ED Releases Proposed Gainful Employment, Certification Procedures, HEERF, and Second Chance Pell; Public Comments Open With Multiple Deadlines | Policy Matters (May 2023)
Department of Education Releases Proposed Gainful Employment, Financial Responsibility, Administrative Capability, Certification Procedures, and Ability-to-Benefit Regulations – Public Comment Due June 20
The Department of Education has released the long-anticipated retooling of the Gainful Employment (GE) rule following work during the 2021-2022 Negotiated Rulemaking. Current law requires that certificate programs at all institutions as well as degree programs at private for-profit colleges must prepare students for “gainful employment” in a recognized occupation. The release of these proposed regulations will set performance standards on two measures for GE programs to maintain their Federal financial aid eligibility. In the current proposal, GE programs are asked to show that:
- Graduates can afford their yearly debt payments. In particular, the share of their annual earnings needed to devote to paying their debt (i.e., their “debt-to-earnings ratio”) must be equal to or less than 8 percent, or equal to or less than 20 percent of their discretionary earnings (i.e., their annual earnings above 150 percent of the Federal poverty guideline).
- At least half of graduates have higher earnings than a typical high school graduate in their State’s labor force who never pursued a postsecondary education.
Individual GE programs would be assessed separately on each of these two metrics. If a program fails at least one metric, the proposed regulations state they would need to warn students that the program is at risk of losing access to Federal aid. If a GE program fails the same metric twice in a three-year period, that program would lose access to Federal aid. The Department is estimating that currently, out of the 32,000 GE programs, that 1,800 would fail one of these metrics. While the eligibility for Title IV aid applies to the GE programs, the proposed rule states that the Department of Education will be calculating, and publishing its calculations for all Title IV programs, regardless of whether they are GE programs or not.
In addition to the GE proposed rule, the Department has also proposed changes to conduct robust monitoring and oversight of institutions of higher education, including on Financial Responsibility, Administrative Capability, Certification Procedures, and Ability to Benefit.
Of the more significant notes to the UPCEA community is a change to Certification Procedures where the Department has made changes to require: “Institutions show that their programs meet any required programmatic accreditation and State licensure requirements so that students can obtain employment. And institutions comply with all State consumer protection laws related to closure, recruitment, and misrepresentations for all States in which they enroll students.” The proposed language includes that the institution must satisfy these requirements for “where the student is located” and goes beyond just simply notifying students if they are aware if they meet, do not meet, or have not made a determination on meeting these licensure requirements in those states and notifying those students prior to taking the program.
While institutions may be involved in SARA, that arrangement covers a more narrow scope, and this prospective change by the Department implements broader applicability to consumer protection laws to institutions who are operating in those states, including areas including closure, recruitment and misrepresentation.
Comments on all of these proposals are due by June 20. If the final rule gets published before November 1 of this year, it could go into effect by July 1 of 2024. The impacts to UPCEA members of these proposals may be significant. UPCEA will continue to keep our membership updated of these developments, but we encourage you to bring this information to the attention of your institution’s government affairs office, compliance officers, and president’s office for additional scrutiny of gathering comments on the proposals.
- Department of Education Fact Sheet on Gainful Employment Regulations
- Department of Education Fact Sheet on Financial Responsibility, Administrative Capability, Certification Procedures, and Ability to Benefit Regulations
The US Department of Education has created a No Cost Extension (NCE) Request Form on the coming deadline to use for Higher Education Emergency Relief Fund (HEERF) dollars, which supported institutions as COVID-19 relief grants. On June 30, 2023, the period for most HEERF grants will end and any remaining unliquidated grant funds will be returned to the Treasury Department. However, current law allows for grantees the option to receive up to a twelve-month No Cost Extension (NCE) of their grant project periods. The Department is requesting emergency approval to collect requests for an extension beyond June 30, 2023 and ensure that grant recipients have a plan for using their remaining HEERF grant funds. Please review this with your institutional leadership to make sure they are aware, and to request an extension if needed. The HEERF (both in amount and scope) is one of the largest in ED’s history, with 18,000 awards to over 5,100 institutions totaling over $76 billion. Read more.
The Department of Education is greatly encouraging public comment addressing the following questions surrounding information collection as part of the Prison Education Program Application, as it ramps up the rolling out of Second Chance Pell for Prisoners programs to allow all institutions to take part:
- is this collection necessary for the plan to work properly;
- will the information be implemented in a well-timed process;
- are the time and effort put into this worth the money spent;
- how can the department improve its information collection techniques;
- And how can the department reduce the burden of this on their respondents.
It is important to note that all comments must be written and submitted by June 16th. The collection will provide insight into the necessary steps needed to be taken to implement this program. This program could largely impact the number of attendees in higher education programs, with Pell Grants allowing those who could not previously afford enrollment the chance to attend. This opportunity provides many with the chance to earn a quality education during their incarceration, and is an important opportunity for schools to review as the lead-up to the broader implementation of reinstatement of access to Pell Grants for incarcerated students begins on July 1, 2023. Read more and provide a comment by June 16.
- Momentum Building for Pell Grant Expansion (Inside Higher Ed)
- How Defaulting on the National Debt Could Affect Higher Education (American Council on Education)
UPCEA Policy Committee
Kristen Brown, University of Louisville, Chair
Mark Bernhard, North Carolina State University
Frank Principe, University of Maryland Global Campus
Ricky LaFosse, University of Michigan
George Irvine, University of Delaware
Stephanie Landregan, University of California, Los Angeles
Dinah Manns, Capella University
Wendy Eaton, Northeastern University
Abram Hedtke, St. Cloud State University
Debra Iles, Harvard University