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Two weeks after announcing a regulatory rewrite of the gainful-employment rule for nondegree career education programs, Education Secretary Betsy DeVos announced late Friday that she was delaying key provisions of the existing rule.
The department will give those programs until July 2018 to disclose information such as graduate employment rates or debt levels to prospective students, a year later than originally scheduled. And it will also extend a deadline to file alternate earnings appeals, citing a Wednesday court order in a lawsuit brought by cosmetology schools.
A Federal Register notice from the department indicated that within 30 days it would set new deadlines for alternate earnings appeals. Those appeals allow programs to address underreported income from tips or self-employment for the debt-to-earnings ratios that determine if they pass or fail under the rule's metrics.
DeVos said the announcement followed through on her promise of a regulatory reset. But critics said it showed she intended to slow walk the gainful-employment rule to death. The announcement came late on a Friday afternoon before a holiday weekend for many -- and comes amid concerns from critics of for-profit higher education that the Trump administration is destroying regulations that, even if flawed, were a serious attempt to protect students.
In a statement, the secretary said the gainful-employment rule had been repeatedly challenged by educational institutions covered by the rules and overturned by the courts.
"We need to get this right for our students, and we need to get this right for our institutions of higher education," DeVos said. "Once fully implemented, the current rules would unfairly and arbitrarily limit students’ ability to pursue certain types of higher education and career training programs. We need to expand, not limit, paths to higher education for students, while also continuing to hold accountable those institutions that do not serve students well.”
Gainful-employment data released in January showed that about a tenth of all programs assessed under the rule failed the department's metrics. And most of those failing programs were from the for-profit sector.
In the court order this week, federal district court Judge Rudolph Contreras instructed the department to give cosmetology programs more time to file appeals. But he wrote that his narrowly tailored ruling "avoids upending the entire GE regulatory scheme."
“This is a willful misreading of what the judge wrote,” said Ben Miller, senior director for postsecondary education at the Center for American Progress. “It’s a sham excuse where clearly the goal was set in advance. They will grasp for anything to avoid meaningful accountability here, regardless of how spurious the rationale.”
Steve Gunderson, president and CEO of Career Education Colleges and Universities, the chief lobby group of for-profit colleges, applauded the delay of the rule's provisions.
"The rule is clearly flawed. Recent studies and court rulings prove this rule needs to be revisited," he said. "Now, through public comments and negotiated rule making, all stakeholders involved have a chance to identify the shortcomings of this regulation. We look forward to working with the department and others to constructively develop a new source of information for all college career programs that shares with students the incomes for their chosen profession and the average amount of debt for their academic studies."
