Gaining Ground on Gainful Employment?

President Trump’s promises to dismantle Obama-era higher education regulations may impact the gainful employment rule.

By Kevin Kuzma, Consulting Editor

Since taking office, President Donald Trump and his administration have been doing their best imitation of Walmart in the policy realm. But instead of prices, the administration has been rolling back rules and regulations put in place by the Obama administration that Trump has deemed overreaching or, in some cases, bad for the economy.

To date, the rollbacks have included regulations on carbon emissions, the clean water rule, financial regulations and funding for organizations conducting abortions. In the higher education world, the administration has been forthright about its plans to undo Obama-era regulations, including the gainful employment rule that has shuttered many career college campuses throughout the United States and significantly dwarfed the career education sector’s growth.

The rule was originally configured to eliminate career training-oriented colleges that graduate students into programs that would not provide them jobs where salaries were sufficient to pay off their student loans. Some pundits believe another round of negotiated rule-making could be in store, which ultimately means repealing or reducing the range of the gainful employment rule may not be as easy as some sector leaders originally hoped.

In March, the new Department of Education announced it would delay deadlines for programs to appeal debt-to-income ratios and for the notice requirements of a school’s program outcomes under the gainful employment metric. The “GE” rule, as some refer to it, impacts career colleges and nondegree programs at community colleges and nonprofit schools. The delay of nearly three months allows colleges to put off submitting appeals or public disclosures under the rule as well as performance standards set by the previous administration for the ability of graduates of vocational programs to repay their federal student loans.

Very good news

While the move was decried by Trump opponents who believe it signals that Secretary of Education Betsy DeVos plans to lift restrictions on “predatory” colleges, it was viewed differently by Steve Gunderson, president and CEO of Career Education Colleges and Universities (CECU). On March 7, CECU issued a response to the announcement from the U.S. Department of Education’s Federal Student Aid office that it will extend the deadlines for schools to submit alternative earnings appeals and disclosures until July 1.

 

Gunderson said, “We very much appreciate the department and the administration recognizing the problems with this rule. We have asked them to delay the enforcement and to conduct a review of the unintended consequences of this rule as it begins to play out.

“This is very good news for thousands of students who seek to complete their career education and begin their careers. We are prepared to share with the department how this rule treats identical programs differently based upon the geography and economy of where the students live. It is time for constructive conversations.”

Many leaders in the realm of higher education — including those affiliated with traditional colleges and universities — are unsure what direction the Department of Education might take regarding many decisions it faces. The department said in a written statement that it decided to implement the delays to give it time to “further review the gainful employment regulations and their implementation.”

Gunderson said that objection to the delay on Capitol Hill was a concern that could impact the rule’s future.

Through the tea leaves

“The pushback from Senate Democrats has been nothing short of intense,” Gunderson said. “The pushback has been so painful that Democrats are hoping the administration decides not to move forward in repealing the rule.”

 

Regardless of what future awaits gainful employment, the current administration will not create the same climate for career schools as the Obama regime.

“Our schools need to understand that this administration wants to work with us, not put us out of existence,” Gunderson said. “But the pressure they are facing is so active and intense, it really enhances the need for our sector to be as vocal and as active as we have been the past six to eight years. Our elected officials need direct support from us.”

With so many issues and eventual outcomes still up in the air, what does the future hold for gainful employment? No one can say definitively yet, but Gunderson offered his insight.

“If we read correctly through the tea leaves, what they could do is transition the gainful employment rule from a binding regulation into a piece of information. They could keep the definition and the calculations, but not allow the rule to determine eligibility for Title IV funding. That is my gut instinct.”