before the final vote on the package of proposed regulations, negotiators were asked to voice their final concerns to ED. Many negotiators said that using disclosures in place of the automatic loss of Title IV eligibility was not enough to get rid of bad actors.

"If the idea is that full disclosure leads to students making more informed decisions I support that, but I don't think that will result in protecting taxpayers and in protecting students," said Johnson Tyler, who represents legal assistance groups for students.

Whitney Barkley-Denney, representing consumer advocacy groups, agreed, adding that disclosures might help more sophisticated consumers from making bad decisions with respect to their educational paths, but that she is concerned about those consumers with less information at their disposal.

"Nothing about a disclosure is going to help someone pay back $30,000 in student loans when they can't get a job that they were supposed to get from that program," she said. "We need to be really realistic about what a disclosure does."

Other negotiators reiterated that it was extremely difficult to make decisions about applying GE regulations to all programs without any data on how that would affect programs and students.

"We have to be very careful, especially if you are going to apply sanctions, with an unknown rule, without knowing the consequences," said Chad Muntz, representing four-year public institutions. "Even if something doesn't get settled here today, it doesn't mean we don't want to protect students. It just means we don't want to unintentionally kill institutions without realizing the effect that an arbitrary standard might have."

Many negotiators were optimistic that, despite a week characterized by a lack of general agreements, their discussion about the GE regulations will lead to more data being made available to students to help them make informed decisions about their education.

Having concluded the GE negotiated rulemaking session, ED will now begin to draft regulations. Because of the lack of consensus, ED is free to draft its language as it sees fit, presumably taking into account the information gathered during the negotiated rulemaking process. Martin did indicate in day three of this negotiating session that it was ED's intent to move forward with the current set of issue papers distributed for the third session of neg reg in the event of no consensus.

Moving forward, ED will publish a Notice of Proposed Rulemaking (NPRM) with its proposed language, which will have a period of public comment. Per master calendar requirements, final regulations would need to be published by Nov. 1, 2018 in order to take effect July 1, 2019.


Publication Date: 3/16/2018

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