Stakeholders to Weigh In on Gainful Employment

A Wall Street Journal article yesterday filled in some of the blanks left by the Department of Education’s postponement of the gainful employment rule.  The article notes that the Department will hold meetings with stakeholders and interested parties to further discuss the rule. See below for an excerpt from the article:

The Education Department will use the extra time to conduct a series of public hearings and meetings, which it said “will allow interested parties to clarify the comments they’ve submitted and respond to questions from Department officials.” The department will not open up a second official comment period.

I’m encouraged by the Department of Education’s initiative to understand the rationale behind the 90,000 comments it received regarding the gainful employment rule. However, I urge the Department to use these meetings as exploratory opportunities to understand why so many individuals dissented to the rule as written, rather than as attempts to convince opposing voices to change their points of view.

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Education is Not a Commodity

Colleges and universities have a primary responsibility to the community in the social contract they are granted.  An essential aspect of that responsibility is the education of students. Without students, there would be no purpose for an educational institution, including research universities. Private sector institutions exist to educate and train students with the knowledge and skills they will need in their careers, on-the-job, and in real-world settings.

In a recent Jackson Sun column, Professor Harry Lee Poe muses that education is not a commodity. While it might seem that Professor Poe was intending to argue against the for-profit education model, the article turns out to be quite the opposite. Instead, Poe emphasizes the importance of what he calls “corporate colleges” in adult education. “College education has become as important as a high school education was 40 years ago.” – he states – and private sector schools make it possible for adults to receive a vital portion of their education.

We need a variety of forms of higher education, and private sector schools in their considerable diversity represent many aspects of higher education.  Restrictions, like the ones proposed by the Department of Education’s proposed gainful employment rule have the considerable potential to limit some of those forms of higher education – either by restricting access of students to some of them or restricting new entrants into the higher education market.  Moreover, the rule is turning the attention of for-profit schools away from education and on regulation or the potential for it.  It is time to re-examine the full consequences of the proposed rule before it is implemented – and before it jeopardizes the educational future of thousands of students.

“Tight Spot” for For-Profits?

On Monday, Kelly Field, The Chronicle of Higher Ed’s chief Washington reporter, and Sara Hebel, The Chronicle’s politics editor, came together to discuss the recently released Gainful Employment rule. The conversation highlighted the implications of the rule, focusing on the institutions and the individuals that would be affected.

According to Hebel, the rule would “reign in high levels of borrowing for some profit-based colleges,” and would put strict limits on student borrowing. Unfortunately, the rule will have serious negative consequences for the students who rely on financial aid the most – minority students, single parents, and working adults. We should focus our efforts – and so should the Department of Education – on constructing opportunities for success, rather than building obstacles to it.

Gainful Employment in the Federal Register

On Monday, July 26, the text of the Gainful Employment rule was officially published in the Federal Register.

What does this mean? Individuals and other organizations will have 45 days from that date to respond to the proposed rule – sharing their views about Gainful Employment with the Department of Education. The Department will then take those comments into consideration before issuing the final rule in November 2010 and implementing that rule in July 2011.

Click here to read the rule in detail.

Gainful Employment Rule Coming Out Today

The Department of Education is set to release the Gainful Employment rule today according to several news sources:

Chronicle of Higher Education – Education Department Takes Aim at For-Profits With Student-Debt Rule

Inside Higher Ed – Splitting the Difference on Gainful Employment

Associated Press – Proposed federal rules target for-profit colleges

Wall Street Journal – U.S. to Scrutinize For-Profit Career Colleges

Washington Post – Administration proposal aims to tighten oversight of for-profit colleges

Reuters – U.S. rule would force education cos to show work

New York Times – U.S. Releases Rules on For-Profit Colleges

USA Today –  Plan would crack down on for-profit college industry

Rumor has it…

Rumors abound that the Department of Education aims to loosen the restrictions on its proposed gainful employment rule. And recent shifts in stock prices reflect optimism that these whisperings will prove to be true.  But what does this mean?

Department of Education spokesperson Justin Hamilton e-mailed the following statement:

“What our proposal will do is balance the need to protect students and taxpayers while strengthening the critical role for-profit schools will play in helping us meet the president’s 2020 goal: for America to once again lead the world in the number of college graduates.”

 

For months, I have been writing that the proposed gainful employment rule has the potential to leave low-income and minority students out in the cold. The Department’s recent statement indicates the intent to move ahead with a rule that restricts access to higher education by focusing apparent dislike for private sector institutions ahead of the desire to help students seeking higher education.

My admiration for Secretary Duncan leads me to hope that Mr. Hamilton’s emailed statement means that the amended rule will recognize the critical role of for-profit schools.  The rule is scheduled to be released shortly by the Department of Education.

One Size Does Not Fit All

Chronicle of Higher Education reporter Jennifer Gonzalez makes a very interesting point in her article “Nonprofit Colleges Have Their Own Concerns About New Federal Rules” stressing that it’s not just the proprietary schools that are having concerns with the proposed Dep of Ed regulations.

Mollie Benz Flounlacker, associate vice president for federal relations at the Association of American Universities says “There is concern that some of these regulations targeting the for-profit sector will have a spillover effect. This one-size-fits-all approach doesn’t work in higher education, which has such a diverse set of institutions.”

Students and their learning needs vary enormously.  One-size does not fit all, and traditional colleges and universities are well aware of the resulting challenge.  Schools shouldn not be regulated in a one-size-fits-all approach.

In the same article from the Chronicle, it was also interesting to note C. Todd Jones’ comment. He is the president and general counsel of the Association of Independent Colleges and Universities of Ohio. He makes the point that “the department has created a new regulatory regime to fix a problem that they have not fully articulated with a solution whose impact they don’t fully understand.”

As with any federal rule-making, , there are going to be concerns on both sides of the issue. It is important for the Department to consider the various and unintended consequences of its regulations. At the end of the day, the U. S. needs to consider what is best for the student and what is best for raising U. S. economic competitiveness through education.  And a one-size-fits-all approach probably is not a solution.