Warren Calls For More Higher Education Oversight, Accountability

By Maria Carrasco, NASFAA Staff Reporter

Sen. Elizabeth Warren (D-Mass.) on Sunday wrote a letter to the Department of Education (ED) demanding that the department goes beyond publishing an annual list of low-financial-value programs and exercises more oversight and accountability to higher education institutions. 

“As I offer support for your effort to identify low financial value programs that saddle students with mountains of debt that they have little hope of repaying, I also write to bring to your attention several other areas where the department can and should strengthen accountability and oversight of institutions of higher education that too often leave students with insurmountable debts,” Warren wrote in the letter

Warren put forth eight recommendations for ED, including ensuring that institutions that fall below standards are subject to provisional Program Participation Agreements (PPAs) and are closely supervised to meet benchmarks to improve. PPAs are terms and conditions that institutions must meet to participate in the Title IV program. And for institutions that fail to improve, their Title IV funding should be revoked, Warren wrote. 

She also called for stronger enforcement on for-profit institutions, specifically related to the concern that some may manipulate their cohort default rate data by nudging borrowers into forbearance. Additionally, ED should review for-profit institutions that convert to nonprofit status to ensure “covert” for-profit colleges are not redirecting funds to benefit private parties. ED should also use its authority to hold for-profit college owners and executives accountable if their institution fails or if those institutions “lie to students who take on massive student loan debts,” Warren wrote. 

Other recommendations include improving oversight of online program management (OPM) companies and their arrangements with institutions. ED should conduct more oversight on accreditors and terminate accreditors if necessary to “protect students and taxpayers." Additionally, Warren suggested that ED should partner with the Consumer Financial Protection Bureau (CFPB) and other agencies to conduct fair lending risk assessments in order to ensure student lending practices comply with fair lending and civil rights laws.

She also called for ED to reinstitute and strengthen gainful employment rules, noting that she is concerned with the delays in implementation after the second negotiated rulemaking committee was unable to reach a consensus on proposed regulations. The release of the gainful employment rule proposal is set to come out spring 2023.

“I am encouraged by the department’s attention to the need for stronger accountability among institutions of higher education and the steps that the department already has taken to hold higher institutions accountable for their actions,” Warren wrote. “However, I believe more must be done. The department should take every opportunity to utilize the authority Congress has given it to ensure that schools are more accountable to students and taxpayers.”


Publication Date: 3/29/2023

Darren C | 4/7/2023 1:34:28 PM

Points well made. Imposing regulations such as gainful employment is not a genuine solution. This type of oversight in an already broken education system leads to more problems and headaches. Politicians always grandstand on big picture ideas not caring about how these ideas actual function in a real-life situation. It's another band aid not aimed addressing the core issue here, the overblown cost of education and focus on profit, for both institutions and the Government itself.

Thomas V | 3/30/2023 4:28:49 PM

An analysis from CBO's July 2021 report states in part: Federal debt held by the public will rise from 100 percent of Gross Domestic Product (GDP) at the end of Fiscal Year (FY) 2020 to 103 percent in 2021 and reach a record 106 percent by 2031. In nominal dollars, debt will increase by $13.5 trillion, from $22.3 trillion today to $35.8 trillion by the end of 2031.

That's nearly 36 trillion in federal debt by 2031, and Elizabeth is worried about getting Gainful Employment going again. GE was a colossal waste of time and money. It made absolutely NO impact on the school, students or our programs. We use words like accountability and transparency for schools, but it never seems to apply to the federal government. Lizzy, schools are reporting that 80% struggle with administrative capability because they can't hire or keep workers in this field primarily because the work has become so complicated and bogged down in compliance and regulatory demands that few want to stay in this line of work. We don't need more oversight on education, we need politicians that are not so blind to the real challenges colleges face just trying to keep their offices staffed and their doors open.

Peter G | 3/30/2023 3:43:03 PM

Many people love the idea of Gainful Employment (as I too, naively did once) but that in practice it unwieldy, particularly from a community college point of view.

We have many, many of these programs, they will ultimately likely all 'pass' but the work involved is gargantuan, and the "data" is prone to problems. For one, there's still no good solution to how to handle small programs, and ED and schools really struggled with how to meaningfully handle students in multiple programs, how to really find a clear line around 'embedded' vs. stand-alone, etc.

These wrinkles further complicated an already complex process. At a high level GE makes a lot of sense, but in the weeds it's a mess. Advocates tend to point to the impact it had in cleaning out a swath of programs the first time, but I liken it to a metaphor about cleaning out a storage unit. If you do it every 10 years, there's big payoff, but if you do it every year, over time it's the same amount of work for less payoff. You're not going to continue to get those same results over time.

On the PPA front, again, I'm sympathetic to the larger point being made here, but I have a colleague whose school was placed on provisional standing for the most nitpicky of one-time reasons (failure to add the additional GE language ED made schools go back and add as a PPA addendum in 2016), and ultimately that action and all the other work resulting created really created no value for anyone: it was a penalty for something that had happened years prior, changed nothing in reality, and not only had been resolved, but the requirement itself was moot by that point.

The other issue with anything around the PPA is that School Eligibility, at least in our region, is already slammed. It means significant delays for schools that are compliant. If staffing/systems can be fully flushed out and streamlined, maybe there is more room for meaningful scrutiny in this space, but as is, I can't get behind it.

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