What Does It Mean to Early Implement and Document Rescission of the Gainful Employment Regulations?

By NASFAA Training and Regulatory Assistance Staff

The Department of Education (ED) rescinded all gainful employment (GE) regulations in final rules published Monday, and authorized early implementation, at schools’ discretion. Although the rules are effective July 1, 2020, schools that choose early implementation are not subject to the rescinded GE regulations. ED on Friday released a separate Electronic Announcement on the details of the early implementation process.

Still, the process may be confusing for some institutions.

The institution must decide if it wants to continue to comply with the GE program regulations under 34 CFR 668, Subpart Q and Subpart R until the rescission becomes final on July 1, 2020. In other words, the institution must decide whether it wants to continue to comply with the current requirements to:

  • Report GE data for the 2018-19 award year to the National Student Loan Data System (NSLDS), which will be due Oct. 1, 2019;
  • Include the GE Disclosure Template, or a link thereto, in their GE program promotional materials and directly distribute the disclosure template to prospective students, as required by July 1, 2019. [668.412(d) and (e) and May 23, 2019 Gainful Employment Electronic Announcement #120];
  • Update and post the GE Disclosure Template and any other GE disclosures required under 668.412 on the school’s webpages, as required by July 1, 2019;
  • Comply with the Program Participation Agreement (PPA) certification requirements for GE programs under 668.414; and
  • Otherwise comply with any of the other regulatory requirements under 668 Subpart Q and R.

If the institution decides to implement the rescission early, and documents that decision, it no longer has to comply with the above requirements as of the date the institution makes that decision, or July 1, 2020, whichever comes first.

If the institution decides not to do early implementation, all current GE regulatory provisions, including those indicated above, continue to apply until July 1, 2020.

The Decision: This means the school officials making decisions related to the GE programs and consumer information, along with the financial aid office, must collectively make this decision on behalf of the institution. This decision most likely is not the decision of just the financial aid office, so you will need to consult with the decision-makers on your campus.

Documentation: Neither the July 1, 2019 Federal Register Notice nor the June 28, 2019 GE Electronic Announcement #122 specify how a school must document its decision to implement early the rescission of the GE rules. How you document the decision is up to the institution. NASFAA would suggest documenting in your school’s policies and procedures manual its decision whether to proceed with early implementation.

If that decision is made by a campus committee or an individual office, the committee or office could document its deliberations and its decision using meeting minutes or notes. NASFAA has learned that some schools are maintaining as documentation the internal memos or notifications that are sent to other campus offices, notifying them of the institution’s decision to implement the GE rescission earlier than July 1, 2020.

As the June 28, 2019 GE Electronic Announcement #122 explains, the school does not have to publish its decision to early implement the rescission, but the school must make such documentation available to ED upon request.

Why Not Earlier?: Some schools are asking, “Why couldn’t ED just implement the full rescission on July 1, 2019 instead of July 1, 2020?” The answer is that statute prohibits ED from doing that. ED must abide by the Master Calendar requirements under section 482(c) of the Higher Education Act of 1965 (HEA), as amended. To ensure schools have sufficient advance notification to implement regulatory changes, ED must publish the final rule by November 1 in order for those rules to become effective on July 1 of the following year. Because the GE final rule was not published by Nov. 1, 2018, the rules cannot be effective on July 1, 2019—they cannot be effective until July 1, 2020.

That having been said, HEA does grant ED the authority to designate certain regulations for early implementation. This means any or all rules can be effective earlier if the school chooses early implementation.


Publication Date: 7/3/2019

Jeff A | 7/3/2019 10:24:03 AM

While some news stories are claiming the GE rule has been 'gutted', in reality ED will be vastly expanding GE related consumer information to help all students, not just 6-10% of students.

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